EQS-Adhoc: The Grounds Real Estate Development AG: Capital measures with participation of HIG Capit | 09.08.24

Ad hoc announcement pursuant to Article 17 of the MAR
(Market Abuse Regulation)

-Capital measures with participation of HIG Capital –

• Announced potential collaboration with HIG Capital is now being executed
• Capital increase up to a maximum of EUR 53.4 million with prior capital reduction in a ratio of 2:1
• Further increase in the bond issued in October 2023
• Condition precedent including waiver of interest claims under the bond WKN: A3H3FH | ISIN: DE000A3H3FH2

Berlin, August 9, 2024 – The Grounds Real Estate Development AG (“Company” / ISIN: DE000A2GSVV5) is now taking the next steps in connection with the strategic partnership with funds managed by HIG Capital, announced in the ad hoc announcement of October 13, 2023. The capital increase announced in this ad hoc announcement must now be decided at the General Meeting of Shareholders on September 19, 2024. Up to (53,416,548) new registered shares without nominal value (“New shares“) are issued. Shareholders will receive statutory subscription rights. The capital increase will be preceded by a simplified capital reduction, which will be decided at the same General Meeting of Shareholders. The capital reduction will be carried out to compensate for losses by consolidating shares in a 2:1 ratio, i.e. the share capital will be reduced – prior to the capital increase – from EUR 17,805,517.00 to EUR 8,902,758.00 divided into 8,902,758 registered shares without nominal value with a pro rata amount of the share capital of EUR 1.00 each. Prior to this, in order to have an even number of shares, one old share provided to the Company by a shareholder free of charge will be cancelled. The background to the capital reduction is also that the Company has decided to book a depreciation on various properties in its half-yearly financial statements as of June 30, 2024, for reasons of prudence. The Company now expects a negative EBIT between EUR -7 million and EUR -9 million.

A company belonging to a fund managed by HIG Capital (“Investor“) has committed to subscribe for 40,000,000 New Shares as part of a pre-subscription agreement. The subscription obligation is subject to various conditions precedent, among other thingsapproval of the merger by the German Federal Cartel Office with respect to the Investor, and the non-occurrence of material adverse circumstances. A precondition is also that the terms of the bond 2021/2027 issued by the Company (WKN: A3H3FH | ISIN: DE000A3H3FH2) are changed to a zero coupon bond without any interest.

Certain shareholders of the Company, holding approximately 73% of the share capital, have committed to support the capital reduction and the capital increase and to transfer their subscription rights to the Investor. The Company expects the capital measures to be implemented by the end of the calendar year.

At the same time, the Investor agreed to provide the Company with an additional EUR 4.5 million in the short term through an increase of the bond issued in October 2023. Together with an earlier increase, the volume of this bond will then amount to EUR 17 million. At the same time, the maturity of the bond was extended until December 31, 2029.

Company contact:

The Grounds Real Estate Development AG

Jacopo Mingazzini, Member of the Board of Directors

Charlottenstrasse 79-80, 10117 Berlin, Germany

Phone: +49 (0) 30 2021 6866

Fax: +49 (0) 30 2021 6849

Email address: [email protected]

Website: www.thegroundsag.com

– End of ad-hoc notification –