Magnora ASA

Legal Proceedings Report • May 23, 2016

SEVAN MARINE ASA: Logitel Offshore

SEVAN MARINE ASA: Logitel Offshore

We refer to the comments made in our Q4 2015 earnings

release of February 24, 2016 and the 2015 Annual

Accounts released on April 29, 2016 regarding the

review of the circumstances surrounding and the

legality of the Logitel Offshore agreements.

We also refer to comments made regarding the operation

of Arendal Spirit and deferral of delivery of

remaining Logitel Offshore units made in the Q1 2016

earnings release and the Summons to Bondholder Meeting

from Teekay Offshore Partners' ("Teekay") published

May 19, 2016.

The board of Sevan Marine initiated in January 2016 a

review of the circumstances surrounding and the

legality of the Logitel Offshore agreements, including

the USD 60m bond loan granted by Sevan Holding V AS to

Logitel Offshore Pte Ltd ("Logitel") in 2013 and the

Fourpartite Agreement entered into in 2014 between

Sevan Marine, CeFront, Logitel and Teekay. The outcome

of this review has exposed potential breaches of

Norwegian corporate law in relation to these

agreements. This could result in the agreements being

void or voidable. Sevan Marine initiated, through a

special Board committee led by the chairperson, a

dialogue with Logitel and Teekay in February 2016 in

an attempt to resolve the issues raised in an amicable

manner and within the framework of applicable law.

Until lately the special Board committee was very

optimistic that a settlement would be reached in time

to present the main elements of such at the Annual

General Meeting to be held on Wednesday, May 25, 2016.

The dialogue has recently been paused by

Logitel/Teekay. Logitel/Teekay have stated that the

rationale for this relates to the gangway incident

which occurred on Arendal Spirit as disclosed by

Teekay in their Q1 earnings release. Sevan Marine has

also noted that it appears that Teekay has not

allocated any funds in their proposed restructuring

plan to accommodate any claims or payments to Sevan

Marine in relation to the Logitel Agreements. Sevan

Marine notes that this appears to have been done

despite the amount and nature of the claims.

Sevan Marine believes that claims in excess of, and

potentially significantly higher than, USD 50 million

may be made against Logitel and/or Teekay irrespective

of the validity of the above mentioned agreements.

Sevan Marine regrets the situation and is dedicated to

seeking the best outcome for all its shareholders.

Sevan Marine is currently considering its

alternatives, including potentially initiating

litigation against Logitel, Teekay and other involved

parties. Sevan Marine has also been approached by a

group of minority shareholders claiming to control

Sevan Marine shares in excess of the 10 percent

threshold required in the Joint Stock Public Companies

Act for demanding an external investigation into

certain matters of relevance to the company. These

shareholders have stated that they will consider

calling an external investigation into this matter

should an amicable solution not be reached.

The outcome of this situation and any potential

recovery of value is now considered uncertain. As

such, there remains material uncertainty regarding

both the amount and timing of any payments in relation

to both the Logitel loan and variable payments due

from Logitel. Sevan Marine now has the understanding

that given the situation Logitel/Teekay intends to

withhold the variable payment due to Sevan Marine

regarding Arendal Spirit in June 2016. Combined with

the further decision announced by Logitel/Teekay in

their Q1 earnings release of May 19, 2016 to defer the

delivery of units 2 and 3 to beyond 2019 non-cash,

accounting impairments and provisions of USD 8 million

in relation to the convertible loan and expected

variable fee amounts will be recorded as per March 31,

Sevan Marine will provide a further update on this

matter during its Q1 2016 earnings release and Annual

General Meeting to be held on Wednesday, May 25, 2016.

*******

The information in this announcement is subject to the

disclosure requirements of the Norwegian Securities

Trading Act section 5-12 and/or the Oslo Børs -

Continuing Obligations.

Sevan Marine ASA is specializing in design,

engineering and project execution of floating units

for offshore applications, based on its patented

cylindrical floater technology. Sevan Marine ASA is

listed on Oslo Børs with ticker SEVAN. For more

information, please refer to www.sevanmarine.com.

For more information please contact:

Carl Lieungh, CEO, Sevan Marine ASA

carl.lieungh@sevanmarine.com

+47 916 64 720 mobile

Reese McNeel, CFO, Sevan Marine ASA

reese.mcneel@sevanmarine.com

+47 415 08 186 mobile