Energy

Exploration & Production

High Yield Research

January 8, 2004
Greg Imbruce 800/937-5333 gimbruce@jefco.com

Mission Resources Corp.

Restructuring Underway

(MSSN)

Amount Coupon Maturity O/S $MM Seniority 4/1/07 Sr. Sub. Nts. (1) 10.875% $117.4

Rating Ca / NR

Price 98.0%

CY YTW 11.10% 11.62%

Yrs. Coupon STW to Mty. Pmts. 916 3.4 4/1,10/1

Recommendation Buy

(1) Original $225 mm issue. On 3/23/03, MSSN acquired $97.6 mm in face amount for approx. $71.7 mm (73.5%), plus accrued interest. Additionally, on 12/18/03, MSSN announced it had acquired $10 MM of its 10.875% Sr. Sub. Nts. for 4.5 MM common shares.

Recommendation: Buy
We recommend Mission Resources Corp.'s (MSSN) 10.875% Sr. Sub. Notes '07 as a BUY at 98 (11.62% YTW,+916 bps) due to the attractive relative yield in todays market coupled with the following: Recent debt-for-equity swap that reduces debt by $10 mm in exchange for 4.5 million shares Approximately 1.4x asset coverage attributable to the 10.875s Adequate credit statistics (1.7x interest coverage and 4.5x leverage) that are expected to improve in response to: (i) the recent debt-for-equity swap that results in $1mm of annual interest cost savings; and (ii) higher EBITDA from lower unit costs and strong commodity prices, both in the spot market as well as through the Company's hedging program The Company's financial performance is somewhat insulated from commodity prices with almost 46% of the next 12-months production hedged at $4.50/MCFE Ample liquidity ($47 mm 4Q03E) as a result of asset sales completed during 4Q03 Stabilized production (63 MMCFE per day) from the Company's impressive year-to-date drilling program, despite the recent asset sales We are also encouraged by the recently announced asset sale of Mission's long-life, lower quality, high cost properties in East Texas at attractive valuations relative to the asset quality ($5.38/BOE or $0.90/MCFE) - this sale in combination with new natgas finds of low unit cost reserves achieves the Company's goal toward high-grading its oil and gas reserves by focusing on optimizing unit economics Expectation that the Company will pursue the restructuring efforts management stated in its 3Q03 conference call,"We are continuing our efforts to lower debt to a more appropriate level, and are investigating a number of opportunities, including a refinancing of our senior credit facility, a refinancing of the remaining notes, and new equity or debt" - we estimate that a collection of these options could potentially reduce annual interest costs an additional $7-8 mm per year and enable the stock to trade in-line with comparables If the Company were successful in refinancing the Notes, outside of a tender, it would require the Company to call the 10.875s at the current 103.625 call price - we expect, however, MSSN would wait until the call price declines to 101.8125 on 4/1/04 Impressive stock performance (+479% Year-over-Year) should enable the company to delever using equity or an equity-linked instrument - we expect that the stock will maintain support trading at 5.9x LTM EBITDA, a discount to its comparables, which trade at 6.6x (median) to 11.1x (average) Solid M&A market which should will result in further consolidation of E&P companies during 2004, which we expect will support MSSNs stock since management owns 5% of the equity and indicated that its intention is to restructure and then consider attractive exit strategies - this, of course, would trigger the 101.0 change-of-control put XTO Energy Inc. (XTO) announced today that it will acquire 182 BCFE of East Texas and northern Louisiana properties for $249 mm or $1.37/MCFE this unit valuation is in-line with our MSSN upside scenario of $1.32/MCFE, which results in a $3.41 NAV per share for MSSN Mission Resources Corp.

Greg Imbruce gimbruce@jefco.com Exploration & Production 800/937-5333 COMPANY DESCRIPTION: January 8, 2004 Mission Resources Corporation (NASDAQ: MSSN) is a Houston-based independent exploration and production company created by the merger of Bellwether Exploration Company with Bargo Energy Company, which was consummated in 2001. The property base combines Bargo's long life oil properties in West Texas with Bellwether's high deliverabilitiy gas producing properties in the Gulf Coast and the Gulf of Mexico. MSSN's long-term strategy is to be geographically focused onshore in the Louisiana Gulf Coast, South Texas and the Permian Basin. At December 31, 2002, MSSN's 229 BCFE (38 MMBOE) of proved reserves, as engineered by Netherland Sewell, were 64% Oil and 77% Proved Developed, and maintained an 10-year reserve life based on the Company's most recent quarter's production rate. In addition to its oil and gas assets, the Company holds leases on over 61,000 net undeveloped acres in the US. In accordance with its plan to high-grade its oil and gas reserve quality, the Company targeted a 70% natural gas mix for year-end 2003 proved reserves. The Company expects 2003 CapEx to total $32 million with nearly $27 million or 83% allocated to development and exploration drilling targets.

