BR Properties S A : Material Fact - Capital Reduction and FII

BR PROPERTIES S.A.

CNPJ 06.977.751/0001-49

NIRE 35.300.316.592

Publicly held company

MATERIAL FACT

BR PROPERTIES S.A. ("Company") (BRPR3), pursuant to CVM Resolution 44/2021, informs that the Company's Board of Directors approved the convening of an extraordinary general shareholders' meeting to be held on January 24, 2023, 10:00 am, at the Company's headquarters ("EGM"), to resolve on (i) the reduction of the Company's corporate capital in the total amount of BRL 2,510,809,856.20, for considering it excessive, without canceling any shares issued by the Company, which will result in a refund to shareholders of (a) a total amount in cash of BRL 1,276,000,000.00 and (b) an amount in kind to be paid through the delivery of quotas of real estate investment fund BRPR Corporate Offices Fundo de Investimento Imobiliário (CNPJ/ME 48.978.859/0001-04) ("FII"), in the total amount of BRL1,234,809,856.20, pursuant to the terms of management proposal ("2023 Capital Reduction"); and (ii) the reverse stock split (grupamento) of all the shares issued by the Company at the ratio of 40 shares to one ("Reverse Stock Split"), among other matters.

After the sales of real estate properties as disclosed in the material facts of May 18, 2022 and July 20 and 22, 2022 ("Transaction"), which were followed by the amortization of the Company's then existing debt and by the capital reduction in the amount of BRL 1,125,000,000.00, as disclosed in the material facts dated July 6 and 29, 2022 and September 12, 2022, the Company began to evaluate the best use of the proceeds from the second installment of the price of the real estate properties sold in the Transactions, as well as the use of its remaining portfolio of commercial towers.

Considering that the local and foreign macroeconomic conditions remain challenging and that the Company does not foresee new investments in the short term that can generate attractive returns, the Company decided to propose the 2023 Capital Reduction to its shareholders, so that they can better monetize their invested capital, both in relation to the liquidity to be generated by the second installment of the Transactions due in July 2023 and to Company's the remaining commercial towers portfolio.

On the date hereof, and in order to enable the payment of the cash portion of the 2023 Capital Reduction, the Company entered into a Term of Commitment for Structuring Private Issues of Securities ("Term of Commitment") with Banco BTG Pactual S/A ("BTG"), through which BTG granted a financing line to the Company in the amount of R$ 1,330,000,000.00 for the anticipation of part of the installment due in July 2023 related to the Operations, with the objective of allowing the Company to use the proceeds from such anticipation in the 2023 Capital Reduction. The financing line has the following conditions: (a) transaction costs anticipated by BTG: CDI + 1.65% p.a.; (b) reserve fee: 0.50% p.a.; (c) structuring fee (0.65% of the committed amount).

Regarding the in-kind portion of the 2023 Capital Reduction, the Company structured the FII with the purpose of transferring the properties in its remaining office towers portfolio to such fund and delivering the respective FII quotas to the Company's shareholders. The FII quotas will be listed for trading on the secondary market on B3 and once admitted to trading, will be traded under the ticker BROF11.

If the 2023 Capital Reduction and the Reverse Stock Split are approved, the Company's shareholders will receive FII quotas at the rate of one share for each share held by them. Such 1:1

ratio already considers that the Reverse Stock Split to be resolved at the EGM will have been completed before the 2023 Capital Reduction becomes effective and the FII quotas are delivered.

The capital reduction, if approved, will become effective 60 days after the publication of the minutes of the EGM, pursuant to the article 174 of Law 6,404, when the Company will disclose to its shareholders the procedures, the final amount per share to be refunded, the date of payment and the initial date of negotiation of the Company's shares ex-reduction.

The proposed Reverse Stock Split aims to reduce the volatility of shares issued by the Company and provide a better level for the Company's share quotes considering the 2023 Capital Reduction. Once the Reverse Stock Split is approved, the shareholders will be granted a 30-day period for the free adjustment of positions, and any fractions of shares will be grouped and sold in an auction to be held at B3, and the proceeds from the sale will be allocated to the holders of the fractions. The Reverse Stock Split will be completed before the expiration of the 60-day period for opposition of creditors in relation to the 2023 Capital Reduction and capital restitution will be delivered to the shareholders considering their shareholding position after the Reverse Stock Split.

All information about the 2023 Capital Reduction, including the approval procedures by the EGM, as well as addition information about the FII, including its prospectus and also about the Reverse Stock Split, are described in the management proposal disclosed by the Company on this date.

The Board of Directors also approved the cancellation of 9,727,208 Company treasury shares.

The Company will keep shareholders and the market informed about the EGM, the 2023 Capital Reduction and the Reverse Stock Split.

São Paulo, January 3, 2023.

André Bergstein

Financial and Investor Relations Officer

BR PROPERTIES S.A.