As further described in Electromagnetic Geoservices ASA's ("EMGS" or the "Company") Q4 2017 report, published on 8 February 2018, the Company's financial situation is such that additional financing is required.

Following a thorough assessment of all options available to the Company, an independent board of directors (the "Independent Board") of the Company which did not include board members representing the major shareholders. has, in cooperation with the Company's three largest shareholders, developed a comprehensive refinancing proposal (the "Comprehensive Refinancing"). The Comprehensive Refinancing consists of two elements; (i) a rights issue with gross proceeds of up to USD 12.5 million, whereof USD 10.0 million is underwritten (the "Rights Issue") ; and (ii) issuance of a new, fully underwritten convertible bond loan with a total nominal amount of up to USD 32.5 million (the "Bond Issue"). The underwriting will be regulated by way of underwriting agreements, with fully termed underwriting agreements expected to be executed on or about 5 March 2018.

The rights issue will provide the Company with financing for general corporate purposes.

The net proceeds from the Bond Issue will be used to refinance the Company's existing bond issue. The proposed terms of the Bond Issue include a reduction of the free cash covenant (USD 2.5 million compared with USD 10 million under current bond loan), denomination in USD (new interest rate based on 3M USD LIBOR plus a margin of 5.5 per cent, compared with 3M NIBOR plus a margin of 6.0 per cent under current bond loan), an extension of the maturity (2023 compared with 2019 under current bond loan) and a conversion price equal to 135% of the subscription price in the Rights Issue.

The Independent Board is firmly of the opinion that the Comprehensive Refinancing will secure and maintain shareholder value going forward, by providing the Company with a significantly improved financial runway, stability and flexibility. 

The Rights Issue and the Bond Issue are subject to approval from the Company's general meeting. Hence, notice is hereby given of an extraordinary general meeting of EMGS at Karenslyst Allé 2, 0278 Oslo to be held on 23 March 2018 at 10:00 (local time).

Reference is made to the attached calling notice for further details regarding the Comprehensive Refinancing. The calling notice will be distributed electronically or by post to all shareholders with a known address. The calling notice, as well as appendices, is also available on EMGS' website.

ege Veiseth, EMGS Chief Financial Officer, +47 992 16 743

Calling Notice