Rule 2.7 Announcement: Gran Tierra Energy to Acquire i3 Energy plc

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY RESTRICTED JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION.

THE FOLLOWING ANNOUNCEMENT IS AN ADVERTISEMENT AND NOT A PROSPECTUS OR CIRCULAR OR PROSPECTUS OR CIRCULAR EQUIVALENT DOCUMENT AND INVESTORS SHOULD NOT MAKE ANY INVESTMENT DECISION IN RELATION TO THE NEW GRAN TIERRA SHARES EXCEPT ON THE BASIS OF THE INFORMATION IN THE SCHEME DOCUMENT WHICH IS PROPOSED TO BE PUBLISHED IN DUE COURSE.

NEITHER THIS ANNOUNCEMENT, NOR THE INFORMATION CONTAINED HEREIN, CONSTITUTE A SOLICITATION OF PROXIES WITHIN THE MEANING OF APPLICABLE CANADIAN SECURITIES LAWS. SHAREHOLDERS ARE NOT BEING ASKED AT THIS TIME TO EXECUTE A PROXY IN FAVOUR OF THE ACQUISITION OR THE MATTERS DESCRIBED HEREIN.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.

FOR IMMEDIATE RELEASE.

CALGARY, Alberta, Aug. 19, 2024 (GLOBE NEWSWIRE) --

19 August 2024

Recommended and Final* Cash and Share Acquisition

of

i3 Energy plc ("i3 Energy")

by

Gran Tierra Energy, Inc. ("Gran Tierra")

to be implemented by way of a scheme of arrangement under Part 26 of the Companies Act 2006

Summary

The Boards of Gran Tierra and i3 Energy are pleased to announce that they have reached agreement on the terms of a recommended and final* cash and share offer by Gran Tierra for i3 Energy pursuant to which Gran Tierra will acquire the entire issued and to be issued share capital of i3 Energy (the "Acquisition"), intended to be effected by means of a court sanctioned scheme of arrangement between i3 Energy and the i3 Energy Shareholders under Part 26 of the Companies Act (the "Scheme").

Under the terms of the Acquisition, each i3 Energy Shareholder will be entitled to receive:

• one New Gran Tierra Share per every 207 i3 Energy Shares held; and
• 10.43 pence cash per i3 Energy Share,

(together, the "Consideration")

In addition, each i3 Energy Shareholder will be entitled to receive:

• a cash dividend of 0.2565 pence per i3 Energy Share in lieu of the ordinary dividend in respect of the three month period ending 30 September 2024 (the "Acquisition Dividend")
  
  

Following completion of the Acquisition, i3 Energy Shareholders will own up to 16.5 per cent. of Gran Tierra.

Based on Gran Tierra's closing price of US$8.66 per Gran Tierra Share on the NYSE American on 16 August 2024 (being the last Business Day before the Offer Period began), the Acquisition implies a value of 13.92 pence per i3 Energy Share and approximately £174.1 million (US$225.4 million) for the entire issued and to be issued share capital of i3 Energy which represents:

(a)      a premium of 49.0 per cent. to the Closing Price of 9.34 pence per i3 Energy Share on 16 August 2024;

(b)      a premium of 49.7 per cent. to the volume weighted average price of 9.30 pence per i3 Energy Share for the 30-day period ended 16 August 2024;

(c)      a premium of 43.6 per cent. to the volume weighted average price of 9.70 pence per i3 Energy Share for the 60-day period ended 16 August 2024; and

(d)      a premium of 37.5 per cent. to the volume weighted average price of 10.12 pence per i3 Energy Share for the 180-day period ended 16 August 2024.

A Mix and Match Facility will also be made available to i3 Energy Shareholders in order to enable them to elect, subject to off-setting elections, to vary the proportions in which they receive cash and New Gran Tierra Shares to be issued. The maximum aggregate amount of cash to be paid and New Gran Tierra Shares to be issued under the terms of the Acquisition will not be varied or increased as a result of elections under the Mix and Match Facility, in accordance with Gran Tierra’s no increase statement made in accordance with Rule 32.2 of the Takeover Code. Gran Tierra reserves the right to scale back elections made for the New Gran Tierra Shares pursuant to the Mix and Match Facility if the issuance of such New Gran Tierra Shares would result in any i3 Energy Shareholder holding 10% or more of Gran Tierra's issued share capital (on a non-diluted basis) following completion of the Acquisition.

If any dividend, distribution or other return of value in respect of the i3 Energy Shares other than the Acquisition Dividend is declared, paid, made or becomes payable on or after the date of this Announcement and prior to the Effective Date, Gran Tierra will reduce the cash consideration payable for each i3 Energy Share under the terms of the Acquisition by the amount per i3 Energy Share of such dividend, distribution or other return of value. Any exercise by Gran Tierra of its rights referred to in this paragraph shall be the subject of an announcement. In such circumstances, i3 Energy Shareholders would be entitled to receive and retain any such dividend, distribution or other return of value, which has been declared, made or paid or which becomes payable.

It is intended that, immediately following completion of the Acquisition, Gran Tierra will transfer the entire issued share capital of i3 Energy to its wholly owned, indirect subsidiary, Gran Tierra EIH. Gran Tierra EIH is the holding entity for Gran Tierra's Colombian assets.

Following completion of the Acquisition, it is expected that the i3 Energy Shares will be cancelled from trading on the AIM market of the London Stock Exchange and delisted from the TSX and that Gran Tierra will, subject to Canadian Securities Laws, apply to have i3 Energy cease to be a reporting issuer in all jurisdictions of Canada in which it is a reporting issuer.

