23 Feb 2006 07:01
Planet Acquisitions Limited23 February 2006 NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR FROM THE UNITEDSTATES, AUSTRALIA, CANADA OR JAPAN 23 February 2006 PLANET ACQUISITIONS LIMITED A COMPANY FORMED AT THE DIRECTION OF 3i RECOMMENDED PROPOSALS FOR THE CASH ACQUISITION OF CHORION PLC TO BE IMPLEMENTED BY MEANS OF A SCHEME OF ARRANGEMENT Summary • The board of Planet Acquisitions and the Independent Directors ofChorion announce that they have reached agreement on the terms of therecommended acquisition of Chorion by Planet Acquisitions for 425 pence in cashper Chorion Share. The Acquisition will be effected by means of a scheme ofarrangement under section 425 of the Companies Act 1985. • Planet Acquisitions is a new company incorporated in England andWales for the purpose of making the Acquisition. Following completion of theAcquisition, Planet Acquisitions will be indirectly owned by the 3i Investorstogether with the Management Team and certain of their connected persons (whowill own a minority shareholding). • The terms of the Acquisition will value the entire issued ordinaryshare capital of Chorion (fully diluted for the exercise of all outstandingoptions under the Chorion Share Option Schemes with an exercise price below 425pence) at approximately £110.7 million and represents a premium ofapproximately: • 23.2 per cent. to the Closing Price of 345.0 pence per Chorion Share on 21 February 2006, the last Business Day prior to the announcement of a possible offer for Chorion; and • 31.9 per cent. to the average Closing Price of 322.2 pence per Chorion share for the 12 months ended 21 February 2006, the last Business Day prior to the announcement of a possible offer for Chorion. • Planet Acquisitions has received irrevocable undertakings andletters of intent to vote in favour of the Proposals at the Court Meeting toapprove the Scheme from Chorion Shareholders (including the IndependentDirectors) in respect of, in aggregate, 10,601,400 Chorion Shares, representingapproximately 43.7 per cent. of the entire issued ordinary share capital ofChorion entitled to vote at the Court Meeting. • Planet Acquisitions has entered into certain conditionalarrangements with the Management Team to acquire all of the Chorion Shares heldby them or their connected persons, representing approximately 4.8 per cent. ofthe existing issued ordinary share capital of Chorion. • The Independent Directors, who have been so advised by Rothschild,consider the terms of the Proposals to be fair and reasonable. In providing itsadvice, Rothschild has taken into account the Independent Directors' commercialassessments of the Proposals. Accordingly, the Independent Directorsunanimously recommend that Chorion Shareholders vote in favour of the Scheme, asJohn Llewellyn-Lloyd (being the only Independent Director holding ChorionShares) has irrevocably undertaken to do in respect of his own beneficialholding. • The Scheme will be subject, inter alia, to approval by ChorionShareholders and sanction by the Court. It is expected that the Scheme willbecome effective in mid-April 2006. • UBS Investment Bank is acting as financial adviser to PlanetAcquisitions and 3i. KPMG Corporate Finance is acting as financial adviser tothe Management Team. Rothschild is acting as financial adviser to Chorion andthe Independent Directors and GE Commercial Finance has arranged the acquisitionfinance facilities on behalf of Planet Acquisitions. Commenting on the Proposals, Chris Williams of 3i said: "3i knows this sector well. We have been very impressed by the way themanagement team has developed Chorion's business to this point and with theirplans for the future. We believe 3i's expertise and investment resources, andthe additional flexibility gained by taking the company private, will allow theproven management team to deliver the full potential of the business." Waheed Alli, Chairman of Chorion, said: "Today's announcement makes sense for all stakeholders. We are entering achallenging period in our development, where substantial investment will beneeded, the risks will be higher and returns take longer to realise. This offerwill give our shareholders the opportunity to realise an excellent return ontheir investment, while 3i's long-term commitment will be invaluable in helpingthe management team develop the business over time." The Scheme Document setting out the details of the Proposals and the proceduresto be followed to approve the Scheme, and forms of proxy, will be posted toChorion Shareholders and, for information only, to participants in the ChorionShare Option Schemes and holders of Redeemable Preference Shares as soon aspracticable and in any event within 28 days of this Announcement unlessotherwise agreed with the Panel. This summary should be read in conjunction with the full text of thisAnnouncement. There will be an analyst presentation at 10:00 a.m. today at KPMG, 8 SalisburySquare London EC4Y 8BB to outline the Proposals. Enquiries:Chorion Telephone: +44 (0) 20 7280 5000John Llewellyn-Lloyd Andrew McGuinness Rothschild Telephone: +44 (0) 20 7280 5000Warner MandelDominic Wallis Portland PR (Chorion PR enquiries) Telephone: +44 (0) 20 7404 5344 Tim Allan 3i Telephone: +44 (0) 20 7928 3131Chris Williams Inaki EchaveUBS Telephone: +44 (0) 20 7567 8000Jonathan RowleyJames Simpson Maitland (3i PR enquiries) Telephone: +44 (0) 20 7379 5151Colin Browne Liz Morley Chorion is a leading brand development and management business which owns andexploits crime and children rights, generating revenue through the licensing andmerchandising of toys, publishing of books and TV. The Chorion portfolioincludes classic brands such as Noddy, Mr. Men, Famous Five and other Blytoncharacters, Agatha Christie (Miss Marple and Poirot), Simenon (Maigret) andChandler (Marlowe). 3i is a world leader in private equity and venture capital and invests acrossEurope, the United States and Asia. 3i was established in 1945, listing on theLondon Stock Exchange in 1994. It is a constituent of the FTSE 100 index. 3imanages over £6.2 billion of assets (as at 31 March 2005) comprising its ownbalance sheet of around £4.3 billion and private equity limited partnerships of£1.9 billion, invested alongside 3i. Recent investments made by 3i include NCP,the UK's leading parking services company, Giochi Preziosi, the leading Italiantoy company, Daalderop, a leading supplier of innovative heating equipment inthe Netherlands and NordNav, a Swedish company which develops next generationglobal navigation satellite systems. 3i has identified media as a key area offocus and is Europe's most active private equity investor in the European mediasector. Recent transactions in the media sector include Yellow Brick Road,Hallmark Channel's international TV assets, Trinity Mirror's Northern Irishnewspapers, Boxer TV in Scandinavia, 1-2-3 TV in Germany, Poliris in France andNimbus in India. The availability of the Proposals or the distribution of this Announcement topersons who are not resident in the UK may be affected by the laws of therelevant jurisdictions in which they are located. Persons who are not residentin the UK should inform themselves of, and observe, any applicable requirements. CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This Announcement contains certain forward-looking statements with respect tothe financial condition, results of operations and business of Chorion andcertain plans and objectives of the boards of Chorion and Planet Acquisitionswith respect thereto. These forward-looking statements can be identified by thefact that they do not relate only to historical or current facts.Forward-looking statements often use words such as "anticipate", "target", "expect", "estimate", "intend", "plan", "goal", "believe", "will", "may", "should", "would", "could", or other words of similar meaning. These statements arebased on assumptions and assessments made by the boards of Chorion and PlanetAcquisitions in light of their experience and their perception of historicaltrends, current conditions, expected future developments and other factors theybelieve appropriate. By their nature, forward-looking statements involve riskand uncertainty, because they relate to events and depend on circumstances thatwill occur in the future and the factors described in the context of suchforward-looking statements in this Announcement could cause actual results anddevelopments to differ materially from those expressed in or implied by suchforward-looking statements. Although Chorion and Planet Acquisitions believethat the expectations reflected in such forward-looking statements arereasonable, Chorion and Planet Acquisitions can give no assurance that suchexpectations will prove to have been correct and Chorion and Planet Acquisitionstherefore caution you not to place undue reliance on these forward-lookingstatements which speak only as at the date of this Announcement. The Proposals will not be available, directly or indirectly, in or into and willnot be capable of acceptance, approval or participation in or from the UnitedStates, Canada, Australia or Japan. In addition, it is not currently intendedthat the Proposals will be made, directly or indirectly, in or into, or by useof the mails or by any means or instrumentality (including, without limitation,by means of telephone, facsimile, telex, internet or other forms of electroniccommunication) of interstate or foreign commerce of, or by any facilities of anational securities exchange of, the United States and it is not currentlyintended that the Proposals will be capable of acceptance by any such use,means, instrumentality or facility or from within the United States.Accordingly, copies of this announcement are not being, and must not be, mailedor otherwise forwarded, distributed or sent in, into or from the United States.Custodians, nominees and trustees should observe these restrictions and shouldnot send or distribute the announcement in or into the United States, Canada,Australia or Japan. UBS Limited ("UBS" or "UBS Investment Bank") is acting exclusively for 3i andPlanet Acquisitions and no one else in connection with the Proposals and willnot be responsible to anyone other than 3i and Planet Acquisitions for providingthe protections afforded to clients of UBS nor for providing advice in relationto the Proposals, the content of this Announcement, or any matter referred toherein. KPMG Corporate Finance, a division of KPMG LLP which is authorised and regulatedby the Financial Services Authority for investment business activities, isacting exclusively for the Management Team as financial adviser in relation tothe Proposals and is not acting for any other person in relation to suchProposals. KPMG Corporate Finance will not be responsible to anyone other thanthe Management Team for providing the protections afforded to its clients or forproviding advice in relation to the contents of this Announcement or any matterreferred to herein. Rothschild, which is regulated in the United Kingdom by the Financial ServicesAuthority, is acting exclusively for Chorion and the Independent Directors andno one else in connection with the Proposals and will not be responsible toanyone other than Chorion and the Independent Directors for providing theprotections afforded to clients of Rothschild nor for providing advice inrelation to the Proposals, the content of this Announcement or any matterreferred to herein. Appendix I sets out the Conditions to the implementation of the Proposals. Appendix II sets out the bases and sources of information from which thefinancial calculations used in this Announcement have been derived. Appendix III contains the definitions of terms used in this Announcement(including this summary). NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO OR FROM THE UNITEDSTATES, AUSTRALIA, CANADA OR JAPAN 23 February 2006 PLANET ACQUISITIONS LIMITED A COMPANY FORMED AT THE DIRECTION OF 3i RECOMMENDED PROPOSALS FOR THE CASH ACQUISITION OF CHORION PLC TO BE IMPLEMENTED BY MEANS OF A SCHEME OF ARRANGEMENT 1. Introduction The board of Planet Acquisitions and the Independent Directors announce thatthey have reached agreement on the terms of a recommended cash acquisition byPlanet Acquisitions of all of the issued and to be issued ordinary share capitalof Chorion for 425 pence in cash per Chorion Share, to be effected by means of ascheme of arrangement under section 425 of the Companies Act. Planet Acquisitions is a new company incorporated in England and Wales for thepurpose of implementing the Proposals. Following completion of the Acquisition,Planet Acquisitions will be indirectly owned by the 3i Investors together withthe Management Team (namely Waheed Alli, Nicholas James Williams (referred tothroughout this Announcement as Nicholas James), Sue Murphy and William Astor)and certain of their connected persons who will own a minority shareholding. In view of the interests that the Management Team will have in PlanetAcquisitions, the Independent Directors alone have considered the approach fromPlanet Acquisitions and the terms of the Proposals. The Acquisition does not extend to the Redeemable Preference Shares. TheRedeemable Preference Shares will not be affected by the Proposals. 