BMG Rights Management acquires Chrysalis Music Group USA for $168.6 million

Deal Participants:
Acquiring Company: BMG Rights Management View Profile Charts Homepage
Target Company: Chrysalis Music Group USA View Profile Charts Homepage
Deal Financials:
Price: $168.6 million
 
Date:
Announced: Nov 26, 2010

PRESS RELEASE

UK: RECOMMENDED CASH OFFER FOR CHRYSALIS PLC by BMG

For immediate release

RECOMMENDED CASH OFFER FOR CHRYSALIS PLC

26 November 2010

Summary
• The Boards of Directors of Forte Bidco 1 Limited (“Bidco”), and Chrysalis plc (“Chrysalis”) are pleased to announce that they have reached agreement on the terms of a recommended cash offer for the entire issued and to be issued share capital of Chrysalis (the “Acquisition”). Bidco is a wholly-owned subsidiary of BMG Luxco, a joint venture between Bertelsmann and an affiliate of Kohlberg Kravis Roberts & Co. L.P. (“KKR”). It is intended that the Acquisition will be implemented by way of a Court approved scheme of arrangement (the “Scheme”) under Part 26 of the Companies Act 2006 (the “2006 Act”).
• Under the terms of the Scheme, Chrysalis Shareholders will receive 160 pence in cash for each Chrysalis Share held.
• The Acquisition values the entire issued and to be issued ordinary share capital of Chrysalis at approximately £107.4 million.
• The price of 160 pence per Chrysalis Share represents a premium of approximately:
 45.5 per cent. to the Closing Price of 110.0 pence per Chrysalis Share on 29 October 2010, being the last Business Day prior to the announcement by Chrysalis that it was in discussions which may lead to an offer for the entire issued share capital of the company; and
 55.7 per cent. to the average Closing Price of 102.7 pence per Chrysalis Share for the period 30 July 2010 to 29 October 2010, being the three month period to the last Business Day prior to the announcement by Chrysalis that it was in discussions which may lead to an offer for the entire issued share capital of the company.
• The combination of Chrysalis and BMG is an important step in BMG’s growth strategy. The transaction will enhance BMG’s position as a leading music rights publisher with a depth and breadth of offering to serve a wide range of music customers across a global platform.
• The Directors of Chrysalis, who have been so advised by Jefferies, consider the terms of the Acquisition to be fair and reasonable. In providing their advice, Jefferies have taken into account the commercial assessment of the Directors of Chrysalis. Accordingly, the Directors of Chrysalis intend unanimously to recommend that Chrysalis Shareholders vote in favour of the Scheme at the Court Meeting and the associated resolutions at the General Meeting as they have irrevocably undertaken to do in respect of their own beneficial holdings.
• Bidco has received irrevocable undertakings to vote in favour of the Scheme and the associated resolutions at the Court Meeting and the General Meeting in respect of their beneficial holdings of Chrysalis Shares from Chris Wright, Peter Lassman, Andrew Mollett, David Murrell and Jeremy Lascelles, being all the Directors of Chrysalis who hold Chrysalis Shares (in respect of 19,986,738 Chrysalis Shares in aggregate). These undertakings will remain binding in the event of a competing offer being made for Chrysalis.
• Bidco has received irrevocable undertakings to vote in favour of the Scheme and the associated resolutions at the Court Meeting and the General Meeting in respect of their beneficial holdings of Chrysalis Shares from, Schroder Investment Management Limited (in respect of 10,400,401 Chrysalis Shares), North Atlantic Value LLP (in respect of 9,500,000 Chrysalis Shares) and Guinness Peat Group plc (in respect of 9,412,438 Chrysalis Shares). These undertakings will also remain binding in the event of a competing offer being made for Chrysalis. Schroder Investment Management Limited (“SIM”), under the terms of its irrevocable undertaking, retains the right to transfer Chrysalis shares to a replacement fund manager or custodian free from the irrevocable undertaking at their client’s instructions in certain circumstances.
• Accordingly, Bidco has received irrevocable undertakings to vote in favour of the Scheme and the associated resolutions at the Court Meeting and the General Meeting in respect of 73.4 per cent. of the issued share capital of Chrysalis, all such undertakings remaining binding in the event of a competing offer being made for Chrysalis.
• It is anticipated that the Scheme Document will be posted to Chrysalis Shareholders and (for information purposes only) to participants in the Chrysalis Share Schemes in December 2010 and that the Scheme and associated resolutions will be put to Chrysalis Shareholders at the Court Meeting and the General Meeting, which are expected to be held in January 2011. Subject to the satisfaction, or where relevant waiver, of all relevant Conditions, and the requisite Shareholder and Court approvals being obtained, the Scheme is expected to become effective in early February 2011. In accordance with the Code, the Acquisition proceeds will be posted to Chrysalis Shareholders within 14 days of the Scheme becoming effective. With the consent of the Panel, Chrysalis has agreed that the Court Order giving effect to the Scheme will not be lodged until the fourth day after the Court Order is granted.

Commenting on the Acquisition, Hartwig Masuch, the CEO of BMG, said:
“We believe that our offer represents compelling value for Chrysalis’ shareholders as evidenced by the strong endorsement BMG has received from Chrysalis’ Board and its major shareholders. The acquisition of Chrysalis represents an important step forward in our strategy as we build a major, global music rights business. Chrysalis’ extensive and high quality catalogue represents an excellent fit with our existing business. Our strategy is to provide state-of-the-art, comprehensive and transparent management of music rights and the operational excellence of Chrysalis reinforces this commitment. BMG looks forward to working with Chrysalis to build on its success to date for the benefit of all stakeholders.”

Commenting on the Acquisition, Chris Wright, Chairman and Co-Founder of Chrysalis, said:
“Today’s deal marks the end of one era and the start of another for Chrysalis, a company which has been at the heart of the music industry since I founded it jointly with my original partner, Terry Ellis, more than four decades ago. Our continued progress – evolving from management, recorded music, television and radio to focus on music publishing – has been clearly recognised by BMG. As we embark together on the next chapter of the Chrysalis story, I am proud of both our track record and our future prospects in an industry in which we have both innovated and pioneered.”