No Increase Statement

Gran Tierra considers the financial terms of the Acquisition comprising 10.43 pence per i3 Energy Share in cash, one new Gran Tierra Share per every 207 i3 Energy Share held, and the payment of the 0.2565 pence per i3 Energy Share Acquisition Dividend to be full and fair and therefore that the financial terms of the Acquisition will not be increased in accordance with Rule 32.2 of the Takeover Code. Under Rule 35.1 of the Takeover Code, if the Acquisition lapses, except with the consent of the Panel, Gran Tierra will not be able to make an offer for i3 Energy for at least 12 months.

Gran Tierra reserves the right to revise the financial terms of the Acquisition in the event: (i) a third party, other than Gran Tierra, announces a firm intention to make an offer for i3 Energy on more favourable terms than Gran Tierra’s Acquisition; or (ii) the Panel otherwise provides its consent.

Background to and reasons for the Acquisition

Over the last five years, Gran Tierra has looked to diversify into specific oil and gas basins where it is confident it can create shareholder value focused on operated, high-quality assets with large resources in place and access to infrastructure. The Western Canadian Sedimentary Basin (“WCSB”) being one of the basins on Gran Tierra’s priority list. The majority of the Gran Tierra team has worked in the WCSB and, with its headquarters located in Calgary, is well positioned to do so again.

Gran Tierra believes that the Acquisition offers significant benefits to both companies and their respective shareholders, including the following:

• A business with increased scale and relevance: The Acquisition will create an independent energy company of scale in the Americas with significant production, reserves, cash flows and development optionality. This increased scale is expected to facilitate access to capital, allow for optimised capital allocation, enhance shareholder returns and increase relevance to investors:
  • i3 Energy has guided to 2024 working interest production of 18,000 to 19,000 BOEPD from its Canadian assets with exit rate guidance of 20,250 – 21,250 BOEPD and Gran Tierra has announced 2024 guidance production of 32,000 to 35,000 BOPD (100 per cent. oil).
  • i3 Energy has 1P working interest reserves of 88 MMBOE as at 31 July 2024 and Gran Tierra had 1P working interest reserves of 90 MMBOE as at 31 December 2023.
  • i3 Energy has 2P working interest reserves of 175 MMBOE as at 31 July 2024 and Gran Tierra had 2P working interest reserves of 147 MMBOE as at 31 December 2023.
  • i3 Energy has an independently valued 2P net present value discounted at 10 per cent. ("NPV10") (after tax) of C$994 million (approximately US$725 million) as at 31 July 2024 and Gran Tierra has an independently valued 2P NPV10 (after tax) of US$1.9 billion as at 31 December 2023. On a 1P (after tax) basis, i3 Energy’s NPV10 is C$469 million (approximately US$342 million) and Gran Tierra’s NPV10 is US$1.3 billion.
  • i3 Energy has announced full year 2024 EBITDA guidance of US$50 – 55 million after considering hedges and Gran Tierra has announced full year 2024 EBITDA guidance of US$335 – US$395 million in its low case (at US$70/bbl Brent oil pricing), US$400 – US$460 million in its base case (at US$80/bbl Brent oil pricing), and US$480 – US$540 million in its high case (at US$90/bbl Brent oil pricing).
  • i3 Energy has over 250 net booked drilling locations (374 gross booked drilling locations) associated with 2P reserves which, coupled with Gran Tierra’s substantial booked reserves, recent exploration discoveries and significant prospective acreage across Colombia and Ecuador, provides development and exploration upside potential to shareholders.
• Increased diversity across geographies and product streams: The Acquisition will create a more diverse international energy company operating across the Americas in regions with substantial oil and gas production, well-established regulatory regimes, stable contracts, access to markets and attractive fiscal terms. The Combined Group will offer a more diversified proposition to both i3 Energy Shareholders and Gran Tierra shareholders. Gran Tierra's and i3 Energy's Q2 2024 production imply an approximate geographic split of 62 per cent. Colombia, 36 per cent. Canada, and 3 per cent. Ecuador for the Combined Group, with a commodity mix of 81 per cent. liquids and 19 per cent. natural gas. The addition of new geographies and commodities, along with the exposure to an investment grade country, is expected to benefit the Combined Group in terms of increased development optionality, risk diversification and credit profile. The Combined Group would have approximately 1.4 million net acres in Colombia, 138 thousand net acres in Ecuador and 584 thousand net acres in Canada including 298 thousand net acres in Central Alberta, 102 thousand net acres in Wapiti/Elmworth, 50 thousand net acres in Simonette, and 69 thousand net acres in North Alberta (Clearwater).
• Optimised capital allocation and investment: The Combined Group will have exposure to high return projects across Canada, Colombia and Ecuador, enabling capital allocation and investment across the portfolio to be optimised, using Gran Tierra’s balance sheet strength to accelerate production and cash flow growth from i3 Energy’s 250 net booked drilling locations associated with 2P reserves and additional unbooked Canadian drilling locations and Gran Tierra’s high-impact exploration and low decline oil assets currently under waterflood. Gran Tierra further believes that the strength of the Combined Group will provide an excellent platform for future consolidation, both in Canada and internationally, with significant management expertise, free cash flow, a strong balance sheet and borrowing base potential.
• Balance sheet strength: Gran Tierra has a strong balance sheet and ample liquidity to fund growth projects and shareholder returns. As of 30 June 2024, Gran Tierra had twelve month trailing net debt to adjusted EBITDA of 1.3x and a cash balance of US$115 million. Approximately 70 per cent. of Gran Tierra's debt is due in 2028 and 2029. The addition of i3 Energy’s production and cash flows would enhance Gran Tierra’s balance sheet and enable accelerated investment and shareholder returns. i3 Energy’s assets would add production, cash flows, reserves and a diversified drilling inventory in an investment grade country, Gran Tierra expects this enhanced scale and diversity to provide enhancements to the credit profile of the business and, ultimately, lower its cost of capital. As at 30 June 2024 i3 Energy had zero debt and a C$75 million undrawn credit facility.
• Increased trading liquidity and investor access: Gran Tierra maintains a primary listing on the NYSE American, where it trades significant volume, with additional listings on the London Stock Exchange and the TSX. With i3 Energy Shareholders expected to own up to 16.5 per cent. of Gran Tierra on completion of the Acquisition, the Acquisition is expected to provide enhanced trading liquidity for the Combined Group's shareholders across exchanges and provide continuity of trading venues for i3 Energy Shareholders. Additionally, with increased scale, Gran Tierra expects to be increasingly relevant to a larger pool of international equity and credit investors, with the potential for this to have further benefits in terms of trading liquidity and valuation multiple expansion.
• Cash return for i3 Energy Shareholders with upside potential: Gran Tierra’s offer provides i3 Energy Shareholders with a significant premium, in cash, to the current value of their holdings with material upside potential through equity ownership of the Combined Group. Gran Tierra intends to use the Combined Group's scale and enhanced financial capacity to accelerate development of i3 Energy’s Canadian assets as well as Gran Tierra's existing Colombian and Ecuadorian assets and expects this to provide meaningful long-term returns to shareholders of the Combined Group. Since 1 January 2023 Gran Tierra has purchased approximately 11 per cent. of its Gran Tierra Shares outstanding from free cash flow.

