Board of Directors’ Report on Convertible Bonds. (11. Informe CdA obligaciones convertibles ENTR 0)

FOR INFORMATIONAL PURPOSES ONLY. SPANISH VERSION PREVAILS.

1. Purpose of the report

   This report was drawn up by the Board of Directors of Colonial SFL, SOCIMI S.A. (the "Company") regarding authorisation for the Board to issue bonds that can be converted into new Company shares or other similar securities that may directly or indirectly confer the right to subscribe for Company shares, with the express option to disapply shareholders' preemptive rights, and to increase the share capital as required for the conversion, to be submitted to the General Meeting of Shareholders for its approval.

   Pursuant to Articles 286, 297.1.b), 417 and 511 of the Spanish Limited Liability Companies Law, passed by Royal Legislative Decree 1/2010 of 2 July (the "Spanish Limited Liability Companies Law"), and to the Commercial Registry Regulations approved by Royal Decree 1784/1996 of 19 July, the motion for approval by the General Meeting requires the Board of Directors to prepare this supporting report.

2. Justification for the motion

The Board of Directors deems it very advisable to have the delegated powers envisaged in the current regulations to enable it to raise the funds required to duly manage the Company's interests on primary securities markets at all times.

Given current market circumstances, the Board of Directors feels that it is in the Company's interest to ensure the greatest possible flexibility when accessing financial resources, be these its own or third-party resources. The issue of bonds that can be converted into shares is a financing instrument that involves raising third-party funds. As a result of their convertible nature, the coupon is usually lower than the cost of simple fixed-income securities and bank debt, as the value of the option to convert the securities into Company shares is reflected in their interest rate.

The resolution to delegate to the Board of Directors the authority to issue convertible bonds, as well as warrants and other similar securities, distinguishes convertible bonds, which are specifically regulated by the Spanish Limited Liability Companies Law, from warrants or any other similar securities that may directly or indirectly bestow a right to subscribe for Company shares. This distinction covers any possible differing interpretations stemming from the fact that said securities are not subject to specific regulation under the aforesaid Spanish Limited Liability Companies Law. The resolution places the Board of Directors under an obligation to ensure in the issue of such securities strict compliance with the applicable regulations governing the issue of convertible securities specifically regulated in the Spanish Limited Liability Companies Law that are applicable to them due to their nature, ensuring that the lack of specific regulations is not interpreted as meaning that it is not necessary to comply with the requirements set forth in the aforementioned law for convertible bonds where these apply to warrants due to their nature. In practice, the conditions

stipulated in the aforementioned resolution of the Board of Directors bestow upon all securities the right to subscribe to Company shares.

The proposal also sets forth the criteria that determine the basis and procedures for conversion of the securities into shares, delegating to the Board of Directors responsibility for establishing said basis and procedures for each specific issue within the limits and pursuant to the criteria established by the shareholders in a General Meeting. It will therefore be the Board of Directors that decides, for example without limitation, about the possibility of redemption in cash, whether the conversion is compulsory or voluntary or even contingent or, where applicable, based on objective criteria; and, if the conversion is voluntary, whether it is to be at the option of the holder or the issuer and who is to determine the conversion ratio of the shares issued for the conversion. This may be fixed or variable, with shares valued in accordance with any procedures that the Board of Directors may deem most advisable in accordance with the motion. The Board may also decide on interest rates and the dates and procedures for coupon payments, including the option of variable compensation based on the performance of the Company's share price.

Warrants and other similar securities that may directly or indirectly confer the right to subscribe for Company shares shall be governed by the rules on convertible bonds set forth in the motion if such rules are compatible with their nature.

By ensuring that the Board of Directors enjoys the flexibility permitted by law, the Company has a swift and effective credit mechanism in place to strengthen its balance sheet, bolster its financial structure and even undertake investment and growth initiatives that may be in the strategic interest of the Company.

This delegation would give the Board the leeway and responsiveness it requires for the Company to operate within a competitive environment in which the success of a strategy or financial transaction frequently depends on the ability to act swiftly, avoiding the delays and costs that inevitably result from calling and holding a General Meeting of Shareholders. The Board of Directors shall thus be empowered, where necessary, to amass a significant amount of resources in a short period of time.

