NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART DIRECTLY OR INDIRECTLY, IN AUSTRALIA, CANADA, JAPAN OR THE UNITED STATES

Further, the Board of Directors has resolved to propose to the bondholders of the Company’s outstanding bond issue FRN Electromagnetic Geoservices ASA Senior Unsecured Callable Bond Issue 2013/2016 with ISIN NO 001 068253.7 (the “Bond Issue”) to amend certain terms of the bondholder agreement (the “Bond Proposal”).

The Rights Issue
The Rights Issue will be used to strengthen the Company’s financial position and align the Company’s capital structure with the current market conditions. More specifically, the gross proceeds from the proposed Rights Issue will be used for two separate purposes:
(i) NOK 214 million (equivalent to ~USD 25 million) will be used to strengthen the Company’s financial position and for general corporate purposes
(ii) Up to NOK 64 million (equivalent to ~USD 7.5 million) will be raised to buy back a portion of the Company’s outstanding Bond Issue (the “Bond Buy-Back”), as further described below. The amount raised for the Bond Buy-Back depends on bondholder participation in the Bond Buy-Back and the amount to be raised will be determined following the completion of the offer period of the Bond Buy-Back, expected on or about 24 November 2015

The Rights Issue is fully underwritten and is provided by large existing shareholders of the Company.

The shareholders of EMGS will receive subscription rights in relation to their shareholding in the Company as of the end of the date of the EGM scheduled to be held on 26 November 2015, and as registered in the VPS as of 30 November 2015. One subscription right will give the right to subscribe for and be allocated one new share. The subscription rights will be tradable and listed on Oslo Børs. Oversubscription by holders of subscription rights will be allowed.

The subscription price in the Rights Issue will be NOK 0.25 per new share. Based on the closing price of EMGS as of 4 November 2015 of NOK 0.67, the subscription price represents a discount to the theoretical ex-rights price of between 20% (assuming maximum deal size) and 24% (assuming minimum deal size).

Subsequent to the Rights Issue the Company’s share capital will increase by between NOK 214 million (assuming minimum deal size) and 278 million (assuming maximum deal size) through the issuance of between 856 and 1,112 million new shares.

The Rights Issue is subject to approval by the EGM.

Preliminary timeline and key events:
• Date of EGM: Scheduled for 26 November 2015
• Last day of trading in the EMGS share including the right to receive subscription rights: Scheduled for 26 November 2015
• Subscription period: Early December

The indicative timeline is subject to adjustments.

The Bond Proposal
The proposed amendments to the terms of the Bond Issue are as follows:
(i) Extend the maturity date by 36 months, from 27 June 2016 to 27 June 2019
(ii) The Company will offer to acquire 22.86% of the Bond Issue at a price of 80% of the nominal value of each bond for a total consideration of up to NOK 64 million
(iii) Amend the denomination of the bonds from NOK 1,000,000 to NOK 1.00
(iv) Waive the change of control clause in the bond agreement in connection with the Rights Issue and the underwriting and any shareholding following from or in connection with such Rights Issue or underwriting
(v) Introduce restrictions on the ability to raise new financial indebtedness, subject to certain exemptions as set out in the Bond Proposal to be presented to the bondholders
(vi) Negative pledge and selling restrictions on the multi-client library

Holders of more than 2/3 of the Bond Issue have pre-committed to vote in favor of the amendments and key bondholders have undertaken to tender their bonds.

The proposed amendments will be evaluated in a bondholder meeting scheduled to be held on 19 November 2015. Following approval of the Bond Proposal, the Bond Buy-Back will take place.

The Bond Buy-Back will be offered to all bondholders on equal terms and the Company will offer to acquire 22.86% of the outstanding bonds held by each bondholder. If one or several bondholders do not wish to tender 22.86% of their bonds pursuant to the offer, other bondholders may tender more than 22.86% of their outstanding bonds. In case of several exceeding tenders, any outstanding bonds available under the offer for such exceeding tenders shall be allocated pro-rata to existing number of bonds held among the bondholders who have delivered exceeding tenders.

Any outstanding bonds tendered in the offer shall be redeemed and cancelled, and the number of outstanding bonds and outstanding amount under the bond agreement reduced accordingly.

Indicative timeline and key events:
• Bondholder meeting: Scheduled for 19 November 2015
• Offer period: Within 3 business days after the Bondholder meeting and open for no less than two and no more than three business days
• Announcement date of the result of the Bond Buy-Back: Scheduled for 25 November 2015

The indicative timeline is subject to adjustments.

Carnegie AS acts as financial adviser and Michelet & Co Advokatfirma AS acts as legal advisor in connection with the Rights Issue and the Bond Proposal.

Contact
Stig Eide Sivertsen, EMGS Chief Executive Officer, +47 909 55 767
Charlotte Knudsen, EMGS head of investor relations, +47 97 56 19 59