Mission Resources Corporation (MSSN)

BOND SUMMARY: Description: Sr. Sub. Nts. 10.875% '07 Jefco Rec. Buy Maturity 4/1/2007 Amt O/S Ratings $MM Moody's S&P $117.4 Ca NR Next Call Date Price 4/1/04 101.813 Price 98.0 CY 11.10% Yield YTW 11.62% STW 916 Coupon Pmt Dates 4/1,10/1

COMPANY DATA: Company Symbols (Equity/Debt) Headquarters Phone Website Currency Fiscal Year End Accounting Method Most Recent Quarter Number of Employees Auditor Company Type Current Stock Price Shares Outstanding (MM) MarketCap / Enterprise Value ($MM) Total Debt / Net Debt ($MM) Net Asset Value (NAV) Stock Price / NAV Total Debt per MCFE (Dvlpd./Total) Proved Reserves - BCFE @ 12/31/02 Production - MMCFE (Recent Qtr.) Reserve Life - Yrs. Reserve Engineer(s) Properties

PROVED RESERVES: Mission Resources Corporation MSSN / MSSN Houston, TX (713) 495-3000 www.missionresourcescorp.com USD (1.000 per USD) December Full Cost 9/30/03 90 KPMG LLP Public $2.36 (+4% YTD, +479% YOY) (Incl. 12/04 Debt-for-Equity Swap) 28.0 $66 / $263 $197 / $197 $1.57-$3.41/shr or $44-$96 MM 150%-69% $1.12 / $0.86 229 (23% PUDs / 36% NatGas) 62.8 per Day (41% NatGas) 10.0 Netherland Sewell Permian Basin, Gulf Coast, GOM Total Proved Global Mix Proved NatGas Undvlpd. US CN INTL BCFE % % % % % 1999 182.1 230.8 56% 21% 100% --2000 145.1 189.6 39% 23% 100% --2001 300.9 403.7 38% 25% 100% --2002 176.4 229.1 36% 23% 100% --2003 NA NA NA NA NA NA NA YTD Est. (3) 175.9 228.5 NA NA NA NA NA FINDING COSTS-$/MCFE (99-03): RESERVE REPLACE (99-03): Drilling $2.12 Drilling 57% Drilling + Revisions $8.17 Drilling + Revisions 15% Acquisitions $0.78 Acquisitions 290% Drilling + Acquisitions $1.00 All Sources 305% All Sources $1.14 Net Sources (After Sales) 142% DRILLING SUCCESS (99-03): PRODUCING WELLS (2002): Exploration 55% Gross Wells 2,521 Development 86% Net Wells 703 Overall 80% Net Interest 28% CAPEX: Acq. Dvlp. Expl. Drilling Total Dvlp. % Expl. % 1999 $22.4 $16.9 $14.1 $30.9 $39.3 55% 45% 2000 $5.1 $58.0 $13.1 $71.2 $63.1 82% 18% 2001 $280.3 $32.1 $12.5 $44.6 $312.4 72% 28% 2002 $0.9 $19.3 $1.3 $20.6 $20.1 94% 6% 2003 NA NA NA NA NA NA NA 2004E NA NA NA NA NA NA NA RESERVE VALUE MATRIX: (X-Axis=$/Bbl and Y-Axis=$/Mcf) 2002 $20.00 $22.50 $25.00 $27.50 $30.00 $32.50 $3.00 $86 $117 $148 $180 $211 $243 $3.50 $106 $137 $169 $200 $232 $263 $4.00 $126 $157 $189 $220 $252 $283 $MM $4.50 $146 $178 $209 $241 $272 $304 $5.00 $166 $198 $229 $261 $292 $324 $5.50 $187 $218 $249 $281 $312 $344 Unit Value $20.00 $22.50 $25.00 $27.50 $30.00 $32.50 $3.00 $0.37 $0.51 $0.65 $0.79 $0.92 $1.06 $3.50 $0.46 $0.60 $0.74 $0.87 $1.01 $1.15 $4.00 $0.55 $0.69 $0.82 $0.96 $1.10 $1.24 $/MCFE $4.50 $0.64 $0.78 $0.91 $1.05 $1.19 $1.32 $5.00 $0.73 $0.86 $1.00 $1.14 $1.28 $1.41 $5.50 $0.81 $0.95 $1.09 $1.23 $1.36 $1.50 QUARTERLY SUMMARY: 9/30/02 12/31/02 3/31/03 6/30/03 9/30/03 12/02Q 3/03Q 6/03Q 9/03Q Production, MMCFE/Day 77.2 63.4 61.7 62.8 NatGas % 32% 40% 39% 41% Adj. EBITDA(X) $MM $11.2 $11.1 $11.0 $10.9 Adj. LTM EBITDA(X) $MM $46.8 $47.4 $42.9 $44.2 CapEx $MM $4.0 $6.5 $9.1 $8.2 Adj. EBITDA(X)/Cash Int. Exp. 1.7x 1.8x 1.7x 1.7x Net Debt/Annual Adj. EBITDA(X) 4.9x 4.4x 4.6x 4.7x LOE (Incl. Taxes) per MCFE $1.73 $2.03 $1.89 $1.83 G&A per MCFE $0.36 $0.45 $0.51 $0.45 Interest Expense per MCFE $0.91 $1.06 $1.14 $1.14 Total Costs per MCFE $3.44 $3.45 $3.53 $3.42 $/Bbl Realized Excl. Hedges $23.44 $30.92 $28.60 $28.54 $/Mcf Realized Excl. Hedges $4.01 $6.23 $5.33 $4.79 $/Bbl Differential Excl. Hedges -$4.84 -$3.08 -$0.45 -$1.91 $/Mcf Differential Excl. Hedges -$0.29 -$0.06 -$0.30 -$0.38

