Acquisition and Proposed Fundraising

RNS Number : 3582P

Diversified Energy Company PLC

08 February 2023

 

THIS ANNOUNCEMENT (INCLUDING APPENDIX 1) AND THE INFORMATION CONTAINED HEREIN ARE RESTRICTED, FOR INFORMATION PURPOSES ONLY AND ARE NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, AND DO NOT CONSTITUTE AN OFFER OF SECURITIES FOR SALE IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, SOUTH AFRICA, JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION, RELEASE, DISTRIBUTION, OFFER OR SALE WOULD BE UNLAWFUL. PLEASE SEE THE IMPORTANT NOTICES AT THE END OF THIS ANNOUNCEMENT.

FURTHER, THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS NOT AN OFFER OF SECURITIES IN ANY JURISDICTION.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE UK VERSION OF REGULATION (EU) NO. 596/2014 ON MARKET ABUSE ("UK MAR"), AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018.

8 February 2023

DIVERSIFIED ENERGY COMPANY PLC

("Diversified", "Diversified Energy" or the "Company")

Acquisition and Proposed Fundraising

DIVERSIFIED ENERGY COMPANY PLC (LSE: DEC), announces that it has entered into a purchase agreement to acquire certain upstream assets and related infrastructure in its Central Region from Tanos Energy Holdings II LLC ("Tanos", and such acquisition, the "Acquisition").

The Company further announces its intention to carry out a fundraise (the "Proposed Fundraising") for approximately US$160 million. The Proposed Fundraising will comprise a non-pre-emptive placing of new ordinary shares of £0.01 each in the Company (the "Placing Shares") at the Placing Price (as defined below) (the "Placing") and an offer made by the Company on the REX Platform of new ordinary shares of £0.01 each in the Company (the "Retail Offer Shares", together with the Placing Shares the "Fundraising  Shares") at the Placing Price (the "Retail Offer") to provide existing retail shareholders with an opportunity to participate. The Company will make a separate announcement regarding the Retail Offer and its terms. The Company will announce the number of Placing Shares and Retail Offer Shares, and the Placing Price, at the close of the bookbuilding process.

Subject to closing of the Acquisition, the Company will use the net proceeds from the Proposed Fundraising to partially fund the Acquisition and will fund the remaining Acquisition consideration from its existing revolving credit facility ( " Sustainability Linked Loan " or " SLL " ). The Proposed Fundraising is not conditional on the completion of the Acquisition. Should the Company complete the Proposed Fundraising, but not complete the Acquisition, the Company will determine the most appropriate use of the net proceeds, including potentially investing in other acquisition opportunities aligned with its stated strategy.

Acquisition Highlights

· Purchase price of US$250 million¹, with an effective date of 1 February 2023;

o  Purchase price represents a ~2.3x multiple² on ~US$107 million of estimated Next Twelve Months ( " NTM " ) EBITDA³  before potential synergies;

· Current net production of ~17 Mboepd (101 MMcfepd) (76% natural gas), representing a ~12% increase vs. the Company's December 2022 exit rate net production⁴;

· PDP Reserves of ~25 MMboe (152 Bcfe) with management estimated pre-tax PV10 of ~US$312 million⁵;

· The Acquisition offers substantial potential upside from ~50 undeveloped locations with a management estimated PV10 of ~US$280 million⁶;

o  Could be realized through monetization or opportunistic development with a financial partner;

o  The Acquisition includes 4 wells that are partially developed, and ~US$25 million of anticipated capital expenditure required in 2023 to finish development of these wells;

· Production benefits from premium regional price linkage to Gulf Coast and the strategically important and growing LNG markets;

· The Acquisition includes a hedge book over ~60% of 2023 production at an average floor price of ~US$3.80, above the level of the wider DEC portfolio of ~US$3.65⁷, reducing cash flow volatility;

· Acquisition assets are adjacent to existing Central Region assets, adding scale and providing opportunities to realise additional synergies;

· Acquisition provides immediate financial benefits, with Free Cash Flow and Adjusted EBITDA increasing by 20% and 19%, respectively, on a Trailing Twelve Month ("TTM") basis to 30 June 2022⁸, and 16% accretion on a price per flowing Mcfe basis⁹;

· Acquisition funded through an approximately US$160 million equity fundraise and a US$90 million draw-down on the Company's existing SLL; and

· The Acquisition is conditional and remains subject to, among other things, further diligence with no certainty that the Company will complete the Acquisition.

Proposed Fundraising Highlights

· The Proposed Fundraising will consist of the Placing and Retail Offer for proceeds of approximately US$160 million;

· The Placing will be conducted through an accelerated bookbuild process (the " Bookbuild " ), which will launch immediately following the release of this announcement. The Placing is subject to the terms and conditions set out in Appendix 1 to this announcement (which forms part of this announcement (this announcement including  Appendix 1, the " Announcement " ));

· Stifel Nicolaus Europe Limited, Tennyson Securities, a trading name of Shard Capital Partners LLP ( " Tennyson Securities " ), and Peel Hunt LLP (together, the "Joint Global Coordinators") are acting as joint global coordinators and bookrunners in connection with the Placing;

· T he number of Fundraising Shares and the price at which the Fundraising Shares are to be placed (the "Placing Price") will be determined by the Company following completion of the Bookbuild in consultation with the Joint Global Coordinators;

· The Company expects to close the Bookbuild no later than 8.00 a.m. on 9 February 2023, but the Joint Global Coordinators and the Company reserve the right to close the Bookbuild earlier or later, without further notice. Details of the Placing Price and the number of Fundraising Shares will be announced as soon as practicable after the close of the Bookbuild ;

· Concurrently with the Placing, the Company intends to provide existing retail shareholders with an opportunity to participate in the Proposed Fundraising. The Retail Offer is not made subject to the terms and conditions set out in Appendix 1 to this Announcement and instead will be made on the terms outlined in the separate announcement to be made shortly regarding the Retail Offer and its terms ;

· Following the Acquisition, the Proposed Fundraising and drawdown on its SLL, the Company estimates it will have a 2022 Year-End Pro Forma Net Debt to Adjusted EBITDA multiple of 2.1x¹⁰;

· Shares issued pursuant to the Proposed Fundraising will be eligible for the Q3 2022 dividend of 4.375 cents per share, as well as all future dividends. The ex-dividend date of the Q3 2022 dividend is 2 March 2023 and the Q3 2022 Dividend is expected to be paid on 28 March 2023;

· It is expected that the Fundraising Shares will be settled in two tranches. The first tranche of Fundraising Shares (the "Firm Shares") will be issued under the Company's existing shareholder authorities (representing approximately 9.99% of the Company's existing share capital) and is expected to settle on 14 February 2023. The issue of the second tranche of Fundraising Shares (the "Conditional Shares"), comprising Fundraising Shares in excess of the Company's existing shareholder authorities, will be conditional on shareholder approval at a General Meeting. Therefore, subject to the results of the Proposed Fundraising, the Company intends to convene a shareholder meeting, expected to be held on or around 27 February 2023, to approve the allotment of the Conditional Shares on a non-pre-emptive basis. Diversified will publish a Notice of General Meeting setting out the shareholder resolutions requiring approval, and the Board's recommended support for it, in due course; and

· The Firm Shares will not require or be conditional upon further shareholder approval. The issue and allotment of the Conditional Shares will however be conditional upon such shareholder approval. Furthermore, completion of the issue and allotment of the Firm Shares is not conditional on the issue and allotment of the Conditional Shares and therefore the Firm Shares may be issued and allotted even where the Conditional Shares are not, whether by reason of a failure to obtain shareholder approval for the issue and allotment of the Conditional Shares on a non-pre-emptive basis or otherwise.

Recognising the significance of the Proposed Fundraising, aimed at advancing Diversified's consistent and well-articulated strategy, the Company has consulted with and received strong support from many of its largest shareholders. Consistent with each of its prior placings, the Company will respect the principles of pre-emption, so far as is possible, through the allocation process, both in the Placing and Retail Offer. The Company's management team will actively participate in the structuring and allocation of the Proposed Fundraising. Given the expected share-level earnings and cash-flow accretion of the Acquisition funded with proceeds from the Proposed Fundraising, and given the importance of leveraging a key competitive advantage over other potential buyers of the target assets by being able to raise capital quickly in the London market, the Company believes the structure of the Proposed Fundraising is aligned with shareholder and other stakeholder interests. The Proposed Fundraising structure has allowed Diversified to secure the Acquisition, reducing both the complexity and time required to raise the capital necessary to acquire long-life, low-decline and highly cash generative assets. The issue of the Conditional Shares in excess of the Company's existing shareholder authorities will be conditional on approval by the Shareholders of the allotment of the Conditional Shares on a non-pre-emptive basis.

Commenting on the Acquisition and Proposed Fundraising, CEO Rusty Hutson said:

"Today's announcement marks an exciting start to the year with an accretive acquisition contiguous to our existing Central Region assets. This transaction will drive additional synergies of scale and reduce the combined assets' unit-level expenses to increase already high margins. Accordingly, this acquisition will nicely align with our emphasis on generating free cash flow while increasing our exposure to the premium Gulf Coast market, providing access to the higher realized pricing, lower regional differentials, and the long-term demand pull from the growth in LNG markets.

With an attractive purchase price of 2.3 times the next 12 months EBITDA for the period ended 31 January 2024 equating to an equivalent PV-17 PDP value, these assets will be accretive to adjusted EBITDA and Free Cash Flow representing long-term value for our shareholders. These will be further enhanced by including incremental upside from the 50 undeveloped resource locations. With today's successful fund raise, we reduce our leverage to just 2.1 times Net Debt-to-Adjusted EBITDA, positioning us with a strong balance sheet in an acquisition-rich pricing environment."

Diversified Energy Company PLC Doug Kris, Vice President, Investor Relations https://www.div.energy/	+ 1 [phone]
Stifel Nicolaus Europe Limited (Joint Global Coordinator, Joint Broker) Callum Stewart Jason Grossman Simon Mensley Ashton Clanfield	[phone]
Tennyson Securities (Joint Global Coordinator, Joint Broker) Peter Krens Edward Haig-Thomas	[phone]
Peel Hunt LLP (Joint Global Coordinator, Joint Broker) Richard Crichton David McKeown Georgia Langoulant Sohail Akbar	[phone]
FTI Consulting (Financial Public Relations) Ben Brewerton Sara Powell	[phone]

Background to, and reasons for, the Acquisition and the Proposed Fundraising

Diversified Energy is an established, independent owner and operator of producing natural gas and oil wells, with operations in the Appalachian Basin in the United States throughout the neighbouring states of Tennessee, Kentucky, Virginia, West Virginia, Ohio, and Pennsylvania, where it is the largest independent conventional producer. The Company also has operations in the Central Region of the United States throughout the neighbouring states of Texas, Louisiana, and Oklahoma.

The Company has grown rapidly, establishing a proven track-record of capitalising on opportunities to acquire complementary producing conventional and non-conventional gas and oil assets in the Appalachian Basin and Central Region from industry players who are seeking to re-focus resources, with target assets characterised by predictable production rates, long lives, and generally low and predictable decline rates. The Company maximises and extends production through the deployment of rigorous field management, deploying new extraction technology, and/or refreshing decayed infrastructure on poorly maintained wells. Through operational efficiencies, including utilising the Company's growing midstream infrastructure, the Company maximises value by enhancing production, targeting premium pricing points, and streamlining costs.

Whilst the Company expects the Appalachian Basin to continue to provide a strong opportunity set for future acquisitions and growth, it believes that building scale in the Central Region provides a significant opportunity for the business. The Acquisition, if completed, will be the ninth acquisition in the Central Region since the Company's entry in April 2021. The Company believes that the Central Region provides many of the same opportunities afforded by the Appalachian Basin, with the Acquisition providing low-cost, long-life, predictable decline gas-weighted production assets with significant potential for synergies from regional scale.

The Company believes that it is well positioned with a pre-tax PV10 of its PDP assets of US$4.2 billion¹¹, including PDP Reserves of 823 MMBoe prior to the Acquisition as of the fiscal year end 2022¹¹, reflecting a largely predictable, long life, low decline asset base. The Company has a demonstrated record of sustaining well production and driving cost efficiencies into its assets through its Smarter Asset Management ("SAM") programme.

