Offer for Tinopolis PLC

9th May 2008 07:01

Tinopolis PLC09 May 2008 For immediate release NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION IN WHOLE OR IN PART IN OR INTO ORFROM THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN OR ANY OTHER JURISDICTIONWHERE IT IS UNLAWFUL TO DO SO 9 May 2008 Recommended acquisition of Tinopolis plc by Red Dragon Acquisitions Limited, a company formed, and controlled by investment partnerships advised by Vitruvian Partners LLP to be implemented by a scheme of arrangement under Part 26 of the Companies Act 2006 Summary • The Independent Director of Tinopolis and the board of Bidco announcethat they have reached agreement on the terms of a recommended acquisition ofthe entire issued and to be issued share capital of Tinopolis by Bidco. Bidco isa newly incorporated company which has been formed, and is controlled, byinvestment partnerships advised by Vitruvian Partners for the purposes of makingthe Acquisition. • Scheme Shareholders will be entitled to receive for each Scheme Share45 pence in cash. • The Acquisition values the entire issued and to be issued sharecapital of Tinopolis at approximately £44.7 million. The price of 45 pence perScheme Share represents a premium of: o 32.4 per cent. to the Closing Price of 34.0 pence per Tinopolis Shareon 8 May 2008, the last business day prior to the date of this announcement; and o 51.1 per cent. to the average closing price of 29.8 pence per TinopolisShare for the six months prior to the date of this announcement. • The last business day on which the Closing Price of Tinopolis Shareswas 45 pence or above was 14 December 2005. • Tinopolis is one of the leading independent television productioncompanies in the United Kingdom. For the financial year ended 30 September 2007,Tinopolis reported turnover of £66.0 million with a profit from operatingactivities before interest and taxation of £2.2 million. As at 30 September2007, Tinopolis held net cash of £10.9 million. • A committee of the board of Tinopolis comprising the Independent Director has been established for the purposes of progressing the Acquisition and making the recommendations to Tinopolis Shareholders in relation to the Acquisition. + • The Independent Director, who has been so advised by Investec, considers the terms of the Acquisition to be fair and reasonable. In providing its advice to the Independent Director, Investec has taken into account the commercial assessment of the Independent Director. + • Accordingly, the Independent Director intends to recommend that Tinopolis Shareholders vote in favour of the Acquisition at the Court Meeting and the General Meeting as the Independent Director has irrevocably undertaken to do in respect of his entire beneficial holding of 3,094,235 Tinopolis Shares, representing approximately 3.2 per cent. of the entire issued share capital of Tinopolis. The Acquisition is expected to be effected by means of a scheme of arrangement between Tinopolis and the Tinopolis Shareholders under Part 26 of the Companies Act 2006. This procedure involves an application by Tinopolis to the Court to sanction the Scheme and to confirm the cancellation of the Scheme Shares and the Executive Managers' Shares. • The implementation of the Scheme will be subject to the Conditions andcertain further terms referred to in Appendix I to this announcement and to beset out in the Scheme Document. To become effective, the Scheme will require,amongst other things, the following events to occur: o a resolution to approve the Scheme being passed by a simple majority innumber of the Scheme Shareholders present, entitled to vote and voting at theCourt Meeting (or at an adjournment thereof), either in person or by proxy,representing not less than 75 per cent. in value of Scheme Shares voted at theCourt Meeting (or at any adjournment thereafter); o a special resolution to approve and implement the Scheme, the CapitalReduction and amendments to the articles of association of Tinopolis beingpassed at the General Meeting; o an ordinary resolution to approve on a poll the arrangements betweenBidco and the Executive Managers being passed at the General Meeting; and o the sanction of the Scheme and confirmation of the Capital Reduction bythe Court and office copies of the Court Orders being delivered to the Registrarand, in the case of the Capital Reduction, such Court Order together with theminute of the Capital Reduction being registered by the Registrar. • Upon the Scheme becoming effective, it will be binding on allTinopolis Shareholders, irrespective of whether they attended or voted at theCourt Meeting or the General Meeting (and if they attended and voted, whether ornot they voted in favour). • It is anticipated that the Executive Managers will invest by way of rollover approximately £4.3 million in Bidco Ordinary Shares (and, indirectly, shares and loan notes in the Bidco Group) and additionally approximately £0.2 million in shares and loan notes in companies in the Bidco Group. Certain of the Tinopolis Shares held by the Executive Managers will be cancelled in consideration for the issue of Bidco Ordinary Shares. The remainder of the Tinopolis Shares held by the Executive Managers will be treated as Scheme Shares under the Scheme. Consequently, none of the Executive Managers will be entitled to vote on the resolution to approve the Scheme to be proposed at the Court Meeting or the ordinary resolution to approve such arrangements between Bidco and the Executive Managers to be proposed at the General Meeting. • The board of Bidco has received irrevocable undertakings to: (i) vote in favour of the Acquisition at the Court Meeting; (ii) vote in favour of the resolutions required to implement the Acquisition to be proposed at the General Meeting; and (iii) to accept any potential takeover offer subsequently made by Bidco in respect of the entire shareholdings of the following Tinopolis Shareholders, amounting to 32,696,854 Tinopolis Shares in total, representing approximately 34.2 per cent. of the entire issued share capital of Tinopolis: • the Independent Director in respect of 3,094,235 Tinopolis Shares,representing approximately 3.2 per cent. of the entire issued share capital ofTinopolis; • Clement Jones in respect of 1,313,920 Tinopolis Shares, representingapproximately 1.4 per cent. of the entire issued share capital of Tinopolis; and • Schroder Investment Management Limited and SVM Asset ManagementLimited in respect of, in aggregate, 28,288,699 Tinopolis Shares, representingapproximately 29.6 per cent. of the entire issued share capital of Tinopolis. • The board of Bidco has also received irrevocable undertakings to: (i) vote in favour of the Acquisition at the Court Meeting; (ii) vote in favour of the resolutions required to implement the Acquisition to be proposed at the General Meeting; and (iii) to accept any potential takeover offer subsequently made by Bidco in respect of the entire shareholdings of the Executive Managers (being Ron Jones, John Glynog Davies, Angharad Mair, Rhian Thomas, Arwel Rees and Jeff Foulser), together with the trustees of the Park Street Trust in respect of, in aggregate, 20,338,193 Tinopolis Shares, representing approximately 21.3 per cent. of the entire issued share capital of Tinopolis. These irrevocable undertakings have been waived by Bidco in relation to the Court Meeting and in relation to the ordinary resolution proposed at the General Meeting in connection with the Management Arrangements, as the Executive Managers are not entitled to vote at the Court Meeting or on such ordinary resolution. • In aggregate, therefore, Bidco has received irrevocable undertakingsto vote at the General Meeting: in favour of the special resolution to approveand implement the Scheme, the Capital Reduction and amendments to the articlesof association of Tinopolis to be proposed at the General Meeting, in respect of53,035,047 Tinopolis Shares, representing approximately 55.6 per cent. of theexisting issued share capital of Tinopolis entitled to vote on such resolution. • The irrevocable undertaking given by Schroder Investment Management Limited will lapse in the event of an offer being made by a third party which is, in their reasonable opinion, an improvement of 10 per cent on the value of the consideration offered under the Acquisition. It will also lapse in respect of any relevant Tinopolis Shares in circumstances where Schroder Investment Management Limited transfers such Tinopolis Shares to a replacement fund manager or custodian in circumstances where a relevant client has terminated or altered its professional relationship with Schroder Investment Management Limited or if Schroder Investment Management Limited is instructed otherwise by a relevant client. . The other irrevocable undertakings referred to above will not lapse in the event of receipt by the Company of a higher competing offer. It is expected that the Scheme Document will be posted by late May 2008 and that the Court Meeting and the General Meeting to approve the Acquisition will be held on 16 June 2008. Subject to shareholder approval and the satisfaction or waiver of the other Conditions it is expected that the Scheme will become effective in the first half of July 2008. KPMG Corporate Finance is acting as financial adviser to Bidco. Investec is acting as financial adviser to Tinopolis and is also Tinopolis' nominated adviser for the purposes of the AIM Rules for Companies. Commenting on the Acquisition, Rhys Davies, the Independent Director of Tinopolis said: "The Acquisition by Vitruvian Partners LLP represents an opportunity forTinopolis Shareholders to realise their entire investment in Tinopolis, in cashat a premium to the current Tinopolis Share price, within a relatively shortperiod of time. Moreover, the Acquisition fairly reflects the Company's futuregrowth prospects from executing its business plan as a publicly listed company." Commenting on the Acquisition, Ron Jones, the Chairman of Tinopolis said: "In Vitruvian we have found the right partner for the next stage in thisCompany's development. There are many opportunities out there and my entire teamis enthusiastic about the future and what this partnership can achieve." Commenting on the Acquisition, Toby Wyles, Managing Partner of VitruvianPartners said: "We are delighted to be able to support Ron Jones and the management team atTinopolis in the next stage of the development of the Company. We have greatrespect for the management team at Tinopolis and the business they have built.We are keen to work with them and to provide financial support to helpaccelerate the growth of Tinopolis and to exploit new opportunities as thecontent and new media markets continue to evolve rapidly." This summary should be read in conjunction with, and is subject to, the fulltext of the announcement (including its appendices) which forms an integral partof this summary. The Acquisition will be subject to the Conditions and certain further terms setout in Appendix I to this announcement and to be set out in the Scheme Document. Enquiries Bidco Tel: +44 (0) 20 7152 6503Toby Wyles / Ben Johnson KPMG Corporate Finance, financial adviser to Bidco Tel: +44 (0) 20 7311 1000David Elms Financial Dynamics Tel: +44 (0) 20 7831 3113Charles Palmer Tinopolis Tel: +44 (0) 15 5488 0880Ron Jones / Arwel Rees Investec, financial adviser and nominated adviser to Tel: +44 (0) 20 7597Tinopolis 5970 Martin Smith The Scheme Document, containing further details of the Acquisition (includingnotices of a Court Meeting and a General Meeting) together with the Forms ofProxy, will be posted to Tinopolis Shareholders and, for information only, toparticipants in the Tinopolis Share Schemes and the holders of the Warrant assoon as practicable and in any event within 28 days of this announcement, unlessotherwise agreed with the Panel. The directors of Bidco and the investment committee of Vitruvian Partners (allof whose names will be set out in the Scheme Document) accept responsibility forthe information contained in this announcement save for the information forwhich the investment committee of Vitruvian Partners alone acceptsresponsibility, as set out below and the information for which the directors ofTinopolis or the Independent Director accept responsibility, as set out below.To the best of the knowledge and belief of the directors of Bidco and theinvestment committee of Vitruvian Partners (who have taken all reasonable careto ensure that such is the case), such information for which they areresponsible is in accordance with the facts and does not omit anything likely toaffect the import of such information. The investment committee of Vitruvian Partners accepts responsibility for theinformation relating to Vitruvian Partners and the Vitruvian Fund. To the bestof the knowledge and