This summary should be read in conjunction with, and is subject to, the full text of this announcement (including the Appendices). The Acquisition will be subject to the Conditions and further terms set out in Appendix I to this announcement and to the full terms and Conditions to be set out in the Scheme Document. Appendix II to this announcement contains the bases and sources of certain information contained in this announcement. Appendix III provides details of the irrevocable undertakings received by Bidco. Appendix IV contains definitions of certain terms used in this announcement.

In accordance with Rule 19.11 of the Code, a copy of this Announcement will be published on the following websites: www.bmg.com and www.chrysalis.com.

Enquiries
BMG Telephone: +49 (0) 30 300 133 340
Hartwig Masuch (Chief Executive Officer, BMG GmbH)
Kay Krafft (Chief Investment Officer, BMG GmbH)
Citi Telephone: +44 (0) 20 7986 4000
(Sole Financial Adviser and Corporate Broker to BMG and Bidco)
Jan Skarbek
Ketan Mehta
Simon Alexander (corporate broking)
Sian Evans

Finsbury Telephone: +44 (0) 20 7251 3801
(PR Adviser to BMG)
Charles Watenphul
Ed Simpkins
Chrysalis Telephone: +44 (0) 20 7465 6327
Chris Wright (Chairman)
Jeremy Lascelles (Group Chief Executive)
Andy Mollett (Chief Financial Officer)
Jefferies Telephone: +44 (0) 20 7029 8000
(Sole Financial Adviser to Chrysalis)
Jonathan Goodwin
Julian Culhane
Investec Telephone: +44 (0) 20 7597 5970
(Corporate Broker to Chrysalis)
Keith Anderson
Brunswick Telephone: +44 (0) 20 7404 5959
(PR Adviser to Chrysalis)
Tim Burt
Dania Saidam

This announcement does not constitute or form any part of an offer or invitation to sell or purchase any securities or the solicitation of an offer to buy any securities or the solicitation of any vote of approval in any jurisdiction, pursuant to the Acquisition or otherwise. The Acquisition will be made solely by means of the Scheme Document and the form of proxy accompanying the Scheme Document, which will contain the full terms and conditions of the Acquisition, including details of how to vote in favour of the Acquisition. Chrysalis Shareholders are advised to read this announcement in conjunction with the formal documentation in relation to the Acquisition carefully, once it has been dispatched. The Acquisition will be subject to the Conditions set out in Appendix I to this announcement and the full conditions and further terms which will be set out in the Scheme Document and form of proxy. This announcement and all other materials related to the Acquisition are solely directed to existing Chrysalis Shareholders.
Any acceptance or other responses to the Acquisition should be made only on the basis of the information in the Scheme Document. Chrysalis will prepare the Scheme Document to be distributed to the Chrysalis Shareholders. On the Effective Date, the Scheme will be binding on each Chrysalis Shareholder and all Chrysalis Shares will be cancelled in accordance with the Scheme, irrespective of whether any such Chrysalis Shareholder has attended or voted at the Court Meeting or General Meeting.
Citi, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for BMG and Bidco and no one else in relation to the matters referred to in this announcement and will not be responsible to anyone other than BMG and Bidco for providing the protections afforded to clients of Citi nor for providing advice in relation to these matters, the content of this announcement or any matter referred to herein.
Jefferies, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Chrysalis and no one else in relation to the matters referred to in this announcement and will not be responsible to anyone other than Chrysalis for providing the protections afforded to clients of Jefferies nor for providing advice in relation to these matters, the content of this announcement or any matter referred to herein.
The distribution of this announcement in jurisdictions other than the UK may be restricted by law and therefore any persons who are subject to the laws of any jurisdiction other than the UK should inform themselves about, and observe, any applicable requirements. This announcement has been prepared for the purpose of complying with English law and the Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions outside the UK.
Copies of this announcement are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from any Restricted Jurisdiction and persons receiving this announcement (including custodians, nominees and trustees) must not mail or otherwise forward, distribute or send it in or into or from any Restricted Jurisdiction.
The Acquisition will be subject to the applicable rules and regulations of the UK Listing Authority, the London Stock Exchange and the Code.
Notice to US holders of Chrysalis Shares
US holders of Chrysalis Shares should note that the Scheme relates to the shares of a UK company that is a “foreign private issuer” as defined under Rule 3b-4 under the Exchange Act and will be governed by English law. Accordingly, neither the proxy solicitation nor the tender offer rules under the Exchange act will apply to the Scheme. Moreover, the Scheme will be subject to the disclosure requirements and practices applicable in the UK to schemes of arrangement, which differ from the disclosure requirements of the US proxy solicitation rules and tender offer rules. Financial information included in the Scheme Document will have been prepared in accordance with accounting standards applicable in the UK that may not be comparable to the accounting standards applicable to financial statements of US companies. If Bidco exercises its right to implement the acquisition of the Chrysalis Shares by way of a takeover offer, the offer will be made in compliance with applicable US securities laws and regulations.
Forward looking statements
It is possible that this announcement could or may contain forward-looking statements that are based on current expectations or beliefs, as well as assumptions about future events. Reliance should not be placed on any such statements because, by their very nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results, and BMG, Bidco and Chrysalis’ plans and objectives, to differ materially from those expressed or implied in the forward-looking statements. None of BMG, Bidco nor Chrysalis undertake to update or revise forward-looking statements, whether as a result of new information, future events or otherwise.
Dealing disclosure requirements
Under Rule 8.3(a) of the Code, any person who is interested in 1 per cent. or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person’s interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1 per cent. or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person’s interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel’s website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should consult the Panel’s website above and/or contact the Panel’s Market Surveillance Unit on +44 (0)20 7638 0129.

For immediate release

RECOMMENDED CASH OFFER FOR CHRYSALIS PLC

26 November 2010

1. Introduction
The Boards of Directors of Forte Bidco 1 Limited (“Bidco”) and Chrysalis plc (“Chrysalis”) are pleased to announce that they have reached agreement on the terms of a recommended cash offer to be made by Bidco for the entire issued and to be issued share capital of Chrysalis. Bidco is an indirect wholly-owned subsidiary of BMG Luxco, a joint venture between Bertelsmann and an affiliate of KKR.