ASSET COVERAGE: Value $MM Sr. Sec. Sr. Unsec. Sr. Sub Oil & Gas $244 3.04x NA 1.39x Energy Assets $244 3.04x NA 1.39x Total Excl. WC $241 3.01x NA 1.37x Total Assets $241 3.02x NA 1.37x LIQUIDATION ANALYSIS: (Based on Total Asset Values) 18-Month Recovery: PV15 80.0% 100% NA 100% PV20 74.3% 100% NA 100% PV25 69.0% 100% NA 95% 24-Month Recovery: PV15 74.2% 100% NA 100% PV20 67.3% 100% NA 93% PV25 61.1% 100% NA 84% DEBT SENIORITY: Description Sr. Sec. Sr. Unsec. Sr. Sub WC Facility 4.750% '06 ---Sr. Sec. Nts. 12.000% '05 $80 --Sr. Sub. Nts. 10.875% '07 --$117

Other NA NA NA NA

Total 1.23x 1.23x 1.22x 1.22x

NA NA NA NA NA NA Other ----

98% 91% 84% 91% 82% 75% Total -$80 $117

Total Debt $80 -$117 -$197 LIQUIDITY: WORKING CAPITAL: Cash & Equivalents $14 Cash & Equivalents $14 Revolver Avail. $12 +Accounts Receivable $15 Other -- -Accounts Payable $29 Liquidity $27 Working Capital (Deficit) $1 RECENT EVENTS: >>MSSN repurchased $97.6 mm 10.875% Sr. Sub. Nts. in March 2003 for $71.7 mm (73% of face value) plus accrued interest, funded by a new $80 mm credit facility. The New facility has an initial 12% coupon, which increases to 13% on 2/16/04>>On 12/18/03, MSSN announced it had acquired $10 MM of its 10.875% Sr. Sub. Nts. for 4.5 MM common shares, which equates to $2.22/share if assuming bonds at par or if assuming the $2.14 closing share price on 12/18, bonds were repurchased at 96.3% >>Company is reorienting geographic focus towards onshore Gulf Coast with natgas concentration.>>MSSN signed definitive agreement in early October 2003 to sell E. Texas properties to Danmark Energy for $21.5 mm. Reserves total 4.0 MMBOE (24 BCFE)) and equates to $5.38/BOE or $0.90/MCFE. New production from wells recently completed should improve MSSN's production mix from 39% to 50% natgas by year-end.