belief of the investment committee of Vitruvian Partners(who have taken all reasonable care to ensure that such is the case), suchinformation for which they are responsible is in accordance with the facts anddoes not omit anything likely to affect the import of such information. The directors of Tinopolis (all of whose names will be set out in the SchemeDocument) accept responsibility for the information contained in thisannouncement relating to Tinopolis, the Tinopolis Group and themselves and theirimmediate families, related trusts and connected persons. To the best of theknowledge and belief of the directors of Tinopolis (who have taken allreasonable care to ensure that such is the case), such information for whichthey are responsible is in accordance with the facts and does not omit anythinglikely to affect the import of such information. The Independent Director accepts responsibility for his recommendation of theAcquisition contained in this announcement. To the best of the knowledge andbelief of the Independent Director (who has taken all reasonable care to ensurethat such is the case), such information for which he is responsible is inaccordance with the facts and does not omit anything likely to affect the importof such information. KPMG Corporate Finance, a division of KPMG LLP which is authorised and regulatedby the Financial Services Authority for investment business activities, isacting for Bidco as financial adviser in relation to the potential Acquisitionand is not acting for any other person in relation to the potential Acquisition.KPMG Corporate Finance will not be responsible to anyone other than Bidco forproviding the protections afforded to its clients or for providing advice inrelation to the contents of this announcement or any offer or arrangementsreferred to herein. Investec which is authorised and regulated by the Financial Services Authorityis acting exclusively for Tinopolis and no-one else as financial adviser inrelation to the potential Acquisition. Investec will not be responsible toanyone other than Tinopolis for providing the protections afforded to itsclients or for providing advice in relation to the contents of this announcementor any offer or arrangements referred to herein. The availability of the Acquisition or the distribution of this announcement topersons who are not resident in the United Kingdom may be affected by the lawsof the relevant jurisdictions in which they are located. Persons who are notresident in the United Kingdom should inform themselves of, and observe, anyapplicable requirements. Any failure to comply with these restrictions mayconstitute a violation of the securities laws of any such jurisdiction. The Acquisition will not be made available, directly or indirectly, in or intothe United States or by use of the mails of, or by any means or instrumentality(including, without limitation, facsimile or other electronic transmission,telex or telephone) of inter-state or foreign commerce of, or any facility of, anational, state or other securities exchange of, the United States, nor will itbe made available directly or indirectly in or into Canada, Australia or Japanand no person may vote in favour of the Acquisition by any such use, means,instrumentality or facility or from within the United States, Canada, Australiaor Japan or any other such jurisdiction if to do so would constitute a violationof the relevant laws of such jurisdiction. Accordingly, copies of thisannouncement, the Scheme Document and the Forms of Proxy are not being, will notbe and must not be mailed or otherwise forwarded, distributed or sent in, intoor from the United States, Canada, Australia or Japan or any other suchjurisdiction if to do so would constitute a violation of the relevant laws ofsuch jurisdiction and persons receiving this press announcement, the SchemeDocument and the Forms of Proxy (including without limitation custodians,nominees and trustees) must not mail, forward, distribute or send them in, intoor from the United States, Canada, Australia or Japan or any other suchjurisdiction if to do so would constitute a violation of the relevant laws ofsuch jurisdiction The Acquisition will be subject to the applicable rules and regulations of theLondon Stock Exchange and the City Code. Cautionary note regarding forward looking statements This document contains certain forward-looking statements with respect to thefinancial condition, results of operations and business of Tinopolis, theAcquisition and certain plans and objectives of the boards of Tinopolis andBidco with respect thereto. These forward-looking statements can be identifiedby the fact 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 statementsare based on assumptions and assessments made by the boards of Tinopolis andBidco in light of their experience and their perception of historical trends,current conditions, expected future developments and other factors they believeappropriate. By their nature, forward-looking statements involve risk anduncertainty, because they relate to events and depend on circumstances that willoccur in the future and the factors described in the context of suchforward-looking statements in this document could cause actual results anddevelopments to differ materially from those expressed in or implied by suchforward-looking statements. Although Tinopolis and Bidco believe that theexpectations reflected in such forward-looking statements are reasonable,Tinopolis and Bidco can give no assurance that such expectations will prove tohave been correct and Tinopolis and Bidco therefore caution you not to placeundue reliance on these forward-looking statements which speak only as at thedate of this document. 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 Tinopolis, all ''dealings'' in any ''relevantsecurities'' of Tinopolis (including by means of an option in respect of, or aderivative referenced to, any such ''relevant securities'') must be publiclydisclosed by no later than 3.30 p.m. (London time) on the business day followingthe date of the relevant transaction. This requirement will continue until thedate on which an offer becomes, or is declared, unconditional as to acceptances,lapses or is otherwise withdrawn or on which the ''offer period'' otherwiseends. If two or more persons act together pursuant to an agreement orunderstanding, whether formal or informal, to acquire an ''interest'' in''relevant securities'' of Tinopolis, they will be deemed to be a single personfor the purpose of Rule 8.3. Under the provisions of Rule 8.1 of the City Code, all ''dealings'' in''relevant securities'' of Tinopolis by Bidco, or by any of their respective''associates'', must be disclosed by no later than 12.00 noon (London time) onthe business day following the date of the relevant transaction. A disclosuretable, giving details of the companies in whose ''relevant securities''''dealings'' should be disclosed, and the number of such securities in issue,can be found on the Panel 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 quotations marks are defined in the City Code, which can also be foundon the Panel's website at www.thetakeoverpanel.org.uk. If you are in any doubtas to the application of Rule 8 to you or whether or not you are required todisclose a ''dealing'' under Rule 8, you should consult the Panel. Rule 2.10 Disclosure In accordance with Rule 2.10 of the City Code, the Company confirms that it has95,465,888 Tinopolis Shares of 2 pence each in issue (excluding Tinopolis Sharesheld in treasury) and admitted to trading on AIM under the ISIN codeGB0009365692. For immediate release NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION IN WHOLE OR IN PART IN OR INTO ORFROM THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN OR ANY OTHER JURISDICTIONWHERE IT IS UNLAWFUL TO DO SO 9 May 2008 Recommended acquisition of Tinopolis plc by Red Dragon Acquisitions Limited, a company formed, and controlled by investment partnerships advised by Vitruvian Partners LLP to be implemented by a scheme of arrangement under Part 26 of the Companies Act 2006 1. Introduction The Independent Director and the board of Bidco are pleased to announce thatthey have reached agreement on the terms of a recommended acquisition of theentire issued and to be issued share capital of Tinopolis by Bidco. It isintended that the Acquisition is to be effected by means of a scheme ofarrangement between Tinopolis and its shareholders under Part 26 of theCompanies Act 2006 (or should Bidco so elect and subject to the consent of thePanel, by means of the Offer). Bidco is a newly incorporated company which has been formed, and is controlledby investment partnerships advised by Vitruvian Partners for the purposes ofmaking the Acquisition. In view of their arrangements with Bidco as described in paragraph 3 below, RonJones, Arwel Rees and Angharad Mair and, in view of his continuing role inTinopolis in the event of the Acquisition being successful, John Willis, areeach regarded as having a conflict of interest in relation to the Acquisition. Acommittee of the board of Tinopolis comprising the Independent Director, RhysDavies (Non-Executive Director), has therefore been established for the purposesof progressing the Acquisition, considering all matters relating to theAcquisition and making the recommendations to Tinopolis Shareholders in relationto the Acquisition. 2. The Acquisition Under the terms of the Scheme, which will be subject to the Conditions andcertain further terms set out in Appendix I to this announcement and to be setout in the Scheme Document, Scheme Shareholders will be entitled to receive: for each Scheme Share 45 pence in cash The Acquisition values the entire issued and to be issued share capital ofTinopolis at approximately £44.7 million. The price of 45 pence per Scheme Share represents a premium of: • 32.4 per cent. to the Closing Price of 34.0 pence per Tinopolis Shareon 8 May 2008, the last business day prior to the date of this announcement; and • 51.1 per cent. to the average Closing Price of 29.8 pence per Tinopolis Share for the six months prior to the date of this announcement. The last business day on which the Closing Price of Tinopolis Shares was 45pence or above was 14 December 2005. The Scheme Document, containing further details of the Acquisition (includingnotices of a Court Meeting and a General Meeting) together with the Forms ofProxy, will be posted to Tinopolis Shareholders, and, for information only toparticipants in the Tinopolis Share Schemes and holders of the Warrant as soonas practicable and in any event within 28 days of this announcement, unlessotherwise agreed with the Panel. Resolutions to, amongst other things, approvethe Scheme and the Capital Reduction will be put to Tinopolis Shareholders atthe Court Meeting and the General Meeting, respectively. It is expected that theCourt Meeting and the General Meeting to approve the Acquisition will be held on16 June 2008. Subject to shareholder approval and the satisfaction or waiver ofthe other Conditions, it is expected that the Scheme will become effective inthe first half of July 2008. For details of how the Executive Managers' Shares will be treated pursuant tothe Scheme, please see paragraph 3 below. 3. Arrangements between Bidco and the Executive Managers The board of Bidco believes that the ongoing participation in the continuedgrowth of the Tinopolis Group by the Executive Managers (being Ron Jones, ArwelRees, Jeff Foulser, Angharad Mair, Rhian Thomas and John Glynog Davies) is veryimportant, due to their existing relationship with customers and suppliers.Therefore the Executive Managers have reached agreement with Bidco in relationto the Management Arrangements under which, inter alia, it is anticipated thatthey will invest approximately £4.3 million (being funded from approximately53.8 per cent of their gross proceeds from the Acquisition) in Bidco OrdinaryShares and approximately £0.2 million (being funded from their own resources) inshares and loan notes in other companies in the Bidco Group, which together willgive them an economic entitlement to approximately 28.3 per cent of the equityin Luxco and approximately £4.5 million of nominal value in loan notes inHoldco. Accordingly, certain of the Tinopolis Shares held by Executive Managers' are notclassified as Scheme Shares but as Executive Managers' Shares. As part of theAcquisition, the Executive Managers' Shares will be reclassified as A OrdinaryShares and upon cancellation of the A Ordinary Shares, the Executive Managerswill receive Bidco Ordinary Shares as consideration for such cancellation. SuchA Ordinary Shares will be exchanged, indirectly for equity in Luxco and loannotes in Holdco. Luxco and Holdco are other companies in the Bidco Group.Further details of Bidco's holding company structure will be set out in theScheme Document. The Executive Managers will remain in place to operate the Company once theScheme becomes effective on the basis of their current service contracts,subject to certain agreed amendments. The Company will propose an ordinary resolution at the General Meeting, to bevoted on by way of poll, pursuant to which Tinopolis Shareholders will be askedto approve the arrangements between Bidco and the Executive Managers. None ofthe Executive Managers will be entitled to vote on this resolution or theresolution to approve the Scheme to be proposed at the Court Meeting. Investec considers the terms of the arrangements with the Executive Managers tobe fair and reasonable so far as other Tinopolis Shareholders are concerned. 