Recommendation and irrevocable undertakings

The i3 Energy Directors, who have been so advised by Zeus Capital as to the financial terms of the Acquisition, consider the terms of the Acquisition to be fair and reasonable. In providing its advice to the i3 Energy Directors, Zeus Capital has taken into account the commercial assessments of the i3 Energy Directors. In addition, the i3 Energy Directors consider the terms of the Acquisition to be in the best interests of the i3 Energy Shareholders as a whole. Zeus Capital is providing independent financial advice to the i3 Energy Directors for the purposes of Rule 3 of the Takeover Code.

Accordingly, the i3 Energy Directors intend to recommend unanimously that the i3 Energy Shareholders vote in favour of the Scheme at the Court Meeting and the resolutions to be proposed at the i3 Energy General Meeting as those i3 Energy Directors who hold i3 Energy Shares have irrevocably undertaken to do in respect of their own beneficial holdings of in aggregate 32,139,532 i3 Energy Shares representing approximately 2.7 per cent. of the existing issued ordinary share capital of i3 Energy on the Last Practicable Date (excluding any i3 Energy Shares held in treasury).

Gran Tierra has also received irrevocable undertakings to vote (or, in relation to the i3 Energy CFDs, to use best endeavours to procure votes) in favour of the Scheme at the Court Meeting and the resolutions to be proposed at the i3 Energy General Meeting from the Polus Funds and Graham Heath in respect of a total of 238,537,465 i3 Energy Shares and 118,006,332 i3 Energy CFDs, which represent, in aggregate, approximately 19.84 per cent. and 9.81 per cent. respectively, of i3 Energy's existing issued ordinary share capital on the Last Practicable Date (excluding any i3 Energy Shares held in treasury). Therefore, the total number of i3 Energy Shares and i3 Energy CFDs that are subject to irrevocable undertakings received by Gran Tierra from the Polus Funds and Graham Heath is 356,543,797 i3 Energy Shares and i3 Energy CFDs, representing in aggregate approximately 29.65 per cent. of i3 Energy's existing issued ordinary share capital on the Last Practicable Date (excluding any i3 Energy Shares held in treasury).

Therefore, Gran Tierra has received irrevocable undertakings to vote (or, in relation to the i3 Energy CFDs, to use best endeavours to procure votes) in favour of the Scheme at the Court Meeting and the resolutions to be proposed at the i3 Energy General Meeting from holders of 270,676,997 i3 Energy Shares and 118,006,332 i3 Energy CFDs, which represent, in aggregate, approximately 22.51 per cent. and 9.81 per cent. respectively, of i3 Energy's existing issued ordinary share capital on the Last Practicable Date (excluding any i3 Energy Shares held in treasury). The total number of i3 Energy Shares and i3 Energy CFDs that are subject to irrevocable undertakings received by Gran Tierra is 388,683,329 i3 Energy Shares and i3 Energy CFDs, representing in aggregate approximately 32.32 per cent. of i3 Energy's existing issued ordinary share capital on the Last Practicable Date (excluding any i3 Energy Shares held in treasury).

Transaction Structure and Timetable

It is intended that the Acquisition will be implemented by way of a court sanctioned scheme of arrangement under Part 26 of the Companies Act, further details of which are contained in the full text of this Announcement and full details of which will be set out in the Scheme Document to be published by i3 Energy in due course. However, Gran Tierra reserves the right, with the consent of the Panel, to implement the Acquisition by way of a Takeover Offer.

The Acquisition will be subject to the Conditions and certain further terms set out in Appendix ‎1 to this Announcement and to the full terms and conditions which will be set out in the Scheme Document, including the approval of the Scheme by the i3 Energy Shareholders, the sanction of the Scheme by the Court, the satisfaction of the NSTA Condition, the Minority Shareholder Protection Condition and the Competition Act Condition, and the approval of the TSX.

