JOINT ANNOUNCEMENT

15 JUNE 2015

DOWNING STRUCTURED OPPORTUNITIES VCT 1 PLC ("DSO")
DOWNING PLANNED EXIT VCT 2011 PLC ("DP011")
DOWNING PLANNED EXIT VCT 6 PLC ("DP6")
DOWNING PLANNED EXIT VCT 7 PLC ("DP7")
(TOGETHER, THE "COMPANIES" AND DP2011, DP6 AND DP7 TOGETHER THE "TARGET VCTS" AND EACH A "TARGET VCT")

RECOMMENDED PROPOSALS TO MERGE THE COMPANIES PURSUANT TO SCHEMES OF RECONSTRUCTION UNDER SECTION 110 OF THE INSOLVENCY ACT 1986
The boards of the Companies (the "Boards") are pleased to announce that they have agreed terms to merge the four Companies and that they are today writing to set out the merger proposals to their respective shareholders for consideration. Each of the Companies is managed by Downing LLP ("Downing").

The merger ("Merger") will be effected by the Target VCTs each being placed into members' voluntary liquidation pursuant to schemes of reconstruction under section 110 of the Insolvency Act 1986 ("Schemes" and each a "Scheme"). Shareholders should note that the Merger by way of the Schemes will be outside the provisions of the City Code on Takeovers and Mergers. It is proposed that the name of DSO be changed to "Downing FOUR VCT plc" immediately following the Merger.

The planned exit strategy of each of DSO's share classes, as well as those of the Target VCTs, will not be affected by the Merger as new share classes will be created in line with the current, pre-merger share classes in the Target VCTs as illustrated in the table below.

Pre-Merger Share Classes of Target VCTs	Post-Merger Share Classes of the Enlarged Company
DP2011 General Ord Shares	New DP2011 General Ord Shares
DP2011 A Shares	New DP2011 General A Shares
DP2011 Structured Ord Shares	New DP2011 Structured Ord Shares
DP2011 Structured A Shares	New DP2011 Structured A Shares
DP2011 Low Carbon Ord Shares	New DP2011 Low Carbon Ord Shares
DP6 Shares	New DP67 Ord Shares
DP7 Shares	New DP67 Ord Shares

Each Scheme requires the approval of resolutions by the DSO shareholders and the relevant Target VCT's shareholders. The DP6 and DP7 Schemes are conditional on the DP2011 Scheme going ahead.

The Merger will, if effected, result in an enlarged DSO ("Enlarged Company") with net assets of over £60 million.

Estimated costs of the Merger are £400,000, but Downing LLP has agreed to contribute 50% of the costs, so net costs for shareholders will be £200,000. These net costs will be borne by DSO and the Target VCTs on a basis which is pro rata to their current net asset values and the expected remaining life of each share class. As a result, the running cost savings for each share class over their expected remaining life is expected to exceed the net costs of the Merger borne by that share class.

For the 12 months following the Merger, Downing has also agreed to reduce its investment management fee in respect of DSO Assets from 1.5% to 1.3% and, in respect of the DP2011 Assets, from 1.8% to 1.6%. The applicable investment management fee in respect of DP6 Assets and DP7 Assets will remain at 1.35%.

As part of the proposals, DSO will seek approval to broaden its Investment Policy to allow each share class after the Merger to continue to be managed in the same way as previously, to renew allotment and share purchase authorities, to approve amendments to its articles of association and to approve the cancellation of its share premium account.

Further details of the proposals are set out below. The approval of resolutions in connection with these proposals will be proposed at general meetings of the Companies ("Meetings") being convened as set out in the expected timetable below.

BACKGROUND
VCTs are required to be listed on the premium segment of the Official List, which involves a significant level of costs associated with the listing as well as related fees to ensure they comply with all relevant legislation and regulations. A larger VCT is able to spread the fixed elements of such running costs across a larger asset base and, as a result, reduce running costs as a percentage of net assets. In September 2004, the Merger Regulations were introduced allowing VCTs to be acquired by, or merge with, each other without prejudicing the VCT tax reliefs obtained by their shareholders. A number of VCTs have taken advantage of these regulations to create larger VCTs for economic and administrative efficiencies.

With the above in mind, the Boards and Downing entered into discussions to consider a merger of the four Companies to create a single, larger VCT. The aim of the Merger is to achieve strategic benefits and reductions in the annual running costs for each set of shareholders, while maintaining a platform from which the planned exit strategy of each of the share pools can continue to be executed as it is now.

