Desert Control AS

Regulatory Filings • Jun 13, 2023

Desert Control AS - Update on strategic review

Desert Control AS - Update on strategic review

Sandnes, Norway, 13 June 2023

Desert Control AS (DSRT) ("Company") has appointed Arctic Securities and Pareto Securities to explore strategic options available to the Company as announced on 27 April 2023. The review aims to explore a broad range of strategic alternatives, including financing, structural and business development opportunities, aiming to optimize shareholder value and to support funding of the Company's long-term strategies.

The strategic review is making progress on exploring options for Desert Control's intentions to change its go-to-market and business model for the Middle East region by transitioning to a potential royalty-based licensed operator structure. The strategic review process has generated incoming interest from multiple parties. The Company has entered non-binding letters of intent with selected parties with whom it is anticipated to reach final agreements by around mid-year.

The change of business model aims to unlock cash and reduce operating costs for Desert Control. The pivot towards a licensing model will leverage the capacity and reach of local operators in the Middle East while allowing Desert Control to dedicate additional resources to drive commercialization in the United States and other markets.

The Company confirms that arrangements have been made for an event, with final location to be determined, as published by the Greater Yuma Economic Development Corporation on LinkedIn on 12 June 2023. The arrangements have been made for extending networks with the Middle East and arranging contacts with leading research organisations within the field of desert agriculture in Yuma, Arizona. The event is also aimed at facilitating a potential signing of agreements further to the non-binding letters of intent already entered into, as described above.

Although practical arrangements have been made, Desert Control emphasizes that discussions are still ongoing, and that no assurances can be given as to the outcome or timing of the review process or the signing of any definite agreements. Desert Control does not intend to make any further public comment regarding the review until it has been completed or the Company determines that disclosure is required or appropriate.

The Board is pleased with the progress of the strategic review, and will continue the review process as previously announced, aiming to optimize shareholder value and to support funding of the Company's long-term strategies.

For further inquiries, please contact:

Ole Kristian Sivertsen

President and Group CEO, Desert Control

oks@desertcontrol.com

About Desert Control:

Desert Control specializes in climate-smart AgTech solutions to combat desertification, soil degradation, and water scarcity. Its patented Liquid Natural Clay (LNC) restores and enhances soil ecosystems to reduce water usage and improve the efficiency of fertilizers and natural resources for agriculture, forests, and green landscapes. LNC enables sandy and arid soil to retain water and nutrients, thus increasing crop yields, plant health, and ecosystem resilience while preserving water and natural resources by up to 50%.

For more about Desert Control, visit https://www.desertcontrol.com

Important information

This information is considered to be inside information pursuant to the EU Market Abuse Regulation and is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act.

This stock exchange announcement was published by Marianne Vika Bøe, Chief Financial Officer of Desert Control AS on date and time set out above.

Disclaimer related to forward-looking statements

Matters discussed in this announcement may constitute forward-looking statements. Forward-looking statements are statements that are not historical facts and may be identified by words such as "believe", "expect", "anticipate", "strategy", "intends", "estimate", "will", "may", "continue", "should" and similar expressions. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although the Company believe that these assumptions were reasonable when made, these assumptions are inherently subject to significant known and unknown risks, uncertainties, contingencies and other important factors which are difficult or impossible to predict, and are beyond their control. Actual events may differ significantly from any anticipated development due to a number of factors, including without limitation, changes in public sector investment levels, changes in the general economic, political and market conditions in the markets in which the Company operates, the Company's ability to attract, retain and motivate qualified personnel, changes in the Company's ability to engage in commercially acceptable acquisitions and strategic investments, and changes in laws and regulation and the potential impact of legal proceedings and actions. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this release by such forward-looking statements. The Company does not make any guarantee that the assumptions underlying the forward-looking statements in this announcement are free from errors nor does it accept any responsibility for the future accuracy of the opinions expressed in this announcement or any obligation to update or revise the statements in this announcement to reflect subsequent events. You should not place undue reliance on the forward-looking statements in this announcement.

The information, opinions and forward-looking statements contained in this announcement speak only as at its date, and are subject to change without notice. The Company does not undertake any obligation to review, update, confirm, or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this announcement.

This announcement is for information purposes only and is not to be relied upon in substitution for the exercise of independent judgment. It is not intended as investment advice and under no circumstances is it to be used or considered as an offer to sell, or a solicitation of an offer to buy any securities or a recommendation to buy or sell any securities of the Company.