D1 Oils Placement Announcment

30th Nov 2006 07:04

D1 Oils Plc30 November 2006 NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE UNITED STATES OF AMERICA, AUSTRALIA, CANADA OR JAPAN D1 Oils plc30 November 2006 D1 Oils plc Placing of up to 35,151,515 New Ordinary Shares D1 Oils plc (D1) has conditionally raised £48.7 million (approximately £46.1million after expenses) through a placing with existing shareholders and otherinvestors of 29,484,848 new Ordinary Shares in the Company at 165 pence perOrdinary Share. In addition, the Company has granted an over-allotment option inrespect of up to an additional 5,666,667 new Ordinary Shares. Highlights • Placing of up to 29,484,848 new Ordinary Shares at 165 pence per share raising £48.7 million before expenses• Placing of up to a further 5,666,667 new Ordinary Shares at a price no lower than 165 pence per share pursuant to the Option• Proceeds of the Placing will be used to o Deliver our sustainable and vertically integrated business plan o Enhance our capabilities in agronomy, refining and trading o Further develop our planting, plant science and refining • Significant opportunities to invest additional equity capital, sought by way of the issue of the Option Shares, to accelerate further our planting and plant science programme This announcement includes the text of a letter from the Chairman of the Companyincluded in a circular to shareholders to be posted today, which includesfurther information on the Placing and an update on current developments of thebusiness of the Company. Dresdner Kleinwort, Nominated Adviser and Broker to the Company, hasconditionally placed the Underwritten Shares with existing shareholders andother investors. The Placing, including the issue of up to 5,666,667 new Ordinary Shares pursuantto the over-allotment option, is subject to shareholder approval at anExtraordinary General Meeting to be held on 28 December 2006. The Placing Price represents a discount of approximately 8.0 per cent. to theclosing middle market price of 179.5 pence per share on 29 November 2006, thelast business day prior to this announcement. The full terms and conditions of the Placing are set out in the appendix to thispress release. Karl E. Watkin, Chairman of D1 Oils said, "The outcome of this placing and thesignificant levels of interest shown by the investment community demonstrate themarket confidence in the Company and its strategy to build a leadership positionin the global biofuels industry." Contact: D1 Oils Graham Prince, Head of Corporate CommunicationsTel: +44 (0) 1642 755580Mobile: +44 (0) 7973 323840 Brunswick Group Mark AntelmeTel: +44 (0) 20 7404 5959 Dresdner Kleinwort David HutchisonMichael CovingtonTel: +44 (0) 20 7623 8000 Notes to editors D1 Oils plc is a UK-based global producer of bodies. We are building a global supply chain and network that is sustainable and delivers value from'earth-to-engine'. Our operations cover agronomy, refining and trading. We arepioneering the science, planting and production of inedible vegetable oils; wedesign, build, own, operate and market bodies refineries; and we source,transport and trade seeds and seedlings, seedcake, crude vegetable oils andbodies. Our vision is to be the world's leading bodies business. This announcement does not constitute an offer to sell or an invitation tosubscribe for, or the solicitation of an offer to buy or to subscribe for,Ordinary Shares in any jurisdiction in which such an offer or solicitation isunlawful and is not for distribution in or into Canada, Japan, the United Statesor Australia (the "Prohibited Territories"). The Ordinary Shares have not beenand will not be registered under the United States Securities Act of 1933 (asamended) or under the applicable securities laws of any state in the UnitedStates or any Prohibited Territory and, unless an exemption under such Acts orlaws is available, may not be offered for sale or subscription or sold orsubscribed directly or indirectly within the Prohibited Territories or for theaccount or benefit of any national, resident or citizen of the ProhibitedTerritories. The distribution of this announcement in other jurisdictions may berestricted by law and therefore persons into whose possession this announcementcomes should inform themselves about and observe any such restrictions. Anyfailure to comply with these restrictions may constitute a violation of thesecurities laws of such jurisdictions. The contents of this announcement are not to be construed as legal, financial ortax advice. If necessary, each recipient of this announcement should consulthis, her or its own legal adviser, financial adviser or tax adviser for legal,financial or tax advice. Dresdner Kleinwort Limited and Dresdner Kleinwort Securities Limited, who areauthorised and regulated by the Financial Services Authority, and Dresdner BankAG, London Branch, which is authorised by BAFin and by the Financial ServicesAuthority and which is regulated by the Financial Services Authority for theconduct of designated investment business in the United Kingdom, are acting forD1 Oils and for no one else in connection with the Placing and will not beresponsible to anyone other than D1 Oils for providing the protections affordedto customers of Dresdner Kleinwort Limited, Dresdner Kleinwort SecuritiesLimited and Dresdner Bank AG, London Branch, or for affording advice in relationto the Placing or any other matters referred to herein. The responsibilities ofDresdner Kleinwort Limited, as nominated adviser under the AIM Rules, are owedsolely to the London Stock Exchange and are not owed to the Company or to any ofthe Directors. No representation or warranty, express or implied, is made by Dresdner KleinwortLimited, Dresdner Kleinwort Securities Limited or Dresdner Bank AG, LondonBranch as to any of the contents of this announcement for which the directors ofD1 Oils are solely responsible. This announcement contains certain statementsthat are or may be forward-looking. These statements typically contain wordssuch as ''intends'', ''expects'', ''anticipates'', ''estimates'' and words ofsimilar import. By their nature, forward-looking statements involve risk anduncertainty because they relate to events and depend on circumstances that willoccur in the future and therefore undue reliance should not be placed on suchforward-looking statements. Forward-looking statements speak only as of the datethey are made and the Company undertakes no obligation to update publicly any ofthem in light of new information or future events except as required by the AIMRules. There are a number of factors that could cause actual results anddevelopments to differ materially from those expressed or implied by suchforward-looking statements. THE SECURITIES REFERRED TO IN THIS ANNOUNCEMENT HAVE NOT BEEN REGISTERED WITH,RECOMMENDED, APPROVED OR DISAPPROVED BY ANY UNITED STATES FEDERAL OR STATESECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOINGAUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY OF THISANNOUNCEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THEUNITED STATES. The following is the text of the letter from the Chairman of the Companyincluded in a circular to be sent to shareholders on 30 November, 2006. "Introduction Your board has today announced that the Company has conditionally raisedapproximately £48.7 million before expenses (approximately £46.1 million net ofexpenses) through a placing with institutional investors, underwritten by DBAG,of 29,484,848 Ordinary Shares in the Company at 165 pence per Ordinary Share. Inaddition the Company has granted an over-allotment option in respect of up to anadditional 5,666,667 Ordinary Shares. The purpose of this document is to provideyou with further information on the Placing and to convene the EGM to seekShareholder approval for the Resolutions necessary to effect the Placing. Development of the business to date Since D1 was listed on AIM in October 2004, the Company has made significantprogress in seeking to establish a global biodiesel business. Building on thedevelopment of the business after the flotation, the additional funding of£24.4m raised in June 2005 enabled us to work towards our vision of creatingvalue from "earth to engine" through our three core activities of agronomy,refining and trading. We are now seeking to accelerate the development of thebusiness and to take advantage of the growing international demand for renewablefuels. In our results for the six months ended 30 June 2006, announced on 27September 2006, we reported that we are performing well in all aspects of ourbusiness. We believe we are making substantial progress towards realising ourvision of becoming a leading global biodiesel business. In agronomy, as of 30 September 2006, together with our joint venture partners,we have either planted or obtained rights to over 114,000 hectares of plantedJatropha curcas. Further planting is underway in key locations in the developingworld, and includes significant new planting in China. We believe we are makingsubstantial advances in the plant science of inedible oil production, and weexpect to be able to deliver a new 'E1' elite jatropha seed with an improvedyield potential of 2.7 tonnes of oil per hectare at maturity. In refining, we have brought our first biodiesel refineries in the UK intooperation. As announced on 21 November 2006 we have finalised the terms of afinancing package to fund the roll-out of the first four of our D1 20 refineryunits. We also plan to expand significantly our UK operations with theacquisition of a new refining and distribution site at Bromborough onMerseyside. This acquisition is conditional and scheduled to be completed by theend of 2006. Once acquired and operational, this site will enable usapproximately to double our targeted UK refinery capacity from 220,000 tonnes to420,000 tonnes by the end of 2008. In trading, we have concluded our first major UK offtake contract for biodieselwith Petroplus. Further offtake agreements are being negotiated. We are alsodeveloping our logistics capabilities to support our planting and refining as wegrow internationally. As at 31 October 2006, the Company had net cash resources of approximately £8.5million. This includes, for pro-forma purposes, approximately £4.0 million ofproceeds from the sale and leaseback of the first four D1 20 refinery units,announced on 21 November 2006. Update on activities Agronomy and planting programme We are continuing our work in the planting and production of jatropha. As of 30September 2006, together with our joint venture partners, we have planted orobtained rights to offtake from a total of over 114,000 hectares of jatrophaplanting worldwide. The substantial increase in planting is principally due togood progress in South East Asia and India, as well as the establishment of anew planting base in Southern China. Our continuing ability to attract large-scale commercial agronomy partners isdemonstrated by our joint venture with Williamson Magor, the Indian tea plantinggroup, which achieved planting of 8,300 hectares by 30 September 2006 in NorthEast India. In Africa, planting is now underway on a new area of 20,000 hectaresin Swaziland in cooperation with the Swazi Government, and in Zambia we haverecently increased our land allocations for future planting to over 174,000hectares. In South East Asia, we have concluded a series of