The Company has a proactive approach to hedging, using a combination of structures to provide cost efficient downside protection whilst maintaining an element of upside potential. At present, the Company has ~85% of 2023 production hedged at an average natural gas price of ~US$3.65/Mcf.

Given the strength of the Company's asset base and hedge portfolio, it is well positioned to take advantage of the opportunities it sees in the sector. With a number of industry participants refocusing capital away from what they consider to be non-core assets, Diversified continues to find opportunities to acquire assets at an attractive valuation, remove cost, and drive operational efficiencies into its asset base, ultimately supporting the Company's long term cash flow generation, dividend, and the return for its shareholders.

The Acquisition

The Company has executed a purchase agreement with Tanos to acquire certain gas and oil wells as well as related midstream infrastructure.

This Acquisition complements the Cotton Valley and Haynesville upstream assets and related facilities in the states of Louisiana and Texas the Company acquired from Tanos in 2021. The purchase price, should the Acquisition proceed, is expected to be US$250 million, prior to customary closing adjustments. The Acquisition is subject to ongoing due diligence, which the Company will complete to its satisfaction prior to confirming the final terms (including purchase price), and is also subject to various other conditions. There can be no certainty that the Acquisition will proceed. The Proposed Fundraising is not conditional on the completion of the Acquisition. The Acquisition is expected to close on 1 March 2023. Should the Acquisition proceed, it is expected to have a deemed effective date of 1 February 2023. 

The Acquisition includes approximately 150 net operated wells over some 33,700 acres in the Cotton Valley and Haynesville region of Texas, adjacent to existing Central Region assets acquired in the previous Indigo, Tanos and East Texas Acquisitions, demonstrating the Company's ability to create scale in the focus area rapidly. The average operated working and net revenue interests of the wells included within the transaction is 96% and 73% respectively. The proximity of the assets to the Company's existing Central Region acreage increases scale and density in the region which is expected to improve unit cost metrics.

The assets have current net production of approximately 17 MBoepd (101 MMcfepd), of which 76% is natural gas, and estimated PDP Reserves of approximately 25 MMBoe (152 Bcfe). Based on the Company's preliminary assessment, the assets have a PDP pre-tax PV10 of US$312 million based on NYMEX strip as of 12 January 2023.

The NTM EBITDA Margin is estimated to be approximately 80%¹², before any synergies, and given a largely variable cost base the Company expects this to remain a high-margin business. Key cost metrics for the assets (excluding synergies) include a US$0.30 - 0.40/MMBtu net gas differential discount (inclusive of index differentials and marketing deducts) and an estimated cash operating cost of US$5.10 - US$5.70/Boe (US$0.85 - 0.95/Mcfe). Based on forecast production and current pricing, NTM EBITDA for the twelve month period ended 31 January 2024 attributable to the acquired assets will be approximately US$107 million, excluding longer-term synergies that the Company expects to be able to realise³.

The wells included within the Acquisition have an average age of 13 years¹³ and are estimated to have a one-year production decline rate of ~32%, a third-year decline rate of ~23%, and terminal decline rate of ~9%¹⁴. On a pro-forma basis, the Company expects to have a company-wide average decline rate of ~11% following the Acquisition, below its peer group. The assets offer the same long-life, gas-weighted production potential and low terminal decline as the Company's broader portfolio and are ideally located within Diversified's core Central Region focus area, providing an opportunity for strong synergy potential.

With a long life of productive capacity remaining in the acquired wells, at 17 years on average, Diversified does not expect any significant near-term cash requirements in relation to plugging and abandonment ("P&A") activities, as the Company is not currently required to enter into any Company wide state level P&A agreements in connection with the Acquisition. The Company estimates costs for P&A activities to be in the range of US$40,000 - 60,000 per well. Continuous monitoring of emissions on more than 90% of the production assets to be acquired complements Diversified's existing emissions detection activities.

The Acquisition provides a significant potential upside opportunity for Diversified through the undeveloped acreage included within the assets but not included within the purchase price. The Acquisition includes approximately 50 undeveloped locations with an estimated incremental PV10 of approximately US$280 million. Adjusting the acquisition metrics to include undeveloped reserve value further improves the attractiveness of the Acquisition, and Diversified has the option to realize this value through monetization or opportunistic development with a financial partner.  The Acquisition includes 4 wells that are partially developed, with approximately US$25 million of anticipated capital expenditure required in 2023 to complete these wells.

The Central Region has significant similarities with the Appalachian Basin, with mature operating regions and significant gas production from low-cost, low-decline well stock and an extremely fragmented operator landscape. The Central Region benefits from premium Gulf Coast pricing dynamics, as well as significant infrastructure, given its location within an established operating region and its proximity to rapidly growing LNG capacity. Gas prices in the Gulf Coast are currently trading at an approximate 20% premium to those in Appalachia over the next 10 years. The growth in this operating basin is expected to provide continued opportunities for Diversified to repeat its business model in the Central Region.

Subject to closing of the Acquisition, the Company will use the net proceeds from the Proposed Fundraising to partially fund the Acquisition. The remainder of the Acquisition consideration will be funded from the Company's existing SLL, The Company estimates that, following the Acquisition and the Proposed Fundraising, it would have a Net Debt / Pro Forma Adjusted EBITDA ratio of 2.1x, within the Company's preferred leverage range of 2.0x-2.5x  and down from 2.3x as of year-end 2022. The reduction in leverage provides additional financing capacity should the Company successful identify and secure further acquisition opportunities in the Central Region or Appalachian Basin.

Details of the Placing

The Company will announce the Placing Price on closing of the Bookbuild.

The Placing is being conducted through an accelerated bookbuild process to eligible institutional investors.

The Placing will launch immediately following the release of this Announcement. The Company expects to close the Bookbuild no later than 8.00 a.m. on 9 February 2023, but the Joint Global Coordinators and the Company reserve the right to close the Bookbuild earlier or later, without further notice.

The Placing is not conditional on completion of the Acquisition. Should the Acquisition not proceed, the Company will determine the most appropriate use of the net proceeds, including potentially investing in other acquisition opportunities aligned with its stated strategy. The Company would be required, in certain circumstances, to pay a break fee of US$7.5 million to Tanos in the event of termination of the purchase agreement owing to a breach of certain obligations by the Company.

The Placing Shares, when issued, will be fully paid and will rank pari passu in all respects with each other and with the existing ordinary shares of £0.01 in the capital of the Company, including the right to receive all dividends and other distributions declared, made or paid after the date of issue.

Applications will be made to (i) the Financial Conduct Authority (the "FCA") for admission of the Placing Shares and the Retail Offer Shares to listing on the premium listing segment of the Official List; and (ii) London Stock Exchange plc for admission of the Placing Shares and the Retail Offer Shares to trading on its main market for listed securities (together, "Admission").

The Company has current shareholder authority to issue up to 9.99% of its existing issued share capital. The Proposed Fundraising is expected to exceed this authority limit, and as such the Proposed Fundraising will utilise split settlement, with the Firm Shares (that are within the current shareholder authorities) settling on a T+3 basis, and the balance of the Fundraising Shares, being the Conditional Shares, settling on a delayed basis. Allocation of the Firm Shares and the Conditional Shares will be irrevocable once confirmed to investors. The issue of the Conditional Shares is conditional, inter alia, on the passing of the Resolutions at the General Meeting. Therefore, subject to the results of the Proposed Fundraising, the Company intends to convene a shareholder meeting, expected to be held on or around 27 February 2023, to approve the allotment of the Conditional Shares on a non-pre-emptive basis. Diversified will publish a Notice of General Meeting setting out the shareholder resolutions requiring approval, and the Board's recommended support for it in due course.

Settlement for, and Admission of, the Firm Shares is expected to take place on or before 8.00 a.m. on 14 February 2023. Settlement for, and Admission of, the Conditional Shares is expected to take place on or before 8.00 a.m. on 28 February 2023, subject to the shareholders approving the allotment of the Conditional Shares on a non-pre-emptive basis . The Placing is also conditional upon the placing agreement between the Company and the Joint Global Coordinators (the "Placing Agreement") becoming unconditional and not being terminated in accordance with its terms. Appendix 1 to this Announcement sets out further information relating to the terms and conditions of the Placing.

Shares issued pursuant to the Proposed Fundraising will be eligible for the Q3 2022 dividend of 4.375 cents per share, as well as all future dividends. The ex-dividend date of the Q3 2022 dividend is 2 March 2023 and the Q3 2022 Dividend is expected to be paid on 28 March 2023.

Stifel Nicolaus Europe Limited, Tennyson Securities and Peel Hunt LLP are acting as joint global coordinators and bookrunners in connection with the Placing.

The Retail Offer

Concurrently with the Placing, the Company intends to provide existing retail shareholders with an opportunity to participate in the Proposed Fundraising. The Retail Offer is not made subject to the terms and conditions set out in Appendix 1 to this Announcement and instead will be made on the terms outlined in the separate announcement to be made shortly regarding the Retail Offer and its terms.

The issue of the Conditional Shares is conditional on, among other things, Shareholders approving the allotment of the Conditional Shares on a non-pre-emptive basis . If Shareholders do not pass the appropriate Resolutions, the issue of the Conditional Shares will not proceed.

This Announcement should be read in its entirety. Investors' attention is drawn to the detailed terms and conditions of the Placing described in Appendix 1 (which forms part of this Announcement).

By participating in the Placing, investors will be deemed to have read and understood this Announcement (including Appendix 1) in its entirety, to be participating in the Placing and making an offer to acquire, and acquiring, ordinary shares of the Company under the Placing on the terms and subject to the conditions of the Placing set out in Appendix 1 to this Announcement, and to be providing the representations, warranties, undertakings and acknowledgements contained in Appendix 1 to this Announcement.

Market Abuse Regulation

This Announcement contains inside information for the purposes of UK MAR. In addition, market soundings (as defined in EU MAR and UK MAR, together "MAR") were taken in respect of the matters contained in this Announcement, with the result that certain persons became aware of such inside information as permitted by MAR. Upon the publication of this Announcement, the inside information is now considered to be in the public domain and such persons shall therefore cease to be in possession of inside information in relation to the Company and its securities.

Footnotes:

1.  Purchase price excludes $7 million upward purchase price adjustment for hedge positions to be acquired from the seller with a value of ~$10 million as of 27 January 2023.

2.  Purchase price multiple calculated as the acquisition purchase price of $250 million, divided by $107 of NTM EBITDA (as defined within footnote 3)

3.  Reflects the Acquisition's estimated NTM EBITDA for the period ended 31 January 2024 for PDP wells and wells scheduled for completion before or immediately following the closing date; assumes historical cost structure using NYMEX strip as of 12 January 2023.

4.  Exit Rate represents the Company's average daily production for the month of December 2022, adjusted for downtime attributable to the impact of Winter Storm Elliot.

5.  Measured at acquisition effective date of 1 February 2023 and using NYMEX strip pricing as of 12 January 2023; PDP reserves includes PDP wells and wells scheduled for completion before or immediately following the expected closing date.

6.  As of 12 December 2022; Undeveloped reserves exclude reserves associated with wells scheduled for completion before or immediately following the expected closing date.

7.  1Mcf=1.07MMBtu.

8.  Adjusted EBITDA and Free Cash Flow based on the trailing 12-month from 1H 2022 announced interim results, 8 August 2022; adjusted for the pro-forma, annualized impact of the Company's previously announced East Texas and ConocoPhillips acquisitions..

9.  Calculated as the difference between the acquisition's $/Mcfe valuation, defined as the purchase price of $250 million divided by current production of ~101 MMcfepd, and the Company's $/Mcfe valuation, defined as Enterprise Value of $2,506 million at 24 January 2023 and December 2022 exit rate, adjusted for downtime attributable to the impact Winter Storm Elliot, as previously announced on 31 January 2023.

10.  Based on year-end 2022 Pro Forma Net Debt/ Adj. EBITDA of 2.3x as previously announced on 31 January 2023, adjusted for the pro-forma impact of the Acquisition.

11.  Pro-forma number calculated as the Company's audited PDP Reserves and equivalent PV-10 value as of 31 December 2021, adjusted for the impact of PDP Reserves and equivalent PV-10 values for acquired during 2022, as previously announced.

