Notification about a merger agreement

The Board of Directors of Sopharma AD (the “Company”) hereby notifies that on 29 October 2012 was signed a merger agreement between Bulgarian Rose – Sevtopolis AD (merging company) and Sopharma AD (acquiring company). The agreement settles both the technical process of the merger of Bulgarian Rose – Sevtopolis AD into Sopharma AD, as well as the ensuing consequences for the two companies. The fair price of the shares of the companies involved in the transformation is determined based on generally accepted valuation methods. Based on the fair price of the shares of the companies involved in the transformation an exchange ratio of 0.554192 has been formed, which means that one share of the merging company Bulgarian Rose – Sevtopolis AD shall be exchanged for 0.554192 shares of the acquiring company Sopharma AD. As of the present moment the Deputy Chairman of the Financial Supervision Commission, Head of the "Investment Supervision" Department, has not yet granted an approval under art. 124 of the POSA of the merger contract, of the reports of the governing bodies under art. 262i of the Commercial Act and of the report of the examiner under art. 262 m of the Commercial Act.