THE SCHEMES
The Merger will be effected in the following way.

First, each Target VCT will be placed into members' voluntary liquidation pursuant to a scheme of consolidation under section 110 of the Insolvency Act 1986, subject to shareholders' approval.

Secondly, all of the assets and liabilities of each Target VCT will be transferred to DSO in consideration for the issue of Consideration Shares by DSO directly to the shareholders of the relevant Target VCT.

Each Scheme requires the prior approval of the shareholders of the relevant Target VCT and the Shareholders of DSO. If a shareholder of a Target VCT does not vote in favour of the Merger and expresses his dissent in writing then he may require the Liquidators to purchase his shares at their break-value price, this being an estimate of the amount he would receive in an ordinary winding up of the relevant Target VCT if all of the assets had to be realised. The break-value is expected to be significantly below the net asset value of the relevant Target VCT.

For these purposes, whilst there will only be one general meeting of DSO at which shareholders will be invited to consider and vote in favour of the Mergers, there will be two general meetings for each of the Target VCTs. At the Target VCTs' First General Meetings, Target VCT shareholders will be invited to approve the Merger. At the Second Target VCT Meetings, Target VCT Shareholders will be invited to pass a special resolution for the winding up of the relevant Target VCT.

In addition to the approval of Shareholders being sought at the General Meeting, each Scheme is dependent on:

*   the relevant Scheme being approved by the shareholders of DSO and the relevant Target VCT;
*   notice of dissent not being received from shareholders (of the relevant Target VCT) who hold more than 10% in nominal value of the issued share capital; and
*   DSO confirming that it has received no notice of any claims, proceedings or actions of whatever nature threatened or commenced against any of the Target VCTs which the board of DSO regard as material,
*   the DP2011 scheme becoming effective,

and so will proceed and become effective immediately after the passing of the special resolution for the winding up of the relevant Target VCT.

The number of Consideration Shares to be issued will be on a "one for one" basis with Consideration Shares being issued in a new corresponding share class created in DSO. There is one exception being the DP2011 LC Shares where 935 Consideration Shares will be issued for every 1,000 existing DP2011 LC Shares held. (This is because the DP2011 LC shares were originally issued at a price of 93.5p per share instead of the more common VCT issue price of 100p per share. This adjustment rebases the shares to an equivalent original issue price of 100p.)

Each Scheme is conditional upon certain conditions being satisfied as further set out in the circulars being posted to shareholders today, including resolutions to be proposed to shareholders of each of the Companies. Each Target VCT will apply to the UKLA for cancellation of the listing of its shares, upon the successful completion of its Scheme, such cancellation is anticipated to take place on 24 August 2015 (the cancellation requiring the approval of the relevant Target VCT's shareholders).

The Merger will result in the creation of an enlarged company and should result in savings in running costs and simpler administration. As all of the Companies have similar investment policies, a number of common investments and are managed by Downing, this is achievable without material disruption to the Companies and their combined portfolio of investments.

The boards of the Companies consider that the Merger will bring a number of benefits to all of the Companies' groups of shareholders through:

*   A reduction in the expected annual running costs for most shareholders;
*   Annual running costs capped by Downing at 3% of net assets;
*   a reduction in Downing's investment management fees for the 12 months following the Merger by 0.2% of the NAV per annum in respect of each DSO Share;
*   increased flexibility for exit and wind up strategies for different groups of shareholders; and
*  enhanced prospects for the possibility of creating an Target share class which could be offered to those Shareholders who may wish to remain invested and continue to receive tax free dividends at the end of the initial planned exit period.

Additional attractive features of the Merger include:

*   Downing has agreed to contribute 50% of the costs of the Merger meaning that DSO and the Target VCTs will only bear £200,000 of the £400,000 estimated costs;
*   Downing has agreed to cover 100% of any costs of the Merger in excess of £420,000; and
*  no impact on the tax position of Shareholders - existing VCT tax reliefs carry over and attach to the post- Merger shares for all Shareholders.

The Merger is comprised of three separate Schemes and will only go ahead if at least the DP2011 Scheme becomes unconditional. If one or two of the Schemes become unconditional, then the resulting Enlarged Company will be commensurately smaller than if all three Schemes become unconditional with the result that the Enlarged Company will have a smaller net asset base across which to spread the costs of the Schemes that do go ahead and the running costs of the Enlarged Company going forward. In this case, the costs of the Schemes that do go ahead may take longer to recover than they would if the full four-way Merger was implemented.