2. The Proposals Under the terms of the Proposals, which are subject to the Conditions andfurther terms set out in Appendix I to this Announcement and any further termsto be set out in the Scheme Document, Scheme Shares will be cancelled and SchemeShareholders will receive: for each Chorion Share 425 pence in cash The Acquisition values the entire issued ordinary share capital of Chorion(fully diluted for the exercise of all outstanding options under the ChorionShare Option Schemes with an exercise price below 425 pence) at approximately£110.7 million and the price per Chorion Share which Scheme Shareholders wouldreceive under the Proposals represents a premium of approximately: • 23.2 per cent. to the Closing Price of 345.0 pence per ChorionShare on 21 February 2006, the last Business Day prior to the announcement of apossible offer for Chorion; and • 31.9 per cent. to the average Closing Price of 322.2 pence perChorion Share for the 12 months ended 21 February 2006, the last Business Dayprior to the announcement of a possible offer for Chorion. 3. Recommendation The Independent Directors consider that the Proposals are in the best interestsof Chorion Shareholders as a whole. Accordingly, the Independent Directorsintend to recommend that Chorion Shareholders vote in favour of the resolutionsto be proposed at the Court Meeting and the Chorion EGM required to implementthe Scheme, as John Llewellyn-Lloyd (being the only Independent Director holdingChorion Shares) has irrevocably undertaken to do in respect of his entirebeneficial holding, which amounts to 26,518 Chorion Shares, representingapproximately 0.1 per cent. of Chorion's issued ordinary share capital. 4. Background to and reasons for recommending the Proposals Chorion has reached the end of a three-year business plan in which the Companyhas successfully developed its crime brands, increased momentum in itschildren's brands and expanded its crime and children's portfolio, most recentlythrough the acquisitions of the Raymond Chandler and Silver Lining properties. This success has been mirrored in the Chorion share price, which has risen from90 pence to 345 pence between 1 October 2002 and 21 February 2006, representinggrowth of over 280 per cent. In late 2005, 3i approached Chorion regarding its interest in making a possibleoffer, if supported by Chorion's management, for the Company. Followingpreliminary discussions, 3i was allowed to perform due diligence and the Companyset up a committee of Independent Directors to consider the Proposals. This hasresulted in the proposed recommended acquisition of Chorion by PlanetAcquisitions at an offer price of 425 pence in cash per Chorion Share. The Proposals represent an excellent opportunity for Chorion Shareholders tosecure a premium to the current trading value of their investment in Chorion.The Independent Directors, who have been so advised by Rothschild, consider theterms of the Proposals to be fair and reasonable. In providing its advice,Rothschild has taken into account the Independent Directors' commercialassessment of the Proposals. While the Independent Directors believe the Company's strategy has the potentialto deliver value to Chorion Shareholders over the long term, there is a degreeof execution risk attached in the nearer future. In arriving at their decision to recommend the Proposals, the IndependentDirectors have considered, among other things, the following: • Uncertainty in relation to future revenue and profit growth: - execution risks associated with the next phase of the Company'sdevelopment (e.g. production and the worldwide roll-out of the new televisionseries of Mr. Men); - the challenging operating environment being currently experiencedby the Company involving the transformation of consumer preferences and buyinghabits and the uncertainty in relation to the migration from DVD- andvideo-related products to different in-house entertainment platforms; and - the increasing need to be able to offset higher investment throughhaving content that is successful in all of the five major markets of the USA,Japan, UK, France and Germany. • Under the terms of the Proposals, the recommended offer price of 425 pence in cash per Chorion Share represents: - a premium of 23.2 per cent. to a share price which has alreadyincreased by 23.9 per cent. over the prior year to 21 February 2006; - a multiple of approximately 21.7x pre-exceptional earnings beforeinterest, tax, depreciation and goodwill amortisation ("EBITDA") for the yearended 31 December 2004 and of 19.3x for the twelve months to 30 June 2005, whichcompares very favourably to the prices paid for similar businesses and thetrading valuations of many publicly quoted companies in the media contentsector; and - a high EBITDA multiple calculated at a time when the Company isachieving record profitability. Given the above, in the opinion of the Independent Directors, the Proposalsrepresent a certainty of value today that may, if the Proposals are rejected,not be realisable in the short to medium term. 5. Management Arrangements The Management Team and their connected persons will invest approximately £2.2million in, and rollover the Management Shares which have an approximate valueof £5.2 million into, a combination of debt securities to be issued by PlanetAcquisitions and equity securities to be issued by Planet Acquisitions Holdings,the holding company of Planet Acquisitions. These securities will not be listedon any stock exchange. In order to give effect to the Management Arrangements, the Management Team,their connected persons and the members of the Planet Acquisitions Group haveentered into a conditional Cancellation Agreement under the terms of whichWaheed Alli agrees to sell one Chorion Share to Planet Acquisitions and twoChorion Shares to Planet Acquisitions Holdings at a price of 425 pence perChorion Share and the Management Team and their connected persons have agreed tothe cancellation of the Management Shares in consideration for the issue to theManagement Team and their connected persons of Management Loan Notes which theManagement Team and their connected persons will, in part, exchange for newequity securities in Planet Acquisitions Holdings. The 3i Investors, theManagement Team and their connected persons and the members of the PlanetAcquisitions Group have also entered into the Investment Agreement in respect ofthe cash subscriptions to be made by the Management Team. The Management Team will remain in place to operate the business once the Schemebecomes effective. The Management Team have entered into new service contractswith Planet Acquisitions Holdings which are conditional upon the Scheme becomingeffective. Further details of these service contracts will be set out in theScheme Document. Chorion Shareholders will be asked at the Chorion EGM to approve the ManagementArrangements described in this paragraph 5 by voting on the Ordinary Resolution.None of the Management Team (or their connected persons who are holders ofChorion Shares) will be entitled to vote on this resolution and voting on thisresolution will be by way of a poll. The options over Chorion Shares held by the Management under the Chorion ShareOption Schemes will be treated in the same manner as all the other options,further details of which are set out in paragraph 14 below. The proceedsreceived by the Management Team under the Scheme in consideration for thecancellation of Chorion Shares issued to them pursuant to the exercise ofoptions under the Chorion Share Option Schemes will be used, in part, by membersof the Management Team to fund their cash investment in the Planet AcquisitionsGroup. Rothschild considers the terms of the Management Arrangements and the investmentby the Management Team to be fair and reasonable so far as all other ChorionShareholders are concerned. 6. Structure of the Proposals (a) Introduction The Acquisition is to be effected by a means of a scheme of arrangement betweenChorion, the Scheme Shareholders, the holders of the Management Shares andPlanet Acquisitions Holdings under section 425 of the Companies Act, theprovisions of which will be set out in full in the Scheme Document. The purposeof the Scheme, together with the proposed changes to the Chorion Articles, is toprovide for Planet Acquisitions to become the owner of the whole of the issuedordinary share capital of Chorion. The Scheme will provide for the cancellationof the Scheme Shares, the Planet Acquisitions Holdings Shares and the ManagementShares, and the application of the reserve arising from such cancellation inpaying up in full a number of New Chorion Shares which is equal to the number ofScheme Shares, Management Shares and Planet Acquisitions Holdings Sharescancelled and issuing the same to Planet Acquisitions and/or its nominee(s). Scheme Shareholders will then receive cash on the basis set out in paragraph 2above. The Scheme will include a reorganisation of the share capital of Chorionwhereby, in accordance with the terms of the Scheme, the Scheme Shares will bereclassified as A Ordinary Shares, the Management Shares will be reclassified asB Ordinary Shares and the Planet Acquisitions Holdings Shares will bereclassified as C Ordinary Shares. The share capital reorganisation will onlytake place at the time at which the order of the Court sanctioning the Scheme isdelivered to the Registrar of Companies. The A Ordinary Shares (which will beowned by the Scheme Shareholders) will be cancelled and holders will receivecash. The B Ordinary Shares will be cancelled and holders will receiveManagement Loan Notes which will, in part, be exchanged for shares in PlanetAcquisitions Holdings. The C Ordinary Shares will be cancelled and PlanetAcquisitions Holdings will receive shares in Planet Acquisitions. No temporarydocuments of title will be issued to Chorion Shareholders in respect of the AOrdinary Shares, the B Ordinary Shares or the C Ordinary Shares. If for any reason the Scheme does not become effective, the share capitalreorganisation described above will not take effect (or will be reversed) andChorion Shareholders will retain their current holdings of Chorion Shares. The terms of the reorganisation of the share capital of Chorion will be set outin the Scheme Document. To become effective, the Scheme requires the approval of Scheme Shareholders atthe Court Meeting. The Scheme also requires the sanction of the Court and thepassing of certain resolutions to be proposed at the Chorion EGM, as well assatisfaction or waiver of the other Conditions set out in Appendix I to thisAnnouncement. Upon the Scheme becoming effective, it will be binding on allChorion Shareholders, irrespective of whether or not they attended or voted atthe Court Meeting or the Chorion EGM. (b) The Meetings Notices of the Court Meeting and the Chorion EGM will be set out in the SchemeDocument. Entitlements to attend and vote at the Meetings and the number ofvotes which may be cast at them will be determined by reference to holdings ofChorion Shares as shown in the register of members of Chorion at the timespecified in the notice of the relevant meeting. The Court Meeting The Court Meeting, which, it is expected, will be convened for 10:30 a.m. on 24March 2006, will be held at the direction of the Court to seek the approval ofthe Scheme Shareholders to the Scheme. At the Court Meeting, voting will be byway of poll and each Scheme Shareholder present in person or by proxy will beentitled to one vote for each Scheme Share held. The approval required at theCourt Meeting is a majority in number of those Scheme Shareholders who arepresent and vote, either in person or by proxy, and who represent 75 per cent.or more in value of all Scheme Shares held by such Scheme Shareholders. Scheme Shareholders have the right to raise any objections they may have to theScheme at the Court Meeting. It is important that as many votes as possible (whether in person or by proxy)at the Court Meeting are cast so that the Court may be satisfied that there is afair and reasonable representation of Chorion Shareholder opinion. A form of proxy for the Court Meeting will be sent to the Scheme Shareholderstogether with the Scheme Document. None of the Management Team (or their connected persons who are holders ofChorion Shares) or the Planet Acquisitions Group or 3i or any other personacting in concert with Planet Acquisitions is entitled to vote at the CourtMeeting, given their interest in the Proposals. Planet Acquisitions, theManagement Team (and their connected persons who are holders of Chorion Shares)and Planet Acquisitions Holdings have confirmed that they will be represented byCounsel at such hearings so as to consent to the Scheme and to undertake to theCourt to be bound thereby. The interests of the Management Team in the Proposalsare set out in further detail in paragraph 5 above. The Chorion EGM It is expected that the Chorion EGM will be convened for 10:45 a.m. on 24 March2006, to consider and, if thought fit, pass the Special Resolution (whichrequires votes in favour representing at least 75 per cent. of the votes cast)to approve: (i) the Scheme; (ii) the reorganisation of the share capital of Chorion referred to above; (iii) the Capital