Black Sea Property AS

Capital/Financing Update • Dec 22, 2016

BLACK SEA PROPERTY AS - REFINANCING OF BANK DEBT - UPDATE ON CAPITAL REQUIREMENTS

BLACK SEA PROPERTY AS - REFINANCING OF BANK DEBT - UPDATE ON CAPITAL REQUIREMENTS

As stated in stock exchange notice on 21 November

2016, the partially-owned company in Bulgaria of Black

Sea Property AS ("The Company") had received an offer

from their bank to extend the term maturity to 8

years. This offer has now been signed, and this means

that the loan of MEUR 7.5 will be repaid over 8 years.

The first instalment will be paid in December 2017 and

will be EUR 500,000. The following instalment payments

will then be MEUR 1 per year. In connection with the

refinancing, the Company has undertaken to pay EUR 300

per square meter on the sale of apartments as

instalment payment. Overall, this gives a long-term,

partial financing and the Company can thus focus on

the completion of the resort in Aheloy.

As previously announced, the Company requires

additional financing of up to MEUR 2.5. This liquidity

requirement was intended to be financed with the

reimbursement of VAT and the sale of apartments. These

processes have unfortunately been delayed, and the

company therefore needs an infusion of liquidity of

between MEUR 2 - 2.5 that must be committed before the

end of February 2017.

After evaluating various options, the Board has chosen

to offer shareholders the opportunity to buy options

on one or more apartments on favourable terms through

our partially-owned company in Bulgaria. Under this

model, shareholders wishing to buy an apartment pay a

certain amount (option premium) upon signing the

contract and the remaining amount of the purchase

price upon acquisition. Final information on this

offer will be given in the first half of January 2017.

The options will be sold for a limited period. The

Company sees this as a good opportunity to combine the

Company's need for capital with the possibility of

offering the purchase of apartments to shareholders.

After the expiration of the offer period for the

purchase of options (which is expected to end in mid-

February 2017), the Board believes that it is

necessary to raise additional funds through a pre-

emptive rights shares issuance (which is expected to

be concluded by the end of February 2017).

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 Residence Resort. Aheloy Residence

Resort is a partially-completed project and will upon

completion comprise over 1,050 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 Residence Resort, to

realize the project's added value through the sale of

residential units and hotel operations.