The estimated total costs of this four-way merger are £400,000. Downing has agreed to bear 50% of the costs of the Merger and 100% of any costs in excess of £420,000. After Downing's contribution, and taking into account Downing's reduced management fees in year one following the Merger, the net costs of the Merger to be borne by the Companies are estimated at £110,000.

As an illustration, had the Merger been completed on the basis of the Schemes as set out the Circulars, the number of Consideration Shares that would be issued for each Target VCT share would be as follows:

Current company	Current share class	Number of  Shares currently in  issue	Net  Asset  Value*	Downing FOUR  VCT share class following Merger	Shares/ Consideration shares	Voting  rights  following  merger
		Number	£M		Number	%
Existing Shares
DSO	Ordinary Shares	10,288,157	5.54	DSO Ordinary Shares	10,288,157	9.02%
DSO	A Shares	15,506,488	0.02	DSO A Shares	15,506,488	0.02%
DSO	B Shares	19,911,070	13.98	DSO B Shares	19,911,070	23.04%
DSO	C Shares	29,926,070	0.03	DSO C Shares	29,926,070	0.04%
DSO	D Shares	7,877,527	6.36	DSO D Shares	7,877,527	10.22%
Consideration Shares
DP2011	Gen Ords	15,679,241	11.49	DP2011 Gen Ords	15,679,241	18.70%
DP2011	Gen A	18,453,789	1.11	DP2011 Gen A	18,453,789	1.94%
DP2011	Structured Ords	10,678,725	8.08	DP2011 Structured Ords	10,678,725	13.11%
DP2011	Structured A	12,572,817	0.78	DP2011 Structured A	12,572,817	1.32%
DP2011	Low Carbon Ords	8,102,222	6.11	DP2011 Low Carbon Ords	7,575,577	10.63%
DP6	DP6	5,355,154	3.42	DP67	5,355,154	5.63%
DP7	DP7	6,006,085	3.81	DP67	6,006,085	6.32%
* The Net Asset Values shown here are the unaudited figures as at 31 March 2015 for DSO, 30 November 2014 for DP2011 (adjusted for dividends paid since) and 31 January 2015 for DP6 and DP7.

The worked example above is produced for illustrative purposes only and assumes that all Schemes are approved in full with no dissenting shareholders from any of the Companies. Voting rights of each share class following the Merger will be broadly in line with their relative net assets.

MANAGEMENT AND ADMINISTRATION ARRANGEMENTS
Downing is the investment manager of all of the Companies and also provides administration and secretarial services to all of the Companies.

Subject to the completion of the Merger, the Enlarged Company will enter into revised arrangements with Downing pursuant to which Downing will receive fees as follows: -

Investment Management Fees are to be calculated according to the specific share class in which the assets in question are held:

Company	Annual Fee  (Pre and post Merger)	Comments
DSO	1.5%	Reduced by 0.2% to 1.3% for the 12 months immediately following the Merger
DP2011	1.8%	Reduced by 0.2% to 1.6% for the 12 months immediately following the Merger
DP6/DP7	1.35%

Downing has agreed to provide running cost caps following the Merger as follows:

Company	Running Cost Cap pre-Merger	Running Cost  Cap post- Merger
DSO	3.5%	3.0%
DP2011	3.5%	3.0%
DP6/ DP7	2.9%	2.9%

THE DSO BOARD
The Boards have considered what the size and future composition of the DSO Board should be following the Merger and it has been agreed that subject to completion of the Merger, the Board composition will be rearranged such that two new directors will be appointed to join the existing DSO Board.

It is proposed that Sir Aubrey Brocklebank and Russell Catley join the DSO Board from their current appointments as directors of DP2011. The appointments of Sir Aubrey Brocklebank and Russell Catley as directors of DSO are subject to the completion of the Merger, and will ensure that the board of directors of the Enlarged Company have direct experience of approximately 90% of the Enlarged Company's portfolio (by value). It is intended that Sir Aubrey Brocklebank will be appointed as the Senior Independent Director upon joining the DSO Board.