Reduction; (iv) the giving of authority to the Directors pursuant to the Chorion Articles to allot shares in Chorion to Planet Acquisitions as provided for in the Scheme; and (v) certain amendments to the Chorion Articles as described below. Notice of the Chorion EGM will be set out in the Scheme Document. Voting on the Special Resolution will be on a show of hands unless a poll isdemanded. The Chairman reserves the right to demand a poll and, in such event,each Chorion Shareholder present in person or by proxy will be entitled to onevote for every Chorion Share held. All Chorion Shareholders will be entitled tovote on the Special Resolution, including the Management Team and theirconnected persons. It is proposed that the Chorion Articles will be amended to ensure that anyChorion Shares which are issued after the Chorion EGM but before the SchemeRecord Time will be subject to and bound by the Scheme, and that any ChorionShares issued after the Reorganisation Record Time but before the Scheme RecordTime will be issued as A Ordinary Shares. Any Chorion Shares issued on theexercise of options under the Chorion Share Option Schemes after the SchemeRecord Time will not be subject to the Scheme. Accordingly, it is also proposedthat the Chorion Articles will be amended so that any Chorion Shares issued toany person other than Planet Acquisitions (or its nominee(s)) on or after theScheme Record Time will automatically be acquired by Planet Acquisitions inconsideration for the payment by Planet Acquisitions to such person of such cashconsideration as would have been payable under the Scheme had such ChorionShares been Scheme Shares. The other amendments to be made to the Chorion Articles reflect thereorganisation of share capital described above. The proposed amendments to theChorion Articles will be set out in full in the notice of the Chorion EGM. The Chorion EGM will also be convened to consider and, if thought fit, pass theOrdinary Resolution to approve the proposed Management Arrangements described inparagraph 5 above. Approval of these arrangements by the independent holders ofChorion Shares is required by the Panel and the resolution will be passed if asimple majority of those voting, in person or by proxy, vote in favour of it. The Management Team (and their connected persons who are holders of ChorionShares) will not be entitled to vote on the Ordinary Resolution and voting willbe by way of a poll. (c) Modifications to the Scheme The Scheme will contain a provision for Chorion and Planet Acquisitions jointlyto consent on behalf of all concerned to any modifications, additions orconditions to the Scheme which the Court may think fit to approve or impose.The Court would be unlikely to approve of or impose any modifications, additionsor conditions to the Scheme which might be material to the interests of SchemeShareholders unless Scheme Shareholders were informed of any such modification,addition or condition. It would be a matter for the Court to decide, in itsdiscretion, whether or not a further meeting of Scheme Shareholders should beheld. Similarly, if a modification, addition or condition is put forward which,in the opinion of the Independent Directors, is of such a nature or importanceas to require the consent of Chorion Shareholders at a further meeting, theIndependent Directors will not take the necessary steps to enable the Scheme tobecome effective unless and until such consent is obtained. (d) Conditions to the Scheme The Conditions to the Scheme are set out in full in Appendix I to thisAnnouncement. The Scheme is conditional, inter alia, upon: (i) the Scheme becoming effective by not later than 31August 2006 or such later date as Chorion and Planet Acquisitions may agree and(if required) the Court may allow; (ii) approval of the Scheme by a majority in number of theScheme Shareholders who are present and vote either in person or by proxy at theCourt Meeting, or any adjournment of that Meeting, and who represent 75 percent. or more in value of all Scheme Shares held by such Scheme Shareholders; (iii) the resolutions to be set out in the notice of theChorion EGM (namely the Special Resolution and the Ordinary Resolution) beingduly passed by the requisite majority at the Chorion EGM or any adjournment ofthat Meeting; and (iv) the sanction (with or without modification agreed byChorion and Planet Acquisitions) of the Scheme and confirmation of the CapitalReduction by the Court, office copies of the Court Orders and the minute of suchreduction attached thereto being delivered for registration to the Registrar ofCompanies and, in the case of the Court Order confirming the Capital Reduction,registration of such Court Order by him. (e) Sanction of the Scheme by the Court Under the Companies Act, the Scheme also requires the sanction of the Court.The hearings by the Court to sanction the Scheme and to confirm the CapitalReduction comprised in the Scheme are expected to be held on 10 April 2006 and12 April 2006 respectively, subject to satisfaction or waiver of the otherConditions. Planet Acquisitions, the Management Team (and their connectedpersons who are holders of Chorion Shares) and Planet Acquisitions Holdings haveconfirmed that they will be represented by Counsel at such hearings so as toconsent to the Scheme and to undertake to the Court to be bound thereby. The Scheme will become effective in accordance with its terms on delivery ofoffice copies of the Court Orders to the Registrar of Companies, and (inrelation to the Court Order to confirm the Capital Reduction comprised in theScheme) the registration of such Court Order by him. If the Scheme becomes effective, it will be binding on all Chorion Shareholdersirrespective of whether or not they attended or voted in favour of the Scheme atthe Court Meeting or in favour of the resolutions proposed at the Chorion EGM.If the Scheme does not become effective by 31 August 2006 (or such later date(if any) as Planet Acquisitions and Chorion may agree and (if required) theCourt may allow) the Scheme will not become effective, the Acquisition will notproceed and any reclassification of the Chorion Shares will be reversed suchthat the rights attaching to Chorion Shares will be as if the reclassificationhad never taken effect. 7. Irrevocable undertakings and letters of intent Planet Acquisitions has received irrevocable undertakings to vote (or procurethe vote) in favour of the Scheme at the Court Meeting (or, in the event thatthe offer is implemented by way of a takeover offer, to accept such offer) inrespect of 8,249,559 Chorion Shares in aggregate, representing approximately34.0 per cent. of Chorion's issued ordinary share capital entitled to vote atthe Court Meeting. Details of these irrevocable undertakings are as follows: • John Llewellyn-Lloyd (being the only IndependentDirector holding Chorion Shares) has irrevocably undertaken to vote in favour ofthe Scheme in respect of 26,518 Chorion Shares representing approximately 0.1per cent. of the issued ordinary share capital of Chorion entitled to vote atthe Court Meeting; • SVG Investment Managers Limited has irrevocablyundertaken to vote (or procure that the registered holder votes) in favour ofthe Scheme in respect of 2,678,000 Chorion Shares representing approximately11.0 per cent of the issued ordinary share capital of Chorion entitled to voteat the Court Meeting; • Artemis Investment Management Limited has irrevocablyundertaken to vote (or procure that the registered holder votes) in favour ofthe Scheme in respect of 1,741,697 Chorion Shares representing approximately 7.2per cent of the issued ordinary share capital of Chorion entitled to vote at theCourt Meeting; • Nigel Wray has irrevocably undertaken to vote (orprocure that the registered holder votes) in favour of the Scheme in respect of1,124,715 Chorion Shares representing approximately 4.6 per cent of the issuedordinary share capital of Chorion entitled to vote at the Court Meeting; • Montanaro has irrevocably undertaken to vote (orprocure that the registered holder votes) in favour of the Scheme in respect of1,046,207 Chorion Shares representing approximately 4.3 per cent of the issuedordinary share capital of Chorion entitled to vote at the Court Meeting; • UBS Global Asset Management (UK) Ltd has irrevocablyundertaken to vote (or procure that the registered holder votes) in favour ofthe Scheme in respect of 1,632,422 Chorion Shares representing approximately 6.7per cent. of the issued ordinary share capital of Chorion entitled to vote atthe Court Meeting. As a result of their interest in the Proposals, the Management Team (and theirconnected persons who are holders of Chorion Shares) are precluded from votingat the Court Meeting and, as a result, the Chorion Shares held by them (andtheir connected persons) will not count towards the majorities required toapprove the Scheme. The Management Team (and their connected persons who areholders of Chorion Shares) have pursuant to the Cancellation Agreementirrevocably undertaken to be bound by the Scheme. Planet Acquisitions has also received irrevocable undertakings to vote in favourof the Special Resolution in respect of a total of 9,469,755 Chorion Shares,representing approximately 37.2 per cent. of Chorion's issued ordinary sharecapital. Details of these irrevocable undertakings are as follows: • John Llewellyn-Lloyd (being the only IndependentDirector holding Chorion Shares) has irrevocably undertaken to vote in favour ofthe Special Resolution in respect of 26,518 Chorion Shares representingapproximately 0.1 per cent. of the issued ordinary share capital of Chorion; • the Management Team (and their connected persons whoare holders of Chorion Shares) have irrevocably undertaken to vote in favour ofthe Special Resolution in respect of 1,220,196 Chorion Shares in aggregate,representing approximately 4.8 per cent. of the issued share capital of Chorion; • SVG Investment Managers Limited has irrevocablyundertaken to vote (or procure that the registered holder votes) in favour ofthe Special Resolution in respect of 2,678,000 Chorion Shares representingapproximately 10.5 per cent of the issued ordinary share capital of Chorion; • Artemis Investment Management Limited has irrevocablyundertaken to vote (or procure that the registered holder votes) in favour ofthe Special Resolution in respect of 1,741,697 Chorion Shares representingapproximately 6.8 per cent. of the issued ordinary share capital of Chorion; • Nigel Wray has irrevocably undertaken to vote (orprocure that the registered holder votes) in favour of the Special Resolution inrespect of 1,124,715 Chorion Shares representing approximately 4.4 per cent. ofthe issued ordinary share capital of Chorion; • Montanaro has irrevocably undertaken to vote (orprocure that the registered holder votes) in favour of the Special Resolution inrespect of 1,046,207 Chorion Shares representing approximately 4.1 per cent. ofthe issued ordinary share capital of Chorion; • UBS Global Asset Management (UK) Ltd has irrevocablyundertaken to vote (or procure that the registered holder votes) in favour ofthe Special Resolution in respect of 1,632,422 Chorion Shares representingapproximately 6.4 per cent. of the issued ordinary share capital of Chorion. Planet Acquisitions has also received irrevocable undertakings to vote in favourof the Ordinary Resolution in respect of a total of 8,249,559 Chorion Shares,representing approximately 34.0 per cent. of Chorion's issued ordinary sharecapital entitled to vote on the Ordinary Resolution. Details of these irrevocable undertakings are as follows: • John Llewellyn-Lloyd (being the only IndependentDirector holding Chorion Shares) has irrevocably undertaken to vote in favour ofthe Ordinary Resolution in respect of 26,518 Chorion Shares, representingapproximately 0.1 per cent. of the issued ordinary share capital of Chorionentitled to vote on the Ordinary Resolution; • SVG Investment Managers Limited has irrevocablyundertaken to vote (or procure that the registered holder votes) in favour ofthe Ordinary Resolution in respect of 2,678,000 Chorion Shares representingapproximately 11.0 per cent. of the issued ordinary share capital of Chorionentitled to vote on the Ordinary Resolution; • Artemis Investment Management has irrevocablyundertaken to vote (or procure that the registered holder votes) in favour ofthe Ordinary Resolution in respect of 1,741,697 Chorion Shares representingapproximately 7.2 per cent. of the issued ordinary share capital of Chorionentitled to vote on the Ordinary Resolution; • Nigel Wray has irrevocably undertaken to vote (orprocure that the registered holder votes) in favour of the Ordinary Resolutionin respect of 1,124,715 Chorion Shares representing approximately 4.6 per centof the issued ordinary share capital of Chorion entitled to vote on the OrdinaryResolution; • Montanaro has irrevocably undertaken to vote (orprocure that the registered holder votes) in favour of the Ordinary Resolutionin respect of 1,046,207 Chorion Shares representing approximately 4.3 per cent.of the issued ordinary share capital of Chorion entitled to vote on the OrdinaryResolution. • UBS Global Asset Management (UK) Ltd has irrevocablyundertaken to vote (or procure that the