The questions received for the general meeting were originally submitted in Danish and have subsequently been translated into English, the Group’s official language. While every effort has been made to ensure accuracy, the company disclaims any responsibility for potential discrepancies, inaccuracies, or misunderstandings arising from the translation.

The following questions were asked on behalf of the shareholders Olav W. Hansen A/S and Sparekassen Danmark.
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Questions to the Auditor

Question 1:

On page 9 of the annual report, rental income is stated by the individual properties. The amounts are indicated as "Rent + cost EUR". It is requested to know how this definition is to be understood and what is contained in the figures. It is also requested to be informed for each property how much is "rent" and how much is "cost".

Answered by the Board:

It is net rental income (kaltmiete) + on account payments of common expenses and heating. Rent + costs in the table is a snapshot at the end of the years in question. In 2024, the rent amounted to EUR 4,086,979 as of 31.12. and on account common expenses, etc., was a total of  EUR 523,050.

Question 2:

In the company's Income Statement (page 69 of the annual report) it is stated that property operation expenses amount to EUR 1,423 thousand. The information is requested as to what is included in this item, including the proportion that relates to (i) maintenance, (i) renovations and (iii) administrative expenses, respectively.

Answered by the Board:

Property expenses cover expenses for e.g. caretaker, cleaning, electricity, heating, maintenance, property tax, water, legal assistance, non-deductible VAT, property management, insurance and fees to the estate agent in connection with letting.

Maintenance and renovation costs can vary significantly from year to year and from property to property. In 2024 the fraction was 25 %.

The proportion of property management was 15 %.

Question 3:

The question is to what extent related parties have directly or indirectly received remuneration from companies in the group, including the extent to which fees have been paid for work or services from the underlying German companies to related parties.

Answered by the Board:

Related parties and company administrators have not received any remuneration from companies in the group or underlying companies.

Question 4:

Information is requested as to whether, in the auditor's opinion, the company's properties have been valued at market price, and whether in this context the term market price means the price at which the properties can be sold in free trade. If market price is not to be understood as the price at which the properties can be sold in free trade, the definition of market price is sought to be explained precisely.

Answered by the Board:

The properties are conceptually valued at fair value, cf. note 2. Fair value is the price at which a willing seller and buyer will enter into a purchase agreement. It is assumed that neither buyer nor seller is forced to act and that both players have knowledge of the property market.

In terms of methodology, fair market value is calculated as the product of the gross capitalization factor, which is the inverse of the required rate of return, and the expected rental income, cf. note 2.

Question 5:

Information is requested as to whether all transactions with related parties, in auditor’s opinion,  are carried out on market terms (arm's length). To the extent that there may be uncertainty about this, an account of the uncertainties and possible financial consequences of this is requested.

Answered by the Board:

In the opinion of the Board of Directors, all transactions with related parties have been carried out on market terms.

Question 6:

It appears from the company's annual report that on 15 January 2024, the company sold the property Hesselvang 11, Grenå. An explanation is requested of the following matters: (i) has the auditor checked that the property has been transferred on market terms (arm's length), (ii) what costs the company directly or indirectly incurred in connection with the acquisition and sale of the property, and (iii) to what extent these costs have been paid to related parties.

Answered by the Board:

A standard purchase agreement has been entered into between the buyer and seller.

In connection with the purchase and sale of the property, the company has paid 5% of the purchase price and 1.9% of the sale price, cf. § 4.6 and 5.4 of the management agreement in the original stock exchange prospectus, to the company administrator Administrationsselskabet Gambit ApS.

Questions to the board

It is stated that the questions have been submitted on behalf of the professional investors Olav W. Hansen A/S and Sparekassen Danmark. Notwithstanding the limited market liquidity for the company's (a small listed real estate company) shares, the two shareholders have acquired a minimum of 16.05% and 12.77% of the company's shares, respectively, cf. page 58 of the annual report for 2024.

Question 1:

If the questions put to the company's auditor have not been answered exhaustively, the company's board of directors is requested to answer the questions or elaborate on the answers.

Answer:

See the answers from the Board above.