4. Responsibility for considering the Acquisition and recommendation By reason of the executive directors' of Tinopolis (being Ron Jones, Arwel Rees,Angharad Mair and John Willis) arrangements with the Bidco Group and orTinopolis upon the Scheme becoming effective each of them are deemed to have aconflict of interest in relation to the Acquisition. A committee of the board ofTinopolis comprising the Independent Director has therefore been established forthe purposes of progressing the Acquisition, considering all matters relating tothe Acquisition and making the recommendation to Tinopolis Shareholders inrelation to the Acquisition. The Independent Director, who has been so advised by Investec, considers theterms of the Acquisition to be fair and reasonable. In providing its advice tothe Independent Director, Investec has taken into account the commercialassessment of the Independent Director. Accordingly, the Independent Director intends to recommend that TinopolisShareholders vote in favour of the resolutions to be proposed at the CourtMeeting and the General Meeting as the Independent Director has irrevocablyundertaken to do in respect of his entire beneficial holding of 3,094,235Tinopolis Shares, representing approximately 3.2 per cent. of the entire issuedshare capital of Tinopolis. 5. Irrevocable undertakings The board of Bidco has received irrevocable undertakings to: (i) vote in favourof the Acquisition at the Court Meeting; (ii) vote in favour of the resolutionsrequired to implement the Acquisition to be proposed at the General Meeting; and(iii) to accept any potential takeover offer subsequently made by Bidco inrespect of the entire shareholdings of the following shareholders, amounting to32,696,854 Tinopolis Shares in total, representing approximately 34.2 per cent.of the entire issued share capital of Tinopolis: • the Independent Director in respect of 3,094,235 Tinopolis Shares, representing approximately 3.2 per cent. of the entire issued share capital of Tinopolis; • Clement Jones in respect of 1,313,920 Tinopolis Shares, representing approximately 1.4 per cent. of the entire issued share capital of Tinopolis; and • Schroder Investment Management Limited and SVM Asset Management Limited in respect of, in aggregate, 28,288,699 Tinopolis Shares, representing approximately 29.6 per cent. of the entire issued share capital of Tinopolis. The board of Bidco has also received irrevocable undertakings to: (i) vote infavour of the Acquisition at the Court Meeting; (ii) vote in favour of theresolutions required to implement the Acquisition to be proposed at the GeneralMeeting; and (iii) to accept any potential takeover offer subsequently made byBidco in respect of the entire shareholdings of the Executive Managers (beingRon Jones, John Glynog Davies, Angharad Mair, Rhian Thomas, Arwel Rees and JeffFoulser), together with the trustees of the Park Street Trust in respect of, inaggregate, 20,338,193 Tinopolis Shares, representing approximately 21.3 percent. of the entire issued share capital of Tinopolis. These irrevocableundertakings have been waived by Bidco in relation to the Court Meeting and inrelation to the ordinary resolution proposed at the General Meeting inconnection with the Management Arrangements, as the Executive Managers are notentitled to vote at the Court Meeting or on such ordinary resolution. Theseirrevocable undertakings permit the transfer of the relevant Tinopolis Shares toMC 432 Limited or MC 433 Limited (being two special purpose vehicles establishedby those individuals) if such transferees have in advance of such transfergranted irrevocable undertakings to Bidco in similar terms. In aggregate, therefore, Bidco has received irrevocable undertakings to vote atthe General Meeting: in favour of the special resolution to approve andimplement the Scheme, the Capital Reduction and amendments to the articles ofassociation of Tinopolis to be proposed at the General Meeting, in respect of53,035,047 Tinopolis Shares, representing approximately 55.6 per cent. of theexisting issued share capital of Tinopolis entitled to vote on such resolution. The irrevocable undertaking given by Schroder Investment Management Limited willlapse in the event of an offer being made by a third party which is, in theirreasonable opinion, an improvement of 10 per cent on the value of theconsideration offered under the Acquisition. It will also lapse in respect ofany relevant Tinopolis Shares in circumstances where Schroder InvestmentManagement Limited transfers such Tinopolis Shares to a replacement fund manageror custodian in circumstances where a relevant client has terminated or alteredits professional relationship with Schroder Investment Management Limited or ifSchroder Investment Management Limited is instructed otherwise by a relevantclient. The other irrevocable undertakings referred to above will not lapse inthe event of receipt by the Company of a higher competing offer. 6. Background to and reasons for recommending the Acquisition Over the past five years, Tinopolis has developed its business into one of theleading independent television production companies in the United Kingdom. Ithas sought to build value for Tinopolis Shareholders by emphasising organicgrowth opportunities, focusing on long term contracted revenues with a widerange of customers and selectively adding further complementary businesses whereit can apply its business approach and skills. The Welsh, Sports and Interactive businesses have historically delivered strongorganic growth and built their level of forward contracted revenues, whilst theMentorn business, although continuing to be loss-making, has significantlyimproved its financial performance under Tinopolis' ownership. Tinopolis has evaluated several sizable acquisition opportunities since itsacquisition of The Television Corporation PLC in January 2006. However, thevaluation attributed to the Company by the equity market has, in the TinopolisDirectors' opinion, limited its ability to finance such acquisitions throughissuing new equity as many assets in the United Kingdom independent televisionproduction sector have been valued at higher valuation multiples than those atwhich Tinopolis has traded since January 2006. Since January 2006, Tinopolis has acquired two smaller businesses, Video ArtsGroup Limited and APP Broadcast Limited, for a total of £3.5 million in initialcash consideration and further deferred consideration of up to £550,000, to besatisfied by a mix of both cash and Tinopolis Shares. Both acquisitions havebeen earnings accretive and strategically beneficial. Tinopolis has also boughtback 4,650,000 Tinopolis Shares for £1.9 million (equivalent to an average priceof 39.9 pence for each Tinopolis Share) during the 2007 financial year. In late December 2007, Tinopolis received an indicative approach from VitruvianPartners regarding its interest in making a possible offer for the Company, withthe intention of retaining the management team to run the Company in privateownership. The Independent Director has evaluated the proposals from VitruvianPartners on behalf of Tinopolis Shareholders as a whole. During preliminary discussions held in January 2008, Vitruvian Partnersdemonstrated a high level of interest in the Company which, combined with theconstraints on Tinopolis in acquiring complementary businesses, convinced theIndependent Director of the merits of allowing Vitruvian Partners to progressthis interest and to conduct a limited due diligence exercise in co-operationwith the Company. The discussions have resulted in the proposed recommendedacquisition of Tinopolis by Bidco at a price of 45 pence in cash for each SchemeShare. The Acquisition represents an opportunity for Scheme Shareholders to realise thevalue of their investment at an attractive premium to the current market valueof the Company. At a price of 45 pence per Scheme Share, representing anenterprise value of approximately £32.5 million as at 30 September 2007(reflecting approximately £10.9 million of net cash held by Tinopolis at 30September 2007 and cash which would be received by the Company on the exerciseof share options under the Share Schemes of approximately £1.3 million) and anequity value of £44.7 million, the Acquisition represents: • an enterprise valuation multiple of 9.8 times Tinopolis' profit fromoperating activities before interest, tax, depreciation and amortisation of £3.3million for the year ended 30 September 2007; • an enterprise valuation multiple of 15.0 times Tinopolis' profit fromoperating activities before interest and tax of £2.2 million for the year ended30 September 2007; • an equity valuation multiple of 24.3 times Tinopolis' net earnings of£1.8 million for the year ended 30 September 2007; • a premium of 32.4 per cent. to the Closing Price of 34.0 pence perTinopolis Share on 8 May 2008, the last business day prior to this announcement;and •a premium of 51.1 per cent. to the average Closing Price of 29.8 pence per Tinopolis Share for the six months prior to this announcement. The last business day on which the Closing Price of Tinopolis Shares was 45pence or above was 14 December 2005. In considering whether to recommend the Acquisition, the Independent Directorhas determined that: • the Acquisition represents an opportunity for Tinopolis Shareholders to realise their entire investment in Tinopolis, in cash and at a premium, within a relatively short period of time and without the operational risks inherent in Tinopolis executing its business plan; and • the Acquisition fairly reflects the Company's future growth prospects. The Independent Director also considered that Tinopolis has received no otherexpressions of interest from potential offerors. Consequently, the Independent Director, who has been so advised by Investec,considers the terms of the Acquisition to be fair and reasonable. In providingits advice to the Independent Director, Investec has taken into account thecommercial assessment of the Independent Director. 7. Background to and reasons for the Acquisition Since its foundation in 1989, Tinopolis has developed into a leading independentmedia company. Vitruvian Partners recognise the significant achievements of theExecutive Managers in developing the Company over the years and intend tosupport the Executive Managers in implementing their existing plans for theTinopolis Group. The turnaround of the Mentorn business, combined with investment in interactiveand new media productions, will be key to delivering future organic growth inrevenue and profitability, alongside Tinopolis' continued growth andprofitability within its sport and Welsh language divisions. In addition,Vitruvian Partners and the Executive Managers have identified a number ofattractive organic and acquisition growth opportunities which Bidco plans topursue in order to reinforce its position in the markets in which it operatesand enhance its prospects for further growth. Given the medium term investment horizon required to pursue this strategy,Vitruvian Partners believes that the next stage of Tinopolis' development wouldbe best achieved under private ownership. 8. Information on Tinopolis Tinopolis is a United Kingdom based independent television production company,with around 2,500 hours of drama, factual, sports and children's programmingproduced each year for more than 200 broadcasters worldwide. Headquartered inLlanelli, Tinopolis has production centres in London, Oxford, Glasgow, Cardiffand Leeds. Tinopolis owns a portfolio of brands, including Mentorn and Sunset +Vine, which produce a range of well known and niche programmes, from the Ashesand the Tour de France sports coverage to Question Time and live Welsh dailyprogrammes Wedi 3 and Wedi 7. Tinopolis is the leading supplier of Welshlanguage programming. The Tinopolis Group also produces a range of interactive,training and education materials for clients including the BBC, Ministry ofDefence and University for Industry. For the financial year ended 30 September 2007, Tinopolis reported turnover of£66.0 million with a profit from operating activities before interest andtaxation of £2.2 million. As at 30 September 2007, Tinopolis held net cash of£10.9 million. 