registered holder votes) in favour ofthe Ordinary Resolution in respect of 1,632,422 Chorion Shares representingapproximately 6.7 per cent. of the issued ordinary share capital of Chorionentitled to vote on the Ordinary Resolution. As a result of their interests in the Proposals, none of the Management Team (orany of their connected persons who are holders of Chorion Shares) will beentitled to vote on the Ordinary Resolution and voting will be by way of a poll. • The undertakings referred to above from John Llewellyn-Lloydwill cease to be binding only if the Scheme lapses or is withdrawn and within 28days thereof Planet Acquisitions has not made, or publicly announces that itwill not make, an offer to acquire Chorion at a cash price of not less than 425pence per Chorion Share (or, in the event that such a takeover offer isimplemented, if such offer lapses or is withdrawn). • The undertakings referred to above from SVG InvestmentManagers Limited will cease to be binding if (i) the Scheme lapses or iswithdrawn and within 28 days thereof Planet Acquisitions has not made, orpublicly announces that it will not make, an offer to acquire Chorion at a cashprice of not less than 425 pence per Chorion Share (or, in the event that such atakeover offer is implemented, if such offer lapses or is withdrawn); or (ii) inthe event that an offer is made for the entire issued shared capital of Chorionby a third party at a price which exceeds 460 pence per Chorion Share, suchthird party offer is recommended for acceptance by Chorion's board and a periodof seven days has elapsed from the announcement of the relevant third partyoffer without Planet Acquisitions having revised the terms of the Proposals sothat the revised Proposals exceed the value of the third party offer; (iii) inrespect of any of the relevant Chorion Shares, in the event that the SVG fundholding such shares is required to sell them in the open market in order to meetcosts payable to that fund's clients as a result of such clients electing toclose out or reduce their investments in the particular fund. • The undertakings referred to above from Artemis InvestmentManagement Limited will cease to be binding if (i) the Scheme lapses or iswithdrawn and within 28 days thereof Planet Acquisitions has not made, orpublicly announces that it will not make, an offer to acquire Chorion at a cashprice of not less than 425 pence per Chorion Share (or, in the event that such atakeover offer is implemented, if such offer lapses or is withdrawn); or (ii) inthe event that an offer is made for the entire issued shared capital of Chorionby a third party at a price which exceeds 460 pence per Chorion Share, suchthird party offer is recommended for acceptance by Chorion's board and a periodof seven days has elapsed from the announcement of the relevant third partyoffer without Planet Acquisitions having revised the terms of the Proposal sothat the revised Proposal exceeds the value of the third party offer. • The undertakings referred to above from Nigel Wray willcease to be binding if (i) the Scheme lapses or is withdrawn and within 28 daysthereof Planet Acquisitions has not made, or publicly announces that it will notmake, an offer to acquire Chorion at a cash price of not less than 425 pence perChorion Share (or, in the event that such a takeover offer is implemented, ifsuch offer lapses or is withdrawn); or (ii) in the event that an offer is madefor the entire issued shared capital of Chorion by a third party at a pricewhich exceeds 460 pence per Chorion Share, such third party offer is recommendedfor acceptance by Chorion's board and a period of seven days has elapsed fromthe announcement of the relevant third party offer without Planet Acquisitionshaving revised the terms of the Proposal so that the revised Proposal exceedsthe value of the third party offer. • The undertakings referred to above from Montanaro will ceaseto be binding if (i) the Scheme lapses or is withdrawn and within 28 daysthereof Planet Acquisitions has not made, or publicly announces that it will notmake, an offer to acquire Chorion at a cash price of not less than 425 pence perChorion Share (or, in the event that such a takeover offer is implemented, ifsuch offer lapses or is withdrawn); or (ii) in the event that an offer is madefor the entire issued shared capital of Chorion by a third party at a pricewhich exceeds 460 pence per Chorion Share and a period of seven days has elapsedfrom the announcement of the relevant third party offer without PlanetAcquisitions having revised the terms of the Proposal so that the revisedProposal exceeds the value of the third party offer. • The undertakings referred to above from UBS Global AssetManagement (UK) Ltd will cease to be binding if (i) the Scheme lapses or iswithdrawn and within 28 days thereof Planet Acquisitions has not made, orpublicly announces that it will not make, an offer to acquire Chorion at a cashprice of not less than 425 pence per Chorion Share (or, in the event that such atakeover offer is implemented, if such offer lapses or is withdrawn); or (ii) inthe event that an offer is made for the entire issued shared capital of Chorionby a third party at a price which exceeds 446.25 pence per Chorion Share and aperiod of five business days has elapsed from the announcement of the relevantthird party offer without Planet Acquisitions having revised the terms of theProposal so that the revised Proposal is no less favourable than such thirdparty offer in the reasonable opinion of UBS Global Asset Management (UK) Ltd;or (iii) the relevant Chorion Shares are transferred to any replacement fundmanager or custodian nominated by the underlying customer or client of UBSGlobal Asset Management (UK) Ltd where such underlying customer has terminatedits professional relationship with UBS Global Asset Management (UK) Ltd inrespect of the relevant Chorion Shares. • The undertakings referred to above from the Management Teamand their connected persons remain binding in all circumstances. In addition, Planet Acquisitions has received letters of intent to vote infavour of the Scheme and the Resolutions (or, the event that the offer isimplemented by way of a takeover offer, to accept such offer) in respect of2,351,841 Chorion Shares in aggregate, representing approximately 9.2 per cent.of Chorion's issued ordinary share capital. Details of these letters of intentare as follows: • Merrill Lynch Investment Managers Limited has provided aletter of intent indicating its current intention to vote (or procure that theregistered holder votes) in favour of the Scheme, the Special Resolution and theOrdinary Resolution in respect of 1,246,563 Chorion Shares representingapproximately 5.1 per cent. of the issued ordinary share capital of Chorionentitled to vote at the Court Meeting, 4.9 per cent. of the issued ordinaryshare capital of Chorion entitled to vote on the Special Resolution and 5.1 percent. of the issued ordinary share capital of Chorion entitled to vote on theOrdinary Resolution. • Canada Life has provided a letter of intent indicatingit's current intention to vote in favour (or procure that the registered holdervotes) in favour of the Scheme in respect of 1,105,278 Chorion Sharesrepresenting approximately 4.6 per cent. of the issued ordinary share capital ofChorion entitled to vote at the Court Meeting. 8. Information on the Planet Acquisitions Group, 3i and the 3i investors Planet Acquisitions is a newly-incorporated company which has been formed forthe purposes of implementing the Acquisition. Planet Acquisitions is a whollyowned subsidiary of Planet Acquisitions Holdings. Planet Acquisitions will beindirectly owned by the 3i Investors and the Management Team (and theirconnected persons) who will own a minority shareholding. Planet Acquisitionshas not traded since its date of incorporation nor has it entered into anyobligations other than in connection with the Acquisition and the financing ofthe Acquisition. The directors of Planet Acquisitions are Waheed Alli, NicholasJames, Sue Murphy and William Astor. The 3i Investors comprise 3i, 3i Pan European Buyouts 2004-06 LP, the 3i Funds,3i Parallel Ventures LP and the Co-investment Plan. The 3i Investors will investin the following proportions: 3i Investor %3i Group plc 19.7953i Pan European Buy-outs 2004-06 LP 43.7503i Parallel Ventures 10.4213i Europartners IVa LP 6.4403i Europartners IVb LP 5.9123i Europartners IVc LP 5.8833i Europartners IVd LP 5.4853i Europartners IVk LP 1.765Co-investment Plan 0.549Total 100 3i is a world leader in private equity and venture capital and invests acrossEurope, the United States and Asia. 3i was established in 1945, listing on theLondon Stock Exchange in 1994. It is a constituent of the FTSE 100 index. 3imanages over £6.2 billion of assets (as at 31 March 2005) comprising its ownbalance sheet of around £4.3 billion and private equity limited partnerships of£1.9 billion, invested alongside 3i. Recent investments made by 3i include NCP,the UK's leading parking services company, Giochi Preziosi, the leading Italiantoy company, Daalderop, a leading supplier of innovative heating equipment inthe Netherlands, and NordNav, a Swedish company which develops next generationglobal navigation satellite systems. 3i has identified media as a key area offocus and is Europe's most active private equity investor in the European mediasector. Recent transactions in the media sector include Yellow Brick Road,Hallmark Channel's international TV assets, Trinity Mirror's Northern Irishnewspapers, Boxer TV in Scandinavia, 1-2-3 TV in Germany, Poliris in France andNimbus in India. 3i Pan European Buyouts 2004-06 LP, the 3i Funds and 3i Parallel Ventures LP areEnglish limited partnerships managed by 3i Investments, which is a wholly-ownedsubsidiary of 3i and is regulated by the Financial Services Authority. 3i PanEuropean Buyouts 2004-06 LP is a vehicle established by 3i to provide carriedinterest to certain 3i executives, subject to specific conditions. 3i PanEuropean Buyouts 2004-06 LP is substantially funded by 3i. The investors in the3i Funds and 3i Parallel Ventures LP comprise UK and overseas institutionalinvestors, such as insurance companies and pension funds or their investmentvehicles. The Co-investment Plan is a vehicle through which certain executives of ParallelPrivate Equity Limited and its subsidiaries can invest alongside 3i ParallelVentures LP in equity investments made by 3i Parallel Ventures LP. 9. Information on Chorion and current trading Chorion is a leading brand development and management business which owns andexploits crime and children rights, generating revenue through the licensing andmerchandising of toys, publishing of books and TV. The Company was formed in2002 by the de-merger of a nightclub and bars business and an intellectualproperty owner business now owned by the Company. At the time of the de-merger,the intellectual property business owned the rights to the Enid Blyton estateand a 64% stake in the Agatha Christie estate (Miss Marple and Poirot). Sincethen, the Management Team has focused on further revitalisation of the Noddybrand, production of additional Agatha Christie movies and expansion of thebrand portfolio, most notably through the acquisition of Mr. Men in 2003 and theacquisition of Silver Lining in July 2005. Other brands in the portfolio includeSimenon (Maigret) and Chandler (Marlowe). For the financial year ended 31 December 2004, Chorion reported turnover of£23.9 million on which it earned profit on ordinary activities before taxationof £4.1 million (restated). Approximately 60 per cent. of the turnover camefrom TV, Video and Films, with approximately 24 per cent. from publishing/audio/magazines/partworks, 14 per cent. from merchandising and 2 per cent. from other. For the six months ended 30 June 2005, Chorion reported turnover of £7.4million, on which it earned pre-exceptional profit on ordinary activities beforetaxation of £1.1 million. As at 30 June 2005, Chorion's net assets were £66.1million. For the second half of Chorion's 2005 financial year, trading has been in linewith the Chorion Board's expectations. The Chorion Board expects to announce thepreliminary results of the Company for the year ended 31 December 2005 on 14March 2006. The preliminary results will be available electronically atwww.chorion.co.uk. Copies of the preliminary results will be posted to SchemeShareholders following their release. In the current year Chorion anticipates being affected by adverse tradingconditions in the US and Japan, where Noddy is growing slower than anticipatedand, in particular, it is likely to be affected by the significant drop in thepre-school DVD market. 10. Reasons for the Acquisition and future plans for Chorion Since the demerger of the business in 2002, Chorion has developed into a globalbusiness with an exceptional portfolio of pre-school and crime characters, and astrong media and retail distribution platform. This position is the result ofthe quality of the incumbent Management Team, who are responsible forquadrupling the value of the business over the period. 3i believes that Chorion operates in an attractive space and that managementhave created a powerful business model with the potential to generate growth byreinvogorating a portfolio of quality assets. 