Question 2:

In 2024, the company had a loss of EUR 487 thousand. In 2023, the company had a loss of EUR 3,501 thousand, which can largely be attributed to an impairment of the value of the company's properties. The Company has revenues of EUR 4,698 thousand and three significant cost items; (i) Property operating expenses of t.EUR 1,423, (ii) salary and administrative expenses of t.EUR 1,427 and (iii) interest expenses of t.EUR 1,917. The Board of Directors is requested to state whether the Board of Directors finds this result satisfactory. On page 33 of the Annual Report, it is stated that the Board of Directors expects a profit of EUR 0.3-0.7 million in 2025. The Board of Directors is requested to explain how this amount is derived, including how each of the three cost items listed above is expected to develop.

Answer:

Taking into account the macroeconomic conditions in Germany in 2024, the Board of Directors considers the results for 2024 to be satisfactory.

The expected result for 2025 before value adjustment of the properties, which is stated in the range EUR 0.3 – 0.7 million, cf. stock exchange announcement number 270. The value adjustment of the properties is expected to be EUR 2.6 million, cf. stock exchange announcement 275.

Question 3:

The Board of Directors is requested to state whether, in the opinion of the Board of Directors, it will be possible to pay dividends within the next 3-5 years?

Answer:

In view of the current global macroeconomic conditions, the Board of Directors is unable to comment on the possibility of paying dividends in the next 3-5 years.

Question 4:

The Board of Directors is requested to describe the terms of the management agreement with Kartago A/S. In this connection, the Board of Directors is requested to explain whether, and if so, how the existing management agreement differs from the original management agreement entered into in connection with the listing of the company. In particular, it is requested to be informed whether there are any changes to the services and, if so, which ones.

Answer:

No management agreement has been entered into with Kartago A/S. A company administration agreement has been entered into with Administrationsselskabet Gambit ApS. The current management agreement differs from the management agreement printed in the 2007 prospectus in that the quarterly fee in the current agreement amounts to 0.16% instead of the original 0.1% quarterly. The increase has occurred as a result of, among other things, the development of inflation.

The increased fee has been mentioned in all annual reports since 2012. The original agreement on company administration expired in 2012, when adaptation first took place. The agreements have been renewed over the course and adapted to changing market conditions. The company's management has had to adapt the administrative basis to the ever-increasing requirements.

The fee to the company administrator has been mentioned in all the annual reports since 2008 and no shareholders have previously questioned the size of the fee.

In the opinion of the Board of Directors, the agreements are market compliant. The Company has compared the administrative costs with the costs of another and comparable listed real estate company – EgnsInvest Ejendomme Tyskland A/S, which was established in 2008 and listed on FirstNorth Nasdaq Copenhagen.

EgnsInvest has invested almost exclusively in residential properties in Berlin. The investment is comparable to the Company's investment. However, EgnsInvest's properties are more homogeneous, as they are almost all residential properties, and the properties are also gathered in Berlin and not like the Company's retail properties located scattered in Germany. Therefore, EgnsInvest's properties have been simpler to manage.

According to the information previously stated, the questioners are shareholders in EgnsInvest. Sparekassen Danmark is a major shareholder. Sparekassen Danmark controls de facto EgnsInvest or can exercise significant influence on EgnsInvest through the companies EgnsInvest Holding A/S and EgnsInvest Management A/S.

The management company in Denmark is EgnsInvest Management A/S, which is 100% owned by EgnsInvest Holding A/S. CEO of Sparekassen Danmark, Vagn Hansen, is Chairman of the Board of Directors of both EgnsInvest Holding A/S and EgnsInvest Management A/S.

In the period 2014 to 2024, the Company's administrative expenses are included in the income statement, i.e. ongoing administration fees, executive fees, board fees, etc. amounted to. DKK 71 million. In the same period, the corresponding administrative expenses in EgnsInvest amounted to DKK 141 million. If the Company's portfolio size is used as a measurement basis, EgnsInvest's total fee would have been DKK 90 million. or approx. 27% higher than the Company's.

In addition to the company administrative work, the company administrator has had to participate significantly in the property administration work since the financial crisis. Even though the management agreement provides for separate invoicing for this, cf. section 6 of the management agreement printed in the prospectus, the company administrator has not invoiced separately for this until 2024, despite the fact that the annual number of hours for performing this work has been considerable.

The administrator will in future invoice separately for work tasks, including property management, which are not covered by the company administrative tasks described in the management agreement.

Question 5:

The Board of Directors is requested to state whether, in the opinion of the Board of Directors, it is possible to have the Company, and the underlying companies, administered more cheaply by an independent third party.