9. Current trading The progress made in integrating the businesses acquired by Tinopolis in 2006and 2007, new commissions and the re-commissioning of its key programmes givesthe board of Tinopolis confidence in the outlook for Tinopolis. In light ofthis, and combined with its wide range of customers and a lack of dependence onany one contract, Tinopolis is well placed for the financial year 2008. Tradingin the current year to date is in accordance with management expectations. 10. Information on Vitruvian Partners Vitruvian Partners is an independent private equity firm that specialises inmiddle-market buyouts, growth buyouts and growth capital investments in theUnited Kingdom and elsewhere in Northern Europe. Vitruvian Partners investmentprofessionals' experience as principals in the investment industry dates back to1990 and demonstrates an ability to invest successfully over multiple marketcycles throughout a spectrum of industries. Vitruvian Partners aims to invest in companies across northern Europe including,the United Kingdom, Eire, Germany, the Nordic Region, the Netherlands, Belgium,Switzerland and Austria. Vitruvian Partners focuses on investments in fastermoving, less capital intensive industries such as media, information technology,telecoms, financial services, business services and leisure. Vitruvian Partners acts as discretionary manager to the Vitruvian Fund whichcomprises total commitments of €925 million. The fund closed to new commitmentsin February 2008. Vitruvian Partners' investment focus is on companies operatingin 'dynamic situations' where there is an opportunity to build strategic valuein such businesses as they go through significant change. The Vitruvian Fund will target investments of €15 million to €150 milliontypically in the sectors referred to above. In December 2007, Vitruvian Partnersannounced the Vitruvian Fund's first investment, the buyout of the LatitudeGroup, a UK based independent internet search marketing agency. 11. Information on Bidco, its financing and arrangements with the ExecutiveManagers Bidco is a newly incorporated company, which has been formed, and is controlledby investment partnerships advised by Vitruvian Partners, for the purposes ofmaking the Acquisition. The Executive Managers have reached agreement with Bidco in relation to theManagement Arrangements under which, inter alia, they intend to subscribe forequity and debt securities in companies in the Bidco Group, representing afinancial commitment of approximately £4.5 million, based on the value of theproportion of their Tinopolis Shares which are being rolled into Bidco,together, in certain cases, with their own resources which are being invested inthe Bidco Group, as described in paragraph 3 above. The Executive Managers have given certain irrevocable undertakings to Bidco inconnection with the Acquisition. In addition, these Executive Managers have eachundertaken not to solicit, initiate or continue discussions (except whererequired under the City Code or by statutory or fiduciary duty, the Panel andany applicable laws and regulations) with any competing offeror for Tinopolis. The Acquisition is subject to, among other things, the approval of theindependent Tinopolis Shareholders of the Management Arrangements. Investecconsiders the proposed terms of the Management Arrangements to be fair andreasonable as far as the independent Tinopolis Shareholders are concerned. Bidco considers the Management Arrangements to be critical to the success of theAcquisition and therefore if the independent Tinopolis Shareholders do not passthe relevant resolution at the General Meeting approving these arrangements,Bidco may (at its absolute discretion) seek to invoke Condition 1(iii), whichwould result in the Acquisition being withdrawn. Further details of the Management Arrangements will be set out in the SchemeDocument. Bidco has not traded since its date of incorporation, nor has it entered intoany obligations other than in connection with the Acquisition and the financingof the Acquisition. The current Directors of Bidco are Vitruvian Directors ILimited and Vitruvian Directors II Limited. After the Scheme has becomeeffective, Ben Johnson and Toby Wyles are expected to be appointed by VitruvianDirectors I Limited and Vitruvian Directors II Limited to act as theirrepresentative in attending board meetings of Bidco. The Bidco Group will be financed using a combination of equity and debt. TheVitruvian Fund will provide approximately £20.5 million of equity funding and£7.4 million of short term equity funding, in addition to the financialcommitment by the Executive Managers of £4.5 million, based on the value of theproportion of their Tinopolis Shares which are being rolled into Bidco, togetherwith their own resources which, in certain cases, are being invested in theBidco Group. To finance the balance of the consideration due under the terms ofthe Acquisition and to pay certain fees and expenses associated with theAcquisition, the Bidco Group has in place approximately £17 million of debtfinancing under committed facilities arranged and fully underwritten by BarclaysBank PLC and The Governor and Company of the Bank of Ireland and theirrespective affiliates. In addition, Bidco will have £9 million of committedworking capital and acquisition facilities. KPMG Corporate Finance has confirmed that it is satisfied that sufficientresources are available to Bidco to satisfy in full the cash considerationpayable pursuant to the Acquisition. Further details on the financing of theAcquisition will be set out in the Scheme Document. 12. Effect of the Scheme on the Tinopolis Share Schemes and Warrant Appropriate proposals will be made to holders of options/awards under theTinopolis Share Schemes and to the holders of the Warrant in due course. Detailsof these proposals will be set out in the Scheme Document. 13. Directors, management and employees The board of Bidco has given assurances to the Independent Director that,following the Scheme becoming effective, the existing employment rights,including pension rights, of all employees of Tinopolis will be fullysafeguarded. The board of Bidco has confirmed to the Independent Director thatBidco's plans for the Tinopolis Group do not involve any immediate change to thecontinued employment or the terms and conditions of employment of the TinopolisGroup employees nor are there currently any plans to change the principallocations of Tinopolis' business. Following the successful implementation of the Acquisition, Ron Jones, ArwelRees, Angharad Mair and John Willis will continue as executive directors of theCompany. The Independent Director has undertaken to resign from the board of Tinopolisupon the Scheme becoming effective. 14. Disclosure of interests in Tinopolis Save for the Tinopolis Shares specified in the irrevocable undertakings referredto in paragraph 5 above, as at the close of business on 8 May 2008, being thelatest practicable business day prior to the date of this announcement, neitherBidco nor any of the directors of Bidco or Vitruvian Partners, nor, so far asBidco is aware, any person acting in concert with Bidco has: (i) any interest inor right to subscribe for any Tinopolis Shares, nor (ii) any short positions inrespect of Tinopolis Shares (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 (iii) borrowed or lent any Tinopolis Shares(save for any borrowed shares which have been on-lent or sold). 15. Inducement fee Tinopolis has entered into an inducement fee agreement with Vitruvian Partners(on behalf of Bidco) under which Tinopolis has given various undertakings toVitruvian Partners, including an undertaking that it will not solicit orinitiate any possible offer for Tinopolis or any other transaction which isinconsistent with, or an alternative to, the Acquisition. As an inducement to Vitruvian Partners to pursue its discussions with Tinopolisin relation to a possible offer, Tinopolis has agreed under the inducement feeagreement to pay an inducement fee to Vitruvian Partners of one per cent. of thevalue of the Acquisition (inclusive of any VAT), calculated on a fully dilutedbasis. The inducement fee will be payable if, in summary: i) an Independent Inconsistent Transaction is announced before theAcquisition becomes effective or lapses and such Independent InconsistentTransaction subsequently becomes or is declared unconditional in all respects orotherwise completes or becomes effective; or ii) the Independent Director announces that he is recommending orapproving an Independent Inconsistent Transaction; or iii) the Independent Director withdraws his recommendation of theAcquisition or alters or qualifies his recommendation; or iv) the Independent Director refuses to put forward the Scheme to theshareholders of Tinopolis. 16. Structure of the Acquisition The Acquisition is expected to be effected by means of a scheme of arrangementbetween Tinopolis and the Tinopolis Shareholders under Part 26 of the CompaniesAct 2006. This procedure involves an application by Tinopolis to the Court tosanction the Scheme and to confirm the cancellation of Scheme Shares and theExecutive Managers' Shares. The implementation of the Scheme will be subject to the Conditions and certainfurther terms referred to in Appendix I to this announcement and to be set outin the Scheme Document. To become effective, the Scheme will require, amongstother things, the following events to occur: • a resolution to approve the Scheme being passed by a simple majorityin number of the Scheme Shareholders present, entitled to vote and voting at theCourt Meeting (or at an adjournment thereof), either in person or by proxy,representing not less than 75 per cent. in value of Scheme Shares voted at theCourt Meeting (or at any adjournment thereafter); • a special resolution to approve and implement the Scheme, the CapitalReduction and amendments to the articles of association of Tinopolis beingpassed at the General Meeting; • an ordinary resolution to approve on a poll the arrangements betweenBidco and the Executive Managers being passed at the General Meeting; and • the sanction of the Scheme and confirmation of the Capital Reductionby the Court and office copies of the Court Orders being delivered to theRegistrar and, in the case of the Capital Reduction, such Court Order togetherwith the minute of the Capital Reduction being registered by the Registrar. Upon the Scheme becoming effective, it will be binding on all TinopolisShareholders, irrespective of whether they attended or voted at the CourtMeeting or the General Meeting (and if they attended and voted, whether or notthey voted in favour). It is expected that the Scheme Document will be posted by late May 2008 and thatthe Court Meeting and the General Meeting to approve the Acquisition will beheld on or about 16 June 2008. Subject to shareholder approval and thesatisfaction or waiver of the other Conditions, it is expected that the Schemewill become effective at the beginning of July 2008. Further details of the Scheme will be contained in the Scheme Document, whichwill be posted to Tinopolis Shareholders as soon as practicable and in any eventwithin 28 days of this announcement, unless otherwise agreed with the Panel. Save for the shares specified in the irrevocable undertakings referred to inparagraph 5 above, neither Bidco nor any party acting in concert with Bidco ownsor holds any other rights over any Tinopolis Shares. 17. Implementation Agreement Tinopolis and Bidco have entered into the Implementation Agreement whichprovides, inter alia, for the implementation of the Scheme and related mattersin accordance with an agreed indicative timetable and contains certainassurances and confirmations between the parties, including provisions toimplement the Scheme on a timely basis and governing the conduct of the businessof the Tinopolis Group. The Implementation Agreement terminates in certain circumstances, including: •if the Acquisition is not sanctioned by the Tinopolis Shareholders; • if the Acquisition has not become effective by 16 September 2008 orsuch later date as Bidco and Tinopolis shall agree; and •by notice from either Bidco or Tinopolis in certain defined circumstances. 18. Cancellation of admission to trading on AIM and re-registration The London Stock Exchange will be requested to cancel the admission to tradingof Tinopolis Shares on AIM when the Acquisition becomes effective. The last dayof dealings in Tinopolis Shares on AIM is expected to be on the business dayimmediately prior to the Effective Date and no transfers of Tinopolis Shareswill be registered after 6.00 p.m. on that date. On the Effective Date, sharecertificates in respect of Tinopolis Shares will cease to be valid and should bedestroyed. In addition, entitlements to Tinopolis Shares held within the CRESTsystem will be cancelled on the Effective Date. It is intended that, following the Scheme becoming effective, and after theadmission to trading on AIM of the Tinopolis Shares has been cancelled,Tinopolis will be re-registered as a private company. 