Ecofin Water & Power Opps PLC



ECOFIN WATER AND POWER OPPORTUNITIES PLC(the "Company")

REMINDER TO THE HOLDERS ("Stockholders") OF 6 PER CENT. CONVERTIBLE UNSECURED SUBORDINATED LOAN STOCK 2016 ("Stock") OF THE COMPANY

This notice is to remind you that you are entitled to exercise your right to convert the whole or any part of your holding of Stock into fully paid Ordinary Shares of 0.1p each in the capital of the Company ("Ordinary Shares ") on 31 May 2014 (the "Conversion Date"). The Trust Deed constituting the Stock dated 29 July 2009 ("Trust Deed ") provides for conversion of Stock into Ordinary Shares at the Conversion Price (as defined in the Trust Deed). The current Conversion Price is set out in Schedule 1 to this notice. Fractions of Ordinary Shares will not be issued to Stockholders on exercise of conversion rights, and no payment of cash or other adjustment will be made in lieu thereof. In accordance with the Trust Deed, you may submit the requisite conversion notice at any time during a period of 28 days ending on 31 May 2014 (please refer to the Conversion Procedures below).

The information set out in this notice and the Schedules hereto is provided to help you to decide whether or not to exercise your conversion rights. You are not obliged to exercise your right to convert and if you do not convert on this occasion you will have further opportunities to do so in May and November each year up to May 2016. Stockholders who do not exercise their conversion rights in full on this occasion will be sent reminders of their rights to convert at subsequent opportunities.

CONSIDERATIONS FOR STOCKHOLDERS

Whether or not Stockholders decide to convert their Stock will depend, amongst other things, on their own individual circumstances including their tax position. The following factors (based on the mid-market closing prices shown in Schedule 2) may be of relevance for Stockholders considering whether to convert their Stock:

Market value : The market value of the Ordinary Shares into which Stock would convert differs from the market value of the Stock. By way of example, £100 nominal of Stock at its closing price on 23 April 2014 would have had a market value of approximately £104.88. On the basis of the current Conversion Price, £100 nominal of Stock would convert into 57.92 Ordinary Shares which, at their closing price on the same day, would have had a value of approximately £84.56.

Income : A holder of £100 nominal of Stock would receive an annual interest income of £6.00. £100 nominal of Stock can be converted into 57.92 Ordinary Shares which are currently expected (but not guaranteed) to receive quarterly dividends at a rate of 1.6875p per Ordinary Share. If all four quarterly dividends are declared and paid, £100 nominal of Stock converted into 57.92 Ordinary Shares would generate an annual dividend income of £3.91.

Taxation: Stockholders are advised to consult their own professional advisors as to the tax implications of exercising or not exercising their conversion rights, as tax treatment will depend on individual circumstances.

Under current UK legislation interest and dividends received by individuals resident or ordinarily resident in the UK are liable to UK income tax. Dividends received by UK corporate shareholders are subject to corporation tax unless they fall within the exempt cases provided for in UK corporation tax legislation.

Interest on the Stock is paid without deduction of UK income tax at source. As far as the Company is aware, conversion of Stock into Ordinary Shares will not constitute a disposal for the purposes of UK taxation of capital gains. Ordinary Shares arising from conversion will be treated as having been acquired by the individual at the same time/base cost at which the Stock was acquired. The tax treatment of Stockholders in relation to UK corporation tax will depend on the treatment of the Stock in the Stockholders accounts.

You should be clear on your tax position before deciding whether or not to convert. If you are not clear on your tax position, or are resident outside the UK for tax purposes, you should consult your own professional advisor before deciding whether or not to convert.

CONVERSION PROCEDURES

In relation to the forthcoming conversion period, the latest time for the lodgement of conversion forms or instructions is 5.00 pm on 30 May 2014.

Conversion of Stock held in Certificated Form

If you wish to convert the whole or any part of your holding of Stock in certificated form you must complete and sign the Conversion Notice on the certificate(s) representing the Stock to be converted and lodge it with the Company's registrars: Capita Registrars, 34 Beckenham Road, Beckenham, Kent BR3 4TU ("Registrar ") between 3 May 2014 and 30 May 2014 (both dates inclusive). Once lodged a conversion notice will be irrevocable, except with the consent of the Company.