3i is keen to support managementin the next stage of development of Chorion. For that, significant investmentwill be required and the speed and magnitude of growth is difficult to predict.Private ownership can provide the flexibility required to realise the potentialto increase the portfolio of brands and expand the international presence of theChorion Group. 11. Directors, management and employees Planet Acquisitions has confirmed to the Independent Directors that, followingthe Scheme becoming effective, the existing employment rights, including pensionrights, of all the employees of the Chorion Group will be fully safeguarded. The Independent Directors have undertaken to resign from the board of Chorionupon the Scheme becoming effective. The Independent Directors will have noentitlement to compensation on resignation. Further details of certain arrangements with the Management Team are set out inparagraph 5 above. 12. Financing the Acquisition Planet Acquisitions will initially be financed using a combination of equity anddebt. Approximately £79.8 million will be provided by the 3i Investors with £7.4million being funded by the Management Team (either by investing cash in thePlanet Acquisitions Group or by rolling over the Management Shares). Theremainder will be funded by debt. UBS is satisfied that the necessary financial resources are available to PlanetAcquisitions to satisfy the cash consideration due under the Proposals in full.Full implementation of the Proposals would result in cash consideration ofapproximately £110.7 million being payable by Planet Acquisitions to ChorionShareholders (assuming exercise in full of all options under the Chorion ShareOption Schemes which have an exercise price below 425 pence). 13. Inducement fee As part of the negotiations between Chorion and 3i Investments, on 17 February2006, Chorion and 3i Investments entered into an Inducement Fee Agreement. Theinducement fee, which amounts to £1.1 million (plus VAT to the extent that it isrecoverable by Chorion), is payable to 3i Investments if, in summary, prior tothe proposed acquisition of Chorion by Planet Acquisitions lapsing or beingwithdrawn, a third party offeror unconnected with 3i Investments makes orannounces an offer for Chorion or contractually agrees to acquire all or amaterial part of the assets of Chorion and its subsidiaries and such alternativeoffer subsequently becomes (prior to the time when in accordance with its termsit would otherwise lapse), or is declared, unconditional in all respects or isotherwise consummated or is publicly recommended by the directors of Chorion orby the Independent Directors (whether at the time of the making of suchalternative offer or (prior to the time when in accordance with its terms itwould otherwise lapse) subsequently). 14. Chorion Share Option Schemes The effect of the Proposals on subsisting options under the Chorion Share OptionSchemes is summarised below. Options under each of the Chorion Share Option Schemes that are not alreadyexercisable will become exercisable when the Scheme becomes effective. Suchoptions will be exercisable for a period of one month and may only be exercisedto the extent that the relevant performance conditions have been satisfied.However, it is intended to amend the rules of the relevant Chorion Share OptionSchemes to allow (where relevant) options to become exercisable from the Courtsanctioning the Scheme. Such amendment will, in relation to the Chorion PLCApproved Executive Scheme, be subject to HM Revenue & Customs approval. Also,where the relevant performance conditions cannot be determined at the timeoptions become exercisable pursuant to the Scheme, the Independent Directorshave exercised their discretion to treat the relevant performance conditions assatisfied and therefore the related options will be exercisable in full. Awards under the Chorion Long Term Incentive Plan that are not already vestedwill vest immediately prior to and conditional upon the Court sanctioning theScheme. To the extent that the relevant performance conditions cannot bedetermined at this time, the Independent Directors have exercised theirdiscretion to allow awards to vest in full. All Chorion Shares issued on the exercise of options prior to the Scheme RecordTime will be subject to the terms of the Scheme. The Scheme will not extend toChorion Shares issued, including on the exercise of options, on or after theScheme Record Time. However, an amendment to the Chorion Articles is to beproposed at the Chorion EGM (and which is set out in the notice of the ChorionEGM at the end of this document) to the effect that Chorion Shares issued on theexercise of options on or after the Scheme Record Time would be automaticallytransferred to Planet Acquisitions in consideration for the payment of such cashconsideration as would have been payable under the Scheme had such ChorionShares been Scheme shares. It is intended that participants who hold subsisting options under the ChorionShare Option Schemes which are underwater (i.e. the exercise price (per share)of such options is greater than 425 pence) will be offered a small cash paymentin consideration of them agreeing to the cancellation of their underwateroptions. 15. Overseas shareholders The implications of the Scheme and the Acquisition for Overseas Shareholders maybe affected by the laws of the relevant jurisdictions. Overseas Shareholdersshould inform themselves about and observe applicable legal requirements. It isthe responsibility of each Overseas Shareholder to satisfy himself as to thefull observance of the laws of the relevant jurisdiction in connectiontherewith, including the obtaining of any governmental, exchange control orother consents which may be required, or the compliance with other necessaryformalities which are required to be observed and the payment of any issue,transfer or other taxes due in such jurisdiction. This document has been prepared for the purposes of complying with English law,the City Code and the AIM Rules and the information disclosed in this documentmay not be the same as that which would have been disclosed if this document hadbeen prepared in accordance with the laws of any other jurisdiction. 16. Transaction Agreement Chorion, Planet Acquisitions and 3i Investments have entered into a TransactionAgreement dated 22 February 2006, under the terms of which the parties haveagreed, amongst other things, to co-operate to implement the Scheme. Details ofthe Transaction Agreement will be set out in the Scheme Document. 17. De-listing of Chorion Shares and re-registration The last day of dealings in, and for registration of transfers of, ChorionShares is expected to be 10 April 2006 (the day of the First Court Hearing),following which the Chorion Shares will be suspended from trading on AIM. Prior to the Scheme becoming effective, application will be made to the LondonStock Exchange for cancellation of the Chorion Shares from trading on AIM. Ifthe Court confirms the Capital Reduction on 12 April 2006, it is expected thatthe delisting will become effective on 13 April 2006. On the Effective Date, share certificates in respect of Scheme Shares will ceaseto be valid. In addition, on the Effective Date, entitlements to Scheme Sharesheld within the CREST system will be cancelled. It is proposed that, following the Scheme becoming effective, and after theChorion Shares have been de-listed, Chorion will be re-registered as a privatecompany. 18. Dealing disclosure requirements Under the provisions of Rule 8.3 of the City Code, if any person is, or becomes,"interested" (directly or indirectly) in one per cent. or more of any class of"relevant securities" of Chorion, all "dealings" in any "relevant securities" ofChorion (including by means of an option in respect of, or a derivativereferenced to, any such "relevant securities") must be publicly disclosed by nolater than 3.30 p.m. (London time) on the business day following the date of therelevant transaction. This requirement will continue until the Effective Dateof the Scheme (or such later date(s) as the Panel may specify). If two or morepersons act together pursuant to an agreement or understanding, whether formalor informal, to acquire an "interest" in "relevant securities" of Chorion, theywill deemed to be a single person for the purpose of Rule 8.3. Under the provisions of Rule 8.1 of the City Code, all dealings in "relevantsecurities" of Chorion by Planet Acquisitions or Chorion, or any of theirrespective "associates", must also be disclosed by no later than 12.00 noon(London time) on the business day following the date of the relevanttransaction. A disclosure table, giving details of the companies whose "relevant securities"and "dealings" should be disclosed, and the number of securities in issue, canbe found on the Takeover Panel's website at www.thetakeoverpanel.org.uk. "Interests in securities" arise, in summary, when a person has long economicexposure, whether conditional or absolute, to changes in the price ofsecurities. In particular, a person will be treated as having an "interest" byvirtue of the ownership or control of securities, or by virtue of any option inrespect of or derivative referenced to, securities. Terms in quotation marks are defined in the City Code, which can also be foundon the Panel's website. If you are in any doubt as to whether or not you arerequired to disclose a dealing under Rule 8, you should consult the Panel. If you are in any doubt as to the application of Rule 8 to you, please contactan independent financial adviser authorised under the Financial Services andMarkets Act 2000, consult the Panel's website at www.thetakeoverpanel.org.uk orcontact the Panel on telephone number +44 (0) 20 7638 0129; fax number +44 (0)20 7236 7013. 19. Disclosure of interests in Chorion Save for three Chorion Shares conditionally contracted to be acquired by thePlanet Acquisitions Group pursuant to the Cancellation Agreement, the ManagementShares, options to purchase or awards in respect of 1,101,535 Chorion Sharesheld by the Management Team and 10,601,400 Chorion Shares held by theIndependent Directors and the other Chorion Shareholders in respect of whichPlanet Acquisitions has received irrevocable undertakings and letters of intentas disclosed above, neither Planet Acquisitions nor, so far as PlanetAcquisitions is aware, any person acting in concert with Planet Acquisitions,owns or controls any Chorion Shares or any securities convertible orexchangeable into Chorion Shares or any rights to subscribe for or purchase thesame, or holds any options (including traded options) in respect of, or has anyoption to acquire, any Chorion Shares or has entered into any derivativesreferenced to Chorion Shares ("Relevant Chorion Securities") which remainoutstanding, nor does any such person hold any short positions in relation toRelevant Chorion Securities (whether conditional or absolute and whether in themoney or otherwise) including any short position under a derivative, anyagreement to sell or any delivery obligation or right to require another personto purchase or take delivery, nor does any such person have any arrangement inrelation to Relevant Chorion Securities. For these purposes, "arrangement"includes any indemnity or option arrangement, any agreement or understanding,formal or informal, of whatever nature, relating to Relevant Chorion Securitieswhich may be an inducement to deal or refrain from dealing in such securities.In the interests of secrecy prior to this Announcement, Planet Acquisitions hasnot made any enquiries in this respect of certain parties which may be deemed bythe Panel to be acting in concert with it for the purposes of the Acquisition(including UBS). Enquiries of such parties will be made as soon as practicablefollowing the date of this Announcement and any material disclosure in respectof such parties will be included in the Scheme Document. 20. General Pursuant to the Senior Facilities Agreement, Planet Acquisitions has agreed notto amend, vary, supplement or waive any Condition without the prior consent of aspecified majority of the lenders. Pursuant to a letter dated 22 February 2006from Planet Acquisitions Holdings to UBS, Planet Acquisitions Holdings hasagreed to procure that Planet Acquisitions will not vary, amend or waive certainof the Conditions without the prior written consent of UBS. The Acquisition will be subject to the requirements of the City Code and will beon the terms and subject to the Conditions set out herein and in Appendix I andto be set out in the Scheme Document. The Scheme Document will include fulldetails of the Scheme, together with notices of the Court Meeting and theChorion EGM and the expected timetable. It will be accompanied by Forms of Proxyfor the Meetings. These will be despatched to Chorion Shareholders and, forinformation only, to holders of options granted under the Chorion Share OptionSchemes and holders of Redeemable Preference Shares, as soon as practicable and,in any event, within 28 days of the date of this Announcement unless agreedotherwise with the Panel. In deciding whether or not to vote in favour of theScheme in respect of their Chorion Shares, Chorion Shareholders should rely onthe information contained in, and follow the procedures described in, the SchemeDocument and Forms of Proxy. As at 7.00am (London time) on 22 February 2006 (the last business day prior tothe date of this announcement), Chorion had 25,488,234 ordinary shares of 30pence in issue (ISIN number GB 0033554287). 