Reference is made to the previous stock exchange announcements from Black Sea Property AS (the "Company") regarding the rights issue of between 107,382,996 and 150,000,000 new shares (the "Offer Shares") at a subscription price of NOK 0.12 per Offer Share (the "Subscription Price") raising gross proceeds of up to NOK 18,000,000 (the “Rights Issue”). The Rights Issue is partially underwritten by a consortium of existing shareholders (jointly, the "Underwriters"), who will secure subscription of Offer Shares for NOK 12,885,956. The Underwriters have provided the Company with certain shareholder loans and shall convert such shareholder loans and accrued interest thereunder (the "Shareholder Loans") to fulfil their underwriting obligations in the Rights Issue.
The subscription period in the Rights Issue will commence today, 19 September 2024.
Nordea Bank Abp, Filial I Norge, is acting as settlement agent in the Rights Issue (the "Settlement Agent").
Registration and publication of the Prospectus:
The prospectus (the "Prospectus") relating to the Rights Issue was registered with the Norwegian Register of Business Enterprises ("NRBE") on 17 September 2024.
Subject to applicable securities laws, the Prospectus is attached to this stock exchange notice and will also be made available at the websites of the Company.
Allocation of Subscription Rights:
The shareholders in the Company as of 16 September 2024 (as registered in the Euronext Securities Oslo, the Norwegian Central Securities Depository ("VPS") on 18 September 2024 pursuant to the two days’ settlements procedure of VPS (the "Record Date") who are not resident in a jurisdiction where such offering would be unlawful, or for jurisdictions other than Norway which would require any filing, registration or similar action (the "Existing Shareholders"), have been granted subscription rights (the "Subscription Rights") in the Rights Issue that provide preferential rights to subscribe for and be allocated, Offer Shares at the Subscription Price.
Existing Shareholders have been granted 1.4837 Subscription Rights for each existing share in the Company registered as held by the Existing Shareholder at the Record Date, rounded down to the nearest whole Subscription Right. Each whole Subscription Rights will, subject to applicable law, give the right to subscribe for and be allocated one (1) Offer Share at the Subscription Price. Over-subscription is permitted, however, there can be no assurance that Offer Shares will be allocated for such subscriptions. Other than subscriptions from Underwriters, subscription without Subscription Rights is not permitted.
The grant or purchase of Subscription Rights and the subscription of Offer Shares by persons resident in, or who are citizens of countries other than Norway, may be affected by the laws of the relevant jurisdiction. Further, no Offer Shares or Subscription Rights will be offered or sold within the United States, except in reliance on an exemption from the registration requirements of the U.S. Securities Act. For a further description of such restrictions, reference is made to the Prospectus.
Subscription period for the Offer Shares:
The subscription period shall commence at 09.00 (CEST) on 19 September 2024 and end at 16.30 (CEST) on 3 October 2024 (the "Subscription Period").
Subscription Rights:
The Subscription Rights will be registered in the VPS with ISIN NO0013338434 and will be distributed to each Existing Shareholder's VPS account at the start of the Subscription Period. The Subscription Rights will be distributed free of charge to the Existing Shareholders.
The Subscription Rights may be used to subscribe for Offer Shares in the Rights Issue before the expiry of the Subscription Period on 3 October 2024 at 16:30 (CEST).
The Subscription Rights will not be admitted to trading on any organized marketplace.
Existing Shareholders who do not use their Subscription Rights to subscribe for Offer Shares before the expiry of the Subscription Period will not be entitled to be allocated any Offer Shares. Existing Shareholders that do not want to subscribe for Offer Shares will not be able to realize any economic value of the grant of Subscription Rights to such Existing Shareholder and will also be subjected to dilution of their proportionate ownership of Shares in the Company.
Regarding further restrictions in respect of who may be allocated or permitted to acquire or exercise Subscription Rights/subscribe for Offer Shares, reference is made to Section 4 "The Rights Issue and the Offer Shares" in the Prospectus.
Subscription procedure:
In order to subscribe for Offer Shares, investors holding Subscription Rights need to complete the subscription form for the Rights Issue (the "Subscription Form") and submit it to the Settlement Agent by 16:30 hours (CEST) on 3 October 2024 or subscribe via the VPS online subscription system.
Subscribers who are Norwegian residents with a Norwegian personal identification number who wish to subscribe for Offer Shares are encouraged to subscribe for Offer Shares through the VPS online subscription system by following the link on https://investor.vps.no/sc/servlet/no.vps.sc.servlets.SCLogonServlet?ISIN=NO0013338434&TSted=000VP&Sig=e70d744d9809fbaa9bd85596a830687a6268cd9335280c8aa3006396f1e16d74 (which will redirect to the VPS online subscription system).