[Page 2 of 7]

Mission Resources Corporation (MSSN)

Exploration & Production
CAPITALIZATION: Capitalization: Total Debt Preferred Stock (Liq. Value) +Shareholders' Equity (Book) Total Capital CREDIT STATISTICS: Leverage Total Debt / Adj. EBITDA(X) Net Debt / Adj. EBITDA(X) Total Debt / Book Capitalization Total Debt / Market Capitalization FFO / Total Debt FFO / Net Debt Interest Coverage Adj. EBITDA(X) / Cash Interest Expense [Adj. EBITDA(X) - CapEx] / Cash Interest Exp. ISSUER RATINGS Book $197 -$70 $267 Qtr. 4.5x 4.5x 74% 76% 10% 10% Qtr. 1.7x 0.4x Proved Dvlpd. $1.12 $1.12 Par $2.36 28.0 $66 $197 -$1 $263 Par $0.86 $0.86 4.5x 4.5x Par $1.15 1.1x 6.0x 5.9x Pmt $MM -$0.8 $6.4 Mkt. $195 -$66 $261 LTM 4.5x 4.4x 74% 76% 11% 11% LTM 1.7x 0.6x Total Proved $0.86 $0.86 Mkt. $2.36 28.0 $66 $195 -$1 $260 Mkt. $0.85 $0.85 4.5x 4.4x Mkt. $1.14 1.1x 5.9x 5.9x Rating Caa1 ... Effective Date Outlook 3/26/2003 NEG ... ... 9/30/03 $12.5 -$0.1 $12.4 Watch ... ...

Greg Imbruce gimbruce@jefco.com 800/937-5333 Watch Date ... ...

Moody's S&P

BANK FACILITY: Bank Facility Borrowing Base Amount Funded L/C's Outstanding Amount Avail.

Provider: Wells Fargo Foothill Maturity: 6/6/06 Rate: PRIME+50 (4.75% Min.) L/C Subfacility $3.0 L/C Fee: 3.0%

NET ASSET VALUE: Proved Reserves YTD Est. (BCFE) Risked Unit Value ($/MCFE) Oil and Gas Assets Gathering System Energy Assets Excl. Acreage US Net Acreage CN Net Acreage Intl. Net Acreage Hedge Contracts (4) Equity Interests & Other Assets Total Assets Working Capital (Deficit) Total Assets after Working Capital Less: LT Debt & Preferred Stock Net Asset Value NAV per Share DEBT MARKET VALUE Description Coupon Maturity WC Facility 4.750% 06/06 Sr. Sec. Nts. 12.000% 01/05 Sr. Sub. Nts. 10.875% 04/07 Base(1) Upside(2) 228.5 228.5 $1.07 $1.32 $244 $302 --$244 $302 $3 $3 ----($6) ($13) --$241 $292 $1 $1 $241 $293 $197 $197 $44 $96 $1.57 $3.41 Price 100.0 100.0 98.0 Mkt -$80.0 $115.1

-- EBITDA@ 5.5x 61 Per Acre -- Per Acre -- Per Acre $50 $25 $5

Debt per Unit Total Debt / MCFE (YTD Est.) Net Debt / MCFE (YTD Est.) ENTERPRISE VALUE: Stock Price Shares Outstanding Market Capitalization +LT Debt +Preferred Stock (Liq.) -Working Capital/(Deficit) Enterprise Value (EV) VALUATION: Debt Only Total Debt / MCFE (YE) Net Debt / MCFE (YE) Total Debt / LQA EBITDA(X) Net Debt / LQA EBITDA(X) Enterprise Values EV / MCFE (YE) EV / Assets EV / LQA EBITDA(X) EV / LTM EBITDA(X) COUPON PAYMENTS: Description WC Facility 4.750% '06 Sr. Sec. Nts. 12.000% '05 Sr. Sub. Nts. 10.875% '07

(YTD Est.) (YTD Est.)

175.9173

Rating B3/NR B3/NR Ca/NR

Face -$80.0 $117.4

Payment Dates Monthly Monthly 4/1

10/1

MANAGEMENT: ROBERT L CAVNAR, CHAIRMAN/PRESIDENT/CEO RICHARD W PIACENTI, SENIOR VP/CFO JOSEPH G NICKNISH, SENIOR VP:OPERS & EXPLOITATION KENT A WILLIAMSON, SENIOR VP:PLANNING & EXPLORATN DANIEL P FOLEY, SENIOR VP:FINANCE LARGEST SHAREHOLDERS: FRANKLIN ADVISORS (Result of 12/04 Debt-for-Equity Swap) IRONWOOD CAPITAL ENCAP INVESTMENT BANK OF AMERICA DIMENSIONAL FUND STATE STREET RESEARCH RHO CAPITAL PARTNERS IDEX MANAGEMENT % O/S 16.1% 5.3% 4.4% 3.8% 3.6% 3.1% 1.9% 1.3% 39.6%

