NOT FOR GENERAL CIRCULATION IN THE UNITED STATES Rolls-Royce plc (incorporated with limited liability in England and Wales with registered number 01003142) US$1,000,000,000 5.750% Notes due 2027 Guaranteed by Rolls-Royce Holdings plc (incorporated with limited liability in England and Wales with registered number 07524813) Rolls-Royce plc (the “Issuer”) is offering (the “Offering”) US$1,000 million of its 5.750% Notes due 2027 (the “Notes”) with such Notes to be guaranteed (the “Guarantee”) by Rolls-Royce Holdings plc (the “Company”, “Guarantor”or“Rolls-Royce” and, together with the Company’s subsidiaries, “Rolls-Royce Group” or the “Group”). Interest will be paid on the Notes semi-annually on 15 April and 15 October of each year, commencing on 15 April 2021. The Notes will mature on 15 October 2027. The Notes will constitute direct, unsubordinated and unsecured senior obligations of the Issuer and rank pari passu and ratably without any preference or priority among themselves and equally with all other existing and future unsecured and unsubordinated obligations of the Issuer from time to time outstanding (subject to certain obligations required to be preferred by law). The Guarantee will constitute a direct, unsubordinated and unsecured senior obligation of the Guarantor and rank equally with all other existing and future unsecured and unsubordinated obligations of the Guarantor from time to time outstanding (subject to certain obligations required to be preferred by law). The Issuer has the option to redeem all or a portion of the Notes at any time at the redemption prices set forth in this offering memorandum, including in some circumstances at par value (the “Offering Memorandum”). On 1 October 2020, the Company announced its intention to conduct a Rights Issue (as defined herein) seeking to raise approximately £2bn in gross proceeds through the sale of new ordinary shares of the Company. Pending the consummation of the Rights Issue, the Issuer will, concurrently with the issuance of the Notes on the Issue Date (as defined herein), deposit or cause to be deposited an amount equal to the gross proceeds of the Offering into an escrow account. The escrow account will be controlled by Citibank, N.A., London Branch (the “Escrow Agent”). The release of the escrowed proceeds will be subject to the satisfaction of certain conditions, including the consummation of the Rights Issue. If the conditions to the release of the escrowed proceeds have not been satisfied or waived on or prior to the date that is 60 calendar days after the Issue Date, the Notes will be subject to a special mandatory redemption. The special mandatory redemption price will be equal to 100% of the aggregate initial issue price of the Notes plus accrued and unpaid interest from, but excluding, the Issue Date to, and including, such special mandatory redemption date and additional amounts, if any. See “Description of the Notes and the Guarantee—Escrow of Proceeds; Special Mandatory Redemption”. Offering Price for the Notes: 100.000% plus accrued interest, if any, from 21 October 2020 This Offering Memorandum has been approved as a prospectus by the U.K. Financial Conduct Authority (the “FCA”), as competent authority under Regulation (EU) 2017/1129 (the “Prospectus Regulation”). The FCA only approves this Offering Memorandum as meeting the standards of completeness, comprehensibility and consistency imposed by the Prospectus Regulation. Approval by the FCA should not be considered as an endorsement of the Issuer or the Guarantor that are the subject of this Offering Memorandum or of the quality of the Notes that are the subject of this Offering Memorandum. Investors should make their own assessment as to the suitability of investing in the Notes that are the subject of this Offering Memorandum. Application has been made to the FCA for the Notes described in this Offering Memorandum to be admitted to the official list of the FCA (the “Official List”) and to the London Stock Exchange plc (the “London Stock Exchange”) for the Notes to be admitted to trading on the London Stock Exchange’s Regulated Market (“Admission”). The London Stock Exchange’s Regulated Market is a regulated market for the purposes of Directive 2014/65/EU (as amended, “MiFID II”). Neither the Notes nor the Guarantee have been recommended by the United States Securities and Exchange Commission (the “SEC”) or any other U.S. federal or state securities commission or regulatory authority nor have such authorities confirmed the accuracy or adequacy of this Offering Memorandum. Any representation to the contrary is a criminal offense in the United States. The Notes and the Guarantee have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), or any securities laws