DSO CHANGES TO ITS ARTICLES, RENEWAL OF SHARE ISSUE AND BUYBACK AUTHORITIES AND CANCELLATION OF SHARE CAPITAL AND RESERVES
As the structure of DSO will change if the Merger goes ahead, due to the creation of a number of new classes of shares, there are some structural changes required to the Articles to ensure the smooth and equitable running of the Enlarged Company. The proposed changes are as follows:

1. The addition to the Articles of the share rights of the New Share Classes

In respect of rights to receive dividends and distributions of capital, these will be identical to the rights in the Target VCT's existing articles of association and will not affect existing Shareholders of DSO as they will only be relevant to the segregated assets of each New Share Class which are transferred to DSO pursuant to the Merger.

2. The introduction of a structured voting rights system for general meetings

A proposed new voting rights system (described in more detail below) aims to ensure that, at a general meeting where holders of all types of shares may be present, the voting power attributable to the various existing classes and New Share Classes is broadly proportionate to the relative value those classes represent in the Enlarged Company. This is achieved by having a base number of votes for each share in a particular class, based on that class's current Net Asset Value. There is also a mechanism for increasing or decreasing the number of base votes in the event that the NAV of a class rises or falls in increments of 25%.

3. The introduction of mechanism to wind up exiting share classes

As certain of the planned exit classes of shares in the Enlarged Company are approaching the end of their lifecycles, the Board believes this is an opportune time to introduce a mechanism into the Articles to allow the Enlarged Company to efficiently wind up share classes in which the value has been almost entirely distributed to shareholders.

It is proposed that where the Net Asset Value of a particular class falls below £25,000 or the largest shareholder holds shares with a value of less than £20, the Board will have the right to convert the remaining shares into deferred shares for repurchase by DSO. This will prevent an almost 'empty' share class, with minimal economic value, from persisting inefficiently and incurring fixed costs relating, amongst other things, to maintaining its listing on the London Stock Exchange.

4. The increase to the directors' annual remuneration cap

An increase to the cap on the aggregate sum to which directors of DSO are entitled by way of remuneration for their services from £100,000 to £150,000 is proposed in light of the increase in size of the Enlarged Company and its board.

EXPECTED TIMETABLE FOR THE MERGER	2015
Latest time for the receipt of forms of proxy for the DSO General Meeting	12 noon on 7 July
DSO General Meeting	12 noon on 9 July
Class Meeting of Ordinary Shareholders	12.05 p.m. on 9 July
Class Meeting of A Shareholders	12.10 p.m. on 9 July
Class Meeting of B Shareholders	12.15 p.m. on 9 July
Class Meeting of C Shareholders	12.20 p.m. on 9 July
Class Meeting of D Shareholders	12.25 p.m. on 9 July
Calculation Date	17 July
Effective Date for the transfer of the assets and liabilities of the Target VCTs to DSO and the issue of Consideration Shares	20 July
Announcement of the results of the DSO General Meeting and completion of the Schemes	21 July
Admission and dealings in the Consideration Shares to commence	23 July
CREST accounts credited with the Consideration Shares issued pursuant to the Schemes	23 July
Certificates for Consideration Shares dispatched by	2 August
EXPECTED TIMETABLE FOR DP2011
	2015
Latest time for receipt of forms of proxy for the DP2011 First General Meeting	11.15 a.m. on 7 July
DP2011 First General Meeting	11.15 a.m. on 9 July
Date from which it is advised that dealings in DP2011 Shares should only be for cash settlement and immediate delivery of documents of title	16 July
Latest time for receipt of forms of proxy for the DP2011 Second General Meeting	11.30 a.m. on 16 July
DP2011 register of members closed	5.00 p.m. 17 July
Record Date for DP2011 Shareholders' entitlements	5.30 p.m. 17 July
Calculation Date	17 July
Dealings in DP2011 Shares suspended	7.30 a.m. on 20 July
DP2011 Second General Meeting	11.30 a.m. on 20 July
Effective Date for the transfer of the assets and liabilities of DP2011 to DSO and the issue of Consideration Shares pursuant to the DP2011 Scheme	20 July
Cancellation of the listing of the DP2011 Shares	8.00 a.m. on 24 August
EXPECTED TIMETABLE FOR DP6
	2015
Latest time for receipt of forms of proxy for the DP6 First General Meeting	12.30 p.m. on 7 July
DP6 First General Meeting	12.30 p.m. on 9 July
Date from which it is advised that dealings in DP6 Shares should only be for cash settlement and immediate delivery of documents of title	16 July
Latest time for receipt of forms of proxy for the DP6 Second General Meeting	12 noon on 16 July
DP6 register of members closed	5.00 p.m. on 17 July
Record Date for DP6 Shareholders' entitlements	5.30 p.m. on 17 July
Calculation Date	17 July
Dealings in DP6 Shares suspended	7.30 a.m. on 20 July
DP6 Second General Meeting	12 noon on 20 July
Effective Date for the transfer of the assets and liabilities of DP6 to the DSO and the issue of Consideration Shares pursuant to the DP6 Scheme	20 July
Cancellation of the listing of the DP6 Shares	8.00 a.m. on 24 August
EXPECTED TIMETABLE FOR DP7
	2015
Latest time for receipt of forms of proxy for the DP7 First General Meeting	12.45 p.m. on 7 July
DP7 First General Meeting	12.45 p.m. on 9 July
Date from which it is advised that dealings in DP7 Shares should only be for cash settlement and immediate delivery of documents of title	16 July
Latest time for receipt of forms of proxy for the DP7 Second General Meeting	12.15 p.m. on 17 July
DP7 register of members closed	5.00 p.m. on 16 July
Record Date for DP7 Shareholders' entitlements	5.30 p.m. on 17 July
Calculation Date	17 July
Dealings in DP7 Shares suspended	7.30 a.m. on 20 July
DP7 Second General Meeting	12 noon on 20 July
Effective Date for the transfer of the assets and liabilities of DP7 to the DSO and the issue of Consideration Shares pursuant to the DP7 Scheme	20 July
Cancellation of the listing of the DP7 Shares	8.00 a.m. on 24 August