21. Enquiries Chorion Telephone: +44 (0) 20 7280 5000John Llewellyn-LloydAndrew McGuinness Rothschild Telephone: +44 (0) 20 7280 5000Warner MandelDominic Wallis Portland PR (Chorion PR enquiries) Telephone: +44 (0) 20 7404 5344Tim Allan 3i Telephone: +44 (0) 20 7928 3131Chris Williams Inaki Echave UBS Telephone: +44 (0) 20 7567 8000Jonathan RowleyJames Simpson Maitland (3i PR enquiries) Telephone: +44 (0) 20 7379 5151Colin Browne Liz Morley The availability of the Proposals and the distribution of this Announcement topersons who are not resident in the UK may be affected by the laws of therelevant jurisdictions in which they are located. Persons who are not residentin the UK should inform themselves of, and observe, any applicable requirements. This Announcement does not constitute an offer to sell, or an invitation topurchase, any securities or the solicitation of any vote or approval in anyjurisdiction. The full terms and conditions of the Scheme will be set out in theScheme Document. Chorion Shareholders are advised to read carefully the formaldocumentation in relation to the Proposals once it has been despatched. UBS, which is regulated in the United Kingdom by the Financial ServicesAuthority, is acting exclusively for 3i and Planet Acquisitions and no one elsein connection with the Proposals and will not be responsible to anyone otherthan 3i and Planet Acquisitions for providing the protections afforded toclients of UBS nor for providing advice in relation to the Proposals, thecontent of this Announcement, or any matter referred to herein. KPMG Corporate Finance, a division of KPMG LLP which is authorised and regulatedby the Financial Services Authority for investment business activities, isacting exclusively for the Management Team as financial adviser in relation tothe Proposals and is not acting for any other person in relation to suchProposals. KPMG Corporate Finance will not be responsible to anyone other thanthe Management Team for providing the protections afforded to its clients or forproviding advice in relation to the contents of this Announcement or any matterreferred to herein. Rothschild, which is regulated in the United Kingdom by the Financial ServicesAuthority, is acting exclusively for Chorion and the Independent Directors andno one else in connection with the Proposals and will not be responsible toanyone other than Chorion and the Independent Directors for providing theprotections afforded to clients of Rothschild nor for providing advice inrelation to the Proposals, the content of this Announcement, or any matterreferred to herein. 22. Appendices Appendix I sets out Conditions to implementation of the Proposals. Appendix II sets out the bases and sources of information from which thefinancial calculations used in this Announcement have been derived. Appendix III contains the definitions of terms used in this Announcement. Appendix I CONDITIONS TO IMPLEMENTATION OF THE PROPOSALS 1. The Proposals will be conditional upon the Scheme becomingunconditional and being implemented by no later than 31 August 2006 or suchlater date as, subject to the City Code, Chorion and Planet Acquisitions mayagree and (if required) the Court may allow. The Scheme will be conditional upon: (i) approval of the Scheme by a majority in number representing 75 percent. or more in value of the Scheme Shareholders who are present and voting,either in person or by proxy, at the Court Meeting or at any adjournment of thatMeeting; (ii) the resolutions to be set out in the notice of the Chorion EGM(namely the Special Resolution and the Ordinary Resolution) being duly passed bythe requisite majority at the Chorion EGM or at any adjournment of that Meeting;and (iii) the sanction (with or without modification (but subject to suchmodification being acceptable to Chorion and Planet Acquisitions)) of the Schemeand the confirmation of the Capital Reduction by the Court, office copies of theCourt Orders and of the minute confirming the Capital Reduction being deliveredfor registration to the Registrar of Companies and, in the case of the CourtOrder confirming the Capital Reduction, registration of such Court Order by him. 2. Chorion and Planet Acquisitions have agreed that, subject asstated in paragraph 4 below, application to the Court to sanction the Scheme andto confirm the Capital Reduction will not be made unless Conditions 1(i) and(ii) above have been fulfilled and, immediately prior to the hearing of thepetition to sanction the Scheme, the following conditions are satisfied orwaived: (a) no government or governmental, quasi-governmental, supranational,statutory, regulatory or investigative body, authority, court, trade agency,association or institution or professional or environmental body or any othersimilar person or body whatsoever in any relevant jurisdiction (each a "RelevantAuthority") having decided to take, institute, implement or threaten any action,proceedings, suit, investigation, enquiry or reference or having required anyaction to be taken or information to be provided or otherwise having doneanything or having made, proposed or enacted any statute, regulation, order ordecision or having done anything which would or might reasonably be expected to: (i) make the Proposals or their implementation, or the acquisition orthe proposed acquisition by Planet Acquisitions of any shares or othersecurities in, or control of, Chorion or any member of the Wider Chorion Groupvoid, illegal or unenforceable in any jurisdiction, or otherwise directly orindirectly restrain, prohibit, restrict, prevent or delay materially the same orimpose additional conditions or financial or other obligations with respectthereto, or otherwise challenge or interfere therewith; (ii) impose any material limitation on the ability of any member of thePlanet Acquisitions Group or any member of the Wider Chorion Group to conductall or any part of their respective businesses or to own or control any of theirrespective assets or properties or any material part thereof; (iii) impose any material limitation on, or result in any material delayin, the ability of any member of the Planet Acquisitions Group or any member ofthe Wider Chorion Group to acquire, hold or exercise effectively, directly orindirectly, all or any rights of ownership of Chorion Shares or any shares orsecurities convertible into Chorion Shares or to exercise voting or managementcontrol over any member of the Wider Chorion Group; (iv) require any member of the Planet Acquisitions Group and/or of theWider Chorion Group to acquire or repay any shares or other securities in and/orindebtedness of any member of the Wider Chorion Group; (v) impose any material limitation on the ability of any member ofthe Planet Acquisitions Group and/or of the Wider Chorion Group to integrate orco-ordinate its business, or any material part of it, with the business of anymember of the Wider Chorion Group or of the Planet Acquisitions Grouprespectively; or (vi) otherwise adversely affect any or all of the businesses, assets,financial or trading position, profits or prospects of any member of the WiderChorion Group, in each case to an extent which is material in the context of the Wider ChorionGroup taken as a whole; (b) all authorisations, orders, grants, recognitions, confirmations,licences, certificates, consents, clearances, permissions and approvals ("authorisations") reasonably deemed necessary or appropriate by PlanetAcquisitions in any jurisdiction for or in respect of the Proposals or theacquisition or proposed acquisition by Planet Acquisitions of any shares orother securities in, or control of, Chorion or the carrying on by any member ofthe Wider Chorion Group of its business or in relation to the affairs of anymember of the Wider Chorion Group having been obtained in terms and in a formreasonably satisfactory to Planet Acquisitions from all appropriate RelevantAuthorities or (without prejudice to the generality of the foregoing) from anypersons or bodies with whom any member of the Wider Chorion Group has enteredinto contractual arrangements in each case where the absence of any suchauthorisations would have a material adverse effect on the Wider Chorion Grouptaken as a whole and all such authorisations remaining in full force and effectand all filings necessary for such purpose having been made and there being nonotice or intimation of any intention to revoke, suspend, materially or not torenew the same at the Effective Date and all necessary filings and applicationshaving been made and all statutory or regulatory obligations in any relevantjurisdiction having been materially complied with in each case as may benecessary in connection with the Proposals and their implementation or theacquisition or proposed acquisition by Planet Acquisitions of any shares orother securities in, or control of, Chorion or any member of the Wider ChorionGroup; (c) except as disclosed in Chorion's annual report and accounts for theyear ended 31 December 2004 or in the interim results statement of Chorion forthe six months ended on 30 June 2005 or as otherwise publicly announced througha Regulatory Information Service (an "RIS") or as otherwise disclosed in writingto any member of the Planet Acquisitions Group or its advisers prior to the dateof this Announcement, there being no provision of any arrangement, agreement,licence, permit, franchise or other instrument to which any member of the WiderChorion Group is a party or by or to which any such member or any of itsrespective assets is or are or may be bound, entitled or subject or anycircumstance which, in consequence of the making of the Acquisition orimplementation of the Proposals or the proposed acquisition of any shares orother securities in, or control of, Chorion by Planet Acquisitions or because ofa change in the control or management of Chorion or otherwise, could reasonablybe expected to result in (to an extent which is material in the context of theWider Chorion Group taken as a whole): (i) any indebtedness or liabilities (actual or contingent) of, or anygrant available to, any member of the Wider Chorion Group being or becomingrepayable or capable of being declared repayable immediately or prior to itsstated maturity or the ability of any such member to borrow monies or incur anyindebtedness being withdrawn or inhibited or capable of being withdrawn orinhibited; (ii) the creation or enforcement of any mortgage, charge or othersecurity interest over the whole or any part of the business, property, assetsor interests of any member of the Wider Chorion Group; (iii) any member of the Wider Chorion Group ceasing to be able to carryon business under any name under which it presently does so; (iv) any such arrangement, agreement, licence, permit, franchise or otherinstrument, or any right, interest, liability or obligation of any member of theWider Chorion Group thereunder being terminated or adversely modified oradversely affected or any adverse action being taken or any onerous obligationor liability arising thereunder; (v) any asset or interest of, or any asset the use of which is enjoyed byany member of the Wider Chorion Group, being or falling to be disposed of orcharged (otherwise than in the ordinary course of business) or ceasing to beavailable to any member of the Wider Chorion Group or any right arising underwhich any such asset or interest could be required to be disposed of or chargedor could cease to be available to any member of the Wider Chorion Groupotherwise than in the ordinary course of business; (vi) any member of the Planet Acquisitions Group and/or of the WiderChorion Group being required to acquire or repay any shares in and/orindebtedness of any member of the Wider Chorion Group; (vii) any adverse change in or adverse effect on the ownership or use ofany intellectual property rights owned or used by any member of the WiderChorion Group; (viii) the value or financial or trading position or prospects of any memberof the Wider Chorion Group being prejudiced or adversely affected in a mannerwhich would be material in the context of the Wider Chorion Group taken as awhole; or (ix) the creation of any material liability, actual or contingent, by anymember of the Wider Chorion Group other than in the ordinary course of trading, and no event having occurred which, under any provision of any sucharrangement, agreement, licence, permit, franchise or other instrument to whichany member of the Wider Chorion Group is a party or by or to which any suchmember or any of its assets may be bound, entitled or subject, might reasonablybe expected to result in any of the events referred to in this paragraph (c) toan extent which is material in the context of the Wider Chorion Group taken as awhole; (d) except as disclosed in Chorion's annual report and accounts for theyear ended 31 December 2004 or in the interim results