of any other jurisdiction. Accordingly, the Notes are being offered and sold in the United States only to qualified institutional buyers (“QIBs”) in accordance with Rule 144A under the Securities Act (“Rule 144A”) and outside the United States to certain non-U.S. persons in accordance with Regulation S under the Securities Act (“Regulation S”). Prospective purchasers that are QIBs are hereby notified that the seller of the Notes and the related Guarantee may be relying on the exemption from the provisions of Section 5 of the Securities Act provided by Rule 144A. For further details about eligible offerees and transfer restrictions, see “Plan of Distribution” and “Transfer Restrictions”. The Notes will initially be represented by global notes in registered form (the “Global Notes”), one or more of which will be issued in respect of any Notes (“Rule 144A Notes”) offered and sold to persons who are QIBs (the “Rule 144A Global Notes”) and one or more of which will be issued in respect of any Notes (“Regulation S Notes”) offered and sold to persons who are non-U.S. persons in reliance on Regulation S (the “Regulation S Global Notes”). The Notes will be issued only in denominations of US$200,000 and integral multiples of US$1,000 in excess thereof. For a more detailed description of the Notes, see “Description of the Notes and the Guarantee” beginning on page 233. An investment in the Notes involves risks. For a discussion of these risks, see “Risk Factors” beginning on page 45. The Issuer has credit ratings of BB+ (outlook negative) by Fitch Ratings Ltd (“Fitch”), Ba3 (outlook negative) by Moody’s Investors Service Ltd. (“Moody’s”) and BB- (outlook CreditWatch negative) by S&P Global Ratings Europe Limited (“S&P”). In general, European regulated investors are restricted from using a rating for regulatory purposes if such rating is not issued by a credit rating agency established in the European Union or the United Kingdom and registered under Regulation (EC) No. 1060/2009 (the “CRA Regulation”), unless the rating is provided by a credit rating agency operating in the European Union before 7 June 2010 which has submitted an application for registration in accordance with the CRA Regulation and such registration is not refused. Fitch, Moody’s and S&P have each been registered under the CRA Regulation by the European Securities and Markets Authority since 31 October 2011. Citigroup Global Markets Inc., BNP Paribas Securities Corp., Goldman Sachs & Co. LLC, Barclays Capital Inc., Bayerische Landesbank, BofA Securities, Inc., Credit Agricole Securities (USA) Inc., HSBC Bank plc, Lloyds Securities Inc., Mizuho Securities USA LLC, MUFG Securities EMEA plc, NatWest Markets Securities Inc., Santander Investment Securities Inc., Skandinaviska Enskilda Banken AB (publ), SMBC Nikko Securities America, Inc., Socie´te´Ge´ne´rale, Standard Chartered Bank, Commerz Markets LLC, TD Securities (USA) LLC and UniCredit Capital Markets LLC (collectively, the “Initial Purchasers”), expect to deliver the Notes to purchasers on or about 21 October 2020 through the facilities of The Depository Trust Company (“DTC”), including through its participants Euroclear Bank SA/NV (“Euroclear”) and Clearstream Banking S.A. (“Clearstream”). Global Coordinators and Joint Bookrunners Citigroup BNP PARIBAS Goldman Sachs & Co. LLC Joint Bookrunners Barclays Bayerische Landesbank BofA Securities Credit Agricole CIB HSBC Lloyds Securities Mizuho Securities MUFG NatWest Markets Santander SEB SMBC Nikko Socie´te´Ge´ne´rale Standard Chartered Bank Corporate & Investment Banking Co-Managers Commerzbank TD Securities UniCredit Capital Markets The date of this Offering Memorandum is 16 October 2020 TABLE OF CONTENTS Page Important Information ................................................................... 1 Stabilization ........................................................................... 2 Notice to Prospective Investors in the United States ........................................... 2 Prohibition of Sales to European Economic Area and United Kingdom Retail Investors ............... 2 Service of Process and Enforceability of Certain Civil Liabilities ................................. 3 Available Information ................................................................... 3 Information Incorporated by Reference ..................................................... 3 Forward-Looking Statements ............................................................. 5 Presentation of Financial, Market and Other Information ....................................... 6 Overview ............................................................................. 15 Overview of the Notes ..................................................................