DOCUMENTS AND APPROVALS
DSO shareholders will receive a copy of a circular convening the DSO general meeting to be held on 9 July 2015 together with a securities note relating to the Merger (the "Securities Note") at which DSO shareholders will be invited to approve resolutions in connection with the proposals.

The Target VCTs' shareholders will each receive a circular convening the Target VCTs' first general meetings on 9 July 2015 and the Target VCTs' second general meetings on 20 July 2015 (together with the Securities Note) at which Target VCTs' shareholders will be invited to approve resolutions in connection with their relevant Scheme.

Copies of the Prospectus (comprising the Securities Note together with a registration document and summary), the DSO circular and the Target VCTs' circulars have been submitted to the UK Listing Authority and will be shortly available for download both from the Downing website (www.downing.co.uk/D4Merger) and the national storage mechanism (www.morningstar.co.uk/uk/NSM).

For further information, please contact:

Investment Manager and Administrator for the Companies
Downing LLP - Grant Whitehouse - Telephone: 0207 416 7780

Solicitors to the Companies
RW Blears LLP - Frank Daly - Telephone: 020 3192 5690

Sponsor to DSO
Jonathan Becher - Panmure Gordon (UK) Limited - Telephone: 020 7886 2500

The directors and proposed directors of DSO accept responsibility for the information relating to DSO and its directors and proposed directors contained in this announcement. To the best of the knowledge and belief of such directors and proposed directors (who have taken all reasonable care to ensure that such is the case), the information relating to DSO and its directors and proposed directors contained in this announcement, for which they are solely responsible, is in accordance with the facts and does not omit anything likely to affect the import of such information.

The directors of DP2011 accept responsibility for the information relating to DP2011 and its directors contained in this announcement. To the best of the knowledge and belief of such directors (who have taken all reasonable care to ensure that such is the case), the information relating to DP2011 and its directors contained in this document, for which they are solely responsible, is in accordance with the facts and does not omit anything likely to affect the import of such information.

The directors of DP6 accept responsibility for the information relating to DP6 and its directors contained in this announcement. To the best of the knowledge and belief of such directors (who have taken all reasonable care to ensure that such is the case), the information relating to DP6 and its directors contained in this document, for which they are solely responsible, is in accordance with the facts and does not omit anything likely to affect the import of such information.

The directors of DP7 accept responsibility for the information relating to DP7 and its directors contained in this announcement. To the best of the knowledge and belief of such directors (who have taken all reasonable care to ensure that such is the case), the information relating to DP7 and its directors contained in this document, for which they are solely responsible, is in accordance with the facts and does not omit anything likely to affect the import of such information.

RW Blears LLP are acting as legal advisers for the Companies and for no one else in connection with the matters described herein and will not be responsible to anyone other than the Companies for providing the protections afforded to clients of RW Blears LLP or for providing advice in relation to the matters described herein.

Panmure Gordon (UK) Limited, which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting as sponsor for DSO and no one else and will not be responsible to any other person for providing the protections afforded to customers of Panmure Gordon (UK) Limited or for providing advice in relation to any matters referred to herein.