statement of Chorion forthe six months ended on 30 June 2005 or as otherwise publicly announced throughan RIS or as otherwise disclosed in writing to any member of the PlanetAcquisitions Group or its advisers prior to the date of this Announcement, nomember of the Wider Chorion Group having since 31 December 2004 to an extentwhich is material in the context of the Wider Chorion Group taken as a whole: (i) issued or agreed to issue or authorised or proposed the issue ofadditional shares or securities of any class, or securities convertible into orexchangeable for shares, or rights, warrants or options to subscribe for oracquire any such shares, securities or convertible securities (save for issuesbetween Chorion and any of its wholly-owned subsidiaries or between suchwholly-owned subsidiaries and save for options as disclosed to PlanetAcquisitions or its advisers granted under the Chorion Share Option Schemesbefore the date of this Announcement or the issue of any Chorion Shares allottedupon the exercise of options granted the date of this Announcement under theChorion Share Option Schemes); (ii) recommended, declared, paid or made or proposed to recommend,declare, make or pay any bonus, dividend or other distribution, whether payablein cash or otherwise, other than to another member of the Chorion Group; (iii) save as between wholly-owned subsidiaries of Chorion or betweenChorion and any of its wholly-owned subsidiaries, effected, authorised, proposedor announced its intention to propose any merger, demerger, reconstruction,arrangement, amalgamation, commitment or scheme or any material acquisition,disposal or transfer of assets or shares (other than in the ordinary course ofbusiness) or any right, title or interest in any assets or shares or othertransaction or arrangement in respect of itself or another member of the WiderChorion Group which in each case would be material in the context of the WiderChorion Group taken as a whole; (iv) acquired or disposed of or transferred (other than in the ordinarycourse of business) or mortgaged, charged or encumbered any assets or shares orany right, title or interest in any assets or shares (other than in the ordinarycourse of business) or authorised the same or entered into, varied or terminatedor authorised, proposed or announced its intention to enter into, vary,terminate or authorise any agreement, arrangement, contract, transaction orcommitment (other than in the ordinary course of business and whether in respectof capital expenditure or otherwise) which is of a loss-making, long-term orunusual or onerous nature or magnitude, or which involves or could involve anobligation of such a nature or magnitude or which is other than in the ordinarycourse of business, in each case which is material in the context of the WiderChorion Group taken as a whole; (v) redeemed, purchased, repaid or reduced or proposed the redemption,purchase, repayment or reduction of any part of its share capital or any othersecurities; (vi) save as between Chorion and its wholly-owned subsidiaries, effected,authorised, proposed or announced its intention to propose any change in itsshare or loan capital; (vii) issued, authorised or proposed the issue of or made any change in orto any debentures, or (other than in the ordinary course of business) incurredor increased any indebtedness or liability, actual or contingent, which ismaterial in the context of the Wider Chorion Group taken as a whole; (viii) taken any corporate action or had any proceedings started orthreatened against it for its winding-up (voluntary or otherwise), dissolution,striking-off or reorganisation or for the appointment of a receiver,administrator (including the filing of any administration application, notice ofintention to appoint an administrator or notice of appointment of anadministrator), administrative receiver, trustee or similar officer of all orany material part of its assets or revenues or for any analogous proceedings orsteps in any jurisdiction or for the appointment of any analogous person in anyjurisdiction; (ix) entered into any contract, transaction or arrangement which is orwould be restrictive on the business of any member of the Wider Chorion Group orthe Planet Acquisitions Group other than to a nature and extent which is normalin the context of the business concerned or which is or could involveobligations which would or might reasonably be expected to be so restrictive; (x) entered into any agreement, contract, transaction, arrangement orcommitment (other than in the ordinary course of business) which is material inthe context of the Wider Chorion Group taken as a whole; (xi) been unable or admitted that it is unable to pay its debts orhaving stopped or suspended (or threatened to stop or suspend) payment of itsdebts generally or ceased or threatened to cease carrying on all or asubstantial part of its business or proposed or entered into any composition orvoluntary arrangement with its creditors (or any class of them) or the filing atcourt of documentation in order to obtain a moratorium prior to a voluntaryarrangement or, by reason of actual or anticipated financial difficulties,commenced negotiations with one or more of its creditors with a view torescheduling any of its indebtedness; (xii) made, or announced any proposal to make, any change or addition toany retirement, death or disability benefit or any other employment-relatedbenefit of or in respect of any of its directors, employees, former directors orformer employees; (xiii) save as between Planet Acquisitions and its wholly-ownedsubsidiaries, granted any lease or third party rights in respect of any of theleasehold or freehold property owned or occupied by it or transferred orotherwise disposed of any such property; (xiv) entered into or varied or made any offer (which remains open foracceptance) to enter into or vary the terms of any service agreement with anydirector or senior executive of Chorion or any director or senior executive ofthe Wider Chorion Group; (xv) made any amendment to its memorandum or articles of association; (xvi) waived or compromised any claim otherwise than in the ordinarycourse of business, which is material in the context of the Wider Chorion Grouptaken as a whole; (xvii) taken, entered into or had started or threatened against it in ajurisdiction outside England and Wales any form of insolvency proceeding orevent similar or analogous to any of the events referred to in sub-paragraphs(viii) and (xi) above; or (xviii) agreed to enter into or entered into an agreement or arrangement orcommitment otherwise than in the ordinary course of business or passed anyresolution or announced any intention to effect any of the transactions, mattersor events referred to in this paragraph (d); (e) since 31 December 2004, except as disclosed in Chorion's annualreport and accounts for the year ended 31 December 2004 or in the interimresults statement of Chorion for the six months ended on 30 June 2005 or asotherwise publicly announced through an RIS or as otherwise disclosed in writingto any member of the Planet Acquisitions Group or its advisers prior to the dateof this Announcement: (i) there having been no material adverse change or deterioration inthe business, assets, financial or trading position or profits or prospects ofthe Wider Chorion Group taken as a whole; (ii) no material litigation, arbitration proceedings, prosecution orother legal proceedings to which any member of the Wider Chorion Group is or maybecome a party (whether as claimant or defendant or otherwise), and no materialenquiry or investigation by or complaint or reference to any Relevant Authority,against or in respect of any member of the Wider Chorion Group, having beenthreatened, announced or instituted or remaining outstanding by, against or inrespect of any member of the Wider Chorion Group in any way which is material inthe context of the Wider Chorion Group taken as a whole; and (iii) no contingent or other liability having arisen or become apparentor increased which might be reasonably likely in either case to have a materialadverse effect on the Wider Chorion Group taken as a whole; (f) except as disclosed in Chorion's annual report and accounts for theyear ended 31 December 2004 or in the interim results statement of Chorion forthe six months ended on 30 June 2005 or as otherwise publicly announced throughan RIS or as otherwise disclosed in writing to any member of the PlanetAcquisitions or its advisers prior to the date of this Announcement, PlanetAcquisitions not having discovered: (i) that any financial, business or other information concerningChorion or the Wider Chorion Group which is contained in the informationpublicly disclosed at any time by or on behalf of any member of the WiderChorion Group either publicly or in the context of the Acquisition contains amaterial misrepresentation of fact which has not, prior to the date of thisAnnouncement been corrected by public announcement through an RIS or omits tostate a fact necessary to make the information contained therein not materiallymisleading; (ii) any information which materially affects the import of any suchinformation as is mentioned in sub-paragraph (i) above; or (iii) that any member of the Wider Chorion Group is subject to anyliability, contingent or otherwise, which is not disclosed in the annual reportand accounts of Chorion for the financial year ended 31 December 2004 or theconsolidated interim results of Chorion for the six months ended 30 June 2005which is material in the context of the Wider Chorion Group taken as a whole;and (g) insofar as it is competent to review the Acquisition, the GermanFederal Cartel Office: (i) having notified Planet Acquisitions or 3i (or any other notifyingparty) within one month from receipt of the complete notification that theconditions for a prohibition under Section 36 paragraph 1 of the German ActAgainst Restrictions of Competition are not satisfied; or (ii) not having informed Planet Acquisitions or 3i (or any othernotifying party) within one month from the receipt of the complete notificationthat it has opened an in-depth investigation. 3. Save with the consent of the Panel, the Proposals will lapse and theScheme will not proceed if, before the date of the Court Meeting, followinginvestigation by the Office of Fair Trading or equivalent regulatory authorityin any other relevant jurisdiction (including, without limitation, the GermanFederal Cartel Office or the European Commission), there is a subsequentreference of the Proposals, or any part of the Proposals, to the CompetitionCommission (or in the case of any equivalent regulatory authority in any otherrelevant jurisdiction (including, without limitation, the German Federal CartelOffice or the European Commission) a reference or subjection of the Proposals toa second stage regulatory enquiry). 4. Subject to the requirements of the Panel, Planet Acquisitionsreserves the right to waive in whole or in part, in its discretion, all or anyof the Conditions contained in paragraph 2. 5. If Planet Acquisitions is required by the Panel to make an offer forChorion Shares under the provisions of Rule 9 of the City Code, PlanetAcquisitions may make such alterations to the terms and conditions of theAcquisition as are necessary to comply with the provisions of that Rule. 6. Planet Acquisitions reserves the right to elect to implement theAcquisition by way of a takeover offer. In such event, such offer will beimplemented on the same terms (subject to appropriate amendments, including(without limitation) an acceptance condition set at 90 per cent. of the sharesto which such offer relates), so far as applicable, as those which would applyto the Scheme. Appendix II BASES AND SOURCES OF INFORMATION Save as otherwise stated, the following constitute the bases and sources ofcertain information referred to in this Announcement: 1. Information relating to Chorion has been extracted from therelevant published audited reports and accounts of Chorion and informationrelating to Planet Acquisitions has been provided by the board of PlanetAcquisitions. 2. The value of the entire issued ordinary share capital of Chorion isbased on 25,488,234 Chorion Shares in issue at the date of this Announcement. 3. The value of the diluted share capital of Chorion is based on25,488,234 Chorion Shares in issue and no more than 1,407,938 "in the money"employee share options outstanding over Chorion Shares at the date of thisAnnouncement. Some of these employee share options are subject to performancecriteria that have not yet been met. It is intended that appropriate proposalswill be made to the holders of such employee share options on the basis that theperformance criteria had been satisfied in full and therefore these options arecapable of being exercised in full and, accordingly, such options have beenincluded in the value of the diluted share capital. 