Please note that Subscription Rights that are not used to subscribe for Offer Shares before the end of the Subscription Period (3 October 2024 at 16:30 CEST), will lapse without compensation and consequently be of no value.
Allocation of Offer Shares:
Allocation of the Offer Shares will take place on or about 4 October 2024 in accordance with the following criteria:
(i) First, Offer Shares will be allocated in accordance with granted and acquired Subscription Rights to subscribers who have validly exercised Subscription Rights during the Subscription Period;
(ii) Second, any unallocated Offer Shares following the allocation under (i) above shall be allocated on a pro-rata basis to Underwriters who have subscribed for Offer Shares, however limited upwards to each such Underwriter's respective Underwriting Obligation for the aggregate Underwriting Obligation of NOK 12,885,965. The Existing Shareholders' subsidiary preferential right to subscribe for Offer Shares that are not subscribed pursuant to exercise of Subscription Rights pursuant to Section 10-4 (3) of the Norwegian Private Limited Liability Companies Act is, thus, waived, cf. Section 10-5 of the Norwegian Public Limited Liability Companies Act;
(iii) Third, any unallocated Offer Shares following the allocation under (ii) above shall be allocated to subscribers who have over-subscribed on a pro-rata basis on the number of Subscription Rights exercised by each subscriber;
(iv) Fourth, any unallocated Offer Shares following the allocation under (iii) above shall be allocated to Underwriters who have subscribed for Offer Shares in excess of their respective Underwriting Obligation on a pro-rata basis; and
(v) Finally, any unallocated Offer Shares following the allocation under (iv) above shall be allocated to the Underwriters who have not fulfilled their underwriting obligation through subscription for Offer Shares in the Subscription Period, pro rata to their respective Underwriting Obligations as further described in Section 4.17 "The Underwriting".
The Underwriters will not be granted Subscription Rights due to technical limitations in the VPS when settling share deposits with contributions-in kind, but will be allocated Offer Shares on second priority pursuant to the above.
No fractional Offer Shares will be allocated. The Company reserves the right to round off, reject or reduce any subscription for Offer Shares not validly made or covered by Subscription Rights and will, in case of over-subscription only allocate Offer Shares to the extent that Offer Shares are available to cover such over-subscriptions.
Any Offer Shares that are unsubscribed by the end of the Subscription Period will be subscribed by the Underwriters in accordance with their Underwriting Obligations.
The result of the Rights Issue is expected to be published on or about 4 October 2024 in the form of a stock exchange notification from the Company through the Company's site on NewsWeb and on the Company's webpage (www.blackseaproperty.no).
Payment, delivery and trading of the Offer Shares:
The payment is expected to be debited on 8 October 2024 (the "Payment Due Date"). Payment for the allocated Offer Shares must be available on the specific bank account on the business day prior to the Payment Due Date, i.e. 7 October 2024. The Offer Shares will carry right to dividends as from the date of registration of the Offer Shares with the NRBE and will be delivered through the facilities of the VPS on or about 1 November 2024.
The Underwriting
Following expiry of the Subscription Period, any Offer Shares that have not been subscribed for and allocated in the Rights Issue will be subscribed and paid for at the Subscription Price by the Underwriters, subject to the terms and conditions of the Underwriting Agreement entered into between the Company and the Underwriters dated 28 May 2024. The Underwriters will guarantee subscription of Offer Shares for an amount of NOK 12,885,956. Any unsubscribed Offer Shares shall be allocated to each Underwriter based on the pro rata relationship between the Underwriters' Underwriting Obligations.
As compensation for providing the guarantee, the Underwriters will be entitled to a guarantee fee of 10% of their underwriting obligation to be settled by issuance of new shares. The new shares to be issued as underwriting fee will be issued pursuant to a Board authorization following registration of the share capital increase pertaining to the Rights Issue.
Other information / Conditions for completion of the Rights Issue:
The completion of the Rights Issue is subject to the following conditions: (i) that the minimum number of Offer Shares is subscribed (i.e. 107,382,966 Offer Shares), and (ii) that the minimum subscription amount is fully paid-up. The subscription of the minimum number of Offer Shares has been fully underwritten by the Underwriters.
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 River Beach Resort. Sunrise River Beach Resort is a partially completed project and will upon completion comprise approximately 950 apartments as well as significant commercial space. Black Sea Property AS has indirect ownership to the project and will work to finalize Sunrise River Beach Resort, to realize the project's added value through the sale of residential units and hotel operations.