oil supplyagreements with Setia Group China. To date D1 has secured rights to offtake fromapproximately 28,000 hectares that Setia Group has planted in Southern China. The cumulative planting position at 30 September 2006 is summarised in the tablebelow: Managed Contract Seed purchase Total plantations farming and oil supply agreementsIndia - 12,740 31,361 44,101Southern Africa 5,155 - 2,000 7,155South East Asia - 30,494 32,563 63,057 ---------- -------- -------- -------Total 5,155 43,234 65,924 114,313 ======= ======== ======== ========= We believe the scale of planting achieved in the period demonstrates thedetermination of the business to deliver new planting and offtake agreements inoften challenging business conditions. A modest harvest will be collected from existing planting around the turn of theyear and this seed will be used principally as planting material. We will alsobe conducting the first end-to-end test of our supply chain, taking harvestedseed from the fields through a local expelling process and on to apre-processing and refining facility in the UK. A key area of focus formanagement, to deliver the business plan, will be the establishment of aneffective and efficient supply chain. We believe that significant financial benefits can be obtained from the use ofjatropha in comparison with other feedstock vegetable oils. The table belowdetails the targeted cost of jatropha (based on non-elite seeds) versus otherfeedstock vegetable oils. Feedstock vegetable oil at current prices* $ per tonne Rapeseed (RBD ex-tank UK) 944 Soya (RBD ex-tank Rotterdam) 795 Palm olein 608 Jatropha (D1 target for non-elite seed) 475 - 500 *Landed in Northern Europe as at 27 November 2006 Sources: The Public Ledger, MPOB and (in relation to jatrophatarget) Company estimates The above table demonstrates the Company's objective to land jatropha intoNorthern Europe at a price that is very competitive with alternative biodieselfeedstocks. It is also important to note that jatropha has cold flow propertiesbroadly equivalent to those of soya. Palm typically is not, unless blended, asuitable feedstock in temperate climates. The table below sets out the targeted cost of jatropha landed in NorthernEurope, based on a seed purchase model in India: Seed purchase model $ per tonne at $ per tonne at $ per tonne at 29% oil content 35% oil content 40% oil content1 kg of seedat a cost of 6rupees perkilo* 133 133 133 Tonnes of seedrequired for 1tonne of oil 3.45 2.86 2.50 Cost of seedto produce 1tonne of oil 460 381 333 ----- ----- -----Crushing cost 40 40 40 ---- ---- ----Sub total 500 421 373 ----- ----- -----Seedcake credit (100) (100) (100) ------- ------- -------Total oil cost 400 321 273 ----- ----- -----Transport costs 100 100 75 ----- ----- ----Landed cost 500 421 348 ===== ===== ===== *Based on exchange rate of 45 rupees: US$1 and Company estimates The above table details the build up of the target landed cost of jatropha inNorthern Europe at $500 per tonne based on wild seed having an average oilcontent of 29%. It is possible to improve yield in two ways; through more seedsper tree and also via more oil in an individual seed. The final two columns inthe table above demonstrate the cost efficiencies arising from improving the oilcontent within an individual seed. The accessions of jatropha identified byAgriom B.V. through its research to date (as mentioned below) have an oilcontent of between 25% and 38%, prior to selective breeding. Jatropha plant science programme We continue to make excellent progress in our globally distributed plant scienceprogramme which is focused on developing the most promising wild varieties ofjatropha into progressively higher yielding commercial crops. Working togetherwith Agriom B.V. (www.agriom.nl) in the Netherlands, we have identified andcollected more than 130 accessions of jatropha to assess variations and plantingquality. The breeding programme to produce higher yields per hectare is beingcarried out in the Netherlands and results assessed in field trials in severalplanting regions. We are now scaling up a number of promising accessions usingvegetative propagation. Agriom is commencing the cross-fertilisation of the mostpromising jatropha sub-varieties aiming to produce hybrids with further enhancedcharacteristics, including yield and quality improvement, higher oil content,and drought resistance. We are also working with SBW International BV(www.stbw.nl), a leading Dutch tissue culture firm, to seek to scale up therapid production of selected varieties. Our plant science programme is headed by Dr Henk Joos who has recently joined usfrom Bayer CropScience. Dr Joos has considerable experience in the commercialdevelopment of corn, soybean, cotton, canola, rice and various tropical cropsin different temperate and tropical countries. We plan to undertake the first planting with our 'E1' range of proprietary eliteseeds in 2008. We believe that this seed will deliver oil yields of 2.7 tonnesper hectare when the trees attain maturity. These seeds will comprise a range ofvarieties to provide adaptation to local micro-climates and to reducevulnerability to disease. We believe the development of the E1 seed willcontinue to deliver new varieties and anticipated higher yields in line with theimprovements made in other commercial crops over the years. We intend tocontinue the development of jatropha and the Board is confident that the Companycan progressively commercialise further enhancements to the yield and propertiesof the crop beyond those achieved with E1. We expect the first volume harvests from initial planting undertaken with wildseed in 2006 to produce modest yields of crude jatropha oil in 2008. We believethe yield from our planting of uncultivated seed will improve such that, after5-6 years with a well maintained crop, we can achieve yields of up to 1.7 tonnesper hectare. This should compare favourably with the yields from crops that havealready experienced considerable development, including soya (c.0.4 tonnes perhectare) and rapeseed (c.1.0 tonnes per hectare) and with the potential to headover the longer-term towards those of palm (c.4-5 tonnes per hectare). In addition to the work on the scientific breeding and propagation of jatropha,we are taking a leading role in developing programmes to optimise theagricultural methods of commercial jatropha production, including irrigation,pruning, planting densities, fertilisers and microclimate control. This work,begun at our Indian centre in Coimbatore, will also be carried out at theRegional Development Centres (RDCs) that we intend to establish in SouthernAfrica and South East Asia during the next 6-9 months. Early indications arethat substantial improvements can be delivered in oil yield using such methods.We have made significant advances in training and communications to farmersincluding a farmers' manual to explain planting techniques. We continue to explore uses for our jatropha seedcake. We are excited by ourcurrent findings that the seedcake can be detoxified and processed into a highprotein content animal feed with much greater revenue potential than for lowervalue uses such as fertiliser. We continue to investigate the commercialpotential of this application. Refining We aim to capitalise on the structural factors driving biodiesel demand in theUK and the EU, and to become one of the leaders in the sector. We believe thatthe attractive economics of our flexible, modular capacity refineries, usingpredominantly third party edible oil feedstocks, will be capable of generatingsignificant returns as the UK market responds to the challenges of the RTFO. Webelieve our strategy to focus on refining our own supplies of higher yieldingjatropha and other inedible oils addresses market exposure to fluctuations infeedstock prices. We have made substantial progress on our refinery operations with the deploymentof our first four D1 20 refineries at our site in Middlesbrough. As planned, allfour units are now in beneficial operation, giving us an interim productioncapacity of 32,000 tonnes per annum. Bringing these refineries into operation identified certain shortfalls in theoriginal design and configuration. These commissioning issues have put pressureon 2006 production and the volume of biodiesel to be produced in the finalmonths of the year will be less than originally anticipated. Nonetheless, wehave been able both to identify and resolve the commissioning issues and to usethe experience gained to improve performance. With the experience gained in commissioning, we believe we are now in a positionto improve the performance of our future D1 20 units, increasing annual unitcapacity by 25 per cent. from 8,000 to 10,000 tonnes. The additional five unitscurrently in manufacture will be built to the new specification and an extrasixth unit will be added. We expect deployment to take place in 2007, enablingus to add a further 60,000 tonnes of capacity during 2007. One of the advantages of our modular technology is that it enables us to buildand commission refineries more rapidly than competing technologies in anexpanding market. We anticipate delivery times to reduce as we delivermanufacturing improvements and economies. The ability of the D1 20 to refinedifferent mixes of oils and oils of differing qualities is a key competitiveadvantage over large scale refining solutions. The experience gained in improving the D1 20 will also contribute to enhancingthe design, now underway, of the 50,000 tonne per annum refinery units. Ourplans for further capacity expansion include the deployment of these units in2007. We believe these will deliver at least five times the output at less thanfive times the capital cost of operation. The availability of both the 10,000tonne and 50,000 tonne refineries increases our market flexibility and coverage. The acquisition of a further site for both conversion to biodiesel productionand deployment of the 10,000 and 50,000 tonne units is central to our ambitionto be a leader in UK and global biodiesel refining capacity. We have thereforerecently exchanged conditional contracts to acquire a 47 acre site complete withproduction and storage facilities at Bromborough on Merseyside for £3.0 million.Completion of the acquisition is anticipated by year end. Bromborough representsa second major biodiesel production, storage and distribution centre tocomplement that already established in Middlesbrough. Our intended strategy is to invest up to £8.0 million in the site during 2007 toconvert it to biodiesel production and provide working capital. Conversion ofthe existing site will enable us to increase production capacity at an estimatedcapital cost which we believe will be significantly lower than construction of anew-built site. Bromborough offers distribution access within a 70 mile radiusto large UK urban markets in the North and Midlands, as well as seabornedelivery to potential UK west coast refinery customers and to Ireland. Onceacquired and operational, the new site is anticipated during 2007 to have aninitial production capacity of approximately 100,000 tonnes, with approximatelya further 100,000 tonnes of planned refinery capacity to be added in 2008. Combined with the planned production capacity from our Middlesbrough plant, theBromborough acquisition has the potential to increase our installed biodieselproduction capacity from our existing target