4. Unless otherwise stated, all prices quoted for shares are closingmid-market prices and are derived from the AIM Appendices to the Daily OfficialList of the London Stock Exchange. Appendix III DEFINITIONS The following definitions apply throughout this Announcement unless the contextrequires otherwise. "3i" 3i Group plc; "3i Funds" 3i Europartners IVa LP, 3i Europartners IVb LP, 3i Europartners IVc LP, 3i Europartners IVd LP, 3i Europartners IVk LP; "3i Investments" 3i Investments plc, a wholly owned subsidiary of 3i Group plc; "3i Investors" 3i, 3i Funds, 3i Pan European Buy-out 2004-06 LP, 3i Parallel Ventures LP and the Co-investment Plan; "Acquisition" the recommended acquisition of Chorion by Planet Acquisitions by means of the Scheme and the Management Arrangements; "AIM" the AIM market of the London Stock Exchange; "AIM Rules" the rules of the London Stock Exchange governing the admission to and operation of AIM; "Australia" the commonwealth of Australia, its states, territories or possessions; "Business Day" a day (excluding Saturdays, Sundays and UK public holidays) on which banks in London are generally open for business in the City of London; "Canada" Canada, its possessions and territories and all areas subject to its jurisdiction or any political sub-division thereof; "Cancellation Agreement" the Cancellation Agreement dated 22 February 2006 between the Management Team, their connected persons, Planet Acquisitions and Chorion Acquisition Holdings, pursuant to which, conditional upon the sanction of the Scheme, the Management Shares will be cancelled and the Management Team and their connected persons will be issued with Management Loan Notes which they will, in part, exchange for shares in Planet Acquisitions Holdings; "Capital Reduction" the proposed reduction of the capital of the Company in connection with the Scheme; "Chorion Articles" the articles of association of Chorion from time to time; "Chorion EGM" the extraordinary general meeting of Chorion Shareholders (and any adjournment thereof) to be convened in connection with the Proposals; "Chorion Group" Chorion, its subsidiaries and its subsidiary undertakings and, where the context permits, each of them; "Chorion Shareholders" the registered holders of Chorion Shares; "Chorion Share Option Schemes" the New Chorion PLC Trust Replacement Share Option Scheme, the New Chorion PLC Company Replacement Share Option Scheme, the Chorion PLC Unapproved Executive Share Option Scheme and the Chorion PLC Approved Executive Share Option Scheme; "Chorion Shares" the ordinary shares of 30 pence each in the capital of Chorion and "Chorion Share" means any one of them; "Chorion" or "the Company" Chorion PLC; "Closing Price" the closing middle market quotation of a Chorion Share as derived from the AIM appendix to the Daily Official List; "City Code" the City Code on Takeovers and Mergers; "Co-investment Plan" Parallel Ventures (No. 2) Co-investment Plan, a vehicle through which certain executives of Parallel Private Equity Limited and its subsidiaries can invest alongside 3i Parallel Ventures LP in equity investments made by 3i Parallel Ventures LP; "Companies Act" the Companies Act 1985, as amended; "Conditions" the conditions to the implementation of the Proposals (including the Scheme) and the Acquisition which are set out in Appendix I to this Announcement; "connected person" as defined in section 346 of the Companies Act; "Court" the High Court of Justice in England and Wales; "Court Meeting" the meeting of the Scheme Shareholders to be convened pursuant to an order of the Court pursuant to section 425 of the Companies Act for the purpose of considering and, if thought fit, approving the Scheme, and any adjustment thereof; "Court Order(s)" the order of the Court sanctioning the Scheme under section 425 of the Companies Act and the order of the Court confirming the Capital Reduction under section 137 of the Companies Act, or where the context may require, either of them; "Daily Official List" the Daily Official List of the London Stock Exchange; "Effective Date" the date on which an office copy of the order of the Court confirming the Capital Reduction provided for by the Scheme has been delivered to the Registrar of Companies for registration and is registered; "First Court Hearing" the Court Hearing of the petition to sanction the Scheme; "holder" a registered holder; "Independent Directors" John Llewellyn-Lloyd and Andrew McGuinness, who are directors of Chorion; "Japan" Japan, its cities, prefectures, territories and possessions; "KPMG Corporate Finance" KPMG Corporate Finance, a division of KPMG LLP; "London Stock Exchange" The London Stock Exchange plc; "Management Arrangements" the arrangements under which the Management Team (and their connected persons) will be issued with Management Loan Notes (which will in part be exchanged for shares in Planet Acquisitions Holdings) and all other matters relating to the Management Team's proposed investment in, and relationship with, the Planet Acquisitions Group; "Management Loan Notes" the 16.5 per cent. Redeemable loans notes 2016 which will be constituted by an instrument to be executed by Planet Acquisitions; "Management Shares" all of the Chorion Shares held by the Management Team and their connected persons (other than any Chorion Shares to be issued to the Management Team pursuant to the exercise of options under the Chorion Share Option Schemes or transferred to them under the Chorion Long Term Incentive Plan or the Chorion Share Incentive Plan); "Management Team" Waheed Alli, Nicholas James, Sue Murphy and William Astor; "Meetings" the Court Meeting and the Chorion EGM; "New Chorion Shares" the new ordinary shares of 30 pence each in the capital of Chorion to be issued in accordance with the Proposals; "Ordinary Resolution" the ordinary resolution to be proposed at the Chorion EGM in connection with, the approval of the Management Arrangements and arrangements with Planet Acquisitions Holding described in paragraph 6 of this Announcement; "Overseas Shareholders" Chorion Shareholders (or nominees of, or custodians or trustees for Chorion Shareholders) not resident in or citizens of the United Kingdom; "Panel" the Panel on Takeovers and Mergers; "Planet Acquisitions" Planet Acquisitions Limited (incorporated in England and Wales under registered number 5544464 with registered office at 10 Snow Hill, London EC1A 2AL); "Planet Acquisitions Group" Planet Acquisitions and Planet Acquisitions Holdings; "Planet Acquisitions Holdings" Planet Acquisitions Holdings Limited, the parent company of Planet Acquisitions; "Planet Acquisitions Holdings Shares" the two Chorion Shares to be held by Planet Acquisitions Holdings pursuant to the Cancellation Agreement; "Proposals" the Scheme and the other matters to be considered at the Meetings and the Management Arrangements; "Redeemable Preference Shares" 6 per cent. non-convertible redeemable preference shares of £1 each in the capital of Chorion; "Regulatory Information Service" as defined in the AIM Rules; "Resolutions" the Ordinary Resolution and the Special Resolution; "Rothschild" N M Rothschild & Sons Limited; "Scheme" or "Scheme of arrangement" the scheme of arrangement proposed to be made under section 425 of the Companies Act between Chorion, the holders of Scheme Shares, the holders of the Management Shares and Chorion Acquisition Holdings, with or subject to any modification, addition or condition approved or imposed by the Court and agreed to by Chorion and Planet Acquisitions; "Scheme Document" the document to be posted to Chorion Shareholders and others containing, inter alia, the Scheme and the notices of the Meetings; "Scheme Record Time" 6:00p.m. on the Business Day immediately preceding the Second Court Hearing; "Scheme Shareholders" the holders of Scheme Shares; "Scheme Shares" (i) the Chorion Shares in issue at the date of the Scheme Document; (ii) any Chorion Shares issued after the date of the Scheme Document and before the Voting Record Time; and (iii) any Chorion Shares issued at or after the Voting Record Time and before the Scheme Record Time in respect of which the original or any subsequent holders thereof are, or shall have agreed in writing to be, bound by the Scheme, in each case other than the Management Shares, the Planet Acquisitions Holdings Shares and the one Chorion Share to be registered in the name of Planet Acquisitions pursuant to the Cancellation Agreement; "Second Court Hearing" the Court hearing of the petition to confirm the Capital Reduction; "Senior Facilities Agreement" the senior facilities agreement dated 23 February 2006 made between, amongst others, GE Leveraged Loans Limited in its various capacities, Planet Acquisitions Holdings and Planet Acquisitions; "Special Resolution" the special resolution to be proposed at the Chorion EGM in connection with, inter alia, the approval of the Scheme and the sanctioning of the Capital Reduction; "subsidiary" and "subsidiary undertaking" have the meaning given to them in the Companies Act but for those purposes ignoring paragraph 20(1)(b) of Schedule 4A to the Companies Act; "Transaction Agreement" the transaction agreement dated 22 February 2006 between Chorion, Planet Acquisitions and 3i Investments pursuant to which the parties have agreed to implement the Scheme; "UBS" or "UBS Investment Bank" UBS Limited; "UK" or "United Kingdom" The United Kingdom of Great Britain and Northern Ireland; "UKLA" The Financial Services Authority acting in its capacity as the competent authority for the purpose of Part VI of the Financial Services and Markets Act 2000 (as amended); "US" or "United States" the United States of America, its possessions and territories, all areas subject to its jurisdictions thereof, any state of the United States of America and the District of Columbia; "Voting Record Time" 6:00p.m. on the day which is two days before the date of the Court Meeting or the Chorion EGM or, if the Court Meeting or the Chorion EGM is adjourned, 6:00p.m. on the day prior to the day immediately before the date fixed for the adjourned meeting; and "Wider Chorion Group" the Chorion Group and associated undertakings and any other body corporate, partnership, joint venture or persons in which the Chorion Group and such undertakings (aggregating their interests) have an interest of more than 20 per cent. of the voting or equity capital or the equivalent. This information is provided by RNS The company news service from the London Stock Exchange
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| Date | Source | Headline | |
|---|---|---|---|
| 17th May 2006 | 4:24 pm | RNS | Second Court Hearing |
| 16th May 2006 | 7:00 am | RNS | Suspension - Chorion plc |
| 15th May 2006 | 5:11 pm | RNS | First Court Hearing |
| 12th May 2006 | 5:12 pm | RNS | Statement re Timetable |
| 11th May 2006 | 12:52 pm | RNS | Holding(s) in Company |
| 9th May 2006 | 11:51 am | RNS | Rule 8.3- Chorion PLC |
| 8th May 2006 | 10:57 am | RNS | Rule 8.3- Chorion PLC |
| 27th Apr 2006 | 6:16 pm | RNS | Result of EGM |
| 26th Apr 2006 | 3:42 pm | RNS | Rule 8.3- Chorion PLC |
| 20th Apr 2006 | 11:09 am | RNS | Rule 8.3- Chorion Plc |
| 18th Apr 2006 | 6:21 pm | RNS | Posting of Revised Scheme Doc |
| 13th Apr 2006 | 11:27 am | RNS | Rule 8.3- Chorion Plc |
| 12th Apr 2006 | 6:40 pm | RNS | Statement re Possible Offer |
| 7th Apr 2006 | 12:20 pm | RNS | EPT Disclosure |
| 6th Apr 2006 | 5:58 pm | RNS | Rule 8.1- (Chorion Plc) |
| 6th Apr 2006 | 4:41 pm | RNS | Rule 8.3- (Chorion plc) |
| 6th Apr 2006 | 4:30 pm | RNS | Rule 8.3- (Chorion plc) |
| 6th Apr 2006 | 1:31 pm | RNS | Rule 8.1- (Chorion plc) |
| 6th Apr 2006 | 1:14 pm | RNS | Additional purchase of shares |
| 6th Apr 2006 | 12:54 pm | RNS | EPT Disclosure |
| 6th Apr 2006 | 12:30 pm | RNS | Rule 8.3- Chorion PLC |
| 6th Apr 2006 | 12:13 pm | RNS | Rule 8.3- (Chorion plc) |
| 5th Apr 2006 | 5:36 pm | RNS | Increased cash offer |
| 5th Apr 2006 | 3:23 pm | RNS | Holding(s) in Company |
| 3rd Apr 2006 | 5:38 pm | RNS | Holding(s) in Company |
| 3rd Apr 2006 | 11:22 am | RNS | Rule 8.3- Chorion Plc |
| 31st Mar 2006 | 4:05 pm | RNS | Statement re Possible Offer |
| 30th Mar 2006 | 5:46 pm | RNS | Rule 8.3- Chorion PLC |
| 30th Mar 2006 | 2:47 pm | RNS | Rule 8.3 - Chorion Plc |
| 29th Mar 2006 | 3:27 pm | RNS | Rule 8.3 - Chorion Plc |
| 28th Mar 2006 | 12:25 pm | RNS | EPT Disclosure |
| 28th Mar 2006 | 10:15 am | RNS | Holding(s) in Company |
| 28th Mar 2006 | 7:02 am | RNS | Withdrawal of Possible Offer |
| 27th Mar 2006 | 3:19 pm | RNS | Rule 8.3- Chorion Plc |
| 27th Mar 2006 | 12:23 pm | RNS | EPT Disclosure |
| 24th Mar 2006 | 5:00 pm | RNS | Statement re Possible Offer |
| 24th Mar 2006 | 12:08 pm | RNS | EPT Disclosure |
| 23rd Mar 2006 | 4:20 pm | RNS | Response to Press Speculation |
| 23rd Mar 2006 | 11:41 am | RNS | EPT Disclosure |
| 22nd Mar 2006 | 7:00 am | RNS | Statement re Possible Offer |
| 21st Mar 2006 | 11:38 am | RNS | EPT Disclosure - Replacement |
| 20th Mar 2006 | 11:39 am | RNS | EPT Disclosure |
| 17th Mar 2006 | 11:13 am | RNS | EPT Disclosure |
| 17th Mar 2006 | 9:19 am | RNS | Holding(s) in Company |
| 16th Mar 2006 | 11:16 am | RNS | EPT Disclosure |
| 15th Mar 2006 | 12:29 pm | RNS | EPT Disclosure |
| 14th Mar 2006 | 6:03 pm | RNS | Statement re Possible Offer |
| 14th Mar 2006 | 7:00 am | RNS | Final Results |
| 13th Mar 2006 | 11:16 am | RNS | EPT Disclosure |
| 13th Mar 2006 | 8:16 am | RNS | Holding(s) in Company |
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