Report of the Meeting of the Joint Representatives from 17.09.2021

On 17 September, a further meeting of the joint representatives and the management of the participating companies took place in Schaan/Liechtenstein.

The subject of the discussion was the current status of the restructuring/consolidation of the group and
the situation in the individual creditor areas (banks, bonds, mezzanine loans), as well as the upcoming extension of the term of the bonds.

I. Restructuring Progress

The remediation in general continues to run properly and quietly. In 2021, the revenues are slightly below average due to the general weather situation.

II. Banks

In the banking sector, it remains the case that all obligations have been duly met.
As in previous years, property financing is being steadily reduced. Continuous coordination with our contacts at the banks is taking place. In some cases, it was possible to negotiate new, more favourable interest conditions (currently at an average of 1.66% p.a.). The banking sector is therefore stable and on target.

III. Mezzanine Loans

In the area of mezzanine loans, the regular annual distributions to the three groups of creditors were duly made in accordance with the restructuring plans.

IV. Interest payments

All payments foreseen for the year 2021 have been duly made:

In the banking sector, debt service has naturally included repayment and interest.

In the bond area, the interest foreseen in the current resolutions will be duly paid as of 30.9.2021.

In the mezzanine area, the payments are properly calculated in accordance with the restructuring plans.
The December 2021 distribution is on schedule.

There are no overall arrears and there continues to be a viable concept for the following years.

V. Litigation in the bond area

Since the last report, further decisions have been issued in the various legal disputes pursued by professional plaintiffs. In the case of Carpevigo Holding AG, there had been four payment claims which were dismissed by the Munich Regional Court II and the Munich Higher Regional Court as inadmissible. The Federal Supreme Court has since confirmed these dismissals. The plaintiffs’ appeal against non-admission was dismissed in each case without further justification.
These proceedings were therefore won with legal effect.
In the actions for avoidance against the resolutions of the creditors’ meetings of Carpevigo AG from
the years 2016 and 2017, the Federal Court of Justice did not accept Carpevigo AG’s non-admission appeal.
Carpevigo AG was not accepted for decision. Here, too, the appeal was dismissed without further
reasons being given. The actions for annulment were therefore successful in the result.
The amount in dispute and the costs incurred by the company are currently still subject to appeal proceedings. Whether the outcome of the proceedings will have any further major legal consequences seems rather doubtful.
This results from the extension of the term of the bonds until 30 June 2026.

This complex and the related litigation will be discussed in more detail below.
Furthermore, the Munich Regional Court II has just dismissed the first action for damages in connection with the execution of the 2016 resolutions as inadmissible and without merit. It remains to be seen whether the other side will appeal.

Furthermore, Carpevigo Holding AG prevailed in the first instance in a legal challenge against the 2016 resolutions. The Munich Regional Court II dismissed the action. Munich Higher Regional Court will hear the appeal of the opposing side shortly. Here, too, the progress remains to be seen.

VI. extension of the term of the bonds by 5 years

In 2021, it was decided to extend the term of all bonds until 30.06.2026 the same interest rate of 1.5% p.a. was agreed.

At Carpevigo AG, several attempts to hold a face-to-face event towards the end of 2020 failed. As a result, the joint representative held a “vote without a meeting in 2021” within the framework of section 18 of the SchVG.
At this meeting, the extension of the term of the bond and a confirmation of the resolutions from 2016 were passed with a majority of over 98%.
Three actions for annulment were again filed by the known professional plaintiffs. The company then initiated clearance proceedings at the Munich Higher Regional Court.
The 23rd senate responsible approved the resolutions, insofar as the extension of the term of the bonds, the interest rate regulations and an opt-in.
With regard to the retroactive confirmation of previous resolutions, no approval was granted. The bond conditions have been approved for the future and have been amended accordingly in the meantime, so that, in particular, the opt-in and the maturity extension could be enforced. The progress of the legal challenges, which against this backdrop are again likely to be limited in scope, remains to be seen. There will be an oral hearing before the Regional Court of Munich II soon.

In the case of Carpevigo Holding AG, the term of both bonds has been extended until 30 June 2021.
for both bonds. Here, the joint representative first had a vote on an internal instruction carried out within the framework of a creditors’ meeting in accordance with the law on bonds. A majority of over 99% of the bondholders voted in favour of this instruction and thus, in substance, in favour of an extension of the term of the bond with no change in interest rates. On this basis, a corresponding restructuring plan was unanimously adopted in the StaRUG proceedings and subsequently executed in the bond terms and conditions. Here too, an extension of the term of the bonds has thus been enforced. In this case, a legal challenge is still pending, which is directed against the resolution on the instruction. The progress of these proceedings, as well as other smaller proceedings that are still ongoing, the outcome remains to be seen.

Schaan 17.09.2021