12.  Reflects the Acquisition's estimated NTM EBITDA for the period ended 31 January 2023 for PDP wells and wells scheduled for completion before or immediately following the closing date; assumes historical cost structure using NYMEX strip as of 12 January 2023; does not assume any post-acquisition synergies; estimated EBITDA Margin calculated as the NTM estimated EBITDA as a percentage of total revenue for the period ended31 January 2023.

13.  Represents simple-average well age and estimated useful life; production-weighted average well age and estimated remaining well life is 3 years and 45 years, respectively.

14.  Amounts based on Company data and represents anticipated PDP production declines for the 12 month periods ended 31 January 2024 and 31 January 2026, respectively; terminal declines based on engineered type curves which represent the estimated production volumes and patterns specific to the geography and geology of the wells.

IMPORTANT NOTICES

THIS ANNOUNCEMENT (INCLUDING APPENDIX 1) AND THE TERMS AND CONDITIONS SET OUT HEREIN (TOGETHER, THIS "ANNOUNCEMENT") IS NOT FOR PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA. THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES FOR SALE INTO THE UNITED STATES (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES AND THE DISTRICT OF COLUMBIA (COLLECTIVELY, THE "UNITED STATES")). THE SECURITIES REFERRED TO HEREIN HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES AND MAY NOT BE OFFERED OR SOLD OR TRANSFERRED, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, EXCEPT PURSUANT TO AN APPLICABLE EXEMPTION FROM REGISTRATION AND IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES. NO PUBLIC OFFERING OF SECURITIES IS BEING MADE IN THE UNITED STATES.

THIS ANNOUNCEMENT IS NOT FOR PUBLIC RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO AUSTRALIA, CANADA, SOUTH AFRICA, JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE OR FORM ANY PART OF AN OFFER TO SELL OR ISSUE, OR A SOLICITATION OF AN OFFER TO BUY, SUBSCRIBE FOR OR OTHERWISE ACQUIRE ANY SECURITIES IN AUSTRALIA, CANADA, SOUTH AFRICA, JAPAN OR ANY JURISDICTION IN WHICH OR TO ANY OTHER PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. ANY FAILURE TO COMPLY WITH THESE RESTRICTIONS MAY CONSTITUTE A VIOLATION OF THE SECURITIES LAWS OF SUCH JURISDICTIONS.

NO PUBLIC OFFERING OF THE SECURITIES REFERRED TO HEREIN IS BEING MADE IN ANY SUCH JURISDICTION OR ELSEWHERE.

No action has been taken by the Company, Peel Hunt LLP ("Peel Hunt"), Tennyson Securities, a trading name of Shard Capital Partners LLP ("Tennyson Securities") or Stifel Nicolaus Europe Limited ("Stifel" and, together with Peel Hunt and Tennyson Securities, the "Joint Global Coordinators") or any of their respective affiliates, or any of their respective directors, officers , partners, employees , advisers or agents or, in the case of the Joint Global Coordinators, persons connected with them as defined in FSMA (collectively, "Representatives") that would permit an offer of the new ordinary shares of the Company to be issued pursuant to the Placing (the " Placing Shares ") in any jurisdiction where action for that purpose is required. Persons receiving this Announcement are required to inform themselves about and to observe any restrictions contained in this Announcement. The distribution of this Announcement and the Placing and/or the offer or sale of the Placing Shares in certain jurisdictions may be restricted by law. Persons (including, without limitation, nominees and trustees) who have a contractual or other legal obligation to forward a copy of this Announcement should seek appropriate advice before taking any action. Persons distributing any part of this Announcement must satisfy themselves that it is lawful to do so.

This Announcement has not been approved by the Financial Conduct Authority or the London Stock Exchange.

Members of the public are not eligible to take part in the Placing. This Announcement is directed at and is only being distributed to persons: (a) if in member states of the European Economic Area, "qualified investors" within the meaning of Article 2(e) of Regulation (EU) 2017/1129 (the "EU Prospectus Regulation") ("Qualified Investors"); or (b) if in the United Kingdom, 'qualified investors' within the meaning of Article 2(e) of the UK version of Regulation (EU) 2017/1129 as it forms part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended from time to time (the "UK Prospectus Regulation") who are (i) persons who fall within the definition of "investment professionals" in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order"), or (ii) persons who fall within Article 49(2)(a) to (d) of the Order; or (c) persons to whom they may otherwise lawfully be communicated (each such person above, a "Relevant Person"). No other person should act or rely on this Announcement and persons distributing this Announcement must satisfy themselves that it is lawful to do so. By accepting the terms of this Announcement, you represent and agree that you are a Relevant Person, if in the United Kingdom, or a Qualified Investor, if in a member state of the EEA. This Announcement must not be acted on or relied on by persons who are not Relevant Persons, if in the United Kingdom, or Qualified Investors, if in a member state of the EEA. Any investment or investment activity to which this Announcement or the Placing relates is available only to Relevant Persons, if in the United Kingdom, and Qualified Investors, if in a member state of the EEA, and will be engaged in only with Relevant Persons, if in the United Kingdom, and Qualified Investors, if in a member state of the EEA.

No offering document or prospectus will be available in any jurisdiction in connection with the matters contained or referred to in this Announcement and no such offering document or prospectus is required (in accordance with the EU Prospectus Regulation or UK Prospectus Regulation ) to be published.

Certain statements in this Announcement are forward-looking statements with respect to the Company's expectations, intentions and projections regarding its future performance, strategic initiatives, anticipated events or trends and other matters that are not historical facts and which are, by their nature, inherently predictive, speculative and involve risks and uncertainty because they relate to events and depend on circumstances that may or may not occur in the future. All statements that address expectations or projections about the future, including statements about operating performance, strategic initiatives, objectives, market position, industry trends, general economic conditions, expected expenditures, expected cost savings and financial results, are forward-looking statements. Any statements contained in this Announcement that are not statements of historical fact are, or may be deemed to be, forward-looking statements. These forward-looking statements, which may use words such as "expects", "anticipates", "plans", "intends", "projects", "indicates" ( or the negative thereof ) and similar expressions , are not guarantees of future performance and are subject to known and unknown risks and uncertainties . There are a number of factors including, but not limited to, commercial, operational, economic and financial factors, that could cause actual results, financial condition, performance or achievements to differ materially from those expressed or implied by these forward-looking statements . Many of these risks and uncertainties relate to factors that are beyond the Company's ability to control or estimate precisely, such as changes in taxation or fiscal policy, future market conditions, currency fluctuations, price fluctuations in crude oil and natural gas, drilling and production results, reserves estimates, environmental and physical risks, the behaviour of other market participants, the actions of governments or governmental regulators, or other risks factors, such as changes in the political, social and regulatory framework in which the Company operates or in economic or technological trends or conditions, including inflation, recession and consumer confidence, on a global, regional or national basis. Given these risks and uncertainties , readers are cautioned not to place undue reliance on forward-looking statements . Forward-looking statements speak only as of the date of such statements and, except as required by the FCA, the London Stock Exchange or applicable law, the Company, the Joint Global Coordinators and their respective Representatives undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. 

In particular, no statement in this Announcement is intended to be a profit forecast or profit estimate and no statement of a financial metric (including estimates of adjusted EBITDA, profit before tax, free cash flow or net debt) should be interpreted to mean that any financial metric for the current or future financial years would necessarily match or exceed the historical published position of the Company and its subsidiaries. Certain statements in this Announcement may contain estimates. The estimates set out in this Announcement have been prepared based on numerous assumptions and forecasts, some of which are outside of the Company's influence and/or control, and is therefore inherently uncertain and there can be no guarantee or assurance that it will be correct. The estimates have not been audited, reviewed, verified or subject to any procedures by the Company's auditors. Undue reliance should not be placed on them and there can be no guarantee or assurance that they will be correct.

Each of the Joint Global Coordinators is authorised and regulated in the United Kingdom by the Financial Conduct Authority (the "FCA"). Each of the Joint Global Coordinators is acting exclusively for the Company and for no one else in connection with the Placing and will not regard any other person (whether or not a recipient of this Announcement) as a client in relation to the Placing and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients or for giving advice in relation to the Placing or any other matters referred to in this Announcement.

This Announcement is being issued by and is the sole responsibility of the Company. No representation or warranty, express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by or on behalf of any of the Joint Global Coordinators (apart from the responsibilities or liabilities that may be imposed by the Financial Services and Markets Act 2000, as amended ("FSMA") or the regulatory regime established thereunder) or by their respective affiliates or any of their respective Representatives for the contents of this Announcement or any other written or oral information made available to or publicly available to any interested party or their respective advisers or any other statement made or purported to be made by or on behalf of any of the Joint Global Coordinators or any of their respective affiliates or any of their respective Representatives in connection with the Company, the Placing Shares or the Placing and any responsibility and liability whether arising in tort, contract or otherwise therefor is expressly disclaimed. No representation or warranty, express or implied, is made by any of the Joint Global Coordinators or any of their respective affiliates or any of their respective Representatives as to the accuracy, fairness, verification, completeness or sufficiency of the information or opinions contained in this Announcement or any other written or oral information made available to or publicly available to any interested party or their respective advisers, and any liability therefor is expressly disclaimed.

This Announcement does not constitute a recommendation concerning any investor's options with respect to the Placing. Recipients of this Announcement should conduct their own investigation, evaluation and analysis of the business, data and other information described in this Announcement. This Announcement does not identify or suggest, or purport to identify or suggest, the risks (direct or indirect) that may be associated with an investment in the Placing Shares. The price and value of securities can go down as well as up. Past performance is not a guide to future performance. The contents of this Announcement are not to be construed as legal, business, financial or tax advice. Each investor or prospective investor should consult with his or her or its own legal adviser, business adviser, financial adviser or tax adviser for legal, business, financial or tax advice.

Any indication in this Announcement of the price at which the Company's shares have been bought or sold in the past cannot be relied upon as a guide to future performance. Persons needing advice should consult an independent financial adviser. No statement in this Announcement should be interpreted to mean that earnings, earnings per share or income, cash flow from operations or free cash flow of the Company for the current or future financial periods would necessarily match or exceed the historical published earnings, earnings per share or income, cash flow from operations or free cash flow of the Company.

The Placing Shares to be issued pursuant to the Placing will not be admitted to trading on any stock exchange other than the main market for listed securities of the London Stock Exchange.

In connection with the Placing, the Joint Global Coordinators and any of their respective affiliates or any of their respective Representatives, acting as investors for their own account, may take up a portion of the Placing Shares in the Placing as a principal position and in that capacity may retain, purchase, sell, offer to sell for the own accounts or otherwise deal for their own account in such Placing Shares and other securities of the Company or related investments in connection with the Placing or otherwise. Accordingly, references to Placing Shares being offered, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or acquisition, placing or dealing by, the Joint Global Coordinators and any of their respective affiliates and their respective Representatives acting in such capacity. In addition, the Joint Global Coordinators and any of their respective affiliates or their respective Representatives may enter into financing arrangements (including swaps, warrants or contracts for difference) with investors in connection with which the Joint Global Coordinators and any of their respective affiliates may from time to time acquire, hold or dispose of shares. The Joint Global Coordinators do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

Appendix 1 to this Announcement sets out the terms and conditions of the Placing. By participating in the Placing, each Placee will be deemed to have read and understood this Announcement (including Appendix 1 ) in its entirety, to be participating in the Placing and making an offer to acquire and acquiring Placing Shares on the terms and subject to the conditions set out in Appendix 1 to this Announcement and to be providing the representations, warranties, undertakings and acknowledgements contained in Appendix 1 to this Announcement.

Neither the content of the Company's website (or any other website) nor the content of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this Announcement.

This Announcement has been prepared for the purposes of complying with applicable law and regulation in the United Kingdom and the information disclosed may not be the same as that which would have been disclosed if this Announcement had been prepared in accordance with the laws and regulations of any jurisdictions outside the United Kingdom.

UK Product Governance Requirements

Solely for the purposes of the product governance requirements contained within the FCA Handbook Product Intervention and Product Governance Sourcebook (the "UK Product Governance Rules"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any 'manufacturer' (for the purposes of the UK Product Governance Rules) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that such Placing Shares are: (a) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in Chapter 3 of the FCA Handbook Conduct of Business Sourcebook ("COBS"); and (b) eligible for distribution through all permitted distribution channels (the "UK target market assessment"). Notwithstanding the UK target market assessment, distributors should note that: the price of the Placing Shares may decline and investors could lose all or part of their investment; the Placing Shares offer no guaranteed income and no capital protection; and an investment in the Placing Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The UK target market assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Placing. Furthermore, it is noted that, notwithstanding the UK target market assessment, the Joint Global Coordinators will only procure investors who meet the criteria of professional clients and eligible counterparties.

