Offer for Morson Group plc (0863E)

TIDMMRN

RNS Number : 0863E

MMGG Acquisition Limited

25 May 2012

EMBARGOED 09.00AM 25 MAY 2012

25 May 2012

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF THAT JURISDICTION

RECOMMENDED CASH OFFER BY MMGG ACQUISITION PLC ("MMGG") FOR MORSON GROUP PLC ("MORSON")

Summary

-- The board of MMGG and the Independent Director are pleased to announce that they have reached agreement on the terms of a recommended cash offer, with a loan note alternative to be made by MMGG, for the whole of the issued and to be issued share capital of Morson;

-- The offer for the entire issued and to be issued share capital of Morson will be 50 pence in cash for each Morson Share, valuing the existing issued share capital of Morson at approximately GBP23 million;

-- MMGG has decided to offer a loan note alternative to the Cash Offer in the form of the Offer Loan Notes. Morson Shareholders must elect to accept either the Cash Offer or the Loan Note Alternative for their entire shareholding;

-- In aggregate, MMGG has received irrevocable undertakings to accept or procure acceptance of the Offer in respect of a total of 26,014,380 Morson Shares, representing 57.37 per cent. of the existing issued share capital of Morson;

-- The Independent Director, who has received advice from W H Ireland Limited, considers the terms of the Offer to be fair and reasonable. However, the Independent Director does not express any view on the terms of the Loan Note Alternative. In providing such advice to the Independent Director, W H Ireland Limited has relied upon the Independent Director's commercial assessments.

-- The Offer Price represents a premium of 20.5 per cent. to the Closing Price of 41.5 pence per Morson Share on 24 May 2012, being the last Business Day prior to the Offer being announced;

-- MMGG was incorporated in England and Wales on 5 March 2012 for the purpose of making the Offer. The shares in MMGG are owned by the Management Team namely Gerrard Godfrey Mason (Chairman), Gerard