of 220,000 tonnes by the end of2007 to 320,000 tonnes, rising to 420,000 tonnes by the end of 2008.Importantly, we will also have the opportunity to examine options for thedeployment of our modular technology between Middlesbrough and Bromborough. Webelieve that D1 has the opportunity to become one of the leading players in theUK and global markets by 2008. Internationally, we anticipate that approximately half of the vegetable oil weharvest from jatropha planting in developing countries will be refined and usedlocally with the balance exported. We expect to deploy our modular D1 20refineries into our regional operations in combinations of the samesemi-permanent clusters of four that we are currently operating on Teesside. The50,000 tonne refinery units are also likely to feature in overseas deployments.In addition to utilising our proprietary refining technology, we are also opento overseas expansion of our refining activities via the acquisition of existingplant for conversion or immediate use, or investment into new biodiesel refiningprojects. Ports, refineries and other major industrial locations are likely tobe the prime locations for refinery installation. Trading We have concluded our first major UK offtake contract for biodiesel withPetroplus. The contract covers the sale of approximately 24,000 tonnes ofbiodiesel over a twelve month period. Petroplus has a leading position in the UKcommercial diesel market and is a major supplier of biodiesel through itsBio-plus branded fuel. This contract accounts for approximately three quartersof the first commercial product from our D1 20 refineries in Middlesbrough. Thefirst delivery of product to Petroplus was made on 26 October 2006. Furtheragreements with other parties to sell the balance of current production are innegotiation. We continue to build our logistics capabilities, particularly in the areas ofinbound and outbound movements and storage, to meet the needs of the businessglobally. Our current soya oil feedstock is purchased on international marketsand delivered to Teesside by marine tanker. In Southern Africa, we have recentlysigned heads of terms in relation to forming a joint venture with SouthernAlliance (Pty) Ltd, a major grain and commodity trader in the region, for thetrading of agricultural commodities for the biofuels market. The joint venturewould aim to expand our capabilities in South Africa, Swaziland and Zambia inthe transport and trade of seeds, seedlings and seedcake and expelling andsupply of oil to biodiesel refineries. At present, D1 is predominantly processing soya oil sourced from Latin Americato supply Petroplus and to supply other intended contracts that are presently innegotiation. Soya prices are currently very high and as such refining presentlyis not economic. We purchased soya at significantly lower prices earlier in theyear and continue to manage these stocks carefully. Production volumes to theend of 2006 are expected to be modest; however, we are fulfilling ourobligations in relation to the existing Petroplus supply contract. Accordingly,we expect the contract to continue to be profitable over the remainder of itsterm, assuming that applicable exchange rates and the inter-relationship betweencommodity prices follow historical trends. As previously indicated, weanticipate that jatropha will become available in material quantities from 2008at a significant cost advantage compared to the prevailing market values ofother feedstock options. Prior to this, the Company's strategy is to produce andsell biodiesel sourced from other vegetable oils to provide cash flow for thebusiness. We believe that the introduction of jatropha oil as the principal feedstock rawmaterial in our refining process has the potential to deliver significantlyimproved margin contributions. The table below illustrates indicativeimprovements that could be achieved as a result of the use of jatropha, based onCompany estimates of longer term commodity prices. Soya Jatropha $ per tonne $ per tonneTraded ULSD* price 620 620 Share of 20ppl** tax break (15p) 300 300 ----- -----Total selling price 920 920 ===== ===== Vegetable oil cost (wild seed) 650 500 Refining cost 125 125 Transport 50 50 ---- ----Total costs 825 675 === === Contribution/tonne 95 245 ==== ===== * ULSD - Ultra Low Sulphur Diesel** ppl - pence per litre Offer period update On 5 July 2006, the Board confirmed that the Company was in very preliminarydiscussions with a number of parties which may or may not lead to an acquisitionof a substantial shareholding in the Company and/or an offer for the entireissued share capital of the Company. As announced on 21 November 2006, the Board has now ceased discussions regardinga possible offer, but is continuing negotiations with certain of the partiesregarding the possible acquisition of a substantial, but less than acontrolling, shareholding in the Company. These negotiations are beingconducted with a view to assisting the Company to accelerate significantly theroll out of its business plan. Reasons for the Placing To maintain the growth of our business and to take advantage of theopportunities presented, we are seeking, subject to Shareholder approval, toraise further funds through the Placing. The Directors believe that theadditional money raised will enable us to deliver our sustainable and verticallyintegrated business plan as described below, to enhance significantly ourcapabilities in each of the areas of our business and to deliver against ourstated objectives. We believe it will enable us to extend our competitiveadvantage in agronomy and to expand our refining footprint. In agronomy, we intend to use the proceeds of the Placing to developsignificantly our plant science programme with the objective of breedingsuperior jatropha cultivars to deliver enhanced oil quality and yield. Theintended next phase of development will include the further identification andselection of superior accessions to use in the breeding programme; crossbreeding of selected accessions to enhance desired characteristics and createunique varieties; and larger-scale multiplication of elite material. We proposeto develop a strategy for the deployment of elite material and also to implementa crop quality management system. We also aim to investigate techniques toenhance the value of jatropha seedcake. Accordingly, the Board intends toincrease the research and development expenditure of its crop science programmefrom around £1.2 million per annum to £2.0 million per annum. In planting, the proceeds of the Placing will enable us to secure our plantingfootprint and enable further substantial planting. We aim to meet a plantingtarget of 150,000 hectares of new planting per year. The proceeds will alsoenable us to invest in new joint ventures with quality partners; to expand ourmanaged plantation and contract farming programmes; and to develop our supplychain and build our stock of oil and seed. The objective will be to strengthenour planting relationships and to enhance security of supply. With seed development and planting gaining pace, we will also seek to secure thecrushing capacity that we believe needs to be in place prior to first harvests.Enhanced capital will enable us to participate and invest in new and existingcrushing projects. We also plan to investigate the potential for automation ofjatropha harvesting, as this offers the potential in the long term to expandplanting to regions where the cost of labour required for harvesting by hand isprohibitive. With greater scale, we believe we will be better positioned to obtainalternative feedstocks in greater volume and more favourable cost in advance ofthe first jatropha harvests. Through the proceeds of the Placing we will also be able to begin delivery oflow cost feedstock from our operations. This will require substantial investmentin working capital through the movement of seeds and oil from plantations to theUK. The proceeds will allow us to fund the working capital requirement of thisarea of the business. In refining, we intend to use the proceeds of the Placing to deliver ourexpanded vision for our sites on Teesside and, when acquired, Merseyside. Theproceeds will assist us in delivering on our UK capacity targets of 320,000tonnes by the end of 2007 and 420,000 tonnes by the end of 2008. We also aim tobegin building out our refining capacity overseas, deploying 100,000 tonnes ofcapacity in each region of our operations with joint venture partners by the endof 2009. The means to deliver these targets will be our new 10,000 tonne D1 20units, our new 50,000 tonne units and conversion of pre-existing plant onceacquired. We also aim to build our third party sales and licensing business. We aim tomanufacture for sale to customers 40,000 tonnes of refinery capacity in 2007rising to 120,000 per year thereafter. We also intend to develop further ourproprietary technology for pre-processing of crude vegetable oils. The Board believes that the Placing announced today, raising a minimum of £46.1million net of all expenses, should fund the delivery of the strategy describedabove without further recourse to shareholders subject to the following keyassumptions: • Key commodity price and exchange rates not moving materially outsidereasonable historic norms for extended periods of time where such movementswould decrease the cash flows of the Company; • The Company deploying its planned refining capacity within a reasonableperiod of that currently targeted; • Capital expenditure and working capital facilities continuing to beavailable on reasonable commercial terms; and • No material adverse changes to the regulatory and fiscal environmentsfor biofuels that are relevant to the Company's strategy. In addition to the key issues as set out above, your attention is drawn to therisk factors set out in the Company's admission document dated 21 October 2004and subsequent placing document dated 31 May 2005. The Board believes there are significant opportunities for the Company to investadditional equity capital to: • Accelerate the roll-out of its strategy particularly in respect ofplanting and plant science; and • Increase the scope of the business plan (for example, the targeted areato be planted and the resources directed towards jatropha yield improvement). Additional funding would also increase further the resilience of the Company toany prolonged periods of volatility in its business. For these reasons, the Board believes that the funding sought by way of theissue of up to a further 5,666,667 Ordinary Shares pursuant to the Option willfurther enhance shareholder value. The table below summarises the proposed use of proceeds for the four year periodfrom 1 January 2007 to 31 December 2010 inclusive assuming net funds raised of£45.0 million. The funding requirement as stated below is stated net of plannedfinancing for capital expenditure and working capital of, in aggregate, £47.0million. The additional funding achieved will be applied in the ways describedabove. £mAgronomyResearch and development 8 Planting (security of supply) 14 Supply chain and stock* 11 ----Sub total 33Refining and pre-processing Capital expenditure and investment* 13Working capital* 12 ---- Sub total 58 Cash inflow** (13) ------Net Funding requirement 45 ==== * Net of financing ** Net of a contingency of £12 million The Board expects total Group overheads for the financial year