Lehto Group Oyj: Lehto Group Plc, inside information: Proposal for Lehto's restructuring programme has been filed with the District Court of Oulu

The administrator of Lehto Group Plc's (the "company" or "Lehto") corporate restructuring proceedings, attorney Klaus Majamäki, has on 17 June 2024 filed proposal for the company's restructuring programme with the District Court of Oulu. In the view of the company and the administrator, the restructuring programme would lead to a better outcome for the company's creditors than bankruptcy. The aim of the restructuring programme is, inter alia, to enable the company to start the Energy Construction Business (defined below), which the company announced on 29 May 2024.

The main content of the proposed restructuring programme:

• The restructuring programme is based on the company's complete divestment of the construction business of Lehto Group and the reorientation of its business towards real estate energy solutions and electricity storages ("Energy Construction Business"). The Energy Construction Business is described in more detail in the stock exchange release published on 29 May 2024.

• In order to launch the Energy Construction Business, the company is required to raise EUR 2,500,000 in equity financing within three months from the date on which the decision to approve the restructuring programme has become final and EUR 2,500,000 in debt or equity financing by 31 December 2025. The deadlines for obtaining financing may be extended with the approval of the administrator of the restructuring programme.

• The company is obliged to ensure that the EUR 15 million convertible bond of the company is converted into shares of the company at least for the claim of approximately EUR 10 million of Lehto Invest Oy by 31 December 2024.

• The payments under the payment schedule of the restructuring programme will be financed partly by the realisation of the company's assets and by future payments on the company's claims. The company is therefore obliged to sell most of its assets within the timeframe set out in the restructuring programme at an arm's length price and to collect the claims identified in the restructuring programme.

• The company's liabilities under the restructuring programme have been structured in such a way that the company will be able to meet the payments and interest due under the payment schedule with the proceeds from the realisation of the company's assets and the cash flow from the company's Energy Construction Business.

• The duration of the payment schedule is approximately 5 years. The last payments under the payment schedule are due on 31 December 2029 for the non-preferential restructuring liabilities and on 30 November 2027 for the secured liabilities.

• The total amount of the secured liabilities under the restructuring programme is EUR 3,470,974.20. The secured liabilities are to be paid upon realization of the collateral assets up to the amount of the net realisation value of the collateral assets, but not exceeding the amount of the secured liabilities. The secured liabilities shall bear annual interest at the rate of 6-month Euribor plus a margin of 2.5 %. The interest rate shall always be at least 3.5 %.

• The total amount of the non-preferential restructuring liabilities, whose amount and basis is clear, is EUR 19,222,141.28, including, inter alia, the company's convertible bond. The amount of the non-preferential restructuring liabilities will be reduced by 90 % of the amount of the claims. The company will be obliged to make additional payments on the non-preferential restructuring liabilities if the conditions set out in the restructuring programme are met, inter alia in case of better-than-expected asset sales and collection of claims.

• Payments on restructuring liabilities whose basis is conditional or amount is capped, shall be deposited in an escrow account and the funds in the escrow account shall be paid on the liabilities in the same way as for non-preferential restructuring liabilities, once a reliable explanation of the basis and amount of the liabilities has been obtained. The payment schedule contributions to the escrow account shall be 75 % of the maximum amount of the unclear liabilities remaining after the debt reduction. The total amount of such restructuring liabilities is approximately EUR 41,864,485.33. The amount of disputed restructuring liabilities is EUR 4,633,597.53.

• The administrator has decided to authorise the company to settle all small creditors with claims up to EUR 1,000. According to the administrator's information, the company has paid all known small debts. The company is obliged to pay any outstanding small debts that meet the above definition within 30 days of the creditor's claim.

• The restructuring liabilities of a creditor with a lower ranking (Section 2 of the Act on the Ranking of Claims) will be reduced in full, i.e. obligation to pay such liabilities will be abolished in full as a result of the adoption of the restructuring programme.

• Early termination of the restructuring programme is possible at the earliest on 1 July 2025. Early termination is conditional on the company paying in full the secured liabilities and their interest, the payment schedule contributions and additional payments on the non-preferential restructuring liabilities in full and the additional payment resulting from the early termination.

Lehto Group Plc

Board of Directors

Further information

Hannu Lehto, CEO, Member of the Board of Directors

+358500280448

Veli-Pekka Paloranta, CFO

+358 40 094 4074