19. Overseas shareholders The availability of the Acquisition or the distribution of this announcement topersons who are not resident in the United Kingdom may be affected by the lawsof the relevant jurisdictions in which they are located. Persons who are notresident in the United Kingdom should inform themselves of, and observe, anyapplicable requirements. This announcement does not constitute an offer for sale of any securities or anoffer or an invitation to purchase any securities. Tinopolis Shareholders areadvised to read carefully the Scheme Document and related Forms of Proxy oncethese have been dispatched. 20. Conclusion and recommendation The Independent Director, who has been so advised by Investec, considers theterms of the Acquisition to be fair and reasonable. In providing its advice tothe Independent Director, Investec has taken into account the commercialassessment of the Independent Director. Accordingly, the Independent Director intends to recommend that TinopolisShareholders vote in favour of the Acquisition at the Court Meeting and theGeneral Meeting as the Independent Director has irrevocably undertaken to do inrespect of his entire beneficial holding of 3,094,235 Tinopolis Shares,representing approximately 3.2 per cent. of the entire issued share capital ofTinopolis. 21. EnquiriesBidco Tel: +44 (0) 20 7152 6503Toby Wyles / Ben Johnson KPMG Corporate Finance, financial adviser to Bidco Tel: +44 (0) 20 7311 1000David Elms Financial Dynamics Tel: +44 (0) 20 7831 3113Charles Palmer Tinopolis Tel: +44 (0) 15 5488 0880Ron Jones / Arwel Rees Investec, financial adviser and nominated adviser to Tel: +44 (0) 20 7597Tinopolis 5970Martin Smith 22. Further information Your attention is drawn to the further information in the Appendices which formpart of this announcement. Appendix I sets out Conditions and certain further terms of the Acquisition. Appendix II sets out the sources of information and basis of calculations usedin this announcement. Appendix III contains the definitions of terms used in this announcement. The Scheme Document, containing further details of the Acquisition (includingnotices of a Court Meeting and a General Meeting) together with Forms of Proxy,will be posted to Tinopolis Shareholders and, for information only, toparticipants in the Tinopolis Share Schemes and the holders of the Warrant assoon as practicable and in any event within 28 days of this announcement, unlessotherwise agreed with the Panel. The directors of Bidco and the investment committee of Vitruvian Partners (allof whose names will be set out in the Scheme Document) accept responsibility forthe information contained in this announcement save for the information forwhich the investment committee of Vitruvian Partners alone acceptsresponsibility, as set out below and the information for which the directors ofTinopolis or the Independent Director accept responsibility, as set out below.To the best of the knowledge and belief of the directors of Bidco and theinvestment committee of Vitruvian Partners (who have taken all reasonable careto ensure that such is the case), such information for which they areresponsible is in accordance with the facts and does not omit anything likely toaffect the import of such information. The investment committee of Vitruvian Partners (all of whose names will be setout in the Scheme Document) accepts responsibility for the information relatingto Vitruvian Partners and the Vitruvian Fund. To the best of the knowledge andbelief of the investment committee of Vitruvian Partners (who have taken allreasonable care to ensure that such is the case), such information for whichthey are responsible is in accordance with the facts and does not omit anythinglikely to affect the import of such information. The directors of Tinopolis (all of whose names will be set out in the SchemeDocument) accept responsibility for the information contained in thisannouncement relating to Tinopolis, the Tinopolis Group and themselves and theirimmediate families, related trusts and connected persons. To the best of theknowledge and belief of the directors of Tinopolis (who have taken allreasonable care to ensure that such is the case), such information for whichthey are responsible is in accordance with the facts and does not omit anythinglikely to affect the import of such information. The Independent Director accepts responsibility for his recommendation of theAcquisition contained in this announcement. To the best of the knowledge andbelief of the Independent Director (who has taken all reasonable care to ensurethat such is the case), such information for which he is responsible is inaccordance with the facts and does not omit anything likely to affect the importof such information. KPMG Corporate Finance, a division of KPMG LLP which is authorised and regulatedby the Financial Services Authority for investment business activities, isacting for Bidco as financial adviser in relation to the potential Acquisitionand is not acting for any other person in relation to the potential Acquisition.KPMG Corporate Finance will not be responsible to anyone other than Bidco forproviding the protections afforded to its clients or for providing advice inrelation to the contents of this announcement or any offer or arrangementsreferred to herein. Investec which is authorised and regulated by the Financial Services Authorityis acting exclusively for Tinopolis and no-one else as financial adviser inrelation to the potential Acquisition. Investec will not be responsible toanyone other than Tinopolis for providing the protections afforded to itsclients or for providing advice in relation to the contents of this announcementor any offer or arrangements referred to herein. The availability of the Acquisition or the distribution of this announcement topersons who are not resident in the United Kingdom may be affected by the lawsof the relevant jurisdictions in which they are located. Persons who are notresident in the United Kingdom should inform themselves of, and observe, anyapplicable requirements. Any failure to comply with these restrictions mayconstitute a violation of the securities laws of any such jurisdiction. The Acquisition will not be made available, directly or indirectly, in or intothe United States or by use of the mails of, or by any means or instrumentality(including, without limitation, facsimile or other electronic transmission,telex or telephone) of inter-state or foreign commerce of, or any facility of, anational, state or other securities exchange of, the United States, nor will itbe made available directly or indirectly in or into Canada, Australia or Japanand no person may vote in favour of the Acquisition by any such use, means,instrumentality or facility or from within the United States, Canada, Australiaor Japan or any other such jurisdiction if to do so would constitute a violationof the relevant laws of such jurisdiction. Accordingly, copies of thisannouncement, the Scheme Document and the Forms of Proxy are not being, will notbe and must not be mailed or otherwise forwarded, distributed or sent in, intoor from the United States, Canada, Australia or Japan or any other suchjurisdiction if to do so would constitute a violation of the relevant laws ofsuch jurisdiction and persons receiving this press announcement, the SchemeDocument and the Forms of Proxy (including without limitation custodians,nominees and trustees) must not mail, forward, distribute or send them in, intoor from the United States, Canada, Australia or Japan or any other suchjurisdiction if to do so would constitute a violation of the relevant laws ofsuch jurisdiction The Acquisition will be subject to the applicable rules and regulations of theLondon Stock Exchange and the City Code. Cautionary note regarding forward looking statements This document contains certain forward-looking statements with respect to thefinancial condition, results of operations and business of Tinopolis, theAcquisition and certain plans and objectives of the boards of Tinopolis andBidco with respect thereto. These forward-looking statements can be identifiedby the fact 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 statementsare based on assumptions and assessments made by the boards of Tinopolis andBidco in light of their experience and their perception of historical trends,current conditions, expected future developments and other factors they believeappropriate. By their nature, forward-looking statements involve risk anduncertainty, because they relate to events and depend on circumstances that willoccur in the future and the factors described in the context of suchforward-looking statements in this document could cause actual results anddevelopments to differ materially from those expressed in or implied by suchforward-looking statements. Although Tinopolis and Bidco believe that theexpectations reflected in such forward-looking statements are reasonable,Tinopolis and Bidco can give no assurance that such expectations will prove tohave been correct and Tinopolis and Bidco therefore caution you not to placeundue reliance on these forward-looking statements which speak only as at thedate of this document. 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 Tinopolis, all ''dealings'' in any ''relevantsecurities'' of Tinopolis (including by means of an option in respect of, or aderivative referenced to, any such ''relevant securities'') must be publiclydisclosed by no later than 3.30 p.m. (London time) on the business day followingthe date of the relevant transaction. This requirement will continue until thedate on which an offer becomes, or is declared, unconditional as to acceptances,lapses or is otherwise withdrawn or on which the ''offer period'' otherwiseends. If two or more persons act together pursuant to an agreement orunderstanding, whether formal or informal, to acquire an ''interest'' in''relevant securities'' of Tinopolis, they will be deemed to be a single personfor the purpose of Rule 8.3. Under the provisions of Rule 8.1 of the City Code, all ''dealings'' in''relevant securities'' of Tinopolis by Bidco, or by any of their respective''associates'', must be disclosed by no later than 12.00 noon (London time) onthe business day following the date of the relevant transaction. A disclosuretable, giving details of the companies in whose ''relevant securities''''dealings'' should be disclosed, and the number of such securities in issue,can be found on the Panel 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 quotations marks are defined in the City Code, which can also be foundon the Panel's website at www.thetakeoverpanel.org.uk. If you are in any doubtas to the application of Rule 8 to you or whether or not you are required todisclose a ''dealing'' under Rule 8, you should consult the Panel. Rule 2.10 Disclosure In accordance with Rule 2.10 of the City Code, the Company confirms that it has95,465,888 Tinopolis Shares of 2 pence each in issue (excluding Tinopolis Sharesheld in treasury) and admitted to trading on AIM under the ISIN codeGB0009365692. APPENDIX I CONDITIONS TO AND CERTAIN FURTHER TERMS OF THE ACQUISITION Part A: The Conditions 1. The Acquisition will, if it is implemented by way of the Scheme, beconditional upon the Scheme becoming unconditional and becoming effective,subject to the City Code, by not later than 16 September 2008 or such later date(if any) as Bidco and Tinopolis may, with the consent of the Panel, agree and(if required) the Court may allow. The Scheme will be conditional upon: (i) the approval of the Scheme by a majority in number representingthree-fourths or more in value of the Scheme Shareholders present and voting,either in person or by proxy, at the Court Meeting (or at any adjournmentthereof); (ii) the special resolution in connection with and required to approve andimplement the Scheme and the Capital Reduction and set out in the notice of theGeneral Meeting being duly passed by the requisite majority at the GeneralMeeting (or at any adjournment thereof); (iii) the ordinary resolution in connection with and required to approve andimplement the arrangements between the Executive Managers and Bidco set out inthe notice of the General Meeting being duly passed by the requisite majority atthe General Meeting (or at any adjournment thereof); (iv) the sanction of the Scheme (with or without modification, on terms agreedby Bidco and Tinopolis) and the confirmation of the Capital Reduction by theCourt and office copies of the Court Orders and the minute of such reductionattached thereto being delivered for registration to the Registrar and, inrelation to the Capital Reduction, being registered by the Registrar. 