The Scheme Document will include full details of the Scheme, together with notices of the Court Meeting and the i3 Energy General Meeting and the expected timetable of principal events, and will specify the action to be taken by i3 Energy Shareholders. It is expected that the Scheme Document, together with the Forms of Proxy and Forms of Election (and/or where required, Letters of Transmittal) in relation to the Mix and Match Facility, will be published as soon as practicable and in any event within 28 days of the date of this Announcement (or such later date as may be agreed by Gran Tierra and i3 Energy with the consent of the Panel).

The Scheme is expected to become effective in Q4 2024, subject to the satisfaction or, where permitted, waiver of the Conditions and certain further terms set out in Appendix ‎1 to this Announcement.

Comments on the Acquisition

Commenting on the Acquisition, Gary Guidry, President and Chief Executive Officer of Gran Tierra said:

"We are thrilled to announce this acquisition, which marks a significant milestone in diversifying our portfolio while strengthening our asset base. By integrating these high-quality, operated assets, including low-decline production, large resources in place and a substantial land base, we are not only enhancing our asset base but also aligning with our long-term strategic vision. We are excited to welcome the talented Canadian team to our company, as their expertise and dedication will be invaluable in driving our continued success. This acquisition is a testament to our commitment to sustainable and profitable growth and delivering consistent value to our shareholders."

Commenting on the Acquisition, Majid Shafiq, Chief Executive Officer of i3 Energy, said:

“We believe that the Acquisition presents an exceptional opportunity for i3 Energy's Shareholders. The Acquisition represents the culmination of a thorough process to realise the maximum value available for shareholders and offers significant upside potential; it expedites the realisation of fair value, with a cash premium and incremental upside through continued ownership in the Combined Group, without necessitating additional capital investment, time, or operational risk. This business combination will significantly enhance scale, thereby improving capacity to drive growth, production, and cash flows for the benefit of all shareholders and local stakeholders.”

This summary should be read in conjunction with, and is subject to, the full text of this Announcement and the Appendices.

The Acquisition will be subject to the Conditions and further terms set out in Appendix 1 to this Announcement and to the full terms and conditions which will be set out in the Scheme Document. Appendix 2 to this Announcement contains the sources and bases of certain information used in this summary and this Announcement. Appendix 3 to this Announcement contains details of the irrevocable undertakings received in relation to the Acquisition that are referred to in this Announcement. Appendix 4 to this Announcement contains details of the Gran Tierra Profit Forecast. Appendix 5 to this Announcement contains definitions of certain terms used in this summary and this Announcement.

Presentation

A presentation in connection with the Acquisition is available on the Gran Tierra website at .

A presentation in connection with the Acquisition is also available on the i3 Energy website at .

Enquiries:

Ashurst LLP is acting as UK legal adviser, Stikeman Elliott LLP is acting as Canadian legal adviser and Gibson, Dunn & Crutcher LLP is acting as US legal adviser to Gran Tierra in connection with the Acquisition. Burness Paull LLP is acting as UK legal adviser and Norton Rose Fulbright Canada LLP is acting as Canadian legal adviser to i3 Energy in connection with the Acquisition.

Gran Tierra Gary Guidry Ryan Ellson	+1 (403) 265 3221
Stifel (Joint Financial Adviser) Callum Stewart Simon Mensley	+44 (0) 20 7710 7600
Eight Capital (Joint Financial Adviser) Tony P. Loria Matthew Halasz	+1 (587) 893 6835
i3 Energy Majid Shafiq	c/o Camarco
Zeus Capital Limited (Rule 3 Financial Adviser, Nomad and Joint Broker)  James Joyce Darshan Patel Isaac Hooper	+44 (0) 203 829 5000
Tudor, Pickering, Holt & Co. Securities – Canada, ULC (Financial Adviser) Brendan Lines
National Bank Financial Inc. (Financial Adviser) Tarek Brahim Arun Chandrasekaran
Camarco Andrew Turner Violet Wilson Sam Morris	+44 (0) 203 757 4980

Further Information

This Announcement is for information purposes only and is not intended to and does not constitute or form part of an offer, offer to acquire, invitation or the solicitation of an offer, offer to acquire or invitation to purchase, or otherwise acquire, offer to acquire, subscribe for, sell or otherwise dispose of any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Acquisition or otherwise nor shall there be any sale, issuance or transfer of securities of Gran Tierra or i3 Energy pursuant to the Acquisition in any jurisdiction in contravention of applicable laws. The Acquisition will be implemented solely pursuant to the terms of the Scheme Document (or, in the event that the Acquisition is to be implemented by means of an Takeover Offer, the Offer Document), which, together with the Forms of Proxy and the Forms of Election (and/or where required, Letters of Transmittal) in relation to the Mix and Match Facility, will contain the full terms and conditions of the Acquisition, including details of how to vote in respect of the Acquisition. Any decision in respect of, or other response to, the Acquisition should be made on the basis of the information contained in the Scheme Document or the Forms of Proxy or the Forms of Election (and/or where required, Letters of Transmittal) in relation to the Mix and Match Facility. In particular, this Announcement is not an offer of securities for sale in the United States or in any other jurisdiction. No offer of securities shall be made in the United States absent registration under the US Securities Act, or pursuant to an exemption from, or in a transaction not subject to, such registration requirements. Any securities issued as part of the Acquisition are anticipated to be issued in reliance upon available exemptions from such registration requirements pursuant to Section 3(a)(10) of the US Securities Act. Additionally, if the Acquisition is implemented by way of a scheme of arrangement or a Takeover Offer, any New Gran Tierra Shares to be issued in connection with the Acquisition are expected to be issued in reliance upon the prospectus exemption provided by 2.11 or Section 2.16, as applicable, of National Instrument 45-106 – Prospectus Exemptions of the Canadian Securities Administrators and in compliance with the provincial securities laws of Canada.