For the avoidance of doubt, the UK target market assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of COBS 9A and COBS 10A, respectively; or (b) a recommendation to any investor or group of investors to invest in, or purchase or take any other action whatsoever with respect to the Placing Shares. Each distributor is responsible for undertaking its own UK target market assessment in respect of the Placing Shares and determining appropriate distribution channels.

EU Product Governance Requirements

Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any 'manufacturer' (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that such Placing Shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment"). Notwithstanding the Target Market Assessment, distributors should note that: the price of the Placing Shares may decline and investors could lose all or part of their investment; the Placing Shares offer no guaranteed income and no capital protection; and an investment in the Placing Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Placing. Furthermore, it is noted that, notwithstanding the Target Market Assessment, the Joint Global Coordinators will only procure investors who meet the criteria of professional clients and eligible counterparties.

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares. Each distributor is responsible for undertaking its own target market assessment in respect of the Placing Shares and determining appropriate distribution channels.

Dealing Codes:

1.  Ticker: DEC.L

2.  ISIN for the Ordinary Shares: GB00BYX7JT74

3.  SEDOL for the Ordinary Shares: BYX7JT7

4.  Company's legal entity identifier: 213800YR9TFRVHPGOS67

APPENDIX 1 - TERMS AND CONDITIONS OF THE PLACING

IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE PLACING

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS ANNOUNCEMENT (INCLUDING APPENDIX 1 ) AND THE TERMS AND CONDITIONS SET OUT HEREIN (TOGETHER, THIS "ANNOUNCEMENT") ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT PERSONS WHOSE ORDINARY ACTIVITIES INVOLVE THEM IN ACQUIRING, HOLDING, MANAGING AND DISPOSING OF INVESTMENTS (AS PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIR BUSINESS AND WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND ARE : (A) IF IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA (THE "EEA"), PERSONS WHO ARE QUALIFIED INVESTORS WITHIN THE MEANING OF ARTICLE 2(E) OF REGULATION (EU) 2017/1129 (THE "EUPROSPECTUS REGULATION") ("QUALIFIED INVESTORS"); OR (B) IF IN THE UNITED KINGDOM, 'QUALIFIED INVESTORS' WITHIN THE MEANING OF ARTICLE 2(E) OF THE UK VERSION OF REGULATION (EU) 2017/1129 AS IT FORMS PART OF UK LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 (THE "UK PROSPECTUS REGULATION") WHO ARE (I) PERSONS WHO FALL WITHIN THE DEFINITION OF "INVESTMENT PROFESSIONALS" IN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED (THE "ORDER"), OR (II) PERSONS WHO ARE HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS OR PARTNERSHIPS OR TRUSTEES OF HIGH VALUE TRUSTS AS DESCRIBED IN ARTICLE 49(2)(A) TO (D) OF THE ORDER; OR (c) OTHERWISE, PERSONS TO WHOM IT MAY OTHERWISE BE LAWFUL TO COMMUNICATE IT TO (EACH SUCH PERSONS REFERRED TO ABOVE AS "RELEVANT PERSONS"). NO OTHER PERSON SHOULD ACT OR RELY ON THIS ANNOUNCEMENT. BY ACCEPTING THE TERMS OF THIS ANNOUNCEMENT YOU REPRESENT AND AGREE THAT YOU ARE EITHER A QUALIFIED INVESTOR OR A RELEVANT PERSON. THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT QUALIFIED INVESTORS IN THE EEA AND RELEVANT PERSONS IN THE UNITED KINGDOM. PERSONS DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT HEREIN RELATE IS AVAILABLE ONLY IN MEMBER STATES OF THE EEA TO QUALIFIED INVESTORS AND IN THE UNITED KINGDOM TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH QUALIFIED INVESTORS IN MEMBER STATES OF THE EEA AND RELEVANT PERSONS IN THE UNITED KINGDOM.

THIS ANNOUNCEMENT (INCLUDING APPENDIX 1 ) DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. EACH PLACEE (AS DEFINED BELOW) SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL, TAX, BUSINESS, FINANCIAL AND RELATED ASPECTS OF A SUBSCRIPTION FOR THE PLACING SHARES (AS DEFINED BELOW).

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES AND THE DISTRICT OF COLUMBIA (COLLECTIVELY, THE "UNITED STATES"), AUSTRALIA, CANADA, SOUTH AFRICA, JAPAN OR ANY JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL OR REQUIRE A PROSPECTUS OR SIMILAR DOCUMENT TO BE FILED. THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN DO NOT CONSTITUTE AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES, AUSTRALIA, CANADA, SOUTH AFRICA, JAPAN OR IN ANY OTHER JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL.

All offers of the Placing Shares will be made pursuant to an exemption under the EU Prospectus Regulation and the UK Prospectus Regulation from the requirement to produce a prospectus. This Announcement is being distributed and communicated to persons in the UK only in circumstances to which section 21(1) of the Financial Services and Markets Act 2000, as amended ("FSMA") does not apply.

The Placing Shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), or under the securities laws of any state or other jurisdiction of the United States. Accordingly, the Placing Shares may not be offered, sold or transferred, directly or indirectly, in or into the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in accordance with any applicable securities laws of any state or other jurisdiction of the United States. The Placing Shares are being offered and sold by the Company (A) outside the United States in offshore transactions as defined in, and pursuant to, Regulation S under the Securities Act ("Regulation S") and (B) in the United States only to persons reasonably believed to be "qualified institutional buyers" in transactions not involving a "public offering" within the meaning of section 4(a)(2) of the Securities Act pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There will be no public offering of the Placing Shares in the United States, the United Kingdom, Australia, Canada, South Africa, Japan or elsewhere.

The Placing has not been approved and will not be approved or disapproved by the United States Securities and Exchange Commission, any state securities commission or any other regulatory authority in the United States, nor have any of the authorities in Australia, Canada, South Africa, Japan or any other jurisdiction in which a registration statement or prospectus would be required to be filed in connection with the Placing Shares passed upon or endorsed the merits of the Placing or the accuracy or adequacy of this Announcement. Any representation to the contrary is unlawful.

Persons who are invited to and who choose to participate in the placing (the "Placing") of new ordinary shares (the "Placing Shares") by making an oral or written offer to acquire Placing Shares, including any individuals, funds or others on whose behalf a commitment to acquire Placing Shares is given ("Placees"), will be deemed to: (i) have read and understood this Announcement (including Appendix 1 ) in its entirety; and (ii) to be making (and shall only be permitted to participate in the Placing on the basis that they have made) such offer on the terms and conditions, and to be providing the representations, warranties, indemnities, acknowledgements, undertakings and agreements, contained in this Appendix 1. In particular, each such Placee represents, warrants, acknowledges and agrees that:

1.  If it is in the United Kingdom it is a Relevant Person and if it is in the member state of the EEA it is a Qualified Investor, and undertakes that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business;

2.  it is acquiring the Placing Shares for its own account or is acquiring the Placing Shares for an account with respect to which it exercises sole investment discretion and has the authority to make and does make the representations, warranties, indemnities, acknowledgments, undertakings and agreements contained in this Announcement;

3.  it understands (or if acting for the account of another person, such person has confirmed that such person understands) the resale and transfer restrictions set out in this Announcement (including this Appendix 1);

4.  if it is a financial intermediary, as that term is used in Article 5(1) of the EU Prospectus Regulation and the UK Prospectus Regulation, that it understands that any Placing Shares subscribed for by it in the Placing will not be acquired on a non-discretionary basis on behalf of, nor will they be acquired with a view to their offer or resale to, persons in circumstances which may give rise to an offer of securities to the public other than an offer or resale in a member state of the EEA to Qualified Investors or in the United Kingdom to Relevant Persons, or in circumstances in which the prior consent of the Joint Global Coordinators has been given to each such proposed offer or resale;

5.  it understands that the Placing Shares have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction of the United States and may not be offered or sold, directly or indirectly, within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States ;

6.  it and the person(s), if any, for whose account or benefit it is acquiring the Placing Shares are either (a)(i) outside the United States and will be outside the United States at the time the Placing Shares are acquired by it and (ii) acquiring the Placing Shares in an "offshore transaction" in accordance with Rule 903 or Rule 904 of Regulation S; or (b) a "qualified institutional buyer" as defined in Rule 144A under the Securities Act (a "QIB") acting for its own account or for the account of one or more QIBs, each of which is acquiring beneficial interests in the Placing Shares for its own account (if acquiring the Placing Shares for the account of one or more other persons, it has full power and authority to make the representations, warranties, agreements and acknowledgements herein on behalf of each such person) who has executed and delivered to the Company and the Joint Global Coordinators a US investor letter substantially in the form provided to it; and

7.  the Company, Peel Hunt LLP ("Peel Hunt"), Tennyson Securities, a trading name of Shard Capital Partners LLP ("Tennyson Securities") and Stifel Nicolaus Europe Limited ("Stifel" and, together with Peel Hunt and Tennyson Securities, the "Joint Global Coordinators", will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements and agreements.None of the Company, the Joint Global Coordinators or any of their respective affiliates or any of their respective Representatives (as defined below) makes any representation to any Placee regarding an investment in the Placing Shares.

IMPORTANT INFORMATION FOR PLACEES ONLY REGARDING THE PLACING

Details of the Placing Agreement and of the Placing Shares

The Joint Global Coordinators and the Company have today entered into a placing agreement (the "Placing Agreement") under which, subject to the terms and conditions set out therein, each of the Joint Global Coordinators has agreed, severally and not jointly or jointly and severally, as agent for and on behalf of the Company, to use its reasonable endeavours to procure Placees for new ordinary shares of one penny each in the capital of the Company (the "Placing Shares"), with the number of Placing Shares and price to be determined following completion of the bookbuilding process in respect of the Placing (the "Placing Price"), and to the extent any Placee defaults in paying the Placing Price in respect of any Placing Shares allocated to it, each of the Joint Global Coordinators has agreed, severally and not jointly or jointly and severally, to subscribe for such Placing Shares at the Placing Price.

The Placing Shares will, when issued, be credited as fully paid and will rank pari passu in all respects with the existing ordinary shares of one penny each in the capital of the Company (the "Ordinary Shares"), including, without limitation, the right to receive all dividends and other distributions declared, made or paid in respect of the Ordinary Shares after Admission (as defined below).

Applications for listing and admission to trading

Applications will be made for (i) the new Ordinary Shares to be issued and allotted to Placees (the "Firm Placing Shares") at the Placing Price on a non pre-emptive basis under the Company's existing 10% shareholder authorities (the "Firm Placing ") and (ii) the new Ordinary Shares to be issued and allotted to Placees (the "Conditional Placing Shares") at the Placing Price in excess of the Company's existing 10% shareholder authorities and conditional upon, inter alia, the passing of certain resolutions to grant the Directors the authority to allot and issue the Conditional Placing Shares on a non-pre-emptive basis (the "Resolutions") at the General Meeting (the "Conditional Placing ") to be admitted to the premium listing segment of the Official List of the Financial Conduct Authority (the "FCA") (the "Official List") and to be admitted to trading on the main market for listed securities of London Stock Exchange plc (the "London Stock Exchange").

At the Company's annual general meeting on 26 April 2022, the Company obtained shareholder approval to issue Ordinary Shares for up to an aggregate nominal amount of £850,046, representing up to 10% of the Company's issued ordinary share capital (being 85,004,600 Ordinary Shares). The Firm Placing will be in respect of new Ordinary Shares. Shareholder approval will be required for the allotment of the  Conditional Placing Shares and, subject to the results of the Placing, the Company intends to convene the General Meeting, expected to be held on or around 27 February 2022, to approve the allotment of the Conditional Placing Shares. The allotment and issue of the Firm Placing Shares will not be conditional upon shareholder approval. The allotment and issue of the Conditional Placing Shares will be conditional upon such shareholder approval. The placing of the Firm Placing Shares may still complete if the placing of the Conditional Placing Shares does not complete, whether by reason of a failure to obtain shareholder approval or non-satisfaction of the other conditions.