2 In addition, Tinopolis and Bidco have agreed that, subject as stated in Part Bbelow, application to the Court to sanction the Scheme and to confirm theCapital Reduction will not be made unless conditions 1(i) to (iii) inclusiveabove have been fulfilled and unless immediately prior to the hearing of thepetition to sanction the Scheme the following conditions (as amended ifappropriate) are satisfied or waived as referred to below: (a) no Third Party having intervened and there not continuing to be outstandingany statute, regulation, notice, decision or order of any Third Party in eachcase which would or might reasonably be expected to: (i) make the Acquisition, its implementation or the acquisition or the proposedacquisition by Bidco or any member of the Wider Bidco Group of any shares orother securities in, or control or management of, Tinopolis or any member of theWider Tinopolis Group void, illegal or unenforceable in any jurisdiction, orotherwise directly or indirectly restrain, prevent, prohibit, restrict, delay orotherwise materially interfere with the same or impose additional conditions orobligations with respect to the Acquisition or such acquisition, or otherwiseimpede, challenge or interfere with the Acquisition or such acquisition, orrequire material amendment to the terms of the Acquisition or the acquisition orproposed acquisition of any Tinopolis Shares or the acquisition of control ormanagement of Tinopolis or any member of the Wider Tinopolis Group by Bidco orany member of the Wider Bidco Group; (ii) materially limit or delay the ability of any member of the Wider BidcoGroup or any member of the Wider Tinopolis Group to acquire or to hold or toexercise effectively, directly or indirectly, all or any rights of ownership inrespect of shares or other securities (or the equivalent) in, or to exercisevoting or management control over, any member of the Wider Tinopolis Group orany member of the Wider Bidco Group; (iii) require, prevent or materially delay any divestiture or alter the termsenvisaged for any proposed divestiture by any member of the Wider Bidco Group ofany shares or other securities in Tinopolis or any member of the Wider TinopolisGroup (in any case to an extent which is material in the context of the WiderBidco Group or the Wider Tinopolis Group, as the case may be, taken as a whole); (iv) require, prevent or materially delay any divestiture or alter the termsenvisaged for any proposed divestiture by any member of the Wider Bidco Group orby any member of the Wider Tinopolis Group of all or any part of theirrespective businesses, assets or properties or limit the ability of any of themto conduct all or any part of their respective businesses or to own or controlany of their respective assets or properties or any part thereof (in any case toan extent which is material in the context of the Wider Bidco Group or the WiderTinopolis Group, as the case may be, taken as a whole); (v) other than in connection with the implementation of the Acquisition, requireany member of the Wider Bidco Group or of the Wider Tinopolis Group to subscribefor or acquire, or to offer to subscribe for or acquire, any shares or othersecurities (or the equivalent) or interest in any member of the Wider TinopolisGroup or the Wider Bidco Group; (vi) materially limit the ability of any member of the Wider Bidco Group or ofthe Wider Tinopolis Group to integrate or co-ordinate its business, or any partof it, with the businesses or any part of the businesses of any other member ofthe Wider Bidco Group and/or of the Wider Tinopolis Group; (vii) result in any member of the Wider Bidco Group or the Wider Tinopolis Groupceasing to be able to carry on business under any name under which it presentlydoes so (in any case to an extent which is material in the context of the WiderBidco Group or the Wider Tinopolis Group, as the case may be, taken as a whole);or (viii) otherwise adversely affect the business, assets, profits, financial ortrading position or prospects of any member of the Wider Bidco Group to amaterial extent, or, of the Wider Tinopolis Group, taken as a whole, to amaterial extent; and all applicable waiting and other time periods during which any Third Partycould intervene under the laws of any relevant jurisdiction having expired,lapsed or been terminated; (b) all material notifications, filings and/or applications which are necessaryor are reasonably considered necessary by Bidco having been made, allappropriate waiting and other time periods (including any extensions of suchwaiting and other time periods) under any applicable legislation or regulationof any relevant jurisdiction having expired, lapsed or been terminated (asappropriate) and all statutory or regulatory obligations in any relevantjurisdiction having been complied with, in each case in connection with theAcquisition or the acquisition or proposed acquisition of any shares or othersecurities in, or control of, Tinopolis or any other member of the WiderTinopolis Group by any member of the Wider Bidco Group or the carrying on by anymember of the Wider Tinopolis Group of its business; (c) all Authorisations which are necessary or are reasonably consideredappropriate by Bidco in any relevant jurisdiction for or in respect of theAcquisition or the acquisition or proposed acquisition of any shares or othersecurities in, or control or management of, Tinopolis or any other member of theWider Tinopolis Group by Bidco or any member of the Wider Bidco Group or thecarrying on by any member of the Wider Tinopolis Group of its business havingbeen obtained, in terms and in a form satisfactory to Bidco, acting reasonably,from all appropriate Third Parties or from any persons or bodies with whom anymember of the Wider Bidco Group or any member of the Wider Tinopolis Group hasentered into contractual arrangements and such Authorisations together with allauthorisations necessary or appropriate for any member of the Wider TinopolisGroup to carry on its business remaining in full force and effect, in each casewhere the absence of such Authorisation would have a material adverse effect onthe Wider Tinopolis Group or the Wider Bidco Group taken as a whole and therebeing no notice or other intimation of any intention to revoke, suspend,restrict, modify or not to renew any of the same having been made and allnecessary statutory or regulatory obligations in any relevant jurisdictionhaving been complied with; (d) save as Disclosed, there being no provision of any arrangement, agreement,lease, licence, permit, franchise or other instrument to which any member of theWider Tinopolis Group is a party, or by or to which any such member or any ofits assets is or are or may be bound, entitled or subject, or any circumstance,which, in each case as a consequence of the Acquisition or the acquisition orproposed acquisition of any shares or other securities in, or control ormanagement of, Tinopolis or any other member of the Wider Tinopolis Group by anymember of the Wider Bidco Group or otherwise, could or might reasonably beexpected to result in, in any case to an extent which is or would be material inthe context of the Wider Tinopolis Group taken as a whole: (i) any monies borrowed by or any other indebtedness or liabilities (actual orcontingent) of, or any grant available to, any member of the Wider TinopolisGroup being or becoming repayable or capable of being declared repayableimmediately or prior to its stated repayment date or the ability of any memberof the Wider Tinopolis Group to borrow monies or incur any indebtedness beingwithdrawn or inhibited or becoming capable of being withdrawn or inhibited; (ii) the creation or enforcement of any mortgage, charge or other securityinterest over the whole or any part of the business, property, assets orinterests of any member of the Wider Tinopolis Group or any such mortgage,charge or other security interest (wherever and whenever created, arising orhaving arisen) becoming enforceable; (iii) any such arrangement, agreement, lease, licence, permit, franchise orinstrument, or the rights, liabilities, obligations or interests of any memberof the Wider Tinopolis Group thereunder, being, or becoming capable of being,terminated or adversely modified or affected or any adverse action being takenor arising thereunder or any onerous obligation or liability arising thereunder; (iv) any asset or interest of any member of the Wider Tinopolis Group or anyasset the use of which is enjoyed by any member of the Wider Tinopolis Groupbeing or falling to be disposed of or charged or ceasing to be available to anymember of the Wider Tinopolis Group or any right arising under which any suchasset or interest could be required to be disposed of or charged or could ceaseto be available to any member of the Wider Tinopolis Group otherwise than in theordinary course of business; (v) any member of the Wider Tinopolis Group ceasing to be able to carry onbusiness under any name under which it presently does so; (vi) the creation or assumption of any liabilities (actual or contingent) by anymember of the Wider Tinopolis Group other than in the ordinary course ofbusiness; (vii) the rights, liabilities, obligations or interests of any member of theWider Tinopolis Group under any such arrangement, agreement, lease, licence,permit, franchise or other instrument or the interests or business of any suchmember in or with any other person, firm, company or body (or any agreements orarrangements relating to any such interests or business) being terminated,adversely modified or affected; (viii) the financial or trading position or the prospects or the value of anymember of the Wider Tinopolis Group being prejudiced or adversely affected inany manner; or (ix) any member of the Wider Tinopolis Group being required to acquire or repayany shares in and/or indebtedness of any member of the Wider Tinopolis Groupowned by or owed to any third party; and no event having occurred which, under any provision of any such arrangement,agreement, lease, licence, permit, franchise or other instrument to which anymember of the Wider Tinopolis Group is a party, or by or to which any suchmember or any of its assets may be found entitled or subject, could result inany of the events or circumstances which are referred to in paragraphs (i) to(ix) of this condition (d) in any case to an extent which is or would bematerial in the context of the Wider Tinopolis Group as a whole; (e) save as Disclosed, no member of the Wider Tinopolis Group having since 30September 2007, being the date to which the last published audited report andaccounts of Tinopolis were made up: (i) issued or agreed to issue, or authorised the issue of, additional shares orsecurities of any class, or securities convertible into or exchangeable for, orrights, warrants or options to subscribe for or acquire, any such shares orconvertible securities save for the issue of up to 4,062,801 Tinopolis Sharespursuant to the Tinopolis Share Schemes and/or the Warrant and/or the issue ofup to £100,000 (at market value) of Tinopolis Shares pursuant to Tinopolis'obligations under the APP Sale and Purchase Agreement; (ii) purchased or redeemed or repaid or proposed the purchase, redemption orrepayment of any of its own shares or other securities (or the equivalent) orreduced or made or authorised any other change to any part of its share capitalother than pursuant to the implementation of the Acquisition; (iii) recommended, declared, paid or made or proposed to recommend, declare, payor make any bonus issue in respect of shares, dividend or other distribution,whether payable in cash or otherwise; (iv) except as between Tinopolis and any of its wholly owned subsidiaries orbetween such subsidiaries, made, authorised, proposed or announced an intentionto make, propose or authorise any change in its loan capital; (v) merged with, demerged or acquired any body corporate, partnership orbusiness or acquired or disposed of or (other than in the ordinary course ofbusiness) transferred, mortgaged or charged or created any security interestover any material assets or any right, title or interest in any material assets(including shares in any undertaking and trade investments) or authorised,proposed or announced the same; (vi) issued or authorised the issue of, or made any change in or to, anydebentures or, other than trade credit incurred in the ordinary course ofbusiness, incurred or increased any indebtedness or liability (actual orcontingent) which in any case is material in the context of the Wider TinopolisGroup taken as a whole; (vii) entered