The Acquisition will be made solely by means of the scheme document to be published by i3 Energy in due course, or (if applicable) pursuant to an offer document to be published by Gran Tierra, which (as applicable) would contain the full terms and conditions of the Acquisition. Any decision in respect of, or other response to, the Acquisition, should be made only on the basis of the information contained in such document(s). If, in the future, Gran Tierra ultimately seeks to implement the Acquisition by way of a Takeover Offer, or otherwise in a manner that is not exempt from the registration requirements of the US Securities Act, that offer will be made in compliance with applicable US laws and regulations. and, to the extent such Takeover Offer extends into the provinces of Canada, such Takeover Offer will be made in compliance with the provincial securities laws of Canada, including, without limitation, to the extent applicable, the rules applicable to take-over bids under National Instrument 62-104 – Take-Over Bids and Issuer Bids of the Canadian Securities Administrators.

The statements contained in this Announcement are made as at the date of this Announcement, unless some other time is specified in relation to them, and publication of this Announcement shall not give rise to any implication that there has been no change in the facts set forth in this Announcement since such date.

This Announcement has been prepared for the purpose of complying with English law and the Takeover Code and the information disclosed may not be the same as that which would have been disclosed if this Announcement had been prepared in accordance with the laws of jurisdictions outside England and Wales, including (without limitation) the United States and Canada. The Acquisition will be subject to the applicable requirements or acceptance, as applicable, of the Takeover Code, Canadian Securities Laws, the Panel, the London Stock Exchange, the TSX, the NYSE American, the FCA and the AIM Rules.

This Announcement contains inside information in relation to each of i3 Energy and Gran Tierra for the purposes of Article 7 of the Market Abuse Regulation. The person responsible for making this Announcement on behalf of i3 Energy is Majid Shafiq and the person responsible for making this Announcement on behalf of Gran Tierra is Gary Guidry.

This Announcement does not constitute a prospectus or circular or prospectus or circular equivalent document, nor does this Announcement, or the information contained herein, constitute a solicitation of proxies within the meaning of applicable Canadian Securities Laws. Shareholders are not being asked at this time to execute a proxy in favour of the Acquisition or the matters described herein.

Information Relating to i3 Energy Shareholders

Please be aware that addresses, electronic addresses and certain other information provided by i3 Energy Shareholders, persons with information rights and other relevant persons for the receipt of communications from i3 Energy may be provided to Gran Tierra during the Offer Period as required under Section 4 of Appendix 4 of the Takeover Code or Canadian Securities Laws, as applicable.

Overseas Jurisdictions

The release, publication or distribution of this Announcement in or into jurisdictions other than the United Kingdom may be restricted by law and therefore any persons who are subject to the laws of any jurisdiction other than the United Kingdom should inform themselves about, and observe any applicable legal or regulatory requirements. In particular, the ability of persons who are not resident in the United Kingdom to vote their i3 Energy Shares with respect to the Scheme at the Court Meeting, or to execute and deliver forms of proxy appointing another to vote at the Court Meeting on their behalf, may be affected by the laws of the relevant jurisdictions in which they are located. Any failure to comply with the applicable restrictions may constitute a violation of the securities laws of any such jurisdiction. To the fullest extent permitted by applicable law the companies and persons involved in the Acquisition disclaim any responsibility or liability for the violation of such restrictions by any person.

Unless otherwise determined by Gran Tierra or required by the Takeover Code, and permitted by applicable law and regulation, the availability of New Gran Tierra Shares to be issued pursuant to the Acquisition to i3 Energy Shareholders will not be made available, directly or indirectly, in, into or from a Restricted Jurisdiction where to do so would violate the laws in that jurisdiction and no person may vote in favour of the Acquisition by any such use, means, instrumentality or form within a Restricted Jurisdiction or any other jurisdiction if to do so would constitute a violation of the laws of that jurisdiction. Accordingly, copies of this Announcement and any formal documentation relating to the Acquisition are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from any Restricted Jurisdiction or any other jurisdiction where to do so would constitute a violation of the laws of that jurisdiction, and persons receiving such documents (including custodians, nominees and trustees) must not mail or otherwise forward, distribute or send such documents in or into or from any Restricted Jurisdiction. Doing so may render invalid any related purported vote in respect of the Acquisition. If the Acquisition is implemented by way of a Takeover Offer (unless otherwise permitted by applicable law and regulation), the Takeover Offer may not be made directly or indirectly, in or into, or by the use of mails or any means or instrumentality (including, but not limited to, facsimile, e-mail or other electronic transmission or telephone) of interstate or foreign commerce of, or of any facility of a national, state or other securities exchange of any Restricted Jurisdiction and the Takeover Offer may not be capable of acceptance by any such use, means, instrumentality or facilities or from within any Restricted Jurisdiction.

The availability of New Gran Tierra Shares pursuant to the Acquisition to i3 Energy Shareholders who are not resident in the United Kingdom or the ability of those persons to hold such shares may be affected by the laws or regulatory requirements of the relevant jurisdictions in which they are resident. Persons who are not resident in the United Kingdom should inform themselves of, and observe, any applicable legal or regulatory requirements. i3 Energy Shareholders who are in doubt about such matters should consult an appropriate independent professional adviser in the relevant jurisdiction without delay.