Subject to the discretion of the Company and the Joint Global Coordinators to elect otherwise, the Firm Placing Shares and the Conditional Placing shares will be allocated proportionately with the same investors. An investor allocated Firm Placing Shares will be conditionally allocated an equivalent proportion of Conditional Placing Shares.

It is expected that: (i) settlement and admission of the Firm Placing Shares will take place on or before 8.00 a.m. on 14 February 2023 ("First Admission") and that dealings in the Firm Placing Shares on the main market of the London Stock Exchange will commence at the same time (or such later time and/or date as the Joint Global Coordinators may agree with the Company); and (ii) settlement and admission of the Conditional Placing Shares will take place on or before 8.00 a.m. on 28 February 2023 ("Second Admission" and, together with First Admission, "Admissions") and that dealings in the Conditional Placing Shares on the main market of the London Stock Exchange will commence at the same time (or such later time and/or date as the Joint Global Coordinators may agree with the Company). The Firm Placing is conditional upon, among other things, the Placing Agreement not being terminated in accordance with its terms and the Conditional Placing is conditional upon, among other things, the Placing Agreement not being terminated in accordance with its terms and the Resolutions being passed at the General Meeting.

Bookbuild

Following this Announcement, the Joint Global Coordinators will today commence an accelerated bookbuilding process to determine demand for participation in the Placing by Placees (the "Bookbuild"). This Appendix 1 gives details of the terms and conditions of, and the mechanics of participation in, the Placing. No commissions will be paid to Placees or by Placees in respect of any Placing Shares. Members of the public are not entitled to participate.

The Joint Global Coordinators and the Company shall be entitled to effect the Placing by such alternative method to the Bookbuild as they may, in their absolute discretion, determine.

Participation in, and principal terms of, the Placing

1.  Each of the Joint Global Coordinators is acting as a joint global coordinator, joint bookrunner and agent for the Company in connection with the Placing.

2.  Participation in the Placing will only be available to persons who may lawfully be, and are, invited to participate by the Joint Global Coordinators. The Joint Global Coordinators and their respective agents and affiliates are entitled to enter bids in the Bookbuild as principal.

3.  The Bookbuild, if successful, will establish a single price per Placing Share payable to the Joint Global Coordinators, as agents for and on behalf of the Company, by all Placees whose bids are successful. The same Placing Price will apply to both the Firm Placing and the Conditional Placing. The Placing Price and the final number of Placing Shares will be determined by the Company (in consultation with the Joint Global Coordinators) following completion of the Bookbuild and any discount to the market price of the Ordinary Shares will be determined in accordance with the Listing Rules of the FCA. The Placing Price and the final number of Placing Shares to be issued will be announced on a Regulatory Information Service ("RIS") following the completion of the Bookbuild.

4.  To bid in the Bookbuild, prospective Placees should communicate their bid by telephone or in writing to their usual sales contact at any of the Joint Global Coordinators. Each bid should state the number of Placing Shares which the prospective Placee wishes to acquire at either the Placing Price which is ultimately established by the Company and the Joint Global Coordinators or at prices up to a price limit specified in its bid. Bids may be scaled down by the Joint Global Coordinators on the basis referred to in paragraph 8 below.

5.  A bid in the Bookbuild will be made on the terms and subject to the conditions in this Appendix 1 and will be legally binding on the Placee on behalf of which it is made and, except with the Joint Global Coordinators' consent, will not be capable of variation or revocation after the time at which it is submitted. Each Placee will have an immediate, separate, irrevocable and binding obligation, owed to the Joint Global Coordinators, as agents for and on behalf of the Company, to pay it in cleared funds immediately on the settlement date, in accordance with the registration and settlement requirements set out below, an amount equal to the product of the Placing Price and the number of Placing Shares such Placee has agreed to subscribe for and the Company has agreed to allot. Subject to the discretion of the Company and the Joint Global Coordinators to determine otherwise, each Placee's allocation will be split proportionally between Firm Placing Shares and Conditional Placing shares, with each Placee receiving a percentage of the total number of Conditional Placing Shares as is equal to the percentage that the number of Firm Placing Shares they receive bears to the total number of Firm Placing Shares.

6.  The Bookbuild is expected to close no later than 8.00 a.m. (London time) on 9 February 2023 but may be closed earlier or later at the discretion of the Joint Global Coordinators and the Company. The Joint Global Coordinators may, in agreement with the Company, accept bids that are received after the Bookbuild has closed.

7.  Each prospective Placee's allocation will be agreed between the Joint Global Coordinators and the Company and will be confirmed orally or in writing (which can include email) by any of the Joint Global Coordinators (as agent for and on behalf of the Company) following the close of the Bookbuild and a trade confirmation will be despatched thereafter. This oral confirmation to such Placee will constitute an irrevocable legally binding commitment upon that person (who will at that point become a Placee) in favour of the Joint Global Coordinators and the Company to acquire the number of Placing Shares allocated to it at the Placing Price on the terms and conditions set out in this Appendix 1 and in accordance with the Company's articles of association and each Placee will be deemed to have read and understood this Announcement (including Appendix 1 ) in its entirety. The terms of this Appendix 1 will be deemed incorporated by reference in the trade confirmation. All obligations under the Bookbuild and Placing will be subject to fulfilment or, where applicable, waiver of the conditions referred to below under "Conditions of the Placing" and to the Placing not being terminated on the basis referred to below under "Right to terminate under the Placing Agreement". By participating in the Bookbuild, each Placee will agree that its rights and obligations in respect of the Placing will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee after confirmation (oral or otherwise) by any of the Joint Global Coordinators.

8.  The Joint Global Coordinators may choose to accept bids, either in whole or in part, on the basis of allocations determined in agreement with the Company and may scale down any bids for this purpose on such basis as they may determine. The Joint Global Coordinators may also, notwithstanding paragraphs 3 and 4 above, and subject to the prior consent of the Company, (i) allocate Placing Shares after the time of any initial allocation to any person submitting a bid after that time; and (ii) allocate Placing Shares after the Bookbuild has closed to any person submitting a bid after that time. The Company reserves the right (upon consultation with the Joint Global Coordinators) to reduce or seek to increase the amount to be raised pursuant to the Placing, in its absolute discretion.

9.  Irrespective of the time at which a Placee's allocation pursuant to the Placing is confirmed, settlement for all Placing Shares to be acquired pursuant to the Placing will be required to be made at the same time, on the basis explained below under "Registration and settlement".

10.  Except as required by law or regulation, no press release or other announcement will be made by the Joint Global Coordinators or the Company using the name of any Placee (or its agent), in its capacity as Placee (or agent), other than with such Placee's prior written consent.

11.  To the fullest extent permissible by law, none of the Joint Global Coordinators, the Company or any of their respective affiliates or any of their respective directors, officers, partners, employees, advisers or agents (collectively, "Representatives") shall have any responsibility or liability to Placees (or to any other person whether acting on behalf of a Placee or otherwise). In particular, none of the Joint Global Coordinators, the Company or any of their respective affiliates or any of their respective Representatives shall have any liability (including to the fullest extent permissible by law, any fiduciary duties) in respect of the conduct of the Bookbuild or of such alternative method of effecting the Placing as the Joint Global Coordinators and the Company may agree.

Conditions of the Placing

The Placing is conditional upon the Placing Agreement becoming unconditional and not having been terminated in accordance with its terms.

The obligations of the Joint Global Coordinators under the Placing Agreement in respect of the placing of the Firm Placing Shares are conditional upon, inter alia:

(a)  First Admission occurring by no later than 8.00 a.m. on 14 February 2023 (or such later time or date the Joint Global Coordinators may agree with the Company, being not later than 21 February 2023 ) ;

(b)  the Company's representations and warranties contained in the Placing Agreement (the "Warranties") being true and accurate and not misleading on and as at the date of the Placing Agreement and at all times up to First Admission;

(c)  the Company complying with its obligations and undertakings under the Placing Agreement so far as the same fall to be performed or satisfied on or prior to First Admission ;

(d)  there not having occurred, since the date of the Placing Agreement at any time prior to First Admission, any material adverse change; and

(e)  no matter having arisen which might reasonably give be expected to give rise to an indemnity claim under the Placing Agreement .

The obligations of the Joint Global Coordinators under the Placing Agreement in respect of the placing of the Conditional Placing Shares are conditional upon, inter alia:

(a)  First Admission having occurred;

(b)  Second Admission having occurred not later than 8.00 a.m. on 28 February 2023 (or such later time or date the Joint Global Coordinators may agree with the Company, being not later than 6 March 2023 );

(c)  the Warranties being true accurate and not misleading on and as at the date of the Placing Agreement and at all times up to Second Admission;

(d)  the Company complying with its obligations and undertakings under the Placing Agreement so far as the same fall to be performed or satisfied on or prior to Second Admission ;

(e)  there not having occurred, since the date of the Placing Agreement at any time prior to Second Admission, any material adverse change;

(f)  no matter having arisen which might reasonably give be expected to give rise to an indemnity claim under the Placing Agreement; and

(g)  the Resolutions set out in the Notice of General Meeting, to be proposed at the general meeting of the shareholders of the Company to be held no later than 5 p.m. on 27 February 2023 (the "General Meeting") having been duly passed.

The Joint Global Coordinators have discretion to waive compliance with certain of the conditions and/or agree an extension in time for their satisfaction.

If: (a) any of the conditions contained in the Placing Agreement, including those described above, are not fulfilled (or, where permitted, waived or extended in writing by the Joint Global Coordinators) or have become incapable of fulfilment on or before the date or time specified for the fulfilment thereof (or such later time and/or date as the Company and the Joint Global Coordinators may agree); or (b) the Placing Agreement is terminated in the circumstances specified below, the Placing will not proceed and the Placees' rights and obligations hereunder in relation to the Placing Shares shall cease and terminate at such time and each Placee agrees that no claim can be made by the Placee in respect thereof. Any such extension or waiver will not affect Placees' commitments as set out in this Announcement.

By participating in the Placing each Placee agrees that neither the Joint Global Coordinators nor any of their respective affiliates nor any of their respective Representatives shall have any liability to any Placee (or to any other person whether acting on behalf of a Placee or otherwise) in respect of any decision they may make as to whether or not to waive or to extend the time and/or the date for the satisfaction of any condition to the Placing nor for any decision they may make as to the satisfaction of any condition or in respect of the Placing generally, and by participating in the Placing each Placee agrees that any such decision is within the absolute discretion of the Joint Global Coordinators.

Lock-up

The Company has agreed with the Joint Global Coordinators that, subject to customary expectations, it will not, and will procure that none of its subsidiaries will, between the date of the Placing Agreement and 45 days after the date of First Admission, without the prior written consent of the Joint Global Coordinators, (a) issue, allot, offer, pledge, sell, contract to sell, pledge, grant any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any Ordinary Shares or other shares in the capital of the Company or any securities convertible into or exchangeable for Ordinary Shares or other shares in the capital of the Company or (b) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of Ordinary Shares or other shares in the capital of the Company, whether any such transaction described in (a) or (b) above is to be settled by delivery of Ordinary Shares or other shares in the capital of the Company or such other securities, in cash or otherwise.

Right to terminate under the Placing Agreement

Prior to First Admission:

Each of the Joint Global Coordinators, for itself in its capacity as joint global co-ordinator and joint bookrunner, is entitled, in its absolute discretion acting in good faith and after consultation (to the extent reasonably practicable) with the Company and the other Joint Global Coordinators, at any time before First Admission, to terminate the Placing Agreement by giving notice to the Company if, amongst other things, (a) any of the conditions to the placing of the Firm Placing Shares have not been satisfied or (where permitted) waived, (b) any of the Warranties are not or cease to be true and accurate or have become misleading; (c) there has been a breach by the Company of any of its obligations or undertakings contained in the Placing Agreement ; (d) since the date of the Placing Agreement, there has been a material adverse change; (e) there has occurred a market disruption event as specified in the Placing Agreement.

Prior to Second Admission:

Each of the Joint Global Coordinators, for itself in its capacity as joint global co-ordinator and joint bookrunner, is entitled, in its absolute discretion acting in good faith and after consultation (to the extent reasonably practicable) with the Company and the other Joint Global Coordinators, at any time before Second Admission, to terminate the Placing Agreement by giving notice to the Company if, amongst other things, (a) any of the conditions to the placing of the Conditional Placing Shares have not been satisfied or (where permitted) waived, (b) any of the Warranties are not or cease to be true and accurate or have become misleading; (c) there has been a breach by the Company of any of its obligations or undertakings contained in the Placing Agreement ; (d) since the date of First Admission but prior to Second Admission, there has been a material adverse change; (e) there has occurred a market disruption event as specified in the Placing Agreement; or (f) the Resolutions set out in the Notice of General Meeting, to be proposed at the General Meeting have not been duly passed.