If you wish to nominate any other person(s) as the holder(s) of the Ordinary Shares arising from conversion, you should apply to the Registrar for (an) appropriate form(s) of nomination which must be completed, executed and lodged with the duly completed Conversion Notice and your Stock certificate(s).

If any of your Stock certificates have been lost, destroyed or defaced and you wish to exercise your conversion rights, you will need to write to the Registrar notifying your intention to convert. The Registrar will send you a Form of Indemnity in respect of the lost, destroyed or defaced certificates, which will need to be completed, executed and returned to the Registrar before conversion can be effected.

Conversion of Stock held in Uncertificated Form (that is, in CREST)

CREST Members should refer to the CREST Manual for information on the CREST procedures and authentication required to effect conversion. CREST Sponsored Members should refer to their CREST Sponsor for information on the action they need to take to effect conversion.

The prescribed form of uncertificated Conversion Notice is an Unmatched Stock Event ("USE") instruction which, on settlement, will have the effect of crediting a stock account of the Registrar under the details specified below.

The USE instruction must be properly authenticated in accordance with CRESTCo's specifications and must contain the following details in addition to any other information required:

a) the nominal amount of Stock to be converted;

b) the participant ID of the Stockholder;

c) the member account ID of the Stockholder from which the Stock to be converted is to be debited;

d) the Registrar's participant ID: This is RA10;

e) the Registrar's member account ID: This is EWPO;

f) the corporate action number, which will be allocated by CRESTCo and can be found by viewing the relevant corporate action details in CREST;

g) the corporate action ISIN: This is GB00B504KH32 ; and

h) the intended settlement date: This will be 5.00 pm on 30 May 2014.

FURTHER INFORMATION

Interest on Stock converted will be payable up to (but excluding) 31 May 2014, and will cease to accrue immediately thereafter.

Ordinary Shares allotted on conversion will rank pari passu with existing Ordinary Shares in relation to distributions declared, paid, or made by reference to record dates after 31 May 2014.

Applications will be made to the UK Listing Authority for all Ordinary Shares issued pursuant to conversion of Stock to be admitted to the Official List and to the London Stock Exchange for such Ordinary Shares to trade on its main market for listed securities. It is anticipated that dealings in the newly allotted Ordinary Shares will commence no later than 14 days after the Conversion Date.

Ordinary Shares arising on conversion will be issued in certificated form where the Stock being converted is held in certificated form, and in uncertificated form where the Stock being converted is uncertificated. Certificates for Ordinary Shares, and for the balance of certificated Stock not converted, will be despatched to Stockholder(s) in accordance with their instructions not later than 28 days after the Conversion Date.

The Registrar will instruct CRESTCo to credit Participant ID and Member ID Accounts as specified in validly received uncertificated Conversion Notices with the number of Ordinary Shares arising on conversion not later than 14 days after the Conversion Date.

This notice is sent in accordance with the terms and conditions of the Stock. It should not be construed as a recommendation to Stockholders to exercise their conversion rights or otherwise and nor does it constitute any form of financial advice.

Yours faithfully

For and on behalf of Ecofin Water & Power Opportunities plc

BNP Paribas Secretarial Services Limited - Company Secretary

24 April 2014

SCHEDULE 1

In accordance with Condition 3(1) of the Trust Deed, the Stock is convertible at a rate of 172.6445p nominal of Stock for one Ordinary Share, equivalent to 0.5792 Ordinary Shares per £1.00 nominal of Stock. The number of new Ordinary Shares which each £100 nominal of Stock will be convertible into is 57.92.

In the event that the capital structure of the Company is varied, the Conversion Rate for future conversion opportunities may differ from the Conversion Rate applying for the conversion period to which this letter relates.

The Conversion Price for conversion of Stock into Ordinary Shares is currently:

57.92 Ordinary Shares for each £100 nominal of Stock; or

172.6445p nominal of Stock for each Ordinary Share

SCHEDULE 2

Closing Mid-prices of Stock and Ordinary Shares :


Ordinary Share Price

Stock Price

2013



1 November

129.00p

104.25p

2 December

131.00p

103.25p

2014



2 January

123.00p

103.75p

3 February

125.75p

103.38p

3 March

131.50p

103.25p

1 April

141.00p

104.12p

23 April

146.00p

104.88p

NB: The above are closing mid-prices derived from the official website of the London Stock Exchange.

BNP Paribas Secretarial Services Limited

Company Secretary

Tel: 020 7410 5971

24 APRIL 2014


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