Further details in relation to i3 Energy Shareholders in overseas jurisdictions will be contained in the Scheme Document.

Notice to US Shareholders

The Acquisition relates to the shares of an English company with a listing on the London Stock Exchange and the TSX and is proposed to be implemented pursuant to a scheme of arrangement provided for under the law of England and Wales. A transaction effected by means of a scheme of arrangement is not subject to proxy solicitation or the tender offer rules under the US Exchange Act. Accordingly, the Acquisition is subject to the procedural and disclosure requirements, rules and practices applicable in the United Kingdom to schemes of arrangement which differ from the requirements of US proxy solicitation or tender offer rules. Financial information included in this Announcement and the Scheme Document in relation to Gran Tierra has been or will be prepared in accordance with US GAAP and in relation to i3 Energy has been or will be prepared in accordance with International Financial Reporting Standards ("IFRS").

If, in the future, Gran Tierra elects, with the consent of the Panel, to implement the Acquisition by means of a Takeover Offer and determines to extend such Takeover Offer into the United States, such Takeover Offer will be made in compliance with all applicable laws and regulations, including, without limitation, to the extent applicable, Section 14(e) of the US Exchange Act and Regulation 14E thereunder, and subject, in the case of participation by i3 Energy Shareholders resident in the United States, to the availability of an exemption (if any) from the registration requirements of the US Securities Act and of the securities laws of any state or other jurisdiction of the United States. Such Takeover Offer would be made by Gran Tierra and no one else. In addition to any such Takeover Offer, Gran Tierra, certain affiliated companies and the nominees or brokers (acting as agents) may make certain purchases of, or arrangements to purchase, shares in i3 Energy outside such Takeover Offer during the period in which such Takeover Offer would remain open for acceptance. If such purchases or arrangements to purchase were to be made, they would be made outside the United States and would comply with applicable law, including the US Exchange Act. Any information about such purchases will be disclosed as required in the United Kingdom, United States and Canada and will be reported to a Regulatory Information Service of the FCA and will be available on the London Stock Exchange website: /, and, if required, on the SEC website at ..

The New Gran Tierra Shares have not been and will not be registered under the US Securities Act or under the securities laws of any state or other jurisdiction of the United States. Accordingly, the New Gran Tierra Shares may not be offered, sold, resold, delivered, distributed or otherwise transferred, directly or indirectly, in or into or from the United States absent registration under the US Securities Act or an exemption therefrom and in compliance with the securities laws of any state or other jurisdiction of the United States. The New Gran Tierra Shares are expected to be issued in reliance upon the exemption from the registration requirements of the US Securities Act provided by section 3(a)(10) thereof.

None of the securities referred to in this Announcement have been approved or disapproved by the SEC, any state securities commission in the United States or any other US regulatory authority, nor have such authorities passed upon or determined the fairness or merits of such securities or the Acquisition or upon the adequacy or accuracy of the information contained in this Announcement. Any representation to the contrary is a criminal offence in the United States.

It may be difficult for US holders of i3 Energy Shares to enforce their rights and claims arising out of the US federal securities laws, since i3 Energy is organised in a country other than the United States, and some or all of its officers and directors may be residents of, and some or all of its assets may be located in, jurisdictions other than the United States. US holders of i3 Energy Shares may have difficulty effecting service of process within the United States upon those persons or recovering against judgments of US courts, including judgments based upon the civil liability provisions of the US federal securities laws. US holders of i3 Energy Shares may not be able to sue a non-US company or its officers or directors in a non-US court for violations of US securities laws. Further, it may be difficult to compel a non-US company and its affiliates to subject themselves to a US court's judgment.

The receipt of New Gran Tierra Shares pursuant to the Acquisition by a US i3 Energy Shareholder may be a taxable transaction for US federal income tax purposes, and may also be a taxable transaction under applicable state and local tax laws, as well as foreign and other tax laws. Each i3 Energy Shareholder is urged to consult its independent professional adviser immediately regarding the tax consequences of the Acquisition.

Notice to Canadian i3 Energy Shareholders

The Acquisition relates to the securities of an English company with a listing on the London Stock Exchange and the TSX and is proposed to be implemented pursuant to a scheme of arrangement provided for under the laws of England and Wales. A transaction effected by means of a scheme of arrangement may differ from the procedures and requirements that would be applicable to a similar transaction under applicable Canadian corporate laws or Canadian Securities Laws, including the rules applicable to take-over bids under National Instrument 62-104 – Take-Over Bids and Issuer Bids of the Canadian Securities Administrators (“Canadian Take-Over Bid Rules”). While Gran Tierra and i3 Energy will complete the Acquisition in accordance with applicable Canadian Securities Laws, the Acquisition is subject to the procedural and disclosure requirements, rules and practices applicable to schemes of arrangement involving a target company incorporated in England and listed on the London Stock Exchange and the TSX, which may differ in certain areas from the requirements applicable to similar transactions under applicable Canadian corporate laws or Canadian Securities Laws.

