Havila Shipping ASA

Investor Presentation • Nov 9, 2016

Financial Restructuring Proposal

November 2016

Disclaimer

This presentation (the "Presentation") has been prepared by, and is the sole responsibility of, Havila Shipping ASA ("Havila Shipping" or the "Company", together with its subsidiaries collectively referred to as the "Group") solely for information purposes in connection with the ongoing financial restructuring of the Company.

No representation or warranty (express or implied) is made as to, and no reliance should be placed on, any information, including projections, estimates, targets and opinions, contained herein, and no liability whatsoever is accepted as to any errors, omissions or misstatements contained herein, and, accordingly, none of the Company or Swedbank Norway and Fearnley Securities who acts as financial advisors to the Company in connection with the refinancing described herein or any of their parent or subsidiary undertakings or any such person's officers or employees accepts any liability whatsoever arising directly or indirectly from the use of this Presentation. The contents of this Presentation are not to be construed as legal, business, investment or tax advice. Each recipient should consult with its own legal, business, investment or tax adviser as to legal, business, investment or tax advice.

This Presentation is for information purposes only, and does not constitute or form part of any offer to sell or a solicitation of any offer to buy any securities in any jurisdictions.

This Presentation speaks as of 8 November 2016. Neither the delivery of this Presentation nor any further discussions of the Company with any of the recipients shall, under any circumstances, create any implication that there has been no change in the affairs of the Company since such date. The Company does not intend, and does not assume any obligation, to update or correct any information included in this Presentation.

Each recipient of this Presentation acknowledges and accepts that an EEA-prospectus will be prepared in relation to the listing of the new shares to be issued in connection with the refinancing described in this Presentation. The prospectus is expected to include, inter alia, updated information about the Company and reports for relevant historical financial periods, as well as risk factors for making investments in the Company. It cannot be excluded that new and/or material information about the Company and its shares may arise, for example as a result of disclosure in such Prospectus.

This Presentation is subject to Norwegian law, and any dispute arising in respect of this Presentation is subject to the exclusive jurisdiction of Norwegian courts with Oslo District Court as legal venue.

Agenda

• 1. Background and restructuring proposal
• 1. Company update
• 1. Appendix

Restructuring overview

Havila Shipping has been actively engaged with its bank lenders, bondholders and other stakeholders for a prolonged period of time with the aim to agree on an overall restructuring plan

The process has been challenging and resulted in a comprehensive recapitalization proposal which includes the following items:

• NOK 164.4 million of new capital from the Company's largest shareholder
• NOK 118.2 million in the form of New Equity
• NOK 46.2 million in the form of an unsecured and interest free shareholder loan
• Conversion of approximately NOK 135 million of accrued interest to equity by the Company's secured lenders
• Sales processes to be initiated for non-core assets with potential shortfall to be converted to equity in the Company at 12.7% recovery based on pricing of New Equity
• All maturities extended until 8/11 2020, sweep mechanism on secured debt subject to certain cash thresholds
• All unsecured debt (bank and bonds) offered (i) 15% of outstanding principal amount in cash, and (ii) certain warrants which may be exercised for shares in a period of 5 years

The restructuring plan will provide Havila Shipping with sufficient liquidity in the short to medium term and reduce the Company's net interest bearing debt by up to 29%

The Proposal is supported by the Company's secured and unsecured bank lenders as well as Havila Holding, the Company's main shareholder, and represent the last viable option the Company see in order to reach a consensual restructuring

A comprehensive restructuring remains absolutely required

Summary of the restructuring (1/3)

On the Restructuring Implementation Date the following shall take place:

New Equity

• NOK 118.2 million of new equity and NOK 46.2 million of convertible shareholder loan to be provided from current main shareholder Havila Holding (new equity to benefit from certain anti-dilution protection going forward initially securing 51% ownership). The estimated subscription price for the new equity corresponds to NOK 0.125 per share
• Secured Creditors to convert to new shares approximately NOK 135 million of accrued interest from and including 16 February 2016 up to and including 30 September 2016 at NOK 0.24 per share

Repair Issue

• The present shareholders will after the equity transactions as set out above be holding 2.5 % of the shares in the Company.
• A repair issue of NOK 30 million will be offered towards existing shareholders (excluding Havila Holding) at NOK 0.125 per share

Unsecured Debt

All unsecured debt (totalling NOK 950 million) will be offered (a) 15% of outstanding principal amount and (b) 500 million warrants which may be exercised for shares in a period of 5 years at NOK 0.156 per share in cash (25 % premium to the subscription price of the new equity)

Divestment of Non-Core Vessels

• Vessels divided in to categories labelled "core vessels" and "non-core vessels", with the latter category divided in to 3 sub-groups (named I, II and III). All non-core vessels to be marketed for sale going forward
• Secured Creditors on the Non-Core Vessels 'Group I' Debt will receive NOK 44 million of already pledged cash

Summary of the restructuring (2/3)

Amendments to surviving debt implemented on the Restructuring Implementation Date:

