EQS-Adhoc: The Grounds Real Estate Development AG: Capital measures with participation of H.I.G. Capit

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

-Capital measures with participation of H.I.G. Capital –

• Announced potential partnership with H.I.G. Capital is now to be implemented
• Capital increase by up to EUR 53.4 million with prior capital reduction at a ratio of 2:1
• Further increase of the bond issued in October 2023
• Condition precedent inter alia waiver of interest claims under the bond WKN: A3H3FH | ISIN: DE000A3H3FH2

Berlin, 9 August 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 H.I.G. Capital announced in the ad hoc announcement of 13 October 2023. The capital increase announced in this ad hoc announcement is now to be resolved at the Annual General Meeting on 19 September 2024. Up to [53,416,548] new no-par value registered shares ("New Shares") are to be issued. Shareholders will be granted statutory subscription rights. The capital increase is to be preceded by a simplified capital reduction, which is to be resolved at the same Annual General Meeting. The capital reduction will be carried out for the purpose of offsetting losses by consolidating shares at a ratio of 2:1, i.e., the share capital is – prior to the capital increase – to be reduced from EUR 17,805,517.00 to EUR 8,902,758.00 divided into 8,902,758 no-par value registered shares with a pro rata amount of the share capital of EUR 1.00 each. Prior to this, for the purpose of an even share capital number, one old share provided to the Company by a shareholder free of charge will be cancelled. Background for the capital reduction is also that the company has decided to book a depreciation on various properties in its half-year financial statements as of June 30, 2024, for reasons of caution. The Company now expects a negative EBIT of between EUR -7 million and EUR -9 million.

A company that belongs to a fund managed by H.I.G. Capital ("Investor") has undertaken to subscribe for 40,000,000 New Shares as part of a pre-subscription agreement. The subscription obligation is subject to several conditions precedent, inter alia, merger clearance by the German Federal Cartel Office regarding the Investor, and the non-occurrence of material adverse circumstances. A condition precedent is also that the terms of the bond 2021/2027 issued by the Company (WKN: A3H3FH | ISIN: DE000A3H3FH2) will be changed to a zero coupon bond without any interest.

Certain shareholders of the Company who together hold approx. 73% of the share capital, have undertaken 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.

In parallel, the Investor agreed to provide the Company with a further EUR 4.5 million in the near-term by way of an increase of the bond issued in October 2023. Together with a prior increase, the volume of this bond will then amount to EUR 17 million. At the same time, the term of the bond was extended to 31 December 2029.

 Company contact:

The Grounds Real Estate Development AG

Jacopo Mingazzini, Management Board member

Charlottenstrasse 79-80, 10117 Berlin, Germany

Tel.: +49 (0) 30 2021 6866

Fax: +49 (0) 30 2021 6849

E-mail: info@tgd.ag

Web: www.thegroundsag.com

– End of the ad-hoc notification –

1965315  09-Aug-2024 CET/CEST