Upon such notice being given, such parties to the Placing Agreement shall be released and discharged (except for any liability arising before or in relation to such termination) from their respective obligations under or pursuant to the Placing Agreement, subject to certain exceptions. Each of the other Joint Global Coordinators may, in its absolute discretion, elect by giving notice to the Company to allow the Placing to proceed.

By participating in the Placing, Placees agree that the exercise by any of the Joint Global Coordinators of any right of termination or other discretion under the Placing Agreement shall be within the absolute discretion of each of the Joint Global Coordinators, that the Joint Global Coordinators do not need to make any reference to, consult with, or seek consent from, Placees and that none of the Company or the Joint Global Coordinators or any of their respective affiliates or any of their respective Representatives shall have any liability to Placees whatsoever in connection with any exercise or failure to exercise any right of termination or other discretion.

No prospectus

No offering document, admission document or prospectus has been or will be submitted to be approved by the FCA (or any other authority) or submitted to the London Stock Exchange in relation to the Placing or any of the Admissions and no such prospectus is required (in accordance with the UK Prospectus Regulation) to be published in the United Kingdom or any equivalent document in any other jurisdiction .

Placees' commitments will be made solely on the basis of their own assessment of the Company, the Placing Shares and the Placing based on information contained in this Announcement (including Appendix 1 ) released by the Company today and any information publicly announced to a RIS by or on behalf of the Company on or prior to the date of this Announcement and subject to the further terms set forth in the trade confirmation to be provided to individual prospective Placees.

Each Placee, by accepting a participation in the Placing, agrees that the content of this Announcement (including Appendix 1 ) and all other publicly available information previously and simultaneously published by the Company by notification to a RIS is exclusively the responsibility of the Company and confirms that it has neither received nor relied on any other information, representation, warranty, or statement made by or on behalf of the Company or the Joint Global Coordinators or any other person and none of the Company or Joint Global Coordinators or any of their respective affiliates or any of their respective Representatives will be liable for any Placee's decision to participate in the Placing based on any other information, representation, warranty or statement which the Placee may have obtained or received. Each Placee acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of the Company in accepting a participation in the Placing. Nothing in this paragraph shall exclude or limit the liability of any person for fraudulent misrepresentation by that person.

Registration and settlement

Settlement of transactions in the Placing Shares following Admission, unless otherwise agreed, will take place within the CREST system, subject to certain exceptions. The Joint Global Coordinators and the Company reserve the right to require settlement for and delivery of the Placing Shares (or a portion thereof) to Placees in certificated form if delivery or settlement is not possible or practicable within the CREST system or would not be consistent with the regulatory requirements in the Placee's jurisdiction.

Following the close of the Bookbuild, each Placee allocated Placing Shares in the Placing will be sent a trade confirmation stating the total number of Placing Shares, the number of Firm Placing Shares and Conditional Placing Shares to be allocated to it at the Placing Price and settlement instructions. Each Placee agrees that it will do all things necessary to ensure that delivery and payment is completed in accordance with the standing CREST or certificated settlement instructions that it has in place with the relevant Bank.

The Company will deliver the Placing Shares (at the applicable times) to a CREST account operated by the Joint Global Coordinators (or any one of them) as the Company's agent and the relevant Joint Global Coordinator will enter its delivery (DEL) instruction into the CREST system. The input to CREST by a Placee of a matching or acceptance instruction will then allow delivery of the relevant Placing Shares to that Placee against payment at the applicable time.

It is expected that (i) settlement of the Firm Placing Shares will be on 14 February 2023 on a T+3 basis and (ii) settlement of the Conditional Placing Shares will be on 28 February 2023 (following the passing of the Resolutions and announcement by the Company thereof), in each case on a delivery versus payment basis in accordance with the instructions set out in the trade confirmation. Interest is chargeable daily on payments not received from Placees on the due date in accordance with the arrangements set out above at the rate of two percentage points above LIBOR as determined by the Joint Global Coordinators.

Each Placee is deemed to agree that, if it does not comply with these obligations, the Joint Global Coordinators (as agents for and on behalf of the Company) may sell any or all of the Placing Shares allocated to that Placee on such Placee's behalf and retain from the proceeds, for the Company's account and benefit, an amount equal to the aggregate amount owed by the Placee plus any interest due. The relevant Placee will, however, remain liable for any shortfall below the aggregate amount owed by it and may be required to bear any stamp duty or stamp duty reserve tax or other similar taxes (together with any interest or penalties) imposed in any jurisdiction which may arise upon the sale of such Placing Shares on such Placee's behalf. By communicating a bid for Placing Shares, each Placee confirms on each of the Joint Global Coordinators all such authorities and powers necessary to carry out any such transaction and agrees to ratify and confirm all actions which the Joint Global Coordinators lawfully takes on such Placee's behalf.

If Placing Shares are to be delivered to a custodian or settlement agent, Placees should ensure that the trade confirmation is copied and delivered immediately to the relevant person within that organisation.

Insofar as Placing Shares are registered in a Placee's name or that of its nominee or in the name of any person for whom a Placee is contracting as agent or that of a nominee for such person, such Placing Shares should, subject as provided below, be so registered free from any liability to UK stamp duty or stamp duty reserve tax. If there are any other circumstances in which any stamp duty or stamp duty reserve tax (and/or any interest, fines or penalties relating thereto) is payable in respect of the allocation, allotment, issue or delivery of the Placing Shares (or for the avoidance of doubt if any stamp duty or stamp duty reserve tax is payable in connection with any subsequent transfer of or agreement to transfer Placing Shares), none of the Joint Global Coordinators or the Company shall be responsible for the payment thereof. Placees shall not be entitled to receive any fee or commission in connection with the Placing.

Representations and warranties and further terms

By submitting a bid and/or participating in the Placing each prospective Placee (and any person acting on such Placee's behalf) irrevocably acknowledges, confirms, undertakes, represents, warrants and agrees (as the case may be) with each Joint Global Coordinator and the Company, in each case as a fundamental term of its application for Placing Shares), the following:

1.  it has read and understood this Announcement, including this Appendix, in its entirety and that its participation in the Bookbuild and the Placing and its subscription for and purchase of Placing Shares is subject to and based upon all the terms, conditions, representations, warranties, indemnities, acknowledgements, agreements and undertakings and other information contained herein and undertakes not to redistribute or duplicate this Announcement and it has not relied on, and will not rely on, any other information given or any representations, warranties or statements made at any time by any person in connection with the Admissions, the Bookbuild, the Placing, the Company, the Placing Shares or otherwise;

2.  that no offering document, offering memorandum, admission document or prospectus has been or will be prepared in connection with the Placing or is required under the EU Prospectus Regulation or UK Prospectus Regulation and it has not received and will not receive a prospectus, offering memorandum, admission document or other offering document in connection with the Bookbuild, the Placing or the Placing Shares;

3.  (i) it has made its own assessment of the Company, the Placing Shares and the terms of the Placing based on this Announcement (including Appendix 1 ) and any information publicly announced to a Regulatory Information Service by or on behalf of the Company prior to the date of this Announcement (the "Publicly Available Information"); (ii) the Ordinary Shares are admitted to the premium listing segment of the Official List of the FCA and to trading on the London Stock Exchange's main market for listed securities and the Company is therefore required to publish certain business and financial information in accordance with the Market Abuse Regulation (EU) No.596/2014 ("MAR"), in the period up to and including 31 December 2020, and from 1 January 2021 in accordance with the UK version of the Market Abuse Regulation (EU) No.596/2014, which forms part of UK law by virtue of the European Union (Withdrawal) Act 2018) ("UK MAR") and the rules and practices of the London Stock Exchange (the "Exchange Information"), which includes a description of the nature of the Company's business, most recent balance sheet and profit and loss account, and similar statements for preceding years, and it has reviewed such Exchange Information as it has deemed necessary or that it is able to obtain or access the Exchange Information without undue difficulty; and (iii) it has had access to such financial and other information (including the business, financial condition, prospects, creditworthiness, status and affairs of the Company, the Placing and the Placing Shares, as well as the opportunity to ask questions) concerning the Company, the Placing and the Placing Shares as it has deemed necessary in connection with its own investment decision to acquire any of the Placing Shares and has satisfied itself that the information is still current and relied on that investigation for the purposes of its decision to participate in the Placing;

4.  that the content of this Announcement is exclusively the responsibility of the Company and that neither the Joint Global Coordinators nor any of their respective affiliates nor any of their respective Representatives nor any person acting on their behalf has or shall have any responsibility or liability for any information, representation or statement contained in this Announcement or any information previously or subsequently published by or on behalf of the Company, including, without limitation, any Exchange Information, and will not be liable for any Placee's decision to participate in the Placing based on any information, representation or statement contained in this Announcement or any information previously published by or on behalf of the Company or otherwise. Each Placee further represents, warrants and agrees that the only information on which it is entitled to rely and on which such Placee has relied in committing itself to acquire the Placing Shares is contained in this Announcement and any Publicly Available Information including (without limitation) the Exchange Information, such information being all that it deems necessary and/or appropriate to make an investment decision in respect of the Placing Shares, and that it has neither received nor relied on any other information given or investigations, representations, warranties or statements made by the Joint Global Coordinators or the Company or any of their respective affiliates or any of their respective Representatives or any person acting on their behalf and neither the Joint Global Coordinators nor the Company nor any of their respective affiliates, nor any of their respective Representatives nor any person acting on their behalf will be liable for any Placee's decision to accept an invitation to participate in the Placing based on any other information, representation, warranty or statement. Each Placee further acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of the Company in deciding to participate in the Placing;

5.  (i) neither the Joint Global Coordinators nor any of their respective affiliates nor any of their respective Representatives nor any person acting on their behalf have made any representations to it, express or implied, with respect to the Company, the Bookbuild, the Placing and the Placing Shares or the accuracy, completeness or adequacy of the Publicly Available Information or the Exchange Information, and each of them expressly disclaims any liability in respect thereof; and (ii) it will not hold the Joint Global Coordinators or any of their respective affiliates or any of their respective Representatives or any person acting on their behalf responsible for any misstatements in or omissions from the Publicly Available Information or the Exchange Information. Nothing in this paragraph or otherwise in this Announcement excludes the liability of any person for fraudulent misrepresentation made by that person;

6.  none of the Joint Global Coordinators or the Company or any of their respective affiliates or any of their respective Representatives or any person acting on behalf of any of them has provided, and none of them will provide, to it any material regarding the Placing Shares or the Company or any other person other than this Announcement, nor has it requested that any of the Joint Global Coordinators, the Company, any of their respective affiliates, any of their respective Representatives or any person acting on behalf of any of them to provide it with any such material;

7.  it understands, and each account it represents has been advised that, (i) the Placing Shares have not been and will not be registered under the Securities Act or with any regulatory authority of any state or other jurisdiction of the United States; (ii) the Placing Shares are being offered and sold only (a) to persons reasonably believed to be QIBs in transactions exempt from, the registration requirements of the Securities Act or (b) in an "offshore transaction" within the meaning of and pursuant to Regulation S under the Securities Act; (iii) the Placing Shares may only be reoffered or resold in transactions exempt from, or not subject to, the registration requirements of the Securities Act and no representation has been made as to the availability of any exemption under the Securities Act or any relevant state or other jurisdiction's securities laws for the reoffer, resale, pledge or transfer of the Placing Shares; and (iv) a prospectus will not be published in respect of any of the Placing Shares under the Securities Act or the securities laws of any state or other jurisdiction of the United States;

8.  it is not an affiliate (as defined in Rule 501(b) under the Securities Act) of the Company, and is not acting on behalf of an affiliate of the Company;

9.  the Placing Shares offered and sold in the United States are "restricted securities" within the meaning of Rule 144(a)(3) under the Securities Act and for so long as the Placing Shares are restricted securities, it will segregate such Placing Shares from any other shares in the Company that it holds that are not restricted securities, will not deposit the Placing Shares into any depositary receipt facility maintained by any depositary bank in respect of the Company's ordinary shares and will notify any subsequent transferee of such Placing Shares of the applicable transfer restrictions;