ended 31 December2007, before research and development expenditure and regional operating costs,to be approximately £7.6 million. We estimate that for the financial year ended31 December 2007 some £2.5 million of expenditure will be incurred in relationto business development, project implementation and operations in the overseasregions in which we operate. Details of the Placing Subject to the passing of the relevant Resolutions at the EGM, the Company isproposing to raise a minimum of approximately £48.7 million before expenses(approximately £46.1 million net of expenses) by the issue of the UnderwrittenShares. The Underwritten Shares will represent approximately 93.2 per cent. ofthe current issued share capital of the Company. Dresdner Kleinwort SecuritiesLimited has conditionally placed the Underwritten Shares with existing holdersof the Company's shares and certain new investors at the Placing Price. The Company has also granted an over-allotment option in respect of up to anadditional 5,666,667 Ordinary Shares at the Option Price, namely a price whichis greater than or at least equal to the Placing Price. The allotment process inrelation to the Option Shares will close at 4.30p.m. on 22 December 2006, orearlier at the sole discretion of Dresdner Kleinwort. The process will establisha single price payable in respect of each Option Share, namely the Option Price.The number of Ordinary Shares to be issued pursuant to the Option (up to amaximum of 5,666,667) and the Option Price will be announced by the Companyprior to the EGM. The Option Shares if issued in full will, together with theUnderwritten Shares, represent approximately 52.6 per cent. of the issued sharecapital of the Company immediately following Admission. The Placing Agreement and the issue of the Placing Shares are each conditionalon, inter alia: (i) the passing at the EGM of the Resolutions numbered 1, 2 and 4; and (ii) Admission occurring on or before 8.00 a.m. on 29 December 2006 (or suchlater time and date as the Company and Dresdner Kleinwort Securities Limited mayagree being no later than 31 December, 2006). Further details of the Placing Agreement and the Option are contained inparagraph 4 of Part II of this document. DBAG has agreed that, to the extent that Dresdner Kleinwort does not procurePlacees to subscribe for the total number of Underwritten Shares at a priceequal to or in excess of the Placing Price, DBAG shall itself subscribe asprincipal for those Underwritten Shares at the Placing Price. The issue ofOption Shares pursuant to the Option is not underwritten. The Placing Shares will, when allotted and fully paid, rank pari passu in allrespects with the existing Ordinary Shares. Admission is expected to take place and dealings in the Placing Shares tocommence on AIM on 29 December 2006. Share certificates in respect of PlacingShares to be held in certificated form are expected to be despatched on or after29 December 2006. Placing Shares to be held in uncertificated form are expectedto be delivered in CREST by no later than 29 December 2006. For regulatory reasons the Placing has only been made, and the Placing Shareswill only be issued, to institutional and other sophisticated investors (i) inthe EU who are also qualified investors for the purposes of the EU ProspectusDirective (and in the UK who are persons falling within article 19 and article49 of the Financial Services and Markets Act 2000 (Financial Promotion) Order2001), and (ii) in other jurisdictions to whom it may lawfully be made. No otherperson may participate in the Placing, or rely on any communication relating tothe Placing. The offer of the Placing Shares has not been and will not be madeto Shareholders generally or to the public for the purposes of the ProspectusRules. This document does not constitute a prospectus or an offer, or thesolicitation of an offer, to subscribe or buy any of the Placing Shares. Extraordinary General Meeting A notice convening the Extraordinary General Meeting to be held on 28 December2006 at 11.00 a.m. at the offices of Dresdner Kleinwort Limited, 30 GreshamStreet, London EC2P 2XY, is set out at the end of this document. The purpose ofthe Meeting is to seek Shareholders' approval to the Resolutions set out in thenotice of EGM. At the Meeting, Resolutions will be proposed to: (1) increase the Company's authorised share capital from £520,000 to £1,000,000by the creation of an additional 48,000,000 Ordinary Shares representingapproximately 92 per cent. of the current existing authorised share capital ofthe Company; (2) authorise the Directors pursuant to section 80 of the Act to allot relevantsecurities up to an aggregate nominal amount of £351,516 (namely the PlacingShares), representing approximately 111.1 per cent. of the existing issued sharecapital of the Company as at the date of this document; (3) authorise the Directors (by way of updated general authority pursuant tosection 80 of the Act) to allot relevant securities (as defined for purposes ofthat section) up to an aggregate nominal amount representing approximately onethird of the Enlarged Issued Share Capital; (4) authorise the Directors pursuant to section 95 of the Act to allot thePlacing Shares for cash without making a pre-emptive offer to Shareholders; and (5) authorise the Directors (by way of updated general authority pursuant tosection 95 of the Act) to allot equity securities (as defined for purposes ofthat section) for cash up to an aggregate nominal amount representingapproximately 5 per cent. of the Enlarged Issued Share Capital. The Directors recommend that Shareholders vote in favour of all the Resolutions.The Directors' reason for putting forward Resolutions 1, 2 and 4 is to enablethe Company to allot the Placing Shares for cash. If Resolutions 1, 2 and 4 arenot approved the Placing cannot occur. Resolutions 3 and 5 confer new authority on the Directors to allot OrdinaryShares based on the increased authorised and issued share capital of the Companyafter Admission has occurred, in accordance with relevant institutionalguidelines. Resolution 1 is necessary for the Placing to occur as the current authorisedcapital of the Company (52,000,000 Ordinary Shares) is insufficient to allow theissue of the Placing Shares, after taking into account the Company's currentissued share capital of 31,641,730 Ordinary Shares. The Board proposes that theauthorised share capital of the Company is increased to 100,000,000 OrdinaryShares to permit the Placing to occur, to allow for the additional issue of theOption Shares and also to take the opportunity afforded by the EGM to increasethe authorised share capital of the Company so that a 'headroom' of existing butunissued share capital is available for general corporate purposes. To be passed, Resolutions 1 to 3 (being ordinary resolutions) will require asimple majority of those Shareholders voting in person or (on a poll) by proxyin favour of the Resolutions. Resolutions 4 and 5 (being special resolutions)require approval by not less than 75 per cent. of the votes cast by theShareholders voting in person or (on a poll) by proxy." A copy of the circular is available, free of charge, for one month from the dateof this announcement at the registered office of the Company, Forty Foot Road,Middlesbrough, TS2 1HG. Definitions The following definitions apply throughout this announcement (other than theAppendix to this announcement) unless otherwise stated or the context requiresotherwise: ''Act'' the Companies Act 1985 (as amended) ''Admission'' admission of the Placing Shares to trading on AIM and such admission becoming effective as provided in the AIM Rules ''AIM'' the Alternative Investment Market, a market operated by the London Stock Exchange ''AIM Rules'' the rules of the London Stock Exchange governing admission to and the operation of AIM ''Articles'' the articles of association of the Company ''Board'' or ''Directors'' the board of directors of the Company ''Business Day'' any day (excluding Saturdays and Sundays) on which banks are open in London for general non-automated banking business ''Certificated'' or '' in certificated form'' an Ordinary Share which is not in uncertificated form ''Code'' the City Code on Takeovers and Mergers ''Company'' or ''we'' or ''D1 Oils'' or ''D1'' D1 Oils plc, a public limited company incorporated and registered in England and Wales with registered number 5212852 ''CREST'' the computerised settlement system to facilitate the holding of and the transfer of title of shares in uncertificated form, operated by CRESTCo Limited ''CREST Regulations'' The Uncertificated Securities Regulations 2001 (SI 2001 No. 3755) as amended ''this document'' the circular of the Company published on 30 November 2006 "DBAG" Dresdner Bank AG, London Branch "Dresdner Kleinwort" Dresdner Kleinwort Limited and/or Dresdner Kleinwort Securities Limited as the context may require "EGM" the Extraordinary General Meeting of the members of the Company convened for 11.00 am on 28 December 2006 "Enlarged Issued Share Capital" the enlarged issued share capital of the Company following Admission of the Placing Shares ''EU'' the European Union ''•'' or ''Euro'' the euro, currency of the EU ''Existing Ordinary Shares'' the 31,641,730 Ordinary Shares in issue as at 30 November 2006 ''FSMA'' the Financial Services and Markets Act 2000 ''Group'' the Company and its subsidiary undertakings "IEA" the International Energy Agency "Irrevocable Undertakings" the irrevocable undertakings given by the Directors who hold Existing Ordinary Shares in relation to voting at the EGM ''London Stock Exchange'' London Stock Exchange plc ''Option'' the conditional over-allotment option granted by the Company to Dresdner Kleinwort Securities Limited to issue up to a maximum of 5,666,667 Ordinary Shares at the Option Price in accordance with the Placing Agreement ''Option Price'' the price at which the Option Shares are placed with Placees, being a price of at least 165p per Option Share ''Option Shares'' up to a maximum of 5,666,667 Ordinary Shares to be issued by the Company pursuant to the Option at the Option Price ''Ordinary Shares'' ordinary shares of 1p each in the capital of the Company ''Petroplus'' Petroplus Refining Teesside Limited, a division of Petroplus International B.V. ''Placees'' subscribers for the Placing Shares procured by Dresdner Kleinwort Securities Limited (as agent for the Company) pursuant to and on the terms of the Placing Agreement ''Placing'' the arrangements for the procurement of subscribers for Ordinary Shares by Dresdner Kleinwort Securities Limited pursuant to the Placing Agreement "Placing Agreement'' the conditional agreement dated 30 November 2006 between (1) Dresdner Kleinwort Securities Limited (2) Dresdner Bank AG, London Branch and (3) the Company relating to the Placing ''Placing Price'' the price at which the Underwritten Shares are placed with Placees, being a price of 165p per Underwritten Share "Placing Shares" up to a maximum of 35,151,515 Ordinary Shares (namely the Underwritten Shares and the Option Shares) ''Prospectus Rules'' the prospectus rules of the Financial Services Authority forming part of the FSA Handbook ''Resolutions'' means the ordinary and special resolutions to be proposed at the EGM ''RTFO'' means the "Renewable Transport Fuel Obligation" announced by the UK Government in November 2005 ''Shareholder(s)'' the