Amortization and maturities

• All fixed amortisations on Secured Debt to be cancelled, except for certain fixed amortisation on certain vessels. Cash sweep of 50% of cash flow on core vessels net of i.a. costs and fixed amortisation
• All Secured Debt shall mature on 7 November 2020

Interest rates

No change in credit margins, save for the Subsea Bonds to be merged into one tranche with an interest rate of 3M NIBOR + 450 bps p.a. and Non-Core Vessels 'Group I' Debt to accrue interest at 5% PIK

Covenants

Financial covenants suspended except minimum cash of NOK 50 million (consolidated on group level)

Summary of the restructuring (3/3)

Subsequent conversions and amendments:

Non-Core Vessels

• Non-Core Vessels 'Group I' Debt and Non-Core Vessels 'Group III' Debt, not fully repaid after sale of the relevant vessels, is converted to shares at a conversion price of NOK 0.981 per share (which equals a conversion rate of 12.7%)
• If vessels in the Non-Core Vessel "Group I" are not sold within 18 months commencing on the date the Restructuring Plan is implemented (the "Restructuring Implementation Date"), a fixed amount of NOK 250 million will be converted at a conversion price of NOK 0.981 per share (which equals a conversion rate of 12.7%) and the remaining debt to be left until such vessels are sold.
• Non-Core Vessels 'Group II' Debt, not fully repaid on a sale of the relevant vessels, will be secured by 2nd lien collateral in the vessel Havila Venus
• Relevant Secured Creditors to cover all costs relating to respective non-core vessels from the date falling 18 months after Restructuring Implementation Date

Non-Performing Vessels

• Core vessels which, in the period of 18 to 24 months after the Restructuring Implementation Date, generates less EBITDA than 2% of Secured Debt, will be declared 'Non-Performing' and may, by the relevant Secured Creditor:
• be taken over (against discharge of all secured debt); or
• sold (against conversion of any deficit to shares at a conversion price of NOK 0.981 per share (which equals a conversion rate of 12.7%))
• If right is not exercised, interest on such vessel shall be paid as PIK and, from the date falling 30 months from the Restructuring Implementation Date, the relevant Secured Creditor shall cover all net costs relating to such vessel
• Upon payment of outstanding interest and a portion of outstanding principal debt (which amount shall be raised as new equity) a Non-Performing Vessel may be re-declared as a Core Vessel. 8

Potential reduction of NIBD by up to 29%

Note: ROR interest is not included in the interest bearing debt figures above. Secured debt ROR interest will be converted to equity and the unsecured debt redemption amount includes settlement for ROR interest

Required operating CF greatly reduced

Current debt repayment schedule

Cash flow statement (NOKm)	2012	2013	2014	2015	2016e	2017e	2018e	2019e
Required operating cash flow	220	320	383	362	1 3 9 1	1454	892	1 040 i
Capex	$-279$	-50	$-226$	-84	$-30$	-40	$-70$	$-70$
Net change in debt*	14	$-374$	$-219$	$-431$	$-1.361$	$-1414$	$-822$	$-970$
Instalments					$-514$	-472	-457	$-320$
Balloons					$-847$	$-942$	$-365$	$-650$
Equity financing CF	185	10			$\overline{\phantom{a}}$	$\overline{\phantom{a}}$
Net cash flow (incl. FX)	140	-95	-62	$-153$				$\bf{0}$

Revised debt repayment schedule

Cash flow statement (NOKm)	2012	2013	2014	2015	2016e	2017e	2018e	2019e
Required operating cash flow	220	320	383	362		66	102	78.
Capex	$-279$	-50	$-226$	$-84$	$-30$	-40	-70	$-70$
Net change in debt*	14	$-374$	$-219$	-431	$-205$	-26	$-32$	-8
Instalments					-18	-26	$-32$	-8
Balloons					$-187$	$\overline{\phantom{a}}$	$\overline{\phantom{a}}$	٠
Equity financing CF	185	10			164	-
Net cash flow (incl. FX)	140	-95	$-62$	$-153$

• Current debt repayment schedule not sustainable without refinancing
• Revised profile and new equity greatly reduce required operating cash flow

Timeline

Bank process

• Final approval from banks expected in place: 30 November 2016, but latest 31 January 2017
• Effective from secured and unsecured lenders final approval expected to be granted within 30 November 2016 provided subject to that all other conditions precedent are being fulfilled

Bond process

• Summons to bondholder meeting: 9 November 2016
• Bondholder meeting 23 November 2016 and effectuation date within 31 January 2017, but latest 28 February 2017

Equity process

• Indicative timeline:
• Notice of EGM: 25 November 2016
• EGM: EGM to resolve share capital increase within 31 January 2017 ( at latest)
• Registration of new share capital: 28 February 2017 (at latest)

Agenda

• 1. Background and restructuring proposal
• 2. Company update
• 1. Appendix

Havila owns a modern and diversified fleet

Modern fleet of 26* vessels with an average fleet age of ~9 years

Acceptable contract coverage and attractive customer base

Decent contract backlog helps on near term visibility

• Total backlog of NOK 1.9bn from firm contracts¹
• Revenue from firm contracts in 2H 2016 of about NOK 350m and about NOK 400m in 2017
• Total backlog of about NOK 3.8bn when full value of option contracts included (total value of NOK 1.9bn)
• Option backlog provides a solid base when working to secure new contracts – preferred position subject being at market terms