10.  it will not distribute, forward, transfer or otherwise transmit this Announcement or any other materials concerning the Placing (including any electronic copies thereof), in or into the United States (including electronic copies thereof) to any person, and it has not distributed, forwarded, transferred or otherwise transmitted any such materials to any person ;

11.  it is not, and at the time the Placing Shares are acquired, neither it nor the beneficial owner of the Placing Shares will be, a resident of Australia, Canada, Japan or South Africa and further acknowledges that the Placing Shares have not been and will not be registered under the securities legislation of Australia, Canada, Japan or South Africa and, subject to certain exceptions, may not be offered, sold, transferred, delivered or distributed, directly or indirectly, in or into those jurisdictions;

12.  if it received any "inside information" as defined in the UK MAR concerning the Company or its shares or other securities or related financial instruments in advance of the Placing, it has not (i) dealt in the securities of the Company; (ii) encouraged or required another person to deal in the securities of the Company; or (iii) disclosed such information to any person except as permitted by UK MAR, prior to the information being made publicly available;

13.  it has complied with its obligations under the Criminal Justice Act 1993, MAR, UK MAR, any delegating acts, implementing acts, technical standards and guidelines and Section 118 of FSMA thereunder, and in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002 (as amended), the Terrorism Act 2000 (as amended), the Terrorism Act 2006, and the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (as amended) (the "Regulations") and the Money Laundering Sourcebook of the FCA and, if making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Regulations. If within a reasonable time after a request for verification of identity, the Joint Global Coordinators have not received such satisfactory evidence, the Joint Global Coordinators may, at their absolute discretion, terminate the Placee's Placing participation in which event all funds delivered by the Placee to the Joint Global Coordinators will be returned without interest to the account of the drawee bank or CREST account from which they were originally debited;

14.  if it is in the United Kingdom it is a Relevant Person and if it is in a member state of the EEA it is a Qualified Investor and undertakes that it will subscribe for, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business;

15.  it understands that any investment or investment activity to which this Announcement relates is available only to Relevant Persons in the United Kingdom and Qualified Investors in a member state of the EEA and will be engaged in only with Relevant Persons in the United Kingdom and Qualified Investors in a member state of the EEA, and further understands that this Announcement must not be acted on or relied on by persons who are not Relevant Persons in the United Kingdom and Qualified Investors in a member state of the EEA;

16.  if it is a financial intermediary, as that term is used in Article 5(1) of the EU Prospectus Regulation and Article 5(1) of the UK Prospectus Regulation, that the Placing Shares subscribed for by it in the Placing will not be subscribed for on a non-discretionary basis on behalf of, nor will they be subscribed for with a view to their offer or resale to, persons in a member state of the EEA other than Qualified Investors or persons in the UK other than Relevant Persons, or in circumstances in which the prior consent of the Joint Global Coordinators has been given to the proposed offer or resale;

17.  that it has not offered or sold and will not offer or sell any Placing Shares to persons in the United Kingdom, except to Relevant Persons or otherwise in circumstances which have not resulted and which will not result in an offer to the public in the United Kingdom within the meaning of section 85(1) of the FSMA;

18.  that any offer of Placing Shares may only be directed at persons in member states of the EEA who are Qualified Investors and represents, warrants and undertakes that it has not offered or sold and will not offer or sell any Placing Shares to persons in the EEA prior to Admission except to Qualified Investors or otherwise in circumstances which have not resulted in and which will not result in an offer to the public in any member state of the EEA within the meaning of the EU Prospectus Regulation;

19.  it has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) relating to the Placing Shares in circumstances in which section 21(1) of FSMA does not require approval of the communication by an authorised person;

20.  it has complied and will comply with all applicable laws (including all relevant provisions of FSMA) with respect to anything done by it in relation to the Placing Shares;

21.  if in the United Kingdom, it is a Qualified Investor within the meaning of Article 2(e) of the UK Prospectus Regulation and is also a person (i) having professional experience in matters relating to investments and who falls within the definition of "investment professionals" in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the "Order"); or (ii) who falls within Article 49(2)(a) to (d) of the Order; or (iii) to whom this Announcement may otherwise lawfully be communicated;

22.  if it is in a member state of the EEA, it is a Qualified Investor;

23.  if in the United Kingdom, unless otherwise agreed by the Joint Global Coordinators, it is a "professional client" or an "eligible counterparty" within the meaning of Chapter 3 of the FCA's Conduct of Business Sourcebook and it is acquiring Placing Shares for investment only and not with a view to resale or distribution;

24.  no action has been or will be taken by either the Company or the Joint Global Coordinators or any person acting on behalf of the Company or the Joint Global Coordinators that would, or is intended to, permit a public offer of the Placing Shares in any country or jurisdiction where any such action for that purpose is required;

25.  neither it, nor the person specified by it for registration as holder of Placing Shares is, or is acting as nominee or agent for, and the Placing Shares will not be allotted to, a person who is or may be liable to stamp duty reserve tax under any of sections 67, 70, 93 and 96 of the Finance Act 1986 (depository receipts and clearance services) and the Placing Shares are not being acquired in connection with arrangements to issue depository receipts or to issue or transfer Placing Shares into a clearance system;

26.  (i) it is acting as principal in respect of the Placing and has the power and authority to carry on the activities in which it is engaged, to subscribe for Placing Shares and to execute and deliver all documents necessary for such subscription; and/or (ii) if it is acting for any other person (A) it is duly authorised to do so and has full power to make the acknowledgments, representations, undertakings and agreements and give the indemnities herein on behalf of each such person; and (B) it is and will remain liable to the Company and/or the Joint Global Coordinators for the performance of all its obligations as a Placee in respect of the Placing (regardless of the fact that it is acting for another person). Each Placee agrees that the provisions of this paragraph shall survive the resale of the Placing Shares by or on behalf of any person for whom it is acting;

27.  if it is a pension fund or investment company, its acquisition of Placing Shares is in full compliance with applicable laws and regulations;

28.  (i) it and any person acting on its behalf is entitled to subscribe for the Placing Shares under the laws of all relevant jurisdictions which apply to it; (ii) it has paid any issue, transfer or other taxes due in connection with its participation in any territory; (iii) it has fully observed such laws and obtained all such governmental and other guarantees, permits, authorisations, approvals and consents which may be required thereunder and complied with all necessary formalities and that it has not taken any action or omitted to take any action which will or may result in the Joint Global Coordinators or the Company or any of their respective affiliates or any of their respective Representatives acting in breach of the legal or regulatory requirements of any jurisdiction in connection with the Placing; and (iv) the subscription of the Placing Shares by it or any person acting on its behalf will be in compliance with applicable laws and regulations in the jurisdiction of its residence, the residence of the Company, or otherwise;

29.  it (and any person acting on its behalf) has the funds available to pay for, and has all necessary capacity and has obtained all necessary consents and authorities to enable it to commit to its participation in the Placing and to perform its obligations in relation thereto (including, without limitation, in the case of any person on whose behalf it is acting, all necessary consents and authorities to agree to the terms set out or referred to in this Announcement) and will honour such obligations;

30.  it (and any person acting on its behalf) will make payment for the Placing Shares allocated to it in accordance with the terms and conditions of this Announcement (including Appendix 1 ), on the due time and date set out herein, failing which the relevant Placing Shares may be placed with other persons or sold as the Joint Global Coordinators may in their absolute discretion determine and without liability to such Placee, and it will remain liable for any amount by which the net proceeds of such sale falls short of the product of the Placing Price and the number of Placing Shares allocated to it and may be required to bear any stamp duty or stamp duty reserve tax or other similar taxes (together with any interest or penalties due pursuant to the terms set out or referred to in this Announcement) which may arise upon the sale of such Placee's Placing Shares on its behalf;

31.  its allocation (if any) of Placing Shares will represent a maximum number of Placing Shares which it will be entitled, and required, to acquire, and that the Joint Global Coordinators or the Company may call upon it to acquire a lower number of Placing Shares (if any), but in no event in aggregate more than the aforementioned maximum;

32.  that its acquisition of Firm Placing Shares is not subject to the passing of the Resolution, that the Conditional Placing is subject to the passing of the Resolutions at the General Meeting and, if the Resolutions are not passed, the Firm Placing may proceed without the Conditional Placing proceeding and, as such, the Company may be required to seek further funding in the future;

33.  the person whom it specifies for registration as holder of the Placing Shares will be (i) itself or (ii) its nominee, as the case may be. Neither the Joint Global Coordinators nor the Company will be responsible for any liability to stamp duty or stamp duty reserve tax or other similar taxes resulting from a failure to observe this requirement. Each Placee and any person acting on behalf of such Placee agrees to indemnify and hold harmless the Company, each of the Joint Global Coordinators, their respective affiliates and any of their respective Representatives in respect of the same on an after-tax basis on the basis that the Placing Shares will be allotted to the CREST stock account of the Joint Global Coordinators (or any one of them) who will hold them as nominee on behalf of such Placee until settlement in accordance with its standing settlement instructions;

34.  the Placing does not constitute a recommendation or financial product advice and the Joint Global Coordinators have not had regard to its particular objectives, financial situation and needs;

35.  none of the Joint Global Coordinators, any of their respective affiliates, any of their respective Representatives or any person acting on behalf of any of them, is making any recommendations to it or, advising it regarding the suitability of any transactions it may enter into in connection with the Placing and that participation in the Placing is on the basis that it is not and will not be a client of any of the Joint Bookrunners and that the Joint Global Coordinators do not have any duties or responsibilities to it for providing the protections afforded to their respective clients or customers or for providing advice in relation to the Placing or in respect of any representations, warranties, undertakings or indemnities contained in the Placing Agreement or for the exercise or performance of any of their rights and obligations thereunder including any rights to waive or vary any conditions or exercise any termination right;

36.  that in making any decision to acquire the Placing Shares (i) it has such knowledge, sophistication and experience in financial, business and international investment matters as is required to evaluate the merits and risks of subscribing for or acquiring the Placing Shares, (ii) it is experienced in investing in securities of this nature in this sector and is aware that it may be required to bear, and is able to bear, the economic risk of participating in, and is able to sustain a complete loss in connection with, the Placing, (iii) it has relied on its own examination, due diligence and analysis of the Company and its affiliates taken as a whole, including the markets in which the Company and its affiliates operate, and the terms of the Placing, including the merits and risks involved and not upon any view expressed or information provided by or on behalf of any of the Joint Global Coordinators, (iv) it has had sufficient time and access to information to consider and conduct its own investigation with respect to the offer and purchase of the Placing Shares, including the legal, regulatory, tax, business, currency and other economic and financial considerations relevant to such investment and has so conducted its own investigation to the extent it deems necessary to enable it to make an informed and intelligent decision with respect to making an investment in the Placing Shares , (v) it is aware and understands that an investment in the Placing Shares involves a considerable degree of risk and (vi) it will not look to the Company, the Joint Global Coordinators, any of their respective affiliates, any of their respective Representatives or any person acting on their behalf for all or part of any such loss or losses it or they may suffer;

37.  in connection with the Placing, any of the Joint Global Coordinators and any of its or their respective affiliates or their respective Representatives acting as an investor for its own account may take up a portion of the Placing Shares and in that capacity may acquire, retain, purchase or sell for its own account such Placing Shares in the Company and any securities of the Company or related investments and may offer or sell such securities or other investments otherwise than in connection with the Placing. Accordingly, references in this Announcement to shares being issued, offered or placed should be read as including any issue, offering or placement of such shares in the Company to the Joint Global Coordinators or their respective affiliates or their respective Representatives acting in such capacity. In addition the Joint Global Coordinators may enter into financing arrangements and swaps with investors in connection with which the Joint Global Coordinators may from time to time acquire, hold or dispose of such securities of the Company, including the Placing Shares. None of the Joint Global Coordinators intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligation to do so;

38.  it acknowledges that it irrevocably appoints any director or authorised signatories of the Joint Global Coordinators as its agent for the purposes of executing and delivering to the Company and/or its registrars any documents on its behalf necessary to enable it to be registered as the holder of any of the Placing Shares agreed to be taken up by it under the Placing;

39.  its commitment to acquire the Placing Shares on the terms set out herein and in the trade confirmation will continue notwithstanding any amendment that may in future be made to the terms and conditions of the Placing and Placees will have no right to be consulted or require that their consent be obtained with respect to the Company's or the Joint Global Coordinators' conduct of the Placing;

40.  the terms and conditions and any agreements entered into by it pursuant to these terms and conditions and any non-contractual obligations arising out of or in connection with such agreements shall be governed by and construed in accordance with the laws of England and it submits (on behalf of itself and on behalf of any person on whose behalf it is acting) to the exclusive jurisdiction of the English courts as regards any claim, dispute or matter arising out of any such agreements and such non-contractual obligations, except that enforcement proceedings in respect of the obligation to make payment for the Placing Shares (together with any interest chargeable thereon) may be taken by the Company or the Joint Global Coordinators in any jurisdiction in which the relevant Placee is incorporated or in which any of its securities have a quotation on a recognised stock exchange;

41.  it will indemnify on an after-tax basis and hold each of the Company and the Joint Global Coordinators and their respective affiliates and their respective Representatives harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of, directly or indirectly, or in connection with any breach of the representations, warranties, acknowledgements, agreements and undertakings in this Appendix 1 and further agrees that the provisions of this Appendix 1 shall survive after completion of the Placing;

42.  neither the Company nor the Joint Global Coordinators owes any fiduciary or other duties to any Placee in respect of any acknowledgements, confirmations, undertakings, representations, warranties or indemnities in the Placing Agreement; and

43.  the Company, the Joint Global Coordinators and their respective affiliates and their respective Representatives and others will rely upon the truth and accuracy of the representations, warranties, acknowledgements, indemnities, undertakings and agreements set forth herein and which are given to each of the Joint Global Coordinators and the Company (for their own benefit and, where relevant, the benefit of their respective affiliates and any person acting on their behalf) and are irrevocable and it irrevocably authorises the Company and the Joint Global Coordinators to produce this Announcement, pursuant to, in connection with, or as may be required by any applicable law or regulation, administrative or legal proceeding or official inquiry with respect to the matters set forth herein. It agrees that if any of the acknowledgements, representations, warranties, undertakings and agreements made in connection with its subscribing and/or acquiring of Placing Shares is no longer accurate, it shall promptly notify the Company and the Joint Global Coordinators.

Each Placee not acquiring the Placing Shares in an "offshore transaction" pursuant to Regulation S (each a "US Placee") shall make specific representations, warranties, agreements and acknowledgements pursuant to a US investor representation letter. Each US Placee acknowledges that it will not be permitted to purchase, subscribe for or otherwise take up Placing Shares unless it has signed and returned such representation letter in accordance with the terms thereof.

Please also note that the agreement to allot and issue Placing Shares to Placees (or the persons for whom Placees are contracting as agent) free of stamp duty and stamp duty reserve tax relates only to their allotment and issue to Placees, or such persons as they nominate as their agents, direct from the Company for the Placing Shares in question. Such agreement is subject to the representations, warranties and further terms above and assumes and is based on the warranty and representation from each Placee that the Placing Shares are not being subscribed for in connection with arrangements to issue depositary receipts or to issue or transfer the Placing Shares into a clearance service. If there are any such arrangements, or the settlement relates to any other dealing in the Placing Shares, stamp duty or stamp duty reserve tax or other similar taxes may be payable, for which none of the Company or the Joint Global Coordinators will be responsible and each Placee shall indemnify on an after-tax basis and hold harmless the Company and the Joint Global Coordinators and their respective affiliates and their respective Representatives for any stamp duty or stamp duty reserve tax paid by them in respect of any such arrangements or dealings. If this is the case, each Placee should seek its own advice and notify the Joint Global Coordinators accordingly.

None of the Company or the Joint Global Coordinators is liable to bear any capital duty, stamp duty and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto) payable in or outside the United Kingdom by any Placee or any other person on a Placee's acquisition of any Placing Shares or the agreement by a Placee to acquire any Placing Shares. Each Placee agrees to indemnify on an after-tax basis and hold harmless the Company, the Joint Global Coordinators, their respective affiliates and their respective Representatives from any and all such stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including interest, fines or penalties relating thereto). Each Placee should seek its own advice as to whether any of the above tax liabilities arise and notify the Joint Global Coordinators accordingly.

In this Announcement, "after-tax basis" means in relation to any payment made to the Company or the Joint Global Coordinators or their respective affiliates or their respective Representatives pursuant to this Announcement where the payment (or any part thereof) is chargeable to any tax, a basis such that the amount so payable shall be increased so as to ensure that after taking into account any tax chargeable (or which would be chargeable but for the availability of any relief unrelated to the loss, damage, cost, charge, expense or liability against which the indemnity is given on such amount (including on the increased amount) there shall remain a sum equal to the amount that would otherwise have been so payable.

Each Placee, and any person acting on behalf of each Placee, acknowledges and agrees that the Joint Global Coordinators and/or any of their respective affiliates and/or any of their respective Representatives may, at their absolute discretion, agree to become a Placee in respect of some or all of the Placing Shares. Each Placee acknowledges and is aware that each of the Joint Global Coordinators is receiving a fee in connection with its role in respect of the Placing as detailed in the Placing Agreement.

When a Placee or person acting on behalf of the Placee is dealing with any of the Joint Global Coordinators, any money held in an account with the relevant Joint Global Coordinator on behalf of the Placee and/or any person acting on behalf of the Placee will not be treated as client money within the meaning of the rules and regulations of the FCA made under FSMA. The Placee acknowledges that the money will not be subject to the protections conferred by the client money rules; as a consequence, this money will not be segregated from the relevant Joint Global Coordinator's money in accordance with the client money rules and will be used by the relevant Joint Global Coordinator in the course of its own business; and the Placee will rank only as a general creditor of such Joint Global Coordinator.

All times and dates in this Announcement may be subject to amendment by the Joint Global Coordinators and the Company (in their absolute discretion).The Joint Global Coordinators shall notify the Placees and any person acting on behalf of the Placees of any changes.

Past performance is no guide to future performance and persons needing advice should consult an independent financial adviser.

The rights and remedies of the Joint Global Coordinators and the Company under these terms and conditions are in addition to any rights and remedies which would otherwise be available to each of them and the exercise or partial exercise of one will not prevent the exercise of others.

PRESENTATION OF FINANCIAL AND OTHER INFORMATION

Non-IFRS financial measures

The Company presents certain key operating metrics that are not defined under IFRS (alternative performance measures) in this Announcement. These non-IFRS measures are used by the Company to monitor the underlying performance of the Company's performance from period to period and to facilitate comparison with its peers. Since not all companies calculate these or other non-IFRS metrics in the same way, the manner in which the Company has chosen to calculate the non-IFRS metrics presented herein may not be compatible with similarly defined terms used by other companies. Therefore, the non-IFRS metrics should not be considered in isolation of, or viewed as substitutes for, the financial information prepared in accordance with IFRS. Certain of the key operating metrics set forth below are based on information derived from the Company's regularly maintained records and accounting and operating systems.

Adjusted Total Revenue

Adjusted Total Revenue is defined as total revenue adjusted for impact of derivatives settled in cash. The Directors view Adjusted Total Revenue as a useful measure that enables investors to discern Diversified's realized revenue after adjusting for the settlements of derivative contracts.

EBITDA

EBITDA is defined by the Company as earnings before interest, tax, depreciation and amortisation.

Adjusted EBITDA

Adjusted EBITDA is defined by the Company as EBITDA (as defined above)  adjusted for non-recurring items such as gain on the sale of assets, acquisition related expenses and integration costs, mark-to-market adjustments related to the Company's hedge portfolio, non-cash equity compensation charges and items of a similar nature and includes the impact of derivatives settled in cash. The Directors believe that Adjusted EBITDA is a useful measure that enables a more effective way to evaluate operating performance and compare the results of operations from period-to-period and against its peers without regard to the Company's financing methods or capital structure.

EBITDA Margin and Adjusted EBITDA Margin

EBITDA Margin and Adjusted EBITDA margin are defined as total EBITDA (as defined above) and Adjusted EBITDA (as defined above) as a percentage of total revenue and Adjusted Revenue (as defined above), respectively. The Directors believe that EBITDA margin and Adjusted EBITDA margin are useful measures of Diversified's profitability and efficiency as well as earning's quality.

Free Cash Flow

Free Cash Flow is defined by the Company as Adjusted EBITDA further adjusted for capital expenditures and cash paid for interest. The Directors view Free Cash Flow as a useful indicator of Diversified's ability to generate cash that is available for activities other than capital expenditures and provides investors with an important perspective on the cash available to service debt obligations, make strategic acquisitions and investments, and pay dividends.

Leverage and Net Debt-to-Adjusted-EBITDA

Leverage (also referred to as "Net Debt-to-Adjusted-EBITDA") is measured as Net Debt (defined below) divided by Adjusted EBITDA (as defined above). The Directors view leverage as a key measure of the Company's ability to pay off its debt as well as it being used in the covenant calculations for the Company's external borrowings.

Net Debt

Net Debt is defined as total debt as recognized on the balance sheet, less cash and restricted cash. Total debt includes Diversified's current portion of debt, Credit Facility borrowings and secured financing borrowings.

Market, industry and other statistical data

This Announcement relies on and refers to information regarding the Company's business and the markets in which the markets in which the Company operates and competes. The market data and certain economic and industry data and forecasts used in this Announcement were obtained from governmental and other publicly available information, independent industry publications and reports prepared by industry consultants, including Energy Information Administration and FactSet.

Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but that there can be no assurance as to the accuracy and completeness of such information. The Company believes that these industry publications, surveys and forecasts are reliable, but they have not been independently verified from third party sources.

All such data sourced from third parties contained in this Announcement have been accurately reproduced and, so far as the Company is aware and is able to ascertain from information published by that third party, no facts have been omitted that would render the reproduced information inaccurate or misleading. No material changes have occurred since the date of the Competent Person's Report available on the Company's website at www.div.energy, the omission of which would make the Competent Person's Report misleading.

The Company cannot assure you that any of the assumptions underlying any statements regarding the gas and oil industry are accurate or correctly reflect the Company's position in the industry. Market data and statistics are inherently predictive and speculative and are not necessarily reflective of actual market conditions. Such statistics are based on market research, which itself is based on sampling and subjective judgments by both the researchers and the respondents, including judgments about what types of products and transactions should be included in the relevant market. In addition, the value of comparisons of statistics for different markets is limited by many factors, including that (i) the markets are defined differently, (ii) the underlying information was gathered by different methods and (iii) different assumptions were applied in compiling the data. Accordingly, the market statistics included in this Announcement should be viewed with caution and no representation or warranty is given by any person as to their accuracy. Elsewhere in this Announcement, statements regarding the gas and oil industry are not based on published statistical data or information obtained from independent third parties, but are based solely on the Company's experience, its internal studies and estimates, and its own investigation of market conditions. The Company cannot assure you that any of these studies or estimates are accurate, and none of the Company's internal surveys or information have been verified by any independent sources. While the Company is not aware of any misstatements regarding its estimates presented herein, the Company's estimates involve risks, assumptions and uncertainties and are subject to change based on various factors.

Forward-looking statements

This Announcement includes forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties, many of which are beyond the Company's control and all of which are based on management's current beliefs and expectations about future events. Forward-looking statements are sometimes identified by the use of forward-looking terminology such as "believe", "expects", "targets", "may", "will", "could", "should", "shall", "risk", "intends", "estimates", "aims", "plans", "predicts", "continues", "assumes", "positioned" or "anticipates" or the negative thereof, other variations thereon or comparable terminology. These forward-looking statements include all matters that are not historical facts. They appear in a number of places throughout this Announcement and include statements regarding the intentions, beliefs or current expectations of management or the Company concerning, among other things, the results of operations, financial condition, prospects, growth, strategies and dividend policy of the Company and the industry in which it operates. In particular, the statements included in the sections entitled "Risk Factors" and "Business" of this Announcement regarding the Company's strategy, targets and expectations in respect of the Company's expected revenue, profit, growth, accounting tax rates, and capital expenditure upon the operating results of the Company as well as other expressions of the Company's targets and expectations and other future events or prospects are forward-looking statements.

No incorporation of website information

Information contained on the Company's website (or any other website) or the contents of any website accessible from hyperlinks on the Company's website (or any other website) are not incorporated into and do not form part of this Announcement.

 

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