person(s) who are registered as holder(s) of Ordinary Shares from time to time ''UK'' United Kingdom of Great Britain and Northern Ireland ''uncertificated'' or ''in uncertificated form'' recorded on the register of Ordinary Shares as being held in uncertificated form in CREST, entitlement to which by virtue of the CREST Regulations, may be transferred by means of CREST ''Underwritten Shares'' 29,484,848 Ordinary Shares to be issued and placed in connection with the Placing at the Placing Price ''US'' or ''United States'' United States of America, each state thereof, its territories and possessions and the District of Columbia ''US$'' or ''dollar'' United States dollar ''£'' United Kingdom pounds sterling APPENDIX - TERMS AND CONDITIONS OF THE PLACING IMPORTANT INFORMATION FOR PLACEES ONLY MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THISDOCUMENT AND THE TERMS AND CONDITIONS SET OUT HEREIN ARE DIRECTED ONLY ATPERSONS SELECTED BY DRESDNER KLEINWORT SECURITIES LIMITED ("DKIB") WHO ARE"INVESTMENT PROFESSIONALS" AS DESCRIBED IN ARTICLE 19 OR "HIGH NET WORTHCOMPANIES" AS DESCRIBED IN ARTICLE 49 OF THE FINANCIAL SERVICES AND MARKETS ACT2000 (FINANCIAL PROMOTION) ORDER 2005 (the "FPO") OR TO WHOM IT MAY OTHERWISELAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS"RELEVANT PERSONS"). THIS DOCUMENT AND THE TERMS AND CONDITIONS SET OUT HEREINMUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANYINVESTMENT ACTIVITY TO WHICH THIS DOCUMENT AND THE TERMS AND CONDITIONS SET OUTHEREIN RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLYWITH RELEVANT PERSONS. THE NEW ORDINARY SHARES THAT ARE THE SUBJECT OF THE PLACING (THE "PLACINGSHARES") ARE NOT BEING OFFERED OR SOLD TO ANY PERSON IN THE EUROPEAN UNION,OTHER THAN TO QUALIFIED INVESTORS AS DEFINED IN SECTION 86(7) OF THE FINANCIALSERVICES AND MARKETS ACT 2000 ("FSMA"), BEING PERSONS FALLING WITHIN ARTICLE 2.1(E)(I), (II) OR (III) OF DIRECTIVE 2003/71/EC (THE "PROSPECTUS DIRECTIVE"),WHICH INCLUDES LEGAL ENTITIES WHICH ARE REGULATED BY THE FINANCIAL SERVICESAUTHORITY (THE "FSA") OR ENTITIES WHICH ARE NOT SO REGULATED WHOSE CORPORATEPURPOSE IS SOLELY TO INVEST IN SECURITIES. The Placing Shares have not been and will not be registered under the UnitedStates Securities Act of 1933, as amended (the "Securities Act") or under thesecurities laws of any state or other jurisdiction of the United States and maynot be offered, sold, resold or delivered, directly or indirectly, in or intothe United States absent registration except pursuant to an exemption from or ina transaction not subject to the registration requirements of the SecuritiesAct. No public offering of the Placing Shares is being made in the UnitedStates. The Placing is being made outside the United States in offshoretransactions (as defined in Regulation S under the Securities Act ("RegulationS")) meeting the requirements of Regulation S under the Securities Act and maybe made within the United States to a limited number of institutional investorswho are qualified institutional buyers within the meaning of Rule 144A under theSecurities Act ("QIBs"), and also "QPs" (as defined below), in transactions thatare exempt from, or not subject to, the registration requirements under theSecurities Act. Prospective investors are hereby notified that D1 Oils plc (the"Company") may be relying on the exemption from the provisions of Section 5 ofthe Securities Act provided by Rule 144A. This document (including the terms and conditions set out herein) does notconstitute an offer of securities for sale in the United States nor thesolicitation of an offer to buy any such securities, nor may securities beoffered or sold in the United States, or in any jurisdiction in which such offeror solicitation is unlawful and the information contained herein is not forpublication or distribution to persons in the United States or any jurisdictionin which such publication or distribution is unlawful. Persons receiving thisdocument (including custodians, nominees and trustees) must not forward,distribute, mail or otherwise transmit it in or into the United States or usethe United States mails, directly or indirectly, in connection with the Placing.The Company does not intend to register the Placing Shares under the SecuritiesAct. This document does not constitute an offer to sell or issue or a solicitation ofan offer to buy or subscribe for Placing Shares in any jurisdiction including,without limitation, Canada, Australia, Japan or any other jurisdiction in whichsuch offer or solicitation is or may be unlawful. This document and theinformation contained herein are not for publication or distribution, directlyor indirectly, to persons in Canada, Australia, Japan unless permitted pursuantto an exemption under the relevant local law or in any jurisdiction in whichsuch publication or distribution is unlawful. The distribution of this document, the Placing and/or issue of the PlacingShares in certain jurisdictions may be restricted by law. No action has beentaken by the Company, DKIB or Dresdner Bank AG, London Branch ("DBAG") thatwould permit an offer of the Placing Shares or possession or distribution ofthis document or any other publicity material relating to such Placing Shares inany jurisdiction where action for that purpose is required. Persons to whoseattention this document has been drawn are required by the Company, DKIB andDBAG to inform themselves about and to observe any such restrictions. By participating in the Bookbuilding Process (as defined below), each person whois invited to and who chooses to participate in the Placing (a "Placee") isdeemed to have read and understood this document in its entirety and to beproviding the representations, warranties, undertakings and acknowledgementscontained herein. Details of the Placing Agreement and the Placing Shares The Company has today entered into a placing agreement (the "Placing Agreement")with DKIB and DBAG, under which DKIB has, subject to the terms set out therein,agreed to use its reasonable endeavours, as agent of the Company, to procurePlacees for the Placing Shares (the "Placing"). DBAG has agreed that to theextent DKIB does not procure Placees for the Placing Shares, DBAG shall itselfsubscribe for 29,484,848 Placing Shares (the "Underwritten Shares"), asprincipal. The Placing Agreement also includes an over-allotment option underwhich the Company may issue up to an additional 5,666,667 Ordinary Shares, asdescribed below. The Placing Shares will, when issued, be credited as fully paid and will rankpari passu in all respects with the existing issued ordinary shares of 1 penceeach in the capital of the Company, including the right to receive all dividendsand other distributions declared, made or paid in respect of such ordinaryshares after the date of issue of the Placing Shares. The Placing Shares will be issued free of any pre-emption rights, encumbrance,lien or other security interest. The Company confirms that, following thepassing of the Resolutions (as defined below), it will be entitled to allot thePlacing Shares pursuant to section 80 of the Companies Act 1985 as if section 89(1) of that Act did not apply to such allotment. These representations willsurvive the Placing. Application for admission to trading Application will be made to London Stock Exchange plc (the "London StockExchange") for admission to trading of the Placing Shares on the AIM market ofthe London Stock Exchange ("Admission"). It is expected that Admission willbecome effective and that dealings will commence on 29 December 2006, and in anyevent no later than 31 December 2006. Bookbuild Commencing today DKIB will be conducting an accelerated bookbuilding process(the "Bookbuilding Process") to determine demand for participation in thePlacing by Placees. This document gives details of the terms and conditions of,and the mechanics of participation in, the Placing. Participation in, and principal terms of, the Bookbuilding Process Each of DKIB and its respective Affiliates is entitled to participate asprincipal in the Bookbuilding Process. The Bookbuilding Process will establish a single price (the "Placing Price")payable to DKIB by all Placees who participate in the Bookbuilding Process. The Bookbuilding Process is expected to close around 7.00 a.m. London time on 30November 2006. A further announcement will be made following the close of theBookbuilding Process detailing the Placing Price at which the Placing Shares arebeing placed (the "Pricing Announcement"). DKIB may, at its sole discretion,accept bids that are received after the Bookbuilding Process has closed. A bid in the Bookbuilding Process will be made on the terms and conditions inthis document and will not be capable of variation or revocation after the closeof the Bookbuilding Process. A Placee who wishes to participate in the Bookbuilding Process shouldcommunicate its bid by telephone to the usual sales contact at DKIB. Ifsuccessful, DKIB will contact and confirm orally to Placees following the closeof the Bookbuilding Process the size of their respective allocations and a tradeconfirmation will be dispatched as soon as possible thereafter. DKIB's oralconfirmation of the size of allocations and each Placee's oral commitments toaccept the same will constitute a legally binding agreement pursuant to whicheach such Placee will be required to accept the number of Placing Sharesallocated to the Placee at the Placing Price set out in the Pricing Announcementand otherwise on the terms and subject to the conditions set out herein and inaccordance with the Company's Memorandum and Articles of Association. DKIB reserves the right to scale back the number of Placing Shares to besubscribed by any Placee in the event of an oversubscription under the Placing.DKIB also reserves the right not to accept offers to subscribe for PlacingShares or to accept such offers in part rather than in whole. The acceptance ofoffers shall be at the absolute discretion of DKIB. DKIB shall be entitled toeffect the Placing by such alternative method to the Bookbuilding Process as itshall in its sole discretion determine. To the fullest extent permissible bylaw, neither DKIB any holding company thereof, nor any subsidiary, branch oraffiliate of DKIB (each an "Affiliate") shall have any liability to Placees savefor fraud or wilful default (or to any other person whether acting on behalf ofa Placee or otherwise). In particular, neither DKIB nor any Affiliate thereofshall have any liability in respect of its conduct of the Bookbuilding Processor of such alternative method of effecting the Placing as it may determine. Nocommissions will be paid to Placees or by Placees in respect of any PlacingShares. Each Placee's obligations will be owed to the Company and to DKIB through whomsuch Placee submitted its bid. Each Placee will also have an immediate,separate, irrevocable and binding obligation, owed to DKIB and the Company, topay to DKIB (or as DKIB may direct) in cleared funds an amount equal to theproduct of the Placing Price and the number of Placing Shares such Placee hasagreed to acquire. DKIB will procure the allotment by the Company of suchPlacing Shares to each Placee following each Placee's payment to DKIB of suchamount. All obligations under the Placing will be subject to fulfilment of theconditions referred to below under "Conditions of the Placing". Over-allotment option The