Total Debt 11.331% MATURITY SCHEDULE: Year Debt 2004 -2005 $80.0 2006 -2007 $117.4 2008 -2009 -2010 -Thereafter -OIL & GAS HEDGES (Next 12-Months): 12/03Q Production Hedged: Oil, MBbls per day 3.5 Gas, MMCF per day 15.0 MMCFE per day 36.0 % Volume Hedged: Oil 56% Gas 59% Total 57% Avg. Prices (NYMEX): Assuming Put Prices Oil ($/Bbl) $23.59 Gas ($/Mcf) $3.24 Assuming Ceiling Prices Oil ($/Bbl) $23.59 Gas ($/Mcf) $4.54

$197.4

$195.1

3/04Q 3.5 15.0 36.0 56% 59% 57%

6/04Q 2.5 7.0 22.0 40% 27% 35%

9/04Q 2.5 7.0 22.0 40% 27% 35%

NTM 3.0 11.0 29.0 48% 43% 46%

$26.03 $4.80 $26.72 $6.11

$24.67 $3.93 $24.67 $4.37

$24.30 $3.93 $24.30 $4.34

$24.67 $3.99 $24.87 $5.01

(1) Represents an internal market value estimate which is based on NYMEX prices of $26.65/Bbl and $4.86/Mcf (90% of 24-month average NYMEX prices) to which ($1.50)/Bbl and ($0.20)/Mcf price differentials are applied in addition to risking Proved Developed and Undeveloped reserves at a 97% and 80% success factor, respectively. (2) Represents an internal market value estimate which is based on NYMEX prices of $29.61/Bbl and $5.40/Mcf (100% of 24-month average NYMEX prices) to which ($1.50)/Bbl and ($0.20)/Mcf price differentials are applied in addition to risking Proved Developed and Undeveloped reserves at a 97% and 80% success factor, respectively. (3) The YTD Proved Reserve figure is an estimate based on the prior year's proved reserves plus Extension/Discoveries plus Acquisitions less Property Sales; each is based on the Company's 4Yr. Avg. FD&A cost, except for Property Sales and Acquisitions, which are calculated based on commodity and market conditions. (4) The hedge contract value is derived from NYMEX prices of $26.65/Bbl and $4.86/Mcf, which are based on 90% of the 24-Mth average prices and not indicative of the current mark-to-market value. NOTE: Debt balances are proforma for the Company's debt-for-equity swap, which involved $10 MM of its 10.875% Sr. Sub. Nts. for 4.5 MM common shares

[Page 3 of 7]

Mission Resources Corporation

Reserve & Production Data
Proved Reserves (BCFE)
450 400 350 300 250 200 150 100 50 0 99 00 01 02 NA 03 231 190 229 404 120 100 80 60 40 20 0 99 00 01 02 NA 03 86.2 95.0

Daily Production (MMCFE)

104.1 90.6

Proved Developed Reserves %

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

Annual Production (BCFE)

40
38 35 31 33

79%

77%

75%

77%

35 30 25 20 15 10 5 NA 0

NA

99

00

01

02

03

99

00

01

02

03

Natural Gas %
70% 60% 50% 40% 30% 20% 10% 0% 99 00 01 Proved Reserves 02 Production NA NA 03
12

Reserve Life (Years)

10.6
10

60% 56%

59% 46% 39% 38% 38% 36%

8 6 4 2

7.3 5.5

6.9

NA
0

99

00

01

02

03

Pretax SEC-10 ($MM)

$400 $350 $300 $250 $200 $150 $100 $50 $0 NA 99 NA 00 01 02 NA 03 $365 $327

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

Reserves by Region

100%

100%

100%

100%

99

00
US

01
CN INTL

02

03

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Mission Resources Corporation

Financial Performance
EBITDA ($MM)
$80 $70 $60 $50 $40 $30 $20 $10 $0 99 00 01 02 NA 03 $47 $40 $76 $69

Interest Coverage
(EBITDA/Cash Interest Exp.)