Answer:

The Board of Directors continuously assesses whether the Company's administrative structure is appropriate and optimal.  It is the opinion of the Board of Directors that a third party would not be able to professionally manage the company more cheaply

Question 6:

The company's board of directors has stated that the original management agreement provided for an annual increase in the management fee. It has not been possible to identify this premise when reviewing the agreement, and the Board of Directors is requested to appoint where this premise is reflected in the original management agreement.

Answer:

It appears from the budgets of the prospectus, cf. pages 81-96, that an annual increase in property value of 4% has been assumed, and thus indirectly a corresponding increase for the fee for company administration.

Question 7:

The Board of Directors is requested to state whether, in the opinion of the Board of Directors, it will be possible to achieve other significant reductions in the Company's costs.

Answer:

The management is constantly trying to optimize operations, including reducing property-specific costs.

Following a tender round, the Company has proposed to change its auditor so that an annual saving in administrative expenses can be expected. The Company also hopes to be able to achieve savings in the costs of legal assistance, because the lengthy legal proceedings against AppelrathCüpper GmbH have now ended with an agreement to extend the lease until 31 January 2028.

On the other hand, in 2025 there will be increased expenses for legal assistance because of the questions now and previously asked by shareholders. It is estimated that these costs will amount to EUR 100,000 for the time being.

Question 8:

The Board of Directors is requested to explain how the Group's costs are distributed between costs directly related to the individual properties and costs related to the administration of the companies in the Group, including costs resulting from the company being listed on the stock exchange.

Answer:

The Group's costs in 2024 totaled tEUR 2,850. Of this,  tEUR 1,423 is directly related to the properties, tEUR 490 (after deduction of salary expenses tEUR 57,000) are expenses for company administration and expenses for maintaining the IPO amounted to tEUR 63,000. In addition, expenses have included: Auditor tEUR 102,000, salaries tEUR 317,000, (including DKK 57,0000 which has been deducted from the administration fee), board fees tEUR 170,000 and lawyers' fees tEUR 94,000.

Question 9:

The Board of Directors is requested to disclose the extent of trading in the Company's shares over the past 12 months. The Board of Directors is also requested to state whether there has been communication with the stock exchange due to a lack of turnover in the share and, if so, to explain this communication. The Board of Directors is requested to state whether, in view of the specific (lacking) trading in the company's shares, the Board of Directors has considered seeking delisting of the company.

Answer:

In the period 1 April 2024 to 31 March 2025, there have been 372 transactions.

During the period, there has been no communication with the stock exchange about turnover.

Based on the past 12 months' transactions, the Board of Directors has not considered seeking delisting of the company.

Question 10:

The Board of Directors is requested to explain how the Company's shareholders – in the opinion of the Board of Directors – will be financially positioned in (i) a scenario where operations are continued on unchanged terms, and (ii) a scenario where the Company's properties are sold and the net proceeds from this (after repayment of the Company's bank debt) are distributed to the Company's shareholders.

Answer:

If global macroeconomic conditions normalize, the Board of Directors expects operating profit to improve over the coming years.

The Board of Directors considers ongoing sales opportunities with subsequent reduction of bank debt, payment of dividends or new investments.

Question 11:

The Board of Directors is requested to account for the size and composition of the administrative costs of the company that was selected to purchase one of the company's German properties in 2024.

Answer:

The question is irrelevant since the project sale was not carried out.

Question 12:

The Board of Directors is requested to provide an account of the company's loan conditions, including whether the company has sought to obtain the best possible terms in connection with the latest loan restructuring through negotiations with several banks and/or mortgage credit institutions.

Answer:

The Company's loan conditions are listed on pages 49 and 50 as well on pages 103, 105-106 of the Annual Report.

Mortgage banks only finance residential properties abroad.

The Board of Directors has long-standing knowledge of the financing of commercial properties in Germany, and it is not the opinion of the Board of Directors that the overall loan conditions could be improved by switching to other banks.

Question 13:

The Board of Directors is requested to state whether the Board of Directors finds that the terms of the company's bank financing are considered satisfactory or whether the Board of Directors considers that there is an opportunity to improve the terms.

Answer:

It is the assessment of the Board of Directors that the current loan terms cannot be improved in the current loan market.

Question 14:

The Board of Directors is requested to explain in detail the reasons for the difference between the value received by the company for the shares in GHSP Botkyrka Fastigheder (DKK 42,196,000) and the input value in the financial statements of Kartago Capital Stockholm A/S (DKK 48,945,884).