2. Summary of the Acquisition
It is intended that the Acquisition will be implemented by way of a Court approved scheme of arrangement under Part 26 of the 2006 Act.
Under the Scheme, which will be subject to the Conditions and further terms set out in Appendix I to this announcement and the full terms and conditions to be set out in the Scheme Document and form of proxy accompanying the Scheme Document, Chrysalis Shareholders at the Scheme Record Time will be entitled to receive:
for each Chrysalis Share 160 pence in cash
The Acquisition values the entire issued and to be issued ordinary share capital of Chrysalis at approximately £107.4 million.
The price of 160 pence per Chrysalis Share represents a premium of approximately:
• 45.5 per cent. to the Closing Price of 110.0 pence per Chrysalis Share on 29 October 2010, being the last Business Day prior to the announcement by Chrysalis that it was in discussions that may lead to an offer for the entire issued share capital of the company;
• 55.7 per cent. to the average Closing Price of 102.7 pence per Chrysalis Share for the period 30 July 2010 to 29 October 2010, being the three month period to the last Business Day prior to the announcement by Chrysalis that it was in discussions that may lead to an offer for the entire issued share capital of the company.

3. Background to, and reasons for, the Acquisition
BMG is an international group focused on the management of music rights. Since its founding in late 2008, BMG has pursued a growth strategy through a combination of organic growth and acquisitions.
The combination of Chrysalis and BMG is an important step in BMG’s strategic growth plan following on from its recent acquisitions of Evergreen, Stage 3 and Cherry Lane, amongst others, and will further establish BMG as a leading music publisher covering a substantial roster of songs and artists. Chrysalis’ high quality catalogue, relationships within the music community and operations provide a strong fit with BMG’s existing business and will further strengthen BMG’s position in the United Kingdom and the United States of America, two of the world’s most dynamic music markets. We believe the combined resources will provide the enlarged group with a powerful opportunity to continue to attract and retain leading talent from across the industry.

4. Background to, and reasons for, the recommendation
The combination of BMG and Chrysalis will enhance BMG’s position as a leading music publisher with a depth and breadth of offering to serve a wide range of music customers across a global platform. BMG (as enlarged by the acquisition of Chrysalis) would benefit from increased size, enhancing its ability to attract key writers around the world, and continue its policy of acquiring additional high quality music publishers and catalogues.
In recent years, Chrysalis has considered a range of options to deliver shareholder value including potential industry consolidation opportunities. The Board of Chrysalis recognises the commercial benefits of a combination with BMG and believes the offer provides an attractive opportunity for Chrysalis’ shareholders to realise their investment, in cash, at a substantial premium to the undisturbed share price.

During the course of the discussions with BMG, Chrysalis received an indicative proposal for the Company from a third party and the Directors considered that proposal in detail. However, as a material portion of the consideration under that proposal consisted of unlisted equity securities in the third party, the Chrysalis Board determined that proposal to be inferior to the cash offer received from Bidco. The Chrysalis Board’s decision to reject that alternate proposal was based upon a number of factors including the increased uncertainty of completion, the lack of liquidity in the shares being offered and difficulties in ascribing a true value to those equity securities.

5. Recommendation
The Directors of Chrysalis, who have been so advised by Jefferies, consider the terms of the Acquisition to be fair and reasonable. In providing their advice, Jefferies have taken into account the commercial assessments of the Directors of Chrysalis. Accordingly, the Directors of Chrysalis intend unanimously to recommend that Chrysalis Shareholders vote in favour of the Scheme and the associated resolutions at the Court Meeting and the General Meeting, as they have irrevocably undertaken to do in respect of their own beneficial shareholdings.

6. Information on BMG
BMG Luxco is a joint venture between the international media company Bertelsmann and an affiliate of KKR. BMG covers the entire range of music rights administration, development and exploitation, placing the needs of songwriters and artists at the core of its business model. Since its founding in late 2008, BMG has established a presence in eight core music markets and now represents rights to more than 200,000 songs and recordings.
Established in 1976, KKR is a leading global alternative asset manager. KKR’s franchise is sponsoring and managing funds that make investments in private equity, fixed income and other assets in North America, Europe, Asia and the Middle East. Throughout its history, KKR has brought a long-term investment approach, focusing on working in partnership with management teams of its portfolio companies and investing for future competitiveness and growth. KKR has more than $41.9 billion in private equity assets under management and more than $13.6 billion in credit assets under management as of September 30, 2010 through various private and publicly traded funds and separately managed accounts. KKR also carries out capital markets activities through its broker dealer subsidiaries. KKR has offices in New York, Menlo Park, San Francisco, Houston, Washington D.C., London, Paris, Hong Kong, Tokyo, Beijing, Mumbai, Dubai and Sydney. More information about KKR is available at: www.kkr.com.
Bertelsmann is an international media company encompassing television, book publishing, magazine publishing, media services, and media clubs in more than 50 countries. Bertelsmann’s claim is to inspire people around the world with first-class media and communications offerings – entertainment, information and services – and occupy leading positions in its respective markets. The foundation of Bertelsmann’s success is a corporate culture based on partnership, entrepreneurial spirit, creativity, and corporate responsibility. Bertelsmann strives to bring creative new ideas to market and create value.
Bidco is a private limited company, incorporated in England, which was established for the purposes of the Acquisition. Bidco is an indirect wholly-owned subsidiary of BMG Luxco. It is intended that, in due course, either the shares in Bidco or, following the acquisition, the shares in Chrysalis, will be transferred to BMG.

7. Information on Chrysalis
Chrysalis is a music company whose principal areas of business comprise: Chrysalis Music Publishing which includes the Chrysalis Group’s international network of music publishing companies, whose purpose it is to exploit and grow Chrysalis’ rich catalogue of music copyrights; Chrysalis Non Music Publishing, which is made up of The Echo Label, a copyright exploitation company; and Chrysalis Copyrights, the owner of certain Master recordings. Chrysalis plc also owns Lasgo Chrysalis Limited, a UK-based wholesale entertainment product distribution business which serves both domestic and overseas wholesale, retail and entertainment markets with CD, DVD and book products.

