Black Sea Property AS

Capital/Financing Update • Apr 6, 2018

BLACK SEA PROPERTY AS: UPDATE ON FINANCING ACTIVITIES

BLACK SEA PROPERTY AS: UPDATE ON FINANCING ACTIVITIES

Reference is made to earlier stock exchange notices regarding, inter alia, ongoing discussions with UniCredit Bulbank regarding a possible refinancing of EPO Aheloy's current bank loan with UniCredit Bulbank.

Black Sea Property AS ("Black Sea Property" or the "Company") can inform that the discussions are moving forward, and EPO Aheloy has now received a non-binding, indicative term sheet from UniCredit Bulbank for a refinancing of the current loan agreement, through a new EUR 3 million construction loan. As part of the conditions precedent for disbursing such loan, the bank has asked that EPO Aheloy also provide equity financing, as self-participation, in the amount of EUR 1.5 million. With a new combined equity and debt financing of EUR 4.5 million, EPO Aheloy will have sufficient available liquidity to bring the Aheloy Beach Resort (the "Resort") into operational status without additional financing from other parties.

In order to fund the required self-participation amount, the Company's Board of Directors is considering to carry out a share issue towards existing shareholders to raise up to EUR 1.2 million, which will cover Black Sea Property's portion of the self-participation amount.

The construction works at the Resort are now at a stage where all 358 apartment units in buildings "N" and "M" are fully complete with furniture and appliances installation in place. Black Sea Property is satisfied with the construction works performed and is ready to commence works on the commercial spaces and the additional facilities needed. The remaining landscape works as well as work on the façade on buildings "L" and "K" will be carried out going forward, and will in sum significantly transform the appearance of the Resort.

Time used for negotiating a solution with UniCredit Bulbank, including the discussions for self-participation, has put pressure on the previously announced schedule for opening of the Resort. EPO Aheloy has therefore decided to open 358 apartments for the 1st year (building "N" and "M") at the earliest 1 July 2018 and base first year operations on last minute sales. This approach will minimize the risk of committing to sell rooms to tour-operators and thereafter not meeting that requirement with respect to opening date.

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.