RUS

Option Exercise Notice

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This notice and the information contained herein are not for publication or distribution, directly or indirectly, in or into the United States, Canada, Australia or Japan, or in any other jurisdiction in which such publication or distribution would be prohibited by applicable law.

The information contained in this notice does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of any securities of PAO “Sovcomflot” (the “Company” and, together with its subsidiaries, the "Group", “Sovcomflot” or “SCF”) in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any jurisdiction.

November 6, 2020. Moscow, Russia. PAO “Sovcomflot” (the “Company”; ticker: FLOT), a global leader in the maritime transportation of hydrocarbons with a focus on operating in ultra-harsh ice environments, refers to its prior announcement of October 7, 2020 relating to the initial public offering of its ordinary shares and listing on the Moscow Exchange (the “Offering”). The Company announces that JSC VTB Capital, acting as market maker on behalf of the Underwriters (as defined below), has exercised today the repurchase option which was granted to it in connection with the Offering. The repurchase option has been exercised in respect of 37 117 881 shares of the Company, which were purchased by JSC VTB Capital on Moscow exchange in the course of stabilization activities. As a result, such shares will be repurchased by OOO “SCF Arctic” (“SCFA”), a wholly-owned subsidiary of the Company. These shares will be held by SCFA in treasury. Following the settlement of the repurchase, the free float of PAO “Sovcomflot” amounts to 15.6%, and the Russian Federation retains a 82.8% stake.

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The contents of this notice have been prepared by and are the sole responsibility of the Company.

The information contained in this notice is for background purposes only and does not purport to be full or complete. No reliance may be placed by any person for any purpose on the information contained in this notice or its accuracy, fairness or completeness.

This notice may include statements that are, or may be deemed to be, “forward-looking statements”. These forward-looking statements may be identified by the use of forward-looking terminology, including the terms “believes”, “estimates”, “plans”, “projects”, “anticipates”, “expects”, “intends”, “may”, “will” or “should” or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that the predictions, forecasts, projections, guidance and other forward-looking statements will not be achieved. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements.

Subject to their legal and regulatory obligations, neither VTB Capital plc, Citigroup Global Markets Limited, Merrill Lynch International, J.P. Morgan Securities plc, JSC Sberbank CIB or Sberbank CIB (UK) Limited (together, the “Joint Global Coordinators and Joint Bookrunners”), ING Bank N.V. (the “Co-Manager” and, together with the Joint Global Coordinators and Joint Bookrunners, the “Underwriters”), the Company, nor any of their respective agents, employees or advisors intend or have any duty or obligation to supplement, amend, update or revise any of the forward-looking statements contained in this document to reflect any change in expectations with regard thereto or any change in events, conditions or circumstances on which any statement is based.

In no circumstances shall the provision of this document imply that no negative change may occur in the business of the Company after the date of provision of this document, or any date of amendment and/or addition thereto.
The information contained in this notice does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of any securities of the Company in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any jurisdiction.

This notice is not for publication or distribution, directly or indirectly, in or into the United States, Australia, Canada or Japan. The distribution of this notice may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

This notice does not constitute an offer of securities to the public in the United Kingdom. No prospectus has been or will be approved in the United Kingdom in respect of the Shares.This notice is only addressed to and is only directed at persons in member states of the European Economic Area (the “EEA”) who are “qualified investors” within the meaning of Article 2(e) of Regulation (EU) 2017/1129 (such Regulation, together with any applicable implementing measures in the relevant home Member State under such Regulation, the “Prospectus Regulation”) (“Qualified Investors”). In the United Kingdom, this notice is being distributed to, and is only directed at, Qualified Investors (i) who have professional experience in matters relating to investments falling within the definition of “investment professionals” in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “FPO”), (ii) who fall within Article 49(2)(a) to (d) of the FPO or (iii) to whom it may otherwise lawfully be communicated (all such persons being together referred to as “Relevant Persons”). This notice and information contained herein must not be acted on or relied upon (a) in the United Kingdom, by persons who are not Relevant Persons, and (b) in any member state of the EEA other than the United Kingdom, by persons who are not Qualified Investors. Any investment or investment activity to which this notice relates is available only to (i) in the United Kingdom, Relevant Persons and (ii) in any member state of the EEA other than the United Kingdom, Qualified Investors, and will be engaged in only with such persons.

Investors should not subscribe for or purchase any Shares referred to in this notice except on the basis of information in the Offering Memorandum.

The information contained in this notice does not constitute or form part of any offer for sale or subscription of or solicitation of any offer to buy or subscribe for any securities in the United States, nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever. Under the U.S. Securities Act of 1933, as amended, securities may not be offered or sold in the United States absent registration or an exemption from registration. SCF does not intend to register any portion of the Offering in the United States, Australia, Canada or Japan or to conduct a public offering of the Shares in the United States, Australia, Canada or Japan. Subject to certain exceptions, the Shares referred to herein may not be offered or sold in Australia, Canada or Japan or to, or for the account or benefit of, any national, resident or citizen of Australia, Canada or Japan.

The Underwriters are acting exclusively for the Company and no-one else in connection with the Offering. They will not regard any other person as their respective clients in relation to the Offering and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients, nor for providing advice in relation to the Offering, the contents of this notice or any transaction, arrangement or other matter referred to herein.

Acquiring investments to which this notice relates may expose an investor to a significant risk of losing all of the amount invested. Persons considering making such investments should consult an authorized person specializing in advising on such investments. This notice does not constitute a recommendation concerning the Offering. The value of shares can decrease as well as increase. Potential investors should consult a professional advisor as to the suitability of the Offering for the person concerned.

In connection with the Offering, any of the Underwriters or any of their respective affiliates, may take up a portion of the Shares in the Offering as a principal position and in that capacity may retain, purchase, sell, offer to sell for their own accounts such Shares and other securities of the Company or related investments in connection with the Offering or otherwise. Accordingly, any references in the Offering Memorandum to the Shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any offering or placement of securities to any of the Underwriters and any of their respective affiliates acting in such capacity. In addition, any of the Underwriters and any of their respective affiliates may enter into financing arrangements (including swaps, warrants or contracts for differences) with investors, in connection with which any of the Underwriters and any of their respective affiliates may from time to time acquire, hold or dispose of Shares. The Underwriters do not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

None of the Underwriters or any of their respective directors, officers, employees, advisers or agents accepts any responsibility or liability whatsoever for or makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of the information in this notice (or whether any information has been omitted from the notice) or any other information relating to the Company, its subsidiaries or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of this notice or its contents or otherwise arising in connection therewith.