Answer:

In Kartago Capital – Stockholm A/S, acquisition costs have been capitalized, including provider fees, marketing expenses, non-deductible VAT, legal expenses, technical due diligence expenses, etc., totaling SEK 9,795 million. These expenses have been converted to DKK at an average exchange rate of 67.9.

Question 15:

What was the annual rental income for the property owned by GHSP Botkyrka Fastigheder in the year prior to the sale, and what costs were directly related to the operation of the property?

Answer:

According to the Swedish accounts, the total income in 2022 was SEK 6,927,027 and the total expenses, excl. depreciation, were SEK 1,051,815 or a profit before financing and depreciation of SEK 5,875,212. Interest expenses were SEK 1,649,956 and thus profit before depreciation was SEK 4,225,256.

Question 16:

The Board of Directors is requested to state whether in connection with the sale of the property Hesselvang 11, Grenå it was investigated whether there were other possible buyers for the property and, if so, at what price the property could be sold. The Board of Directors is also requested to state whether, and if so, how much, the return on the property Hesselvang 11, Grenå exceeded the average rate of return on the company's other properties. It is also requested to know whether the interest on the property exceeded the interest on the bank debt that the proceeds from the property were used to repay. The Board of Directors is requested to state the amount of annual remuneration that Kartago A/S receives in accordance with the company and property management agreement entered into with the purchaser of the property.

Answer:

From the time of purchase to the time of sale, the interest rate increased by approximately 2.5%. A buyer in the market would therefore have bid a price at the time of sale for the property that would have been lower than the price at which the company acquired the property. Instead, the property was sold as a project sale, that among other things included a total financing of the property, for DKK 40 million and with a total gain of DKK 2,175,000 before tax.

Questions 2 and 3 are, in the opinion of the Board of Directors, irrelevant.

Kartago Capital A/S and not Kartago A/S, as incorrectly stated, receives an annual management fee of 0.5% from Kartago Capital – Grenaa Retail II A/S. Kartago Capital A/S's share in Kartago Capital – Grenaa Retail II A/S is 6.25%.

At the end of 2023, the Company's DSCR statement was in conflict with the terms of the Company's loan agreement. The Company's DSCR was calculated at 1.01 and had to be at least 1.15 in order to comply with the covenant provisions of the loan agreement. Without the sale of the property in Grenaa, the Company's DSCR would have been 0.95 and therefore the breach of covenant correspondingly greater. As a result of, among other things, the sale of the property in Grenaa and the loan restructuring, the company's DSCR is now approx. 1.75.

If the company had kept the property in Grenå, the capital increase in 2024 would have been approx.  EUR 3 million more.

The Company has exercised due diligence.

Question 17:

The company's board of directors is requested to state whether the company's properties, in the opinion of the board of directors, can be sold at the value at which the properties are recorded in the company's accounts.

Answer:

Under the current global economic markets, investors will be very cautious, and this will affect selling prices, cf. stock exchange announcement no. 275

Question 18:

The Management Board is requested to report on the assessment of the independence of the members of the Management Board. The Recommendations on Corporate Governance state that a board member is not independent if the board member represents or is associated with a controlling shareholder. The fact that a director is elected with the votes of a controlling shareholder does not in itself mean that the director is dependent. However, all the directors of the company are appointed by the controlling shareholder. It is requested to know whether the Board of Directors nevertheless considers the Board members to be independent.

Answer:

In all principal shareholder companies, the Board members are de facto appointed, inter alia, by the principal shareholder. The information provided in the annual report on independence is, in the opinion of the Board of Directors, correct:

Mr. Zethraeus is independent. Ms. Steinert and Mr. Thygesen are not independent.

Question 19:

What remuneration (in relevant financial years) has Jutta Steinert received as an employee of GHSP Erste Holding GmbH.

Answer:

The management does not disclose the individual employee's salary. However, reference is also made to the answer to question 8 above.

Question 20:

Does Ms Steinert have relationships other than her employment with GHSP Erste Holding GmbH that indicate that Ms Steinert could not be regarded as independent?

Answer:

With her educational background, her long-term employment with Deutsche Bank and her in-depth knowledge of the German real estate market, Mrs. Steinert is highly qualified as a member of the Board of Directors. If she were still elected to the board of directors and was not employed by a German subsidiary of the Company, she would be independent.