6.0x 5.0x 4.0x 3.0x 2.0x 1.0x 0.0x 99 00 01 02 3.4x 4.9x

2.9x 1.7x

NA 03

Capital Expenditures ($MM)

$180 $160 $140 $120 $100 $80 $60 $40 $20 $0
$166

Total Debt Leverage

(Total Debt/EBITDA) 6.0x 5.0x 4.8x 3.8x 3.2x

$82 $49 $31 $26

$7

4.0x 3.0x
$21
$1

2.0x
NA NA

1.7x

1.0x 0.0x 99 00 01 02 NA 03

99

00 Capex

01 Acquisitions

02

03

Unit Costs ($/MCFE)

$3.00 $2.50 $2.00 $1.50 $1.00 $0.50 $0.00 99 00 01 02 03 $1.20 $1.00 $0.80 $0.60 $0.40 $0.20 $0.00

Total Debt/Proved Reserve ($/MCFE)

$0.98

$0.66 $0.56

$0.64

NA

LOE+Other

Taxes

G&A

Interest

99

00

01

02

LOE Excl. Tax ($/MCFE)

$1.40 $1.20 $1.00 $0.80 $0.60 $0.40 $0.20 $0.00 99 00 01 02 NA 03 $0.69 $0.77 $1.23 $1.31
$1.40 $1.20 $1.00 $0.80 $0.60 $0.40 $0.20

Total Debt/Developed Reserve ($/MCFE)

$1.28

$0.86 $0.71

$0.86

NA
$0.00

99

00

01

02

03

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Mission Resources Corporation

Drilling Results & Producing Well Data
Net Undeveloped Acreage (000's)
400 350 300 250 200 150 100 50 0 NA 99 NA 00 01 02 NA 03 365 327
Production per Well (MMCFE/Yr.) & Avg. Net Interest per Well (%)

140 120 100 80 60 40 20 0

99 85 17%

130 24% 16% 47 34

28%

30% 25% 20% 15% 10%

NA NA 03

5% 0%

00

01

02

Reserve Replacement - Drilling Only

120% 100% 80% 60% 40% 20% 0% 99 00 01 02 6% 0% 03 99-03 47% 64% 106% $12.00 $10.00 $8.00 57% $6.00 $4.00

Finding Cost - Drilling Only ($/MCFE)

$10.84

$3.22 $2.11 $2.12 $1.11 NA 99 00 01 02 03 99-03

$2.00 $0.00

Reserve Replacement - Overall

1,000% 800% 600% 400% 200% 0% -200% -400% -600% 99 00 01 02 03 99-03
$0.00 99
All Sources Net After Sales

Finding Cost - All-Sources ($/MCFE)

$2.50 $2.00 $1.50 $1.00 $0.54 $0.50 NA 00 01 02 NA 03 99-03 $0.96 $2.37

$1.14

Drilling Success Rate

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 99 00
Exploration $0.00 -$0.10 -$0.20 -$0.30 -$0.40 -$0.50 -$0.60 -$0.70 -$0.80

Price Differentials ($/MCFE)

NA

-$0.34

-$0.30 -$0.47 -$0.56 -$0.69

01

02

03
Overall

99-03

Development

99

00

01

02

03

99-03

[Page 6 of 7]

 2001 Jefferies & Company, Inc. All rights reserved. I, Greg Imbruce, certify that all of the views expressed in this research report accurately reflect my personal views about the subject security(ies) and subject company(ies). I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed in this research report. This material has been prepared by Jefferies & Company, Inc. ("Jefferies") a U.S.-registered broker-dealer, employing appropriate expertise, and in the belief that it is fair and not misleading. It is approved for distribution in the United Kingdom by Jefferies International Limited ("JIL") regulated by the Financial Services Authority ("FSA"). The information upon which this material is based was obtained from sources believed to be reliable, but has not been independently verified. Therefore except for any obligations under the rules of the FSA, we do not guarantee its accuracy. Additional and supporting information is available upon request. This is not an offer or solicitation of an offer to buy or sell any security or investment. Any opinion or estimates constitute our best judgment as of this date, and are subject to change without notice. Jefferies and JIL and their affiliates and their respective directors, officers and employees may buy or sell securities mentioned herein as agent or principal for their own account. This material is intended for use only by professional or institutional investors falling within articles 19 or 49 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2001and not the general investing public. None of the investments or investment services mentioned or described herein are available to other persons in the U.K. and in particular are not available to "private customers" as defined by the rules of the FSA or to anyone in Canada who is not a "Designated Institution" as defined by the Securities Act (Ontario)."

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