Black Sea Property AS

Capital/Financing Update • Jul 29, 2020

BLACK SEA PROPERTY AS: GRACE PERIOD FOR PRINCIPAL REPAYMENT – REFINANCING OF GROUP BANK DEBT CHALLENGING DUE TO COVID-19 SITUATION

BLACK SEA PROPERTY AS: GRACE PERIOD FOR PRINCIPAL REPAYMENT – REFINANCING OF GROUP BANK DEBT CHALLENGING DUE TO COVID-19 SITUATION

EPO Aheloy OOD ("EPO Aheloy"), the development company for the Sunrise Gardens Resort (the "Resort") and a subsidiary of Black Sea Property AS (the "Company"), has now agreed upon a grace period for the repayment of principal of in total EUR 1.43 million until December 2021, of which EUR 1 million is owed under a EUR 10 million loan facility granted by UniCredit BulBank (the "Credit Facility") and the remaining EUR 430,000 is owed under a EUR 3 million construction loan granted by UniCredit Bulbank (the "Construction Loan").

The agreed grace period implies that EPO Aheloy will only make interest payments under the Credit Facility and the Construction Loan for the period until December 2021.

The remaining principal due under the Credit Facility as of the date hereof is EUR 5 million, and the remaining principal due under the Construction Loan is EUR 2.48 million.

Further, and as previously communicated, the Company is actively working on achieving a refinancing of the Credit Facility and the Construction Loan which should also include additional debt financing in order to complete at least building M and N of the Resort in time for the summer season of 2021. However, due to the ongoing COVID-19 situation, the refinancing process remain challenging and the Company is uncertain of if and when such refinancing can be completed.

The Company has previously estimated a funding need until opening of the Resort of up to EUR 4.8 million, however the Company and EPO Aheloy are assessing the possibilities of opening the Resort with a lower funding requirement. However, any opening of the Resort remains subject to further capital injections into EPO Aheloy (either through raise of debt or equity). The Company will provide further information in due course

For further information, please contact:

Egil Melkevik, Chairman

Tel: +47 90 77 09 76

E-mail: em@ms-solutions.no

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 Sunrise Gardens. Sunrise Gardens Resort is a partially completed project and will upon completion comprise approximately 950 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 Sunrise Gardens Resort, to realize the project's added value through the sale of residential units and hotel operations.