into, varied, authorised or announced its intention to enter intoor vary any agreement, transaction, arrangement or commitment (whether inrespect of capital expenditure or otherwise) which: (A) is of a long term, onerous or unusual nature or magnitude or which is orcould involve an obligation of such nature or magnitude; (B) restricts or could restrict the business of any member of the WiderTinopolis Group; or (C) is other than in the ordinary course of business, and which in any case is material in the context of the Wider Tinopolis Grouptaken as a whole; (viii) entered into, implemented, effected or authorised any merger, demerger,reconstruction, amalgamation, scheme, commitment or other transaction orarrangement in respect of itself or another member of the Wider Tinopolis Group; (ix) entered into or varied or made an offer (which remains open for acceptance)to vary the terms of any contract, agreement, commitment or arrangement with,any of the directors or senior executives of any member of the Wider TinopolisGroup or changed or entered into any commitment to change the terms of any ofthe Tinopolis Share Schemes; (x) taken any corporate action or had any step, application, filing in court,notice or legal proceedings started, served, instituted or threatened against itor petition presented or order made for its winding-up (voluntarily orotherwise), dissolution or reorganisation or for the appointment of a receiver,administrator, administrative receiver, trustee or similar officer of all or anymaterial part of its assets and revenues or any analogous proceedings in anyjurisdiction which in any case is material in the context of the Wider Tinopolisgroup taken as a whole; (xi) been unable, or admitted in writing that it is unable, to pay its debts orhaving stopped or suspended (or threatened to stop or suspend) payment of itsdebts generally or having entered into or taken steps to enter into amoratorium, composition, compromise or arrangement with its creditors in respectof its debts or ceased or threatened to cease carrying on all or a substantialpart of its business; (xii) waived, settled or compromised any claim to an extent which is material inthe context of the Wider Tinopolis Group taken as a whole; (xiii) terminated or varied the terms of any agreement or arrangement betweenany member of the Tinopolis Group and any other person in a manner which wouldor might reasonably be expected to have a material adverse effect on thefinancial position or prospects of the Tinopolis Group; (xiv) made any alteration to its memorandum or articles of association or otherincorporation documents save as required to implement the Acquisition; (xv) put in place any pension schemes for its directors, employees or theirdependants or made or agreed or consented to any change to: (A) the terms of the trust deeds constituting the pension schemes (if any)established for its directors, employees or their dependants; or (B) the benefits which accrue, or to the pensions which are payable, thereunder;or (C) the basis on which qualification for, or accrual or entitlement to, suchbenefits or pensions are calculated or determined; or (D) the basis upon which the liabilities (including pensions) of such pensionschemes are funded or made, or agreed or consented to any change to the trustees including the appointmentof a trust corporation; (xvi) proposed, agreed to provide or modified the terms of any share optionscheme, incentive scheme or other benefit relating to the employment ortermination of employment of any person employed by the Wider Tinopolis Group ina manner which is material in the context of the Wider Tinopolis Group taken asa whole; or (xvii) entered into any contract, agreement, commitment or arrangement or passedany resolution or made any offer (which remains open for acceptance) or proposedor announced any intention with respect to any of the transactions, matters orevents referred to in this condition (e); (f) since 30 September 2007, save as Disclosed: (i) no adverse change or deterioration having occurred in the business, assets,financial or trading position or profits or prospects of any member of the WiderTinopolis Group which in any case is material in the context of the WiderTinopolis Group taken as a whole; (ii) no contingent or other liability of any member of the Wider Tinopolis Grouphaving arisen or become apparent to Bidco or increased which in any case ismaterial in the context of the Wider Tinopolis Group taken as a whole; (iii) no litigation, arbitration proceedings, prosecution or other legalproceedings to which any member of the Wider Tinopolis Group is or may become aparty (whether as plaintiff, defendant or otherwise) having been threatened,announced, implemented or instituted by or against or remaining outstandingagainst or in respect of any member of the Wider Tinopolis Group which in anycase is material in the context of the Wider Tinopolis Group taken as a whole; (iv) no enquiry or investigation by, or complaint or reference to, any ThirdParty having been threatened, announced, implemented, instituted by or againstor remaining outstanding against or in respect of any member of the WiderTinopolis Group which in any case is material in the context of the WiderTinopolis Group taken as a whole; (v) no claim being made and no circumstance having arisen which might lead to aclaim being made under the insurance of any member of the Wider Tinopolis Groupwhere such claim would not be covered by such insurance and where such claim ismaterial in the context of the Wider Tinopolis Group taken as a whole; and (vi) no steps having been taken which are likely to result in the withdrawal(without replacement), cancellation or termination of any licence, permit orconsent held by any member of the Wider Tinopolis Group which is necessary forthe carrying on by such member of its business and which is material in thecontext of the Wider Tinopolis Group; (g) Bidco not having discovered (other than to the extent Disclosed): (i) that any financial or business or other information concerning the WiderTinopolis Group disclosed at any time by or on behalf of any member of the WiderTinopolis Group, whether publicly, to any member of the Wider Bidco Group orotherwise, is materially misleading or contains any material misrepresentationof fact or omits to state a fact necessary to make any information containedtherein not materially misleading; (ii) that any member of the Wider Tinopolis Group is subject to any liability(actual or contingent) which is material in the context of the Wider TinopolisGroup taken as a whole; or (iii) any information which affects the import of any information disclosed toBidco at any time by or on behalf of any member of the Wider Tinopolis Group toan extent which is material in the context of the Wider Tinopolis Group taken asa whole; (h) Save as Disclosed, Bidco not having discovered that: (i) any past or present member of the Wider Tinopolis Group has failed to complywith any applicable legislation, regulations or common law of any jurisdictionor any notice, order or requirement of any Third Party with regard to the use,treatment, handling, storage, transport, release, disposal, discharge, presence,spillage, leak or emission of any waste or hazardous or harmful substance or anysubstance likely to impair the environment or harm human or animal health, orotherwise relating to environmental matters or the health and safety of anyperson, or that there has otherwise been any such use, treatment, handling,storage, transport, release, disposal, discharge, presence, spillage, leak oremission (whether or not the same constituted non-compliance by any person withany legislation, regulations or law and wherever the same may have taken place)which, in any case, would be likely to give rise to any liability (whetheractual or contingent) or cost on the part of any member of the Wider TinopolisGroup which in any case is material in the context of the Wider Tinopolis Grouptaken as a whole; (ii) there is, or is likely to be, any obligation or liability, whether actualor contingent, to make good, repair, reinstate, remedy or clean up any propertynow or previously owned, occupied, operated or made use of or controlled by anypast or present member of the Wider Tinopolis Group or any other property orcontrolled waters under any environmental legislation, regulation, common law,notice, circular, order or other lawful requirement of any relevant authority orThird Party in any jurisdiction or otherwise which in any case is material inthe context of the Wider Tinopolis Group taken as a whole; or (iii) circumstances exist whereby a person or class of persons would be likelyto have a claim against a member of the Wider Tinopolis Group in respect of anyproduction used therein now or previously sold or carried out by any past orpresent member of the Wider Tinopolis Group which is or would be material in thecontext of the Wider Tinopolis Group taken as a whole. For the purpose of these conditions: (a) "Third Party" means any government, government department or governmental,quasi-governmental, supranational, statutory, regulatory, environmental orinvestigative body or association, institution or agency (including, withoutlimitation, any trade agency) or authority (including, without limitation, anyanti-trust or merger control authority), any court or professional orenvironmental body or any other person or body whatsoever in any relevantjurisdiction; (b) a Third Party shall be regarded as having "intervened" if it has taken,instituted, implemented or threatened any action, proceeding, suit,investigation, enquiry or reference or made, proposed or enacted any statute,regulation, decision, notice or order or taken any measures or other steps orrequired any action to be taken or information to be provided or otherwisehaving done anything and "intervene" shall be construed accordingly; and (c) "Authorisations" means authorisations, orders, grants, recognitions,determinations, certificates, confirmations, consents, licences, clearances,provisions, permissions and approvals. Part B: Waiver of Conditions and further terms of the Acquisition Subject to the requirements of the Panel, Bidco reserves the right to waive allor any of the above Conditions, in whole or in part, except Condition 1. Bidcoshall be under no obligation to waive (if capable of waiver), to determine to beor remain satisfied or to treat as fulfilled any of conditions 2(a) to (h)(inclusive) by a date earlier than the date specified in paragraph 1 of Part Aof this Appendix I for the fulfillment thereof. Bidco reserves the right to elect to implement the Acquisition by way of atakeover offer (subject to the Panel's consent). In such event, such offer willbe implemented on the same terms and conditions (subject to appropriateamendments, including (without limitation) an acceptance condition set at ninetyper cent. (or such lower percentage (being more than fifty per cent.) as Bidcomay decide (subject to the Panel's consent)) of the shares to which such offerrelates), so far as applicable, as those which would apply to the Scheme. If the Panel requires Bidco to make an offer or offers for any Tinopolis Sharesunder the provisions of Rule 9 of the City Code, Bidco may make such alterationsto the conditions of the Acquisition, including to Condition 1, as are necessaryto comply with the provisions of that Rule. The Acquisition will lapse and the Scheme will not proceed (unless the Panelotherwise consents) if the European Commission initiates proceedings underArticle 6(1)(c) of the Regulation or the Acquisition or any matter arising fromor relating to the Acquisition is referred to the Competition Commission beforethe date of the Court Meeting. The Acquisition will be on the terms and will be subject, inter alia, to theconditions which are set out in Part A of this Appendix I and those terms whichwill be set out in the formal Scheme Document and related Forms of Proxy andsuch further terms as may be required to comply with the AIM Rules of the LondonStock Exchange and the provisions of the City Code. The Acquisition and the Scheme will be governed by English law and will besubject to the jurisdiction of the English courts. The availability of the Acquisition to persons not resident in the UnitedKingdom may be affected by the laws of the relevant jurisdictions. Persons whoare not resident in the United Kingdom should inform themselves about andobserve any applicable requirements. APPENDIX II BASES AND SOURCES OF INFORMATION In this announcement: (a) the value placed by the Acquisition on the entire issued and to be issuedshare capital of Tinopolis (approximately £44.7 million) is based on 99,403,738Tinopolis Shares in issue and/or to be issued on 8 May 2008, the last businessday prior to the date of this Announcement; (b) the