Havila Shipping ASA

Capital/Financing Update • Nov 14, 2016

Havila Shipping ASA: REMARKS TO THE RESTRUCTURING PROPOSAL FROM HAVI08 AS SET OUT IN THE LETTER FROM THE BONDHOLDER GROUP OF 11 NOVEMBER 2016

Havila Shipping ASA: REMARKS TO THE RESTRUCTURING PROPOSAL FROM HAVI08 AS SET OUT IN THE LETTER FROM THE BONDHOLDER GROUP OF 11 NOVEMBER 2016

Introduction

Reference is made to the stock exchange notice issued by Havila Shipping ASA

(the "Issuer") on 9 November 2016 regarding the proposed restructuring plan (the

"Havila Restructuring Plan") and the alternative plan presented by  a group of

bondholders in HAVI08 (the "Bondholder Group") in the stock exchange notice

dated 11 November 2016 (the "HAVI08 Restructuring Plan").

The board of directors of the Issuer have received a letter from the Bondholder

Group dated 11 November 2016 (the "HAVI08 Letter") addressing the arguments for

the HAVI08 Restructuring Plan and why it should be considered preferable

compared to the Havila Restructuring Plan.

The HAVI08 Letter, which is enclosed to this stock exchange notice, has been

reviewed and considered by the board of directors of the Issuer, and

subsequently the Issuer has the following remarks:

Havila Restructuring Plan

Firstly the Issuer wants to repeat and emphasize that the Havila Restructuring

Plan is supported by the secured and unsecured banks, and likewise the majority

shareholder of the Issuer which have confirmed substantial contribution in fresh

cash equity contribution as a part of the restructuring. The majority of the

stakeholders in the Issuer are consequently supporting the Havila Restructuring

Plan.

Conversion of unsecured debt to equity

The Bondholder Group has, according to a non-disclosure agreement, since April

2016 been included in discussions and considerations of various, alternative

solutions for the restructuring of the Issuer - including conversions of all

unsecured debt. Until submission of the HAVI08 Letter, conversion of all

unsecured debt to equity in the Issuer on terms acceptable to the secured banks

has been refused by the bondholders. The Bondholder Group has instead of full

conversion of unsecured debt either claimed additional / partial cash payment or

that a part of the unsecured debt is being maintained.

With reference thereto, and the fact that creditors holding approximately 50 %

of the unsecured debt are supporting the Havila Restructuring Plan, it seems

unlikely that the unsecured creditors as a group will accept conversion of

unsecured debt to equity in the Issuer on terms as set out in the HAVI08

Restructuring Plan.

Equity to be provided to the Issuer

The Issuer has the clear understanding that the secured banks - as a general

principle - will require fresh equity in form of cash to be provided in a

restructuring case like the one on-going for the Issuer, and is therefore

assuming that this will be required for approving any alternative proposal of

restructuring of the Issuer.

In discussion of various alternatives for the restructuring of the Issuer, the

unsecured creditors - including the Bondholder Group - have been requested to

confirm fresh equity in form of cash to be provided to the Issuer as part of the

restructuring. Except for the uncommitted indications as set out in the HAVI08

Letter, the Bondholder Group has so far rejected that they will provide equity

in form of cash to the Issuer.

In order to equalize the equity contribution, the Bondholder Group indicates in

the HAVI08 Letter that NOK 22 million can be provided as fresh equity in form of

cash to the Issuer. Contrary to the Havila Restructuring Plan, which provides

cash contribution of NOK 164 million, the cash contribution as set out in

theHAVI08 Letter is not included in the HAVI08 Restructuring Proposal and

neither confirmed to be committed.

Repair issue

The Issuer has noted that the HAVI08 Restructurings Proposal does not provide a

repair issue towards the shareholders of the Issuer. The Issuer is of the

opinion that the HAVI08 Restructuring Proposal therefore may be challenged by

the shareholders of the Issuer, since equal treatment is not secured by the

proposal.

Contribution from secured and unsecured lenders

The HAVI08 Restructuring Plan is based on the assumption that the secured and

unsecured banks' contribution to the restructuring of the Issuer as set out in

the Havila Restructuring Plan, such as conversion of secured debt and due

interest to equity, deferred instalments for a period of 4 years, coverage of

cost on non-core vessels / non performing vessels and conversion of uncovered

debt on non-core vessels and non-performing vessels to equity, will be

maintained or included as a viable element in the HAVI08 Restructuring Plan. As

of today, the Issuer has no information confirming that the secured and

unsecured banks will maintain their contribution to the restructuring of the

Issuer if the Havila Restructuring Plan does not obtain the required support

from unsecured lenders.

Cash payment and warrants

The Issuer is willing to grant the unsecured lenders a cash payment of 15 % of

the principal amount in combination with warrants which can provide an ownership

interest  of up to 21 % (before repair issue and conversion of debt related to

non-performing vessels - if relevant) in the Issuer. Having in mind that the

present equity is lost and the unsecured debt is challenged, and the fact that

part of the secured debt is partly being converted to equity, the Issuer is of

the opinion that the proposal as set out in the Havila Restructuring Plan, under

the present circumstances, clearly should be considered as fair treatment of

unsecured debt.

Preliminary conclusions

With reference to the above, it is the opinion of the Issuer that the HAVI08

Restructuring Plan is incomplete, purely conditional, and does not include

committed, required and viable elements from all stakeholders for the

restructuring of the Issuer.

Pursuant thereto, and the fact that HAVI08 is representing less than 10 % of the

total debt of the Issuer, the Issuer, as of today, is of the opinion that the

HAVI08 Restructuring Plan will not obtain the support of the secured and

unsecured banks, and therefore will fail - even though the plan should be

supported from bondholders at the announced bondholders' meeting in HAVI08 on

the 24 November 2016.

Consequently the board of directors of the Issuer take notice of the proposal,

but cannot confirm support to the HAVI08 Restructurings Plan as it is presented

in the Summons of 10 November 2016 and explained in the HAVI08 Letter, unless

the required contribution from all stakeholders is secured.

Contact persons for further information are:

Njål Sævik

Chief executive officer

+47 909 35 722

njaal@havila.no

Arne Johan Dale

Chief financial officer

+47 909 87 706

ajd@havila.no

This information is subject to the disclosure requirements pursuant to section

5 -12 of the Norwegian Securities Trading Act.