The issue of bonds that can be converted into new Company shares or similar securities that may give a direct or indirect right to subscribe to such shares also offers the advantage that investment in the Company can be converted into shares, offering a return that is potentially higher than that offered by other debt instruments while allowing the company to increase its own resources. These characteristics mean that the coupon for these securities is usually lower than the cost of simple fixed-income securities and bank debt, as the value of the option given to investors to convert the securities into Company shares is reflected in their interest rate.

For this reason, the Board of Directors considers it necessary to request from the General Meeting of Shareholders a five-year authorisation to issue, on one or more occasions, bonds that can be converted into new Company shares or other similar securities for a maximum amount according to which the nominal amount of the capital increases carried out under the authorisation, added to any increases agreed under the authorisation to increase the share capital through monetary contributions approved by the General Meeting of Shareholders at any given time, is no more than half the share capital on the date of the authorisation (i.e. a par value of €784,180,858.75 euros).

The proposed resolution also envisages an authorisation for the Board of Directors to approve a capital increase as necessary to cover the conversion, for a nominal amount not exceeding half the share capital on the date of the authorisation (i.e. a par value of €784,180,858.75), as provided in

Article 297.1.b) of the Spanish Limited Liability Companies Law, or 20% of the share capital at the time of the authorisation (i.e. a par value of €313,672,343.50), as provided in Article 506 of the same law.

Therefore, for the reasons outlined above and pursuant to the provisions of Article 319 of the Commercial Registry Regulations and Articles 417 and 511 of the Spanish Limited Liability Companies Law and the general regulations governing the issue of bonds, in application by analogy of the provisions of Article 297.1 (b) of the Spanish Limited Liability Companies Law, the corresponding motion is hereby submitted to the General Meeting for its approval.

Furthermore, and as permitted by Article 511 of the Spanish Limited Liability Companies Law in the case of listed companies, when the General Meeting delegates to the directors the power to issue convertible bonds, the directors may also be empowered to disapply shareholders' preemptive rights for issues of convertible bonds made under this delegation where this is in the Company's interest. However, for such purposes, the proposal to disapply shareholders' preemptive rights must be expressly stated on the notice of the General Meeting, and shareholders must be given access to a report prepared by the directors justifying the proposal.

It is also hereby stated that the delegation of powers to the Board of Directors to issue convertible securities contained in the motion this report refers to also includes, as provided for in Article 511 of the Spanish Limited Liability Companies Law, the power of company directors to disapply shareholders' preemptive rights when the interests of the Company so require it. In such case, the Company will only issue convertible securities when the capital increase needed for their conversion, added to the increases with the disapplication of the preemptive right that may have been agreed under other authorisations given by the General Meeting, does not exceed 20% of the total share capital, all this in accordance with the terms of the Spanish Limited Liability Companies Law.

The Board of Directors is of the view that this further option, which significantly extends the Company's leeway and responsiveness made possible by the delegation of the authority to issue convertible securities, is justified by the flexibility and swiftness that are sometimes needed when acting on financial markets in order to be able to seize the moment when market conditions are most favourable.

In any event, it is hereby stated that the power to disapply shareholders' preemptive rights is merely an authority that the General Meeting of Shareholders delegate to the Board of Directors, only to be exercised by the Board if it decides to do so, based on the circumstances prevailing in each case and in accordance with all legal requirements. If, pursuant to such powers, the Board of Directors decides to disapply shareholders' preemptive rights in relation to a specific issue that the Board of Directors decides to carry out under the authorisation granted by the General Meeting of Shareholders, the Board of Directors shall issue, at the time of the issue resolution, a report setting out the specific reasons why this is in the Company's interest. Said report shall be accompanied, where required under applicable law, by a report from an independent expert other than the statutory auditor. The report of the Board of Directors shall be made available to shareholders and communicated to the first General Meeting to be held after the relevant issue resolution, together with the independent expert's report that drawn up, if applicable, in accordance with the above-mentioned provisions.

* * * *

This report was prepared and approved by the Board of Directors at its meeting of 14 May 2026.