The Acquisition is not a “take-over bid” as defined under Canadian Take-Over Bid Rules. However, if, in the future, Gran Tierra elects, with the consent of the Panel, to implement the Acquisition by means of a Takeover Offer and determines to extend such Takeover Offer into the provinces of Canada, such Takeover Offer will be made in compliance with all Canadian Securities Laws, including, without limitation, to the extent applicable, the Canadian Take-Over Bid Rules. In addition to any such Takeover Offer, Gran Tierra, certain affiliated companies and the nominees or brokers (acting as agents) may make certain purchases of, or arrangements to purchase, shares in i3 Energy outside such Takeover Offer during the period in which such Takeover Offer would remain open for acceptance. If such purchases or arrangements to purchase were to be made, they would be made outside of Canada and would comply with Canadian Securities Laws. Any information about such purchases will be disclosed as required in the United Kingdom, will be reported to a Regulatory Information Service of the UK Financial Conduct Authority and will be available on the London Stock Exchange website:

Any New Gran Tierra Shares to be issued in connection with the Acquisition have not been and will not be qualified for distribution under Canadian Securities Laws. Accordingly, the New Gran Tierra Shares may not be offered, sold, resold, delivered, distributed or otherwise transferred, directly or indirectly, in or into or from Canada absent a qualification for distribution or an exemption from the prospectus requirements and in compliance with Canadian Securities Laws. If the Acquisition is implemented by way of a scheme of arrangement or a Takeover Offer, any New Gran Tierra Shares to be issued in connection with the Acquisition are expected to be issued in reliance upon the prospectus exemption provided by Section 2.11 or Section 2.16, as applicable, of National Instrument 45-106 – Prospectus Exemptions of the Canadian Securities Administrators and in compliance with Canadian Securities Laws.

The receipt of consideration pursuant to the Acquisition by a Canadian i3 Energy Shareholder as consideration for the transfer of its i3 Energy Shares may be a taxable transaction for Canadian federal income tax purposes and under applicable Canadian provincial income tax laws, as well as foreign and other tax laws. Each i3 Energy Shareholder is urged to consult their independent professional adviser immediately regarding the tax consequences of the Acquisition applicable to them.

None of the securities referred to in this Announcement have been approved or disapproved by any Canadian securities regulatory authority nor has any Canadian regulatory authority passed upon or determined the fairness or merits of such securities or the Acquisition or upon the adequacy or accuracy of the information contained in this Announcement. Any representation to the contrary is an offence.

i3 Energy is located in a country other than Canada, and some or all of its officers and directors may be residents of a country other than Canada. It may be difficult for Canadian i3 Energy Shareholders to enforce judgments obtained in Canada against any person that is incorporated, continued or otherwise organised under the laws of a foreign jurisdiction or resides outside of Canada, even if the party has appointed an agent for service of process.

Important Notices Relating to Financial Advisers

Stifel Nicolaus Europe Limited ("Stifel"), which is authorised and regulated by the FCA in the UK, is acting as financial adviser exclusively for Gran Tierra and no one else in connection with the matters referred to in this Announcement and will not be responsible to anyone other than Gran Tierra for providing the protections afforded to its clients or for providing advice in relation to matters referred to in this Announcement. Neither Stifel, nor any of its affiliates, owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Stifel in connection with this Announcement, any statement contained herein or otherwise.

Eight Capital ("Eight Capital"), which is authorised and regulated by the Canadian Investment Regulatory Organization in Canada, is acting exclusively for Gran Tierra and for no one else in connection with the subject matter of this Announcement and will not be responsible to anyone other than Gran Tierra for providing the protections afforded to its clients or for providing advice in connection with the subject matter of this Announcement.

Zeus Capital Limited ("Zeus"), which is authorised and regulated by the FCA in the United Kingdom, is acting exclusively for i3 Energy as financial adviser, nominated adviser and joint broker and no one else in connection with the matters referred to in this Announcement and will not be responsible to anyone other than i3 Energy for providing the protections afforded to clients of Zeus, or for providing advice in relation to matters referred to in this Announcement. Neither Zeus nor any of its affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Zeus in connection with the matters referred to in this Announcement, any statement contained herein or otherwise.

Tudor, Pickering, Holt & Co. Securities – Canada, ULC ("TPH&Co."), regulated by the Canadian Investment Regulatory Organization and a member of the Canadian Investor Protection Fund, is acting exclusively for i3 Energy by way of its engagement with i3 Energy Canada., a wholly-owned subsidiary of i3 Energy, in connection with the matters set out in this Announcement and for no one else, and will not be responsible to anyone other than i3 Energy. for providing the protections afforded to its clients nor for providing advice in relation to the matters set out in this Announcement. Neither TPH&Co. nor any of its subsidiaries, branches or affiliates and their respective directors, officers, employees or agents owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of TPH&Co. in connection with this Announcement, any statement contained herein or otherwise.

National Bank Financial Inc. ("NBF"), regulated by the Canadian Investment Regulatory Organization and a member of the Canadian Investor Protection Fund, is acting exclusively for i3 Energy by way of its engagement with i3 Energy Canada, a wholly-owned subsidiary of i3 Energy, in connection with the matters set out in this Announcement. Neither NBF, nor any of its subsidiaries, branches or affiliates and their respective directors, officers, employees or agents owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of NBF in connection with this Announcement, any statement contained herein or otherwise.

