Lehto Group Oyj - Inside information

Lehto Group Plc, inside information: The District Court of Oulu has confirmed Lehto Group Plc's restructuring programme

Lehto Group Plc
Inside information
24 September 2024 at 11.00 (Finnish time)

The District Court of Oulu has today on 24 September 2024 confirmed Lehto Group
Plc's (the “company” or “Lehto”) restructuring programme. Attorney Klaus
Majamäki was appointed supervisor of the restructuring programme. The aim of the
restructuring programme is, inter alia, to enable the company to start the
energy construction business. The main content of the confirmed restructuring
programme corresponds to the proposal for restructuring programme published on
17 June 2024.

The main content of the 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 and in the half
-year financial report published on 1 August 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 supervisor 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 19,190,659.00, including, inter alia, the
company's EUR 15 million 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 41,781,485.33. The amount of disputed
restructuring liabilities is EUR 4,560,713.84.

  · 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 and Member of the Board of Directors

+358 500 280 448

Veli-Pekka Paloranta, CFO

+358 400 944 074