Company has granted an over-allotment option under which the Company mayissue up to an additional 5,666,667 Ordinary Shares at a price equal to or inexcess of the Placing Price. Subject to demand, during the period betweencompletion of the Bookbuilding Process and the proposed extraordinary generalmeeting of the Company a further bookbuilding process (the "Further BookbuildingProcess") will be conducted by DKIB. The Further Bookbuilding Process willestablish a single price payable to DKIB by all Placees who participate in theFurther Bookbuilding Process. The Further Bookbuilding Process is expected toclose no later than 4.30 p.m. London time on 22 December 2006 but may be closedearlier at the sole discretion of DKIB. A further announcement will be madefollowing the close of the Further Bookbuilding Process detailing the number ofPlacing Shares which have been placed and the price at which such Placing Shareshave been placed. The Further Bookbuilding Process will be subject to the sameterms and conditions as the Bookbuilding Process provided that references to thePlacing Price will, in respect of Placees procured during the FurtherBookbuilding Process, be deemed to be references to the price announced at theclose of the Further Bookbuilding Process. Conditions of the Placing The Placing is conditional upon the Placing Agreement becoming unconditional andnot having been terminated in accordance with its terms. The obligations of DKIB and DBAG under the Placing Agreement are conditional,inter alia, on: 1. Admission occurring by no later than 29 December 2006 (or such other date as may be agreed between the Company and DKIB, not being later than 31 December 2006); 2. the Company complying with its obligations under the Placing Agreement to the extent they fall to be performed prior to Admission including the delivery, on the day of (and prior to) Admission, to DKIB of a certificate confirming, inter alia, that none of the representations, warranties and undertakings given by the Company in the Placing Agreement has been breached or is unfulfilled or was untrue, inaccurate or misleading when made or would be breached or unfulfilled or be untrue, inaccurate or misleading were it to be repeated by reference to the facts subsisting on the date of Admission; 3. the Company passing certain resolutions to be proposed at an extraordinary general meeting to, inter alia, increase its authorised share capital and authorise the directors of the Company to allot and issue the Placing Shares pursuant to sections 80 and 95 of the Companies Act 1985 (the " Resolutions"); and 4. the Company allotting prior to Admission, subject only to Admission, the Placing Shares. If (a) the conditions above are not fulfilled or (to the extent permitted underthe Placing Agreement) waived by DKIB, or (b) the Placing Agreement isterminated in the circumstances specified below, the Placing will lapse and eachPlacee's rights and obligations hereunder shall cease and determine at such timeand no claim may be made by a Placee in respect thereof. By participating in the Bookbuilding Process and/or the Further BookbuildingProcess (as the case may be), each Placee agrees that its rights and obligationshereunder terminate only in the circumstances described above and under 'Rightto terminate under the Placing Agreement' below, and will not be capable ofrescission or termination by the Placee. DKIB reserves the right to waive or to extend the time and/or date forfulfilment of any of the conditions in the Placing Agreement where such waiveror extension is permitted under the terms of the Placing Agreement. Any suchextension or waiver will not affect Placees' commitments. DKIB shall not haveany liability to any Placee (or to any other person whether acting on behalf ofa Placee or otherwise) in respect of any decision it may make as to whether ornot to waive or to extend the time and/or date for the satisfaction of anycondition in the Placing Agreement or in respect of the Placing generally. Right to terminate under the Placing Agreement DKIB may, at any time before Admission, terminate the Placing Agreement bygiving notice to the Company if: 1. in the opinion of DKIB (acting in good faith), any of the warranties given by the Company in the Placing Agreement are not true and accurate or have become misleading (or would not be true and accurate or would be misleading if they were repeated at any time before Admission) by reference to the facts subsisting at the relevant time provided that DKIB consults with the Company (where practicable) prior to the giving of any such notice; 2. in the opinion of DKIB (acting in good faith), the Company fails to comply with any of its obligations under the Placing Agreement and such failure has, or is likely to have (in the opinion of DKIB, acting in good faith), a material effect on the Placing; 3. in the opinion of DKIB (acting in good faith) there has been a material adverse change in the financial or trading position or prospects of the Group (defined as the Company and its subsidiary undertakings); or 4. in the absolute discretion of DKIB, there has been a change in national or international financial, political, economic or stock market conditions (primary or secondary); an incident of terrorism, outbreak or escalation of hostilities, war, declaration of martial law or any other calamity or crisis; a suspension or material limitation in trading of securities generally on any Stock Exchange; any change in currency exchange rates or exchange controls or a disruption of settlement systems or a material disruption in commercial banking as would be likely to prejudice the success of the Placing. By participating in the Placing, each Placee agrees with DKIB that the exerciseby DKIB of any right of termination or other discretion under the PlacingAgreement shall be within the absolute discretion of DKIB and that DKIB need notmake any reference to the Placee in this regard and that DKIB shall not have anyliability whatsoever (save in the event of fraud or wilful default) to thePlacee in connection with any such exercise. Further, by participating in thePlacing, each Placee agrees that its rights and obligations hereunder terminateonly in the circumstances described above and under 'Conditions of the Placing'above, and will not be capable of rescission or termination by the Placee. No Prospectus No offering document, prospectus or listing particulars has been or will beprepared in relation to the Placing and the Placees' commitments will be madesolely on the basis of the information contained in this document and anyinformation (including risk factors) previously published by or on behalf of theCompany by notification to a Regulatory Information Service (as defined in theAIM Rules of the London Stock Exchange). Each Placee, by accepting aparticipation in the Placing, agrees that the content of this document isexclusively the responsibility of the Company and confirms to DKIB, DBAG and theCompany that it has neither received nor relied on any other information,representation, warranty or statement made by or on behalf of DKIB (other thanthe amount of the relevant Placing participation in the oral confirmation givento Placees and the trade confirmation referred to below) or DBAG or any of theirrespective Affiliates and none of DKIB, DBAG or the Company or any of theirrespective Affiliates will be liable for the decision of any Placee toparticipate in the Placing based on any other information, representation,warranty or statement which the Placee may have obtained or received (regardlessof whether or not such information, representation, warranty or statement wasgiven or made by or on behalf of any such persons). By participating in thePlacing, each Placee acknowledges and agrees, to DKIB for itself and as agentfor the Company and to DBAG, that except in relation to the informationcontained in this document it has relied on its own investigation of thebusiness, financial or other position of the Company in deciding to participatein the Placing. Nothing in this paragraph shall exclude the liability of anyperson for fraudulent misrepresentation. Registration and settlement Settlement of transactions in the Placing Shares following Admission will takeplace within the CREST system, using the DVP mechanism, subject to certainexceptions. DKIB reserves the right to require settlement for and delivery ofthe Placing Shares to Placees by such other means that it deems necessary, ifdelivery or settlement is not possible or practicable within the CREST systemwithin the timetable set out in this document or would not be consistent withthe regulatory requirements in the Placee's jurisdiction. Each Placee allocated Placing Shares in the Placing will be sent a tradeconfirmation stating the number of Placing Shares allocated to it, the PlacingPrice, the aggregate amount owed by such Placee to DKIB and settlementinstructions. Placees should settle against CREST ID: 318. Each Placee agreesthat it will do all things necessary to ensure that delivery and payment iscompleted in accordance with either the standing CREST or certificatedsettlement instructions which it has in place with DKIB. It is expected that settlement will be on 29 December 2006 on a deferred basisin accordance with the instructions set out in the trade confirmation. Interest is chargeable daily on payments not received from Placees on the duedate in accordance with the arrangements set out above at the rate of 2percentage points above the base rate of Barclays Bank Plc. Each Placee is deemed to agree that if it does not comply with theseobligations, DKIB may sell any or all of the Placing Shares allocated to thePlacee on such Placee's behalf and retain from the proceeds, for its own accountand profit, an amount equal to the aggregate amount owed by the Placee plus anyinterest due. The Placee will, however, remain liable for any shortfall belowthe aggregate amount owed by such Placee and it may be required to bear anystamp duty or stamp duty reserve tax (together with any interest or penalties)which may arise upon the sale of such Placing Shares on such Placee's behalf. If Placing Shares are to be delivered to a custodian or settlement agent, thePlacee should ensure that the trade confirmation is copied and deliveredimmediately to the relevant person within that organisation. Insofar as Placing Shares are registered in the Placee's name or that of itsnominee or in the name of any person for whom the Placee is contracting as agentor that of a nominee for such person, such Placing Shares will, subject asprovided below, be so registered free from any liability to PTM levy, UK stampduty or stamp duty reserve tax. If there are any circumstances in which anyother stamp duty or SDRT is payable in respect of the issue of the PlacingShares, neither DKIB, DBAG nor the Company shall be responsible for the paymentthereof. Placees will not be entitled to receive any fee or commission inconnection with the Placing. Representations and Warranties By participating in the Placing, each Placee (and any person acting on suchPlacee's behalf): 1. represents and warrants that it has read and understood this document in its entirety and acknowledges that its participation in the Placing will be governed by the terms of this document; 2. acknowledges that no prospectus, listing particulars or other offering document