Cautionary Note Regarding Forward Looking Statements

This Announcement (including information incorporated by reference into this Announcement), oral statements regarding the Acquisition and other information published by Gran Tierra and i3 Energy contain certain forward looking statements with respect to the financial condition, strategies, objectives, results of operations and businesses of Gran Tierra and i3 Energy and their respective groups and certain plans and objectives with respect to the Combined Group. These forward looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward looking statements are prospective in nature and are not based on historical facts, but rather on current expectations and projections of the management of Gran Tierra and i3 Energy about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward looking statements. The forward looking statements contained in this Announcement include, without limitation, statements relating to the expected effects of the Acquisition on Gran Tierra and i3 Energy, the expected timing method of completion, and scope of the Acquisition, the expected actions of Gran Tierra upon completion of the Acquisition, Gran Tierra's ability to recognise the anticipated benefits from the Acquisition, expectations regarding the business and operations of the Combined Group, and other statements other than historical facts. Forward looking statements often use words such as "anticipate", "target", "expect", "estimate", "intend", "plan", "strategy", "focus", "envision", "goal", "believe", "hope", "aims", "continue", "will", "may", "should", "would", "could", or other words of similar meaning. These statements are based on assumptions and assessments made by Gran Tierra, and/or i3 Energy in light of their experience and their perception of historical trends, current conditions, future developments and other factors they believe appropriate. By their nature, forward looking statements involve risk and uncertainty, because they relate to events and depend on circumstances that will occur in the future and the factors described in the context of such forward looking statements in this Announcement could cause actual results and developments to differ materially from those expressed in or implied by such forward looking statements. Although it is believed that the expectations reflected in such forward looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct and readers are therefore cautioned not to place undue reliance on these forward looking statements. Actual results may vary from the forward looking statements.

There are several factors which could cause actual results to differ materially from those expressed or implied in forward looking statements. Among the factors that could cause actual results to differ materially from those described in the forward looking statements are changes in the global, political, economic, business, competitive, market and regulatory forces, future exchange and interest rates, changes in tax rates and future business acquisitions or dispositions.

Each forward looking statement speaks only as at the date of this Announcement. Neither Gran Tierra nor i3 Energy, nor their respective groups assumes any obligation to update or correct the information contained in this Announcement (whether as a result of new information, future events or otherwise), except as required by applicable law or by the rules of any competent regulatory authority.

Certain figures included in this Announcement have been subjected to rounding adjustments. Accordingly, figures shown for the same category presented in different tables may vary slightly and figures shown as totals in certain tables may not be an arithmetic aggregation of the figures that precede them.

The estimates of Gran Tierra's and i3 Energy's respective future production and 2024 EBITDA and in the case of i3 Energy, 2024 net operating income, set forth in this Announcement may be considered to be future-oriented financial information or a financial outlook for the purposes of applicable Canadian Securities Laws. Financial outlook and future-oriented financial information contained in this Announcement about prospective financial performance and operational performance are provided to give the reader a better understanding of the potential future performance of Gran Tierra, i3 Energy and the Combined Group in certain areas and are based on assumptions about future events, including economic conditions and proposed courses of action, based on Gran Tierra's and i3 Energy's respective management’s assessment of the relevant information currently available, and to become available in the future. In particular, this Announcement contains Gran Tierra and i3 Energy projected financial and operational information for 2024. These projections contain forward-looking statements and are based on a number of material assumptions and factors set out above and in Appendix 4 to this Announcement. Actual results may differ significantly from the projections presented herein. These projections may also be considered to contain future-oriented financial information or a financial outlook. The actual results of Gran Tierra’s and i3 Energy’s respective operations for any period will likely vary from the amounts set forth in these projections, and such variations may be material. See above for a discussion of the risks that could cause actual results to vary. The future-oriented financial information and financial outlooks contained in this Announcement have been approved by the respective management of Gran Tierra and i3 Energy, as applicable, as of the date of this Announcement. Readers are cautioned that any such financial outlook and future-oriented financial information contained herein should not be used for purposes other than those for which it is disclosed herein. Gran Tierra, i3 Energy and their respective management believe that the prospective financial and operational information has been prepared on a reasonable basis, reflecting Gran Tierra and i3 Energy respective management’s best estimates and judgments, and represent, to the best of Gran Tierra’s and i3 Energy's respective management’s knowledge and opinion, Gran Tierra’s and i3 Energy's expected respective course of action. However, because this information is highly subjective, it should not be relied on as necessarily indicative of future results. See Gran Tierra’s press release dated 23 January 2024 and most recent reports on Form 10-K and Form 10-Q for additional information regarding the 2024 financial and production outlook of Gran Tierra, and i3 Energy’s press release dated 13 August 2024 regarding the financial and production outlook of i3 Energy.

Non-IFRS, Non-GAAP and Other Specified Financial Measures

This Announcement contains references to Gran Tierra’s EBITDA, adjusted EBITDA, net debt, net debt to adjusted EBITDA ratio, i3 Energy’s EBITDA, net operating income, free cash flow, net cash surplus and net debt, which are specified financial measures that do not have any standardized meaning as prescribed by US GAAP in the case of Gran Tierra or UK adopted IFRS in the case of i3 Energy and, therefore, may not be comparable with the calculation of similar measures presented by other applicable issuers. You are cautioned that these measures should not be construed as alternatives to net income or loss, or other measures of financial performance as determined in accordance with US GAAP in the case of Gran Tierra and UK adopted IFRS in the case of i3 Energy. Gran Tierra’s and i3 Energy’s methods of calculating these measures may differ from other companies and, accordingly, they may not be comparable to similar measures used by other companies. Each non-GAAP and non-IFRS financial measure is presented along with the corresponding GAAP or IFRS measure so as to not imply that more emphasis should be placed on the non-GAAP or non-IFRS measure. For an explanation of the composition of i3 Energy’s EBITDA, adjusted EBITDA, net operating income, free cash flow, net cash surplus and net debt, see "Non-IFRS Financial Measures" in i3 Energy’s Management Discussion and Analysis dated