Closing Price of the Tinopolis Shares referred to in this documentrepresents the closing middle market price for Tinopolis Shares on the relevantdate is derived from the Official List of the London Stock Exchange; (c) the six month average share price for Tinopolis Shares has beencalculated using the closing middle market prices for Tinopolis Shares on therelevant dates as derived from Datastream; (d) unless otherwise stated, the financial information relating to Tinopolisis extracted from the Annual Report and Accounts of Tinopolis for the year ended30 September 2007; (e) references to the entire issued and to be issued share capital ofTinopolis exclude Tinopolis Shares held in treasury and, in relation toparagraph (a) above, also exclude any shares required to be issued by Tinopolispursuant to the terms of the APP Sale and Purchase Agreement. APPENDIX III DEFINITIONS The following definitions apply throughout this announcement unless the contextrequires otherwise."Acquisition" the proposed acquisition of Tinopolis by Bidco by means of the Scheme (or, should Bidco so elect, by means of the Offer) on the terms and subject to the conditions and further terms set out in this announcement and to be set out in the Scheme Document (or the Offer Document (as the case may be)) and where the context admits, any subsequent revision, variation, extension or renewal thereof and together with all other related matters to be considered at the Court Meeting and General Meeting;"Act" or "Companies the Companies Act 2006 (as in force from time to time);Act 2006""AIM" the AIM market of the London Stock Exchange;"AIM Rules" the rules for AIM companies and their nominated advisers published from time to time by the London Stock Exchange;"APP Sale and the Sale and Purchase Agreement dated 22 June 2007,Purchase Agreement" pursuant to which Tinopolis bought the entire issued share capital of APP Broadcast Limited;"associate" shall be construed in accordance with section 988(1) of the Companies Act 2006;"Bidco" Red Dragon Acquisitions Limited;"Bidco Group" Luxco and its subsidiaries and subsidiary undertakings and, where the context permits, each of them;"Bidco Ordinary ordinary shares of £0.000001 each in the capital of Bidco;Shares""board" the board of directors of a company;"business day" a day which is not a Saturday, Sunday or public holiday in England;"Capital Reduction" any reduction of Tinopolis' share capital associated with the cancellation and extinguishing of the Tinopolis Shares provided for by the Scheme under section 137 of the Companies Act 1985;"City Code" the City Code on Takeovers and Mergers;"Closing Price" the closing middle-marked quotation of a Tinopolis Share as derived from the Official List;"Conditions" the conditions to the implementation of the Acquisition (including the Scheme) which are set out in Appendix I of this announcement;"Court" the High Court of Justice in England and Wales;"Court Meeting" the meeting or meetings of Scheme Shareholders (other than the Executive Managers) (and any adjournment thereof) to be convened pursuant to an order of the Court under Part 26 of the Companies Act 2006 for the purposes of considering and, if thought fit, approving the Scheme (with or without amendment);"Court Order(s)" the order of the Court sanctioning the Scheme under Part 26 of the Companies Act 2006 and the order of the Court confirming the Capital Reduction under section 137 of the Companies Act 1985 respectively or, where the context requires, either of them;"Datastream" the financial statistical database provided by Thomson Financial;"Disclosed" (i) as disclosed in Tinopolis' annual report and accounts for the period ended 30 September 2007; or (ii) as publicly announced by Tinopolis (through a Regulatory Information Service) prior to the date of this announcement; or (iii) as otherwise fairly disclosed by or on behalf of Tinopolis in writing or in meetings with the Executive Managers attended by Vitruvian Partners and Investec prior to the date of this announcement to Bidco or any member of the Bidco Group in the course of negotiations;"Effective Date" the effective date of the Scheme;"EMI Plan" the Tinopolis Enterprise Management Incentive Plan adopted by Tinopolis on 7 February 2005;"Executive Managers" Ron Jones, Arwel Rees, Jeff Foulser, Angharad Mair, Rhian Thomas and John Glynog Davies;"Executive Managers' 4,347,871of the Tinopolis Shares registered in the name ofShares" and beneficially held by Ron Jones, the 150,000 Tinopolis Shares registered in the name of and beneficially held by Arwel Rees, 28,402 of any Tinopolis Shares issued to Arwel Rees after the date of the Scheme Document and before 6.00pm on the day before the date on which the Reduction Court Order is made, in respect of which Arwel Rees is, or shall have agreed in writing to be, bound by the Scheme. 10,000 of the Tinopolis Shares registered in the name of HSDL Nominees Limited and beneficially owed by Arwel Rees, 146,883 of the Tinopolis Shares registered in the name of and beneficially held by Jeff Foulser, 55,555 of any Tinopolis Shares issued to Jeff Foulser after the date of the Scheme Document and before 6.00pm on the day before the date on which the Reduction Court Order is made, in respect of which Jeff Foulser is, or shall have agreed in writing to be, bound by the Scheme. 1,737,956 of the Tinopolis Shares registered in the name of and beneficially held by Angharad Mair, 1,547,118of the Tinopolis Shares registered in the name of and beneficially held by Rhian Thomas and 1,547,118of the Tinopolis Shares registered in the name of and beneficially held by John Glynog Davies;"Financial Services the Financial Services Authority acting in its capacity asAuthority" the competent authority for the purposes of Part VI of the Financial Services and Markets Act 2000;"Foulser Award" the award over Tinopolis shares granted to Jeff Foulser by way of a letter dated 1 March 2006;"Forms of Proxy" the forms of proxy for use at the Court Meeting and the General Meeting;"General Meeting" the general meeting of Tinopolis Shareholders (and any adjournment thereof) to be convened in connection with the Scheme;"Holdco" DMWSL 584 Limited, a company incorporated in England and Wales with registered number 6475823 and having its registered office at Royal London House, 22-25 Finsbury Square, London EC2A 1DX, being the direct holding company of Bidco;"Implementation the agreement dated 8 May 2008 between Bidco and TinopolisAgreement" relating, among other things, to the implementation of the Acquisition;"Independent Rhys Davies;Director""Independent either:InconsistentTransaction" (a) an offer, scheme, of arrangement, recapitalisation or other transaction which involves a change of control (as defined in the City Code) of Tinopolis or any other member of the Tinopolis Group; or (b) any arrangement or transaction which involves or contemplates the transfer of any interest in the whole, or substantially the whole of the undertaking, assets and/or business of Tinopolis or any other member of the Tinopolis Group; or (c) any other arrangement or transaction or series of the same which is inconsistent with or an alternative to the Acquisition, which is in each case to be made or entered into by or with a third party which is not acting in concert (as defined in the City Code) with Bidco;"Investec" Investec Investment Banking, a division of Investec Bank (UK) Limited;"ISIN Code" a UK international securities identification number;"KPMG Corporate KPMG Corporate Finance, a division of KPMG LLP which isFinance" authorised and regulated by the Financial Services Authority for investment business activities;"Listing Rules" the listing rules of the Financial Services Authority as amended from time to time and contained in the Financial Services Authority's publication of the same name;"London Stock London Stock Exchange plc;Exchange""Luxco" Greece Rouge Dragon SARL a company incorporated in Luxembourg having its registered office at 174, route de Longwy, L-P140 Luxembourg and registered with the Register of Trade and Companies of Luxembourg, being an indirect holding company of Bidco;"Management the arrangements with the Executive Managers, as describedArrangements" in this announcement;"Offer" should Bidco elect (with the consent of the Panel) to make the Acquisition by way of an offer, the recommended cash offer to be made by Bidco to acquire all of the issued and to be issued Tinopolis Shares not already owned (or contracted to be acquired) by Bidco or its associates (including, where the context so requires, any subsequent revision, variation, extension or renewal of such offer);"Offer Document" should Bidco elect to make the Acquisition by way of an offer, the document containing, amongst other things, the details of the offer, the terms and conditions of the offer and certain information about Tinopolis and Bidco to be sent to Tinopolis Shareholders and others;"Official List" the daily official list of the Financial Services Authority;"Panel" the Panel on Takeovers and Mergers;"Reduction Court the order of the Court confirming the reduction of shareOrder" capital under section 137 of the Companies Act provided for by the Scheme;"Registrar" the Registrar of Companies in England and Wales;"Regulatory means any of the services set out in Appendix 3 to theInformation Service" Listing Rules;"Scheme" the proposed scheme of arrangement under Part 26 of the Companies Act 2006 between Tinopolis, the Scheme Shareholders and the holders of Executive Managers' Shares, the full terms of which will be set out in the Scheme Document;"Scheme Document" the document to be sent to Tinopolis Shareholders containing and setting out the Scheme and the notices convening the Court Meeting and the General Meeting;"Scheme holders of Scheme Shares;Shareholders""Scheme Shares" (i) the Tinopolis Shares in issue at the date of the Scheme Document; (ii) any Tinopolis Shares issued after the date of the Scheme Document and before the Voting Record Time; and (iii) any Tinopolis Shares issued at or after the Voting Record Time and before 6:00 p.m. on the day before the date on which the Reduction Court Order is made confirming the Capital Reduction, 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 Executive Managers' Shares, and any Tinopolis Shares held in treasury by Tinopolis;"subsidiary", have the meanings given by the Companies Act, other than"subsidiary paragraph 20(1)(b) of Schedule 4A to that Act which shallundertaking", be excluded for this purpose, and "substantial interest""undertaking", means a direct or indirect interest in 20 per cent. or more"associated of the equity share capital (as defined in that Act) of anyundertaking" and undertaking;"substantialinterest""Tinopolis" or the Tinopolis plc;"Company""Tinopolis Group" Tinopolis and its subsidiaries and subsidiary undertakings and, where the context permits, each of them;"Tinopolis the holders of Tinopolis Shares;Shareholders""Tinopolis Shares" the existing issued or unconditionally allotted and fully paid (or credited as fully paid) ordinary shares of 2 pence each in the capital of Tinopolis and any further such shares which are unconditionally allotted or issued fully paid before the Scheme becomes effective;"Tinopolis Share all or (where the context permits) any of the EMI Plan, theSchemes" Unapproved Plan and the Foulser Award;"Unapproved Plan" the Tinopolis Unapproved Share Option Plan adopted by Tinopolis on 7 February 2005;"UK" or "United the United Kingdom of Great Britain and Northern Ireland;Kingdom""Voting Record Time" 6:00 p.m. on the day which is two days before the date of the Court Meeting or, if such Court Meeting is adjourned, 6:00 p.m. on the day which is two days before the day of such adjourned meeting;"Vitruvian Fund" the Vitruvian Investment Partnership I fund, investment partnerships advised by Vitruvian Partners;"Vitruvian Partners" Vitruvian Partners LLP;"Warrant" the right to subscribe for 48,780 Tinopolis Shares pursuant to a warrant instrument executed by Tinopolis and dated 19 October 2005;"Wider Bidco Group" Luxco and its subsidiaries, subsidiary undertakings, associated undertakings and any other undertaking or joint venture or firm or partnership or company in which Luxco and/or such subsidiaries or undertakings (aggregating their interests) have a substantial interest; and"Wider Tinopolis Tinopolis and its subsidiaries, subsidiary undertakings,Group" associated undertakings and any other undertaking or joint venture or firm or partnership or company in which Tinopolis and/or such subsidiaries or undertakings (aggregating their interests) have a substantial interest. This information is provided by RNS The company news service from the London Stock Exchange

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