8. Current Trading and Prospects
Chrysalis continues to perform in line with the Board’s expectations. The business is experiencing good chart performances from a number of writers and acts as well as useful contributions from high profile synchronisations. This, coupled with the recent news of the Beatles catalogue now available at the Apple iTunes Store for the first time, is expected to result in continued NPS growth.
Chrysalis expects to publish a preliminary results statement in respect of the financial year ended 30 September 2010 on or around 16 December 2010.

9. Structure of the Acquisition
It is intended that the Acquisition will be implemented by way of a Court approved scheme of arrangement between Chrysalis and the Scheme Shareholders under Part 26 of the 2006 Act (although Bidco reserves the right to elect to implement the Acquisition by way of an Offer subject to Panel consent, where necessary). The procedure involves an application by Chrysalis to the Court to sanction the Scheme and to confirm the cancellation of the Scheme Shares, in consideration for which Scheme Shareholders will receive cash (as described above).
To become effective, the Scheme requires, amongst other things, the approval of a majority in number of the Scheme Shareholders present and voting in person or by proxy at the Court Meeting, representing not less than three-fourths in value of the Scheme Shares held by such Scheme Shareholders, together with the sanction of the Court and the passing of the resolutions necessary to implement the Scheme at the General Meeting. The Scheme will only become effective upon delivery to the Registrar of Companies of a copy of the Court Order and the registration of the Court Order. Upon the Scheme becoming effective, it will be binding on all Scheme Shareholders, irrespective of whether or not they attended or voted at the Court Meeting or the General Meeting. The Scheme is expected to become effective in early February 2011.
Under the Scheme, each Scheme Share will be cancelled and new Chrysalis Shares will be issued fully paid to Bidco. In consideration for the cancellation of their Scheme Shares, holders of Scheme Shares will receive cash consideration under the terms of the Acquisition as set out in the Scheme Document.
The Scheme will extend to any Chrysalis Shares issued under the Chrysalis Share Schemes prior to the Scheme Record Time. At the General Meeting, Chrysalis will propose amendments to its Articles of Association pursuant to which any shares issued on the exercise of options or awards under the Chrysalis Share Schemes after the Scheme Record Time will automatically be transferred to Bidco for the same consideration as would be payable under the Scheme.

10. Irrevocable undertakings
Bidco has received irrevocable undertakings to vote (or procure to vote) in favour of the Scheme and the associated resolutions at the Court Meeting and the General Meeting in respect of their beneficial holdings of Chrysalis Shares from Chris Wright, Peter Lassman, Andrew Mollett, David Murrell and Jeremy Lascelles, being all the directors of Chrysalis who hold Chrysalis Shares (in respect of 19,986,738 Chrysalis Shares in aggregate).
Bidco has also received irrevocable undertakings to vote in favour of the Scheme and the associated resolutions at the Court Meeting and the General Meeting in respect of their beneficial holdings of Chrysalis Shares from, Schroder Investment Management Limited (in respect of 10,400,401 Chrysalis Shares), North Atlantic Value LLP (in respect of 9,500,000 Chrysalis Shares) and Guinness Peat Group plc (in respect of 9,412,438 Chrysalis Shares).
SIM, under the terms of its irrevocable undertaking, retains the right to transfer Chrysalis Shares to a replacement fund manager or custodian free from the irrevocable undertaking at their client’s instructions in circumstances where: (i) the client terminates the professional relationship with SIM in respect of such shares; (ii) the client changes their investment mandate with SIM such that holding such shares is no longer consistent with the new mandate; or (iii) if SIM is otherwise instructed by its client.
Accordingly, Bidco has received irrevocable undertakings to vote in favour of the Scheme and the associated resolutions at the Court Meeting and the General Meeting in respect of 73.4 per cent. of the issued share capital of Chrysalis. All of these undertakings will remain binding even in the event of a competing offer being made for Chrysalis.
Further details of these irrevocable undertakings are set out in Appendix III to this announcement.

11. The Chrysalis name
Chrysalis is a well established and successful brand and BMG will use the Chrysalis name in the principal trading name in each of the United Kingdom, the United States of America and Scandinavia and in the corporate names of its principal trading subsidiaries in those territories for the foreseeable future (which it anticipates to be for at least the next three years).

12. Management and employees
Chris Wright has been invited to join the supervisory board of BMG and to become non-executive UK Chairman of BMG.
BMG is committed to growing and diversifying its business. BMG recognises the skills and experience of Chrysalis’ employees and management and undertakes to honour Chrysalis’ existing agreements with employees and management (including their pension rights and LTIP entitlements).

13. Chrysalis Share Schemes
Details of appropriate proposals to participants in the Chrysalis Share Schemes will be set out in the Scheme Document and in separate letters to such participants.

14. Financing
The cash consideration of £107.4 million, excluding costs payable by Bidco under the terms of the Acquisition, will be funded in full using equity contributions from BMG Luxco’s shareholders (Bertelsmann and an affiliate of KKR), part of which may be replaced by a debt facility in due course.
As required under the Code, Citi confirms, as financial adviser to BMG and Bidco, that it is satisfied that sufficient resources are available to Bidco to satisfy in full the cash consideration payable to Chrysalis Shareholders under the terms of the Acquisition.