Comments Contract backlog in NOKm¹

Firm contracts Option

Contract backlog (% of ship days)¹

Strong operational track record

• A qualified organisation focusing on human resources and solid seamanship
• Strong focus on safety with a goal of zero damage to personnel, environment and assets
• Established comprehensive internal control procedures for all vessels in fleet
• Financial and safety performance is evaluated with the captain of each vessel monthly
• Solid operational excellence demonstrated with historically low unplanned off-hire days and comparably strong historical operating margins

Agenda

• 1. Background and restructuring proposal
• 1. Company update
• 3. Appendix

HAVI shareholder base as per 31 October 2016

• Havila Holding is the largest shareholder with 51%
• Other shareholders comprise of financial institutions, industrial companies and family offices
• Top 30 shareholders hold ~73% of current outstanding shares

# SHAREHOLDER	COUNTRY	SHARES	%
1 HAVILA HOLDING AS	Norway	15 379 717	50,96 %
2 TORGHATTEN ASA	Norway	1 223 100	4,05 %
3 THE NORTHERN TRUST CO.	United Kingdom	970 292	3,22 %
4 JEKI PRIVATE LIMITED	Singapore	500 000	1,66 %
5 CARVALLO INTERNATIONAL LTD	Singapore	394 726	1,31 %
6 SPILKA INTERNATIONAL AS	Norway	300 000	0,99 %
7 DANSKE BANK A/S	Denmark	255 246	0,85 %
8 SVEIN TØMMERDAL	Norway	228 827	0,76 %
9 BAKKELY INVEST A/S	Norway	214 800	0,71 %
10 NORDNET BANK AB	Sweden	212 677	0,70 %
11 KS ARTUS	Norway	203 800	0,68 %
12 PACIFIC CARRIERS LTD	Singapore	185 926	0,62 %
13 NORDNET LIVSFORSIKRING AS	Norway	181 677	0,60 %
14 AVANZA BANK AB	Sweden	165 612	0,55 %
15 NORDEA BANK DANMARK A/S	Denmark	163 631	0,54 %
16 BERNHD. BREKKE A/S	Norway	150 000	0,50 %
17 DNB NOR BANK ASA	Norway	110 000	0,36 %
18 KAMATO AS	Norway	108 461	0,36 %
19 VENADIS AS	Norway	104 903	0,35 %
20 TOVE LYNGSTAD	Norway	100 000	0,33 %
21 ANDRE BIRGER NAKKEN	Norway	100 000	0,33 %
22 SEVRIN INGE ROALD	Norway	100 000	0,33 %
23 ROGER BEKKEN	Norway	100 000	0,33 %
24 DROME AS	Norway	100 000	0,33 %
25 ERLEND SMEDSDAL	Norway	80 484	0,27 %
26 SVEN GUNVALDSEN	Norway	80 000	0,27 %
27 OLAV MAGNE TVEITÅ	Norway	80 000	0,27 %
28 HALLVAR ULFSTEIN	Norway	78 500	0,26 %
29 MØRE INVEST AS	Norway	76 581	0,25 %
30 SVEIN OLAV HENRIKSEN	Norway	71 583	0,24 %
Top 30 shareholder		22 020 543	72,96 %
Other		8 159 056	27,04 %
Total outstanding shares		30 179 599	100,00 %

Company structure

PSV fleet (1/3): Brazil vessels

Havila Faith (1998) Lay-up

Havila Princess (2005) Lay-up

Havila Favour (1999) Lay-up

Havila Fortress (1996)

Lay-up

PSV fleet (2/3): 4 vessels with Statoil & Maersk

PSV fleet (3/3)

AHTS fleet: 2x in lay-up and 2x in spot market

Mars (2007) Lay-up
Mercury (2007) Contract expiry: Nov 2016
Neptune (2008) Lay-up
Venus (2009) Spot
Jupiter (2010) Spot

AHTS Asia fleet

• Offices in Great World City
• Vessel management by Posh Semco
• Chartering department
• Young, modern fleet of 8x DP AHTS
• 4 AHTS owned by Havila and 4 owned by POSH
• The vessels are owned by Havila Shipping and POSH, and leased on bareboat to the JV company
• 7 x 8,000 BHP 105T BP DP1 AHTS
• POSH Viking, Vibrant, Virtue, Rapid
• POSH Resolute, Resolve and Radiant
• 1 x 10,800 BHP 139T BP DP2 AHTS POSH Venture

²⁴ Havila vessels

Subsea: Two firm contracts, one being marketed

Harmony (2005/2007) Contract expiry: Apr 2017 Optional period: 2 years up to Apr 2019
Phoenix (2009) Contract expiry: May 2023 Optional period: 4 years up to May 2027
Subsea (2011) Being marketed for work
Troll (2003), RRV Contract expiry: Nov 2016 Optional period: 3 years up to Nov 2019