Proguns Group S.A..

Regulatory Filings • Jan 16, 2026

Report Content With reference to current report ESPI No. 25/2025 dated 21 October 2025,the Management Board of Proguns Group S.A., with its registered officein Warsaw (the "Issuer"), announces that on 16 January 2026 the Issuerentered into an investment agreement (the "Agreement") with Forum 119Closed-End Investment Fund - an entity from the Fidera Group (the"Investor"), Niewiadów Polska Grupa Militarna S.A. ("NPGM"), ZakładySprzętu Precyzyjnego Niewiadów sp. z o.o. ("ZSP"), and Fabryka AmunicjiPocisk S.A. ("FAP").

The Agreement sets out the key assumptions of theInvestor's planned investment, with a value of PLN 60 million, aimed atfinancing the launch in Poland of a factory producing medium-calibre 40mm ammunition (the "Project").

The Project will be implemented in cooperation withST Engineering Advanced Material Engineering Pte. Ltd., with itsregistered office in Singapore ("ST Engineering").

The Issuer, FAP, and ZSP will enter into a jointventure agreement defining the rules of cooperation in theimplementation of the Project.

Pursuant to the provisions of the Agreement, theInvestor subscribed for 4,519,167 bearer shares of the Issuer inexchange for a cash contribution of PLN 20,019,909.81, i.e. PLN 4.43 pereach individual new share.

Investment in FAP:

The Issuer will subscribe for 313,000 bearer sharesof FAP in exchange for a cash contribution of PLN 19,002,230.00,obtaining in total an interest of approximately 49% in the share capitalof FAP.

The Investor will provide project financing in theamount of PLN 40 million, which will be implemented through theInvestor's subscription for participating bonds of FAP. Thesebonds will entitle the Investor to participate in from 50% to 20% ofFAP's profits. The proceeds from the issuance will be used in full tofinalize the construction of the factory producing medium-calibreammunition.

ZSP will hold shares in FAP representing in total 51.03% of FAP's sharecapital, while the Issuer will hold shares in FAP representing in total48.97% of FAP's share capital.

NPGM will indirectly hold voting rights in FAP representingapproximately 79% of FAP's share capital.

Moreover, pursuant to the provisions of the Agreement:

Proportionally to the financing provided through the participatingbonds, the Investor will obtain the right to subscribe for 2,259,583Series D subscription warrants of the Issuer, entitling the holder tosubscribe for the Issuer's Series H bearer shares at an issue price ofPLN 1 per each individual share.

In particular, ZSP will undertake actions to transfer to FAP all rightsand obligations arising from the ST Engineering agreement.

The parties have undertaken to use the funds received from the Investorfor the purpose of implementing the Project.

The Investment Agreement contains provisions establishing security infavour of the Investor, which do not materially differ from the termscommonly applied in the capital market to secure investments of thistype.

The Issuer explains that the conclusion of the Agreement resulted fromthe implementation of the provisions of the term sheet entered into bythe Investor, the Issuer, ZSP, and NPGM, which the Issuer reported incurrent report ESPI No. 25/2025 dated 21 October 2025.

The Issuer indicates that the conclusion of the Agreement constitutesanother step in the implementation of the Issuer's strategy, whichassumes the development of competencies in the defence technology market.

According to data from the European Defence Agency and the NATOIndustrial Advisory Group report (2024), the European 40 mm ammunitionmarket exceeds EUR 2 billion annually, with growing demand from thearmed forces of NATO member states and industrial partners in theCentral and Eastern European region.

The Issuer considers the above information to be material due to itssignificance for the Issuer's development and its potential impact onthe Issuer's results. In the opinion of the Issuer's Management Board,the conclusion and implementation of the Agreement will affect theIssuer's development and contribute to a significant improvement in itsfinancial results.