15. Implementation Agreement
Bidco, Chrysalis and Chris Wright have entered into an Implementation Agreement which contains, among other things, an inducement fee arrangement and a non-solicitation undertaking. A brief summary of the Implementation Agreement is set out below.
Inducement Fee
Chrysalis has agreed that it will pay Bidco an inducement fee of £1,074,291 (being one per cent. of the value of Chrysalis’ equity share capital by reference to the terms of the Acquisition), by way of compensation, if after the date of this Announcement:
(i) a Competing Proposal has completed;
(ii) the Chrysalis Directors do not recommend the Acquisition in either the Scheme Document or, if the Acquisition is implemented by way of a takeover offer, any relevant offer document;
(iii) the Chrysalis Directors withdraw, qualify or adversely modify the terms of their recommendation of the Acquisition;
(iv) the Chrysalis Directors enter into any arrangements in respect of, or which the Chrysalis Directors know or ought reasonably to suspect may lead to, a Competing Proposal;
(v) the Panel permits Bidco to withdraw from or not proceed with the Acquisition for breach of a Condition, where such breach of Condition was attributable to an act or omission of Chrysalis; or
(vi) either Chrysalis or Chris Wright breaches their respective non-solicitation obligations.
Non-solicitation
Chrysalis and Chris Wright have also agreed that:
(i) they will not, and will procure that no member of the Chrysalis Group, nor their respective representatives will directly or indirectly, solicit, initiate, encourage or otherwise seek to procure a Competing Proposal from any third party; and
(ii) they will notify Bidco if any communication, invitation, approach or enquiry, or any request for information, is received by them or any member of the Chrysalis Group from any third party in relation to, or which could lead to, a possible Competing Proposal, including any request for information received by them under Rule 20.2 of the Code.
Except as necessary to comply with the fiduciary duties of the Chrysalis Directors, Chrysalis and Chris Wright have also agreed to not, directly or indirectly, respond to any unsolicited approach or indication of interest from a third party with respect to a Competing Proposal.
Right to match
If Chrysalis notifies Bidco of a Competing Proposal, Chrysalis has agreed to provide Bidco with reasonable details of such approach and the terms proposed by the relevant third party. Chrysalis has also agreed not to accept, recommend, approve or enter into any agreement to implement such Competing Proposal, or withhold, withdraw or adversely modify its recommendation in respect of the Acquisition, until Bidco fails, within three Business Days of being notified of the Competing Proposal, to announce a revised offer at a price per share equal to or greater than that provided under the Competing Proposal.

16. Disclosure of interests in Chrysalis
As at 25 November 2010 being the last business day prior to the date of this announcement, save for the Chrysalis Shares which are the subject of the irrevocable undertakings summarised in paragraph 10, neither Bidco nor, so far as Bidco is aware, any person acting in concert with Bidco, owns or controls any Chrysalis Shares or any securities convertible or exchangeable into Chrysalis Shares or any rights to subscribe for or purchase the same, or holds any options (including traded options) in respect of, or has any option to acquire, any Chrysalis Shares or has entered into any derivative referenced to Chrysalis Shares (“Relevant Chrysalis Securities”) which remain outstanding, nor does any such person have any arrangement in relation to Relevant Chrysalis Securities. For these purposes, “arrangement” includes any indemnity or option arrangement, and any agreement or understanding, formal or informal, of whatever nature, relating to Relevant Chrysalis Securities which may be an inducement to deal or refrain from dealing in such securities, or any borrowing or lending of Relevant Chrysalis Securities that have not been on-lent or sold.
In view of the requirement for confidentiality prior to this announcement, enquiries have not been made of certain persons who are deemed (for the purposes of the Code) to be acting in concert with Bidco. Details of the holdings of such persons (if any) will be included in the Scheme Document.

17. Indicative timetable
The Acquisition will be made on the terms and subject to the Conditions set out in this announcement and the further terms and conditions to be set out in the Scheme Document, including the obtaining of relevant regulatory approvals, approvals by Chrysalis Shareholders and the sanction of the Scheme by the Court. The Scheme Document will include full details of the Scheme, together with notices of the Court Meeting and the General Meeting and the expected timetable.
The Scheme Document will be dispatched to Chrysalis Shareholders and, for information only, to holders of options granted under the Chrysalis Share Schemes, in December 2010, with the Court Meeting and General Meeting to be held in January 2011. Accordingly, it is expected that the Scheme would become effective in early February 2011. A more detailed timetable of events will be included in the Scheme Document.
In deciding whether or not to vote in favour of the Scheme, Chrysalis Shareholders should rely on the information contained in, and follow the procedures described in, the Scheme Document and the form of proxy accompanying the Scheme Document.

18. De-listing and take-private
It is intended that, subject to applicable requirements of the London Stock Exchange and the UK Listing Authority, Bidco will procure that Chrysalis will apply to the London Stock Exchange and the UK Listing Authority for cancellations, respectively, of the admission to trading of the Chrysalis Shares on the London Stock Exchange’s main market for listed securities and of the listing of the Chrysalis Shares on the Official List.

19. General
Bidco reserves the right, with the consent of the Panel (where necessary), to elect to implement the Acquisition by making an Offer for the entire issued and to be issued share capital of Chrysalis.
If Bidco elects to implement the Acquisition by means of an Offer, the Offer will be implemented on the same terms (subject to appropriate amendments and with the consent of the Panel, where necessary), so far as applicable, as those which would apply to the Scheme, save that the Offer will be subject to the condition that acceptances are received from holders of Chrysalis Shares representing not less than 90 per cent. in value of the shares to which the offer relates. Furthermore, if sufficient acceptances of such Offer are received and/or sufficient Chrysalis Shares are otherwise acquired, it is the intention of Bidco to apply the provisions of Part 28 of the 2006 Act to acquire compulsorily any outstanding Chrysalis Shares to which such Offer relates.
The Acquisition will be subject to the Conditions set out in Appendix I. Appendix II contains the bases and sources of certain information contained in this announcement. Appendix III provides the details of the irrevocable undertakings received by Bidco. The definitions of certain terms used in this announcement are set out in Appendix IV.

20. Overseas shareholders
The implications of the Scheme for overseas shareholders may be affected by the laws of the relevant jurisdiction. Such overseas shareholders should inform themselves about and observe any applicable legal requirements. It is the responsibility of each overseas shareholder to satisfy himself as to the full observance of the laws of the relevant jurisdiction in connection therewith, including the obtaining of any governmental, exchange control or other consents which may be required, or the compliance with other necessary formalities which are required to be observed and the payment of any issue, transfer or other taxes due in such jurisdiction. Further details in relation to overseas shareholders will be contained in the Scheme Document.

In accordance with Rule 19.11 of the Code, a copy of this Announcement will be published on the following websites: www.bmg.com and www.chrysalis.com.