has been prepared in connection with the placing of the Placing Shares; 3. acknowledges that the ordinary shares of the Company with a nominal value of 1 pence each are listed on the AIM market of the London Stock Exchange, and the Company is therefore required to publish certain business and financial information in accordance with the rules and practices of the London Stock Exchange (collectively, the "Exchange Information"), which includes a description of the nature of the Company's business and the Company's most recent balance sheet and profit and loss account, and similar statements for preceding financial years, and that the Placee is able to obtain or access the Exchange Information without undue difficulty; 4. acknowledges that none of DKIB, the Company nor any of their respective Affiliates nor any person acting on DKIB's, the Company's or their respective Affiliates' behalf has provided, and will not provide it with any other material regarding the Placing Shares or the Company; nor has it requested DKIB, the Company, any of their respective Affiliates or any person acting on DKIB's, the Company's or their respective Affiliates' behalf to provide it with any such information; 5. acknowledges that the content of this document is exclusively the responsibility of the Company and that neither DKIB, DBAG nor any person acting on their behalf will be responsible for or shall have any liability for any information, representation or statement relating to the Company contained in this document or any information previously published by or on behalf of the Company and neither DKIB, DBAG nor any person acting on their behalf will be liable for any Placee's decision to participate in the Placing based on any information, representation or statement contained in the document 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 to subscribe for the Placing Shares is contained in this document and any information that is publicly available, including any Exchange Information, such information being all that it deems necessary to make an investment decision in respect of the Placing Shares and that it has relied on its own investigation with respect to the Placing Shares and the Company in connection with its decision to subscribe for the Placing Shares and acknowledges that it is not relying on any investigation that DKIB, DBAG, the Company, any of their respective Affiliates or any person acting on their behalf may have conducted with respect to the Placing Shares and none of such persons has made any representations to it, express or implied, with respect thereto; 6. acknowledges that it has not relied on any information relating to the Company contained in any research reports prepared by DKIB, any of its respective Affiliates or any person acting on DKIB's or its Affiliates' behalf and understands that (i) none of DKIB, nor any of its respective Affiliates nor any person acting on DKIB's or its Affiliates' behalf has or shall have any liability for public information or any representation; (ii) none of DKIB, nor any of its respective Affiliates nor any person acting on DKIB's or its Affiliates' behalf has or shall have any liability for any additional information that has otherwise been made available to such Placee, whether at the date of publication, the date of this document or otherwise; and that (iii) none of DKIB, nor any of its respective Affiliates nor any person acting on DKIB's or its Affiliates' behalf makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of such information, whether at the date of publication, the date of this document or otherwise; 7. represents and warrants that it has not received a prospectus, listing particulars or other offering document in relation to the Company and that it has not received or relied on any information given or representations, warranties or statements made by DKIB, DBAG or the Company or any other person in connection with the Placing other than information contained in this document or any information previously published by or on behalf of the Company by notification to a Regulatory Information Service (as defined in the AIM Rules of the London Stock Exchange); 8. represents and warrants that it is entitled to acquire Placing Shares under the laws of all relevant jurisdictions which apply to it and that it has fully observed such laws and obtained all such governmental and other guarantees and other consents in either case which may be required thereunder and complied with all necessary formalities and paid any issue, transfer or other taxes due in connection with its participation in any territory and that it has not taken any action which will or may result in the Company, DBAG or DKIB being in breach of the legal and/or regulatory requirements of any territory in connection with the Placing; 9. represents and warrants that the issue to the Placee, or the person specified by the Placee for registration as holder, of Placing Shares will not give rise to a liability under any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depositary receipts and clearance services) and that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to issue or transfer Placing Shares into a clearance system; 10. represents and warrants that it understands that the Placing Shares have not been and will not be registered under the Securities Act or under the securities laws of any state or other jurisdiction of the United States and that the Company has not been registered as an "investment company" under the United States Investment Company Act of 1940, as amended; 11. represents and warrants that unless it is a "US Person" (within the meaning of Regulation S) that is a QIB in the United States to which the Placing Shares will be offered on a private placement basis, it is, or at the time the Placing Shares are acquired, it will be, (a) the beneficial owner of such Placing Shares and is neither a person located in the United States of America, its territories or possessions, any state of the United States or the District of Columbia (the "United States") nor acting on behalf of a person in the United States, (b) is acquiring the Placing Shares in an offshore transaction (as defined in Regulation S under the Securities Act) and (c) will not offer or sell, directly or indirectly, any of the Placing Shares in the United States except in accordance with Regulation S or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act; 12. represents and warrants that it has not offered or sold and will not offer or sell any Placing Shares to persons in the United Kingdom prior to Admission except to qualified investors as defined in section 86(7) of FSMA, being persons falling within Article 2.1(e)(i), (ii) or (iii) of the Prospectus Directive; 13. represents and warrants that 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; 14. represents and warrants that it has complied and will comply with all applicable provisions of FSMA with respect to anything done by it in relation to the Placing Shares in, from or otherwise involving the United Kingdom; 15. represents and warrants that it has complied with its obligations in connection with money laundering and terrorist financing under the Criminal Justice Act 1993, the Proceeds of Crime Act 2002, the Terrorism Act 2000, the Anti-terrorism Crime and Security Act 2001 and the Money Laundering Regulations (2003) (the "Regulations") and, if it is 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; 16. represents and warrants that it is (a) a person falling within Article 19(5) of the FPO or (b) a person falling within Article 49(2)(a) to (d) of the FPO 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; 17. represents and warrants that it is a qualified investor as defined in section 86(7) of FSMA, being a person falling within Article 2.1(e)(i), (ii) or (iii) of the Prospectus Directive; 18. represents and warrants that it has all necessary capacity and has obtained all necessary consents and authorities to enable it to commit to 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 document) and will honour such obligations; 19. undertakes that it will pay for the Placing Shares acquired by it in accordance with this announcement on the due time and date set out herein against delivery of such Placing Shares to it, failing which the relevant Placing Shares may be placed with other Placees or sold as DKIB may, in its absolute discretion, determine;20. acknowledges that neither DKIB, DBAG nor the Company is making any recommendations to it or advising it regarding the suitability or merits of any transaction it may enter into in connection with the Placing, and acknowledges that participation in the Placing is on the basis that it is not and will not be a client or customer of DKIB or DBAG or any of their respective Affiliates and that neither DKIB nor DBAG or any of their respective Affiliates has any duties or responsibilities to it for providing the protections afforded to their 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 DKIB's or DBAG's rights and obligations thereunder, including any right to waive or vary any condition or exercise any termination right contained therein; 21. undertakes that (i) the person whom it specifies for registration as holder of the Placing Shares will be (a) the Placee or (b) the Placee's nominee, as the case may be, (ii) neither DKIB, DBAG nor the Company will be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe this requirement and (iii) the Placee and any person acting on its behalf agrees to acquire the Placing Shares on the basis that the Placing Shares will be allotted to the CREST stock account of DKIB which will hold them as settlement agent as nominee for the Placees until settlement in accordance with its standing settlement instructions with payment for the Placing Shares being made simultaneously upon receipt of the Placing Shares in the Placee's stock account on a delivery versus payment basis; 22. acknowledges that any agreements entered into by it pursuant to these terms and conditions 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 contract; 23. acknowledges that it irrevocably appoints any director of DKIB 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; 24. represents and warrants that it is not a resident of Australia, Canada or Japan and acknowledges that the Placing Shares have not been and will not be registered nor will a prospectus be cleared in respect of the Placing Shares under the securities legislation of Australia, Canada or Japan and, subject to certain exceptions, may not be offered, sold, taken up, renounced or delivered or transferred, directly or indirectly, within those jurisdictions; 25. acknowledges that the agreement to settle each Placee's acquisition of Placing Shares (and/or the acquisition of a person for whom it is contracting as agent) free of stamp duty and stamp duty reserve tax depends on the settlement relating only to an acquisition by it and/or such person direct from the Company of the Placing Shares in question. Such agreement assumes that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to issue or transfer the Placing Shares into a clearance service. If there were any such arrangements, or the settlement related to other dealing in the Placing Shares, stamp duty or stamp duty reserve tax may be payable, for which neither the Company, DKIB nor DBAG will be responsible. If this is the case, the Placee should take its own advice and notify DKIB accordingly; 26. acknowledges that the Placing Shares will be issued and/or transferred subject to the terms and conditions set out in this document; 27. acknowledges that when a Placee or any person acting on behalf of the Placee is dealing with DKIB, any money held in an account with DKIB 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 relevant rules and regulations of the FSA. 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 DKIB's money in accordance with the client money rules and will be used by DKIB in the course of its business; and the Placee will rank only as a general creditor of DKIB. 28. acknowledges that DKIB may (at its absolute discretion) satisfy its obligations to procure Placees by itself agreeing to become a Placee in respect of some or all of the Placing Shares or by nominating any connected or associated person to do so; 29. acknowledges and understands that the Company, DKIB, DBAG and others will rely upon the truth and accuracy of the foregoing representations, warranties and acknowledgements; and 30. acknowledges that until 40 days after the later of the commencement of the Placing and the closing date, an offer or sale of Placing Shares within the US by any dealer (whether or not participating in the Placing) may violate the registration requirements of the Securities Act if such offer or sale is made otherwise than in accordance with Rule 144A or pursuant to another exemption from registration under the Securities Act to a person that is a QP (as defined below). Additional Representations and Warranties by US Persons In addition to the foregoing, each Placee which is a US Person to which thePlacing Shares will be offered in transactions exempt from, or not subject to,the registration requirements of the Securities Act represents, warrants andagrees as follows: 31. that (a) it is a qualified institutional buyer within the meaning of Rule 144A of the Securities Act, (b) it is a "qualified purchaser" within the meaning of Section 2(a)(51) of the United States Investment Company Act of 1940, as amended ("QP"), and is not (i) a broker or dealer which owns or invests less than US$25 million in securities of unaffiliated issuers, (ii) a participant-directed employee plan or (iii) formed for the purposes of investing in the Placing Shares or the Company, (c) it has duly executed, or will duly execute, an investor letter in the form provided to it by DKIB in which it will make certain undertakings, representations and warranties in addition to those contained herein; and (d) it is subscribing for the Placing Shares for its own account, or for the account managed on behalf of another QIB that is also a QP, and not with a view to any distribution within the meaning of the Securities Act or applicable state law except as set forth below; 32. it acknowledges and agrees that no offering circular or prospectus will be provided in connection with the Placing Shares and it has, or to the extent it is acquiring Placing Shares for the account of another QIB, such other QIB (a) has, sufficient knowledge, sophistication and experience in financial and business matters so as to be capable of evaluating the merits and risks of the purchase of the Placing Shares, (b) is able to bear the economic and financial risk (including a complete loss) of such a purchase, (c) has had sufficient time to consider and conduct its own investigation with respect to the offer and purchase of the Placing Shares, including the tax, legal, currency and other economic considerations relevant to such investment and (d) will not look to the Company, DKIB, DBAG or any of their Affiliates for all or part of any such loss or losses it or they may suffer; 33. it understands and agrees that (a) the Placing Shares are "restricted securities" within the meaning of Rule 144(a)(3) under the Securities Act (b) the Undersigned will not offer, sell, transfer, pledge, hypothecate or otherwise dispose of any Placing Shares except in an offshore transaction outside the United States in accordance with Regulation S under the Securities Act (and not in a prearranged transaction resulting in the sale of Placing Shares into the United States or to a US Person) in accordance with any other applicable laws of the United States and the states of the United States governing the offer and sale of such Placing Shares, and in each case it will notify any purchaser of the Placing Shares of the resale restrictions relating to the Placing Shares, if still applicable, (c) understands and agrees that the Placing Shares (to the extent they are in certificated form), unless otherwise determined by the Company in accordance with applicable law, will bear a legend to that effect in addition to such other legends as the Company deems necessary or as are required under applicable law and (d) understands that the Company or registrar and transfer agent for the Placing Shares will not be required to accept for registration of transfer any Placing Shares except upon presentation of evidence (including an opinion of legal counsel satisfactory to the Company) to the Company and the transfer agent that the foregoing restrictions on transfer have been complied with; 34. it understands and agrees that if any beneficial owner of Ordinary Shares in the Company is at any time a US person and not a QP, the Company may (i) require such beneficial owner to sell its Ordinary Shares to a person who is not a US person or who is a QIB and a QP and is qualified to purchase such shares in a transaction exempt from registration under the Securities Act or (ii) sell such shares on behalf of such beneficial owner at the best price reasonably obtainable to a person who is not a US person or who is a QIB and a QP and is qualified to purchase such shares in a transaction exempt from registration under the Securities Act; 35. without limiting the generality of clause (c) of paragraph 32 above, it acknowledges that the Company may be a passive foreign investment company (" PFIC") for US federal income tax purposes, and it could be a PFIC in future years. The Company has not undertaken an extensive PFIC analysis, however, if such analysis reveals no significant differences between tax and book values for income and losses, then there is a significant likelihood that the Company is a PFIC currently and may be a PFIC in future years. If the Company is a PFIC, then US taxable investors may be subject to adverse US tax consequences in respect of their investment in the Company's shares. US investors may be able to mitigate these adverse US tax consequences by making certain elections for US tax purposes; 36. it agrees that no purchaser of the Placing Shares shall deposit the Placing Shares into any unrestricted American Depositary Receipt facility established or maintained by a depositary bank, unless and until such time as such Placing Shares are no longer "restricted securities" within the meaning of Rule 144(a)(3) under the Securities Act; and 37. it acknowledges and agrees that the Company, DKIB, their Affiliates and others will rely upon its representations, warranties, agreements and acknowledgements set forth herein and in the investor letter, and agrees to notify the Company and DKIB promptly in writing if any of its representations, warranties or acknowledgements ceases to be accurate and complete. The acknowledgements, agreements, undertakings, representations and warrantiesreferred to above are given to each of the Company, DKIB, DBAG (for their ownbenefit and, where relevant, the benefit of their respective Affiliates,directors and employees) and are irrevocable. No UK stamp duty or stamp duty reserve tax should be payable to the extent thatthe Placing Shares are issued or transferred (as the case may be) into CREST to,or to the nominee of, a Placee who holds those shares beneficially (and not asagent or nominee for any other person) within the CREST system and registered inthe name of such Placee or such Placee's nominee. Any arrangements to issue or transfer the Placing Shares into a depositaryreceipts system or a clearance service or to hold the Placing Shares as agent ornominee of a person to whom a depositary receipt may be issued or who will holdthe Placing Shares in a clearance service, or any arrangements subsequently totransfer the Placing Shares, may give rise to UK stamp duty and/or stamp dutyreserve tax, for which neither the Company nor DKIB nor DBAG will be responsibleand the Placee to whom (or on behalf of whom, or in respect of the person forwhom it is participating in the Placing as an agent or nominee) the allocation,allotment, issue or delivery of Placing Shares has given rise to such UK stampduty or stamp duty reserve tax undertakes to pay such UK stamp duty or stampduty reserve tax forthwith and to indemnify on an after-tax basis and to holdharmless the Company, DKIB and DBAG in the event that any of the Company and/orDKIB and/or DBAG has incurred any such liability to UK stamp duty or stamp dutyreserve tax. In addition, Placees should note that they will be liable for any capital duty,stamp duty and all other stamp, issue, securities, transfer, registration,documentary or other duties or taxes (including any interest, fines or penaltiesrelating thereto) payable outside the UK by them or any other person on theacquisition by them for any Placing Shares or the agreement by them to acquireany Placing Shares. This document has been issued by the Company and is the sole responsibility ofthe Company. Dresdner Kleinwort Limited and Dresdner Kleinwort Securities Limited, which areauthorised and regulated by the Financial Services Authority, and Dresdner BankAG, London Branch, which is authorised by BAFin and by the Financial ServicesAuthority and which is regulated by the Financial Services Authority for theconduct of designated investment business in the United Kingdom, are actingexclusively for the Company and for no one else in connection with the Placingand will not be responsible to anyone other than the Company for providing theprotections afforded to customers of Dresdner Kleinwort Limited, DresdnerKleinwort Securities Limited and Dresdner Bank AG, London Branch, or foraffording advice in relation to the Placing, or any other matters referred toherein. All times and dates in this document may be subject to amendment. DKIB shallnotify the Placees and any person acting on behalf of the Placees of anychanges. This document has been prepared solely to provide information about the Placingand it does not constitute, or form part of, any offer or invitation topurchase, underwrite or otherwise acquire Placing Shares being offered, or thesolicitation of any such offer. Without limiting the foregoing statement, thisdocument does not constitute an offer of securities for sale in the UnitedStates nor the solicitation of an offer to buy any such securities, nor maysecurities be offered or sold in the United States absent registration or anexemption from registration as provided in the Securities Act and the rules andregulations thereunder. The Company does not intend to register the PlacingShares under the Securities Act. This information is provided by RNS The company news service from the London Stock Exchange

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