Enquiries
BMG Telephone: +49 (0) 30 300 133 340
Hartwig Masuch (Chief Executive Officer, BMG GmbH)
Kay Krafft (Chief Investment Officer, BMG GmbH)

Citi Telephone: +44 (0) 20 7986 4000
(Sole Financial Adviser and Corporate Broker to BMG and Bidco)
Jan Skarbek
Ketan Mehta
Simon Alexander (Corporate Broking)
Sian Evans

Finsbury Telephone: +44 (0) 20 7251 3801
(PR Adviser to BMG)
Charles Watenphul
Ed Simpkins
Chrysalis Telephone: +44 (0) 20 7465 6327
Chris Wright (Chairman)
Jeremy Lascelles (Group Chief Executive)
Andy Mollett (Chief Financial Officer)
Jefferies Telephone: +44 (0) 20 7029 8000
(Sole Financial Adviser to Chrysalis)
Jonathan Goodwin
Julian Culhane
Investec Telephone: +44 (0) 20 7597 5970
(Corporate Broker to Chrysalis)
Keith Anderson
Brunswick Telephone: +44 (0) 20 7404 5959
(PR Adviser to Chrysalis)
Tim Burt
Dania Saidam

This announcement does not constitute or form any part of an offer or invitation to sell or purchase any securities or the solicitation of an offer to buy any securities or the solicitation of any vote of approval in any jurisdiction, pursuant to the Acquisition or otherwise. The Acquisition will be made solely by means of the Scheme Document and the form of proxy accompanying the Scheme Document, which will contain the full terms and conditions of the Acquisition, including details of how to vote in favour of the Acquisition. Chrysalis Shareholders are advised to read this announcement in conjunction with the formal documentation in relation to the Acquisition carefully, once it has been dispatched. The Acquisition will be subject to the Conditions set out in Appendix I to this announcement and the full conditions and further terms which will be set out in the Scheme Document and form of proxy. This announcement and all other materials related to the Acquisition are solely directed to existing Chrysalis Shareholders.
Any acceptance or other responses to the Acquisition should be made only on the basis of the information in the Scheme Document. Chrysalis will prepare the Scheme Document to be distributed to the Chrysalis Shareholders. On the Scheme Effective Date, the Scheme will be binding on each Chrysalis Shareholder and all Chrysalis Shares will be cancelled in accordance with the Scheme, irrespective of whether any such Chrysalis Shareholder has attended or voted at the Court Meeting or General Meeting.
Citi, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for BMG and Bidco and no one else in relation to the matters referred to in this announcement and will not be responsible to anyone other than BMG and Bidco for providing the protections afforded to clients of Citi nor for providing advice in relation to these matters, the content of this announcement or any matter referred to herein.
Jefferies, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Chrysalis and no one else in relation to the matters referred to in this announcement and will not be responsible to anyone other than Chrysalis for providing the protections afforded to clients of Jefferies nor for providing advice in relation to these matters, the content of this announcement or any matter referred to herein.
The distribution of this announcement in jurisdictions other than the UK may be restricted by law and therefore any persons who are subject to the laws of any jurisdiction other than the UK should inform themselves about, and observe, any applicable requirements. This announcement has been prepared for the purpose of complying with English law and the Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions outside the UK.
Copies of this announcement are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from any Restricted Jurisdiction and persons receiving this announcement (including custodians, nominees and trustees) must not mail or otherwise forward, distribute or send it in or into or from any Restricted Jurisdiction.
The Acquisition will be subject to the applicable rules and regulations of the UK Listing Authority, the London Stock Exchange and the Code
Notice to US holders of Chrysalis Shares
US holders of Chrysalis Shares should note that the Scheme relates to the shares of a UK company that is a “foreign private issuer” as defined under Rule 3b-4 under the Exchange Act and will be governed by English law. Accordingly, neither the proxy solicitation nor the tender offer rules under the Exchange act will apply to the Scheme. Moreover, the Scheme will be subject to the disclosure requirements and practices applicable in the UK to schemes of arrangement, which differ from the disclosure requirements of the US proxy solicitation rules and tender offer rules. Financial information included in the Scheme Document will have been prepared in accordance with accounting standards applicable in the UK that may not be comparable to the accounting standards applicable to financial statements of US companies. If Bidco exercises its right to implement the acquisition of the Chrysalis Shares by way of a takeover offer, the offer will be made in compliance with applicable US securities laws and regulations.
Forward looking statements
It is possible that this announcement could or may contain forward-looking statements that are based on current expectations or beliefs, as well as assumptions about future events. Reliance should not be placed on any such statements because, by their very nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results, and BMG, Bidco and Chrysalis’ plans and objectives, to differ materially from those expressed or implied in the forward-looking statements. None of BMG, Bidco nor Chrysalis undertake to update or revise forward-looking statements, whether as a result of new information, future events or otherwise.
Dealing disclosure requirements
Under Rule 8.3(a) of the Code, any person who is interested in 1 per cent. or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person’s interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1 per cent. or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person’s interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).
Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel’s website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should contact the Panel’s Market Surveillance Unit on +44 (0)20 7638 0129.

Appendix I
CONDITIONS TO THE IMPLEMENTATION OF THE SCHEME AND ACQUISITION
Part A: Conditions of the Acquisition
The Acquisition will be conditional upon the Scheme becoming unconditional and becoming effective by no later than 31 March 2011, or such later date (if any) as Bidco and Chrysalis may, with the consent of the Panel, agree and (if required) the Court may allow.
(A) The Scheme will also be conditional upon:
(i) approval of the Scheme by a majority in number representing not less than three-fourths in value of the Scheme Shareholders (or the relevant class or classes thereof, if applicable) present and voting, either in person or by proxy, at the Court Meeting and at any separate class meeting which may be required by the Court or at any adjournment of any such meeting;
(ii) all resolutions necessary to approve and implement the Scheme being duly passed by the requisite majority or majorities at the General Meeting of Chrysalis or at any adjournment of that meeting; and
(iii) the sanction of the Scheme with or without modification (but subject to any such modification being acceptable to Chrysalis and Bidco) and the confirmation of the Reduction of Capital by the Court and:
(a) the delivery of an office copy of the Court Order and of the statement of capital confirming the Reduction of Capital to the Registrar of Companies in England and Wales; and
(b) the registration of the Court Order effecting the Reduction of Capital by the Registrar of Companies in England and Wales.
In addition, Bidco and Chrysalis have agreed that the Acquisition will be conditional upon the following conditions and, accordingly, the necessary actions to make the Scheme effective will not be taken unless the following conditions (as amended if appropriate) have been satisfied or, where relevant, waived:
(B) in respect of each of the following jurisdictions either (a) the waiting period under the applicable merger control regime having expired, lapsed or been terminated or (b) the applicable competition authority having issued a clearance decision in respect of the Acquisition:
(i) Austria;
(ii) Ireland;
(iii) Italy; and
(iv) the United States.
(C) since the Accounts Date and except as Disclosed, there being no provision of any agreement, arrangement, licence, permit or other instrument to which any member of the Wider Chrysalis Group is a party or by or to which any such member or any of its assets may be bound, entitled or subject, which in consequence of the proposed Acquisition or the Acquisition or because of a change in the control or management of Chrysalis or otherwise, could or might result (in each case to an extent which is material and adverse in the context of the Wider Chrysalis Group as a whole) in:
(i) any moneys borrowed by or any other indebtedness (actual or contingent) of, or grant available to any member of the Wider Chrysalis Group, being or becoming repayable or capable of being declared repayable immediately or earlier than their or its stated maturity date or repayment date or the ability of any member of the Wider Chrysalis Group to borrow moneys or incur any indebtedness being withdrawn or inhibited or being capable of becoming or being withdrawn or inhibited;
(ii) any such agreement, arrangement, licence, permit or instrument or the rights, liabilities, obligations or interests of any member of the Wider Chrysalis Group thereunder being terminated or modified or affected or any obligation or liability arising or any action being taken or arising thereunder;
(iii) any assets or interests of any member of the Wider Chrysalis Group being or falling to be disposed of or charged or any right arising under which any such asset or interest could be required to be disposed of or charged;
(iv) the creation or enforcement of any mortgage, charge or other security interest over the whole or any part of the business, property or assets of any member of the Wider Chrysalis Group;
(v) the rights, liabilities, obligations or interests of any member of the Wider Chrysalis Group in, or the business of any member of the Wider Chrysalis Group with, any person, firm or body (or any arrangement or arrangements relating to any such interest or business) being terminated or adversely modified;
(vi) the financial or trading position or prospects of any member of the Wider Chrysalis Group being prejudiced or adversely affected;
(vii) any member of the Wider Chrysalis Group ceasing to be able to carry on business under any name under which it presently does so; or
(viii) the creation of any material liability, actual or contingent, by any member of the Wider Chrysalis Group;
and no event having occurred which, under any provision of any agreement, arrangement, licence, permit or other instrument to which any member of the Wider Chrysalis Group is a party or by or to which any member of the Wider Chrysalis Group or any of its assets is bound, entitled or subject, could result in any of the events or circumstances as are referred to in sub-paragraphs (i) to (viii) of this condition (C) in any case where such results were material or adverse in the context of the Wider Chrysalis Group;
(D) no government or governmental, quasi-governmental, supranational, statutory, regulatory or investigative body, court, trade agency, association, institution or any other body or person whatsoever in any jurisdiction (each a “Third Party”) having announced or given written notice of a decision to take, institute, implement or threaten any action, proceeding, suit, investigation, enquiry or reference, or enacted, made or proposed any statute, regulation, decision or order, or having taken any other steps which would or might reasonably be expected to:
(i) require, prevent or delay the divestiture or materially alter the terms envisaged for any proposed divestiture by any member of the Wider Bidco Group or any member of the Wider Chrysalis Group of all or any portion of their respective businesses, assets or property or impose any limitation on the ability of any of them to conduct their respective businesses (or any of them) or to own any of their respective assets or properties or any part thereof which, in any such case, is material in the context of the Wider Chrysalis Group taken as a whole;
(ii) require, prevent or delay the divestiture by any member of the Wider Bidco Group of any shares or other securities in Chrysalis;
(iii) impose any limitation on, or result in a delay in, the ability of any member of the Bidco Group directly or indirectly to acquire or to hold or to exercise effectively any rights of ownership in respect of shares or loans or securities convertible into shares or any other securities (or the equivalent) in each case to an extent which is material in the context of the Wider Chrysalis Group taken as a whole or the Wider Bidco Group or to exercise management control over any such member;
(iv) otherwise adversely affect the business, assets, profits or prospects of any member of the Wider Bidco Group or of any member of the Wider Chrysalis Group in a manner which is material in the context of either such Wider Group;
(v) make the Acquisition or its implementation void, illegal, and/or unenforceable under the laws of any jurisdiction, or otherwise directly or indirectly, restrain, restrict, prohibit, delay or otherwise materially interfere with the same, or impose additional conditions or obligations with respect thereto, or otherwise challenge or interfere therewith;
(vi) require any member of the Wider Bidco Group or the Wider Chrysalis Group to offer to acquire any shares or other securities (or the equivalent) or interest in any member of the Wider Chrysalis Group or the Wider Bidco Group owned by any third party which is material in the context of the Wider Chrysalis Group taken as a whole;
(vii) impose any limitation on the ability of any member of the Wider Chrysalis Group to co-ordinate its business, or any part of it, with the businesses of any other members which is adverse and material in the context of the Wider Chrysalis Group as a whole; or
(viii) result in any member of the Wider Chrysalis Group ceasing to be able to carry on business under any name under which it presently does so,
and all applicable waiting and other time periods during which any such Third Party could institute, implement or threaten any action, proceeding, suit, investigation, enquiry or reference or any other step under the laws of any jurisdiction in respect of the Acquisition or the offer or proposed acquisition of any Chrysalis Shares having expired, lapsed or been terminated;
(E) all necessary filings or applications having been made in connection with the Acquisition and all material statutory or regulatory obligations in any jurisdiction having been complied with in connection with the Acquisition or the offer by any member of the Wider Bidco Group of any shares or other securities in, or control of, Chrysalis and all necessary authorisations, orders, recognitions, grants, consents, licences, confirmations, clearances, permissions and approvals reasonably necessary or appropriate for or in respect of the Acquisition including without limitation, its implementation and financing, or the proposed acquisition of any shares or other securities in, or control of, Chrysalis by Bidco having been obtained in terms and in a form satisfactory to Bidco from all appropriate Third Parties or persons with whom any member of the Wider Chrysalis Group has entered into contractual arrangements and all material authorisations, orders, recognitions, grants, consents, licences, confirmations, clearances, permissions and approvals together with all authorisation orders, recognitions, grants, licences, confirmations, clearances, permissions and approvals necessary or appropriate to carry on the business of any member of the Wider Chrysalis Group which is adverse and material in the context of the Wider Chrysalis Group as a whole, remaining in full force and effect and all filings necessary for such purpose have been made and there being no notice or intimation of any intention to revoke or not to renew any of the same at the time at which the Acquisition becomes otherwise unconditional where the same would have material adverse effect in the context of the Wider Chrysalis Group when taken as a whole and all necessary statutory or regulatory obligations in any jurisdiction having been complied with where failure to do so would have a material adverse effect in the context of the Wider Chrysalis Group taken as a whole;
(F) except as Disclosed, no member of the Wider Chrysalis Group has since the Accounts Date:
(i) save as between Chrysalis and wholly-owned subsidiaries of Chrysalis or for Chrysalis Shares issued pursuant to the exercise of options granted under the Chrysalis Share Schemes, issued, authorised or proposed the issue of additional shares of any class;
(ii) save as between Chrysalis and wholly-owned subsidiaries of Chrysalis or for the grant of options under the Chrysalis Share Schemes, issued or agreed to issue, securities convertible into shares of any class or rights, warrants or options to subscribe for, or acquire, any such shares or convertible securities;
(iii) other than to another member of the Wider Chrysalis Group, recommended, declared, paid or made or proposed to recommend, declare, pay or make any bonus, dividend or other distribution whether payable in cash or otherwise;
(iv) save as between Chrysalis and its wholly owned subsidiaries or between such wholly owned subsidiaries merged or demerged with any body corporate or acquired or disposed of or transferred, mortgaged or charged or created any security interest over any assets or any right, title or interest in any asset (including shares and trade investments) or authorised or announced any merger, demerger, acquisition or disposal, transfer, mortgage, charge or security interest, in each case, other than acquisitions or disposals in the ordinary course of business and where such action is not material in the context of the Wider Chrysalis Group taken as a whole;
(v) save as between Chrysalis and its wholly owned subsidiaries or between such wholly owned subsidiaries, made or authorised or proposed or announced an intention to propose any change in its loan capital;
(vi) issued or authorised the issue of any debentures or save as between Chrysalis and its wholly owned subsidiaries or between such wholly owned subsidiaries, save in the ordinary course of business incurred or increased any indebtedness or become subject to any contingent liability;
(vii) purchased, redeemed or repaid or become obliged to purchase, redeem or repay, any of its own shares or other securities or reduced or, save in respect to the matters mentioned in sub-paragraph (i) above, made any other change to any part of its share capital or any other alteration to its share capital within the meaning of section 617 of the 2006 Act;
(viii) save as agreed with Bidco, implemented, or authorised, proposed or announced its intention to implement, any reconstruction, amalgamation or scheme of arrangement otherwise than in the ordinary course of business or entered into or changed the terms of any contract with any director or senior executive;
(ix) entered into or varied or authorised any contract, transaction or commitment (whether in respect of capital expenditure or otherwise) which is of a long term, onerous or unusual nature or magnitude or which is or could reasonably be expected to be materially restrictive on the businesses of any member of the Wider Chrysalis Group or the Wider Bidco Group or which involves or could involve an obligation of such a nature or magnitude or which is other than in the ordinary course of business and which is material in the context of the Wider Chrysalis Group or, as applicable, the Wider Bidco Group as a whole;
(x) (other than in respect of a member which is dormant and was solvent at the relevant time) taken any corporate action or had any legal proceedings started against it for its winding-up, dissolution or reorganisation or for the appointment of a receiver, administrative receiver, administrator, trustee or similar officer of all or any of its assets or revenues or any analogous proceedings in any jurisdiction or had any such person appointed;
(xi) waived or compromised any claim otherwise than in the ordinary course of business where such action is reasonably likely to have a material and adverse impact on the Wider Chrysalis Group taken as a whole;
(xii) entered into any contract, commitment or agreement otherwise than in the ordinary course of business or passed any resolution or made any offer with respect to or announced any intention to, or to propose to, effect any of the transactions, matters or events referred to in this condition;
(xiii) having made or agreed or consented to any change to:
(1) the terms of the trust deeds constituting the pension scheme(s) established by any member of the Wider Chrysalis Group for its directors, employees or their dependents;
(2) the contributions payable to any such scheme(s) or to the benefits which accrue or to the pensions which are payable thereunder;
(3) the basis on which qualification for, or accrual or entitlement to, such benefits or pensions are calculated or determined; or
(4) the basis upon which the liabilities (including pensions) of such pension schemes are funded, valued or made;
where any such action is reasonably likely to have a material adverse impact on the Wider Chrysalis Group taken as a whole;
(xiv) proposed, agreed to provide or modify the terms of, any share option scheme, incentive scheme or other benefit relating to the employment or termination of employment of any person employed by the Wider Chrysalis Group;
(G) except as Disclosed, since the Accounts Date:
(i) no adverse change or deterioration has occurred in the business, assets, financial or trading position or profits or prospects which is material in the context of the Wider Chrysalis Group taken as a whole;
(ii) no litigation, arbitration proceedings, prosecution or other legal proceedings to which any member of the Wider Chrysalis Group is or is aware that it may become a party (whether as a plaintiff, defendant or otherwise) and no investigation by any Third Party against or in respect of any member of the Wider Chrysalis Group have been instituted

Banking Representation:
(add missing info)  
Legal Representation:
(add missing info)  
Who Made the Money?:
Name

Title
Shares (mm)
Ownership
Cost Basis

Amt (mm)
Net (mm)
Terry Ellis
28%
$ 46.37
Edit History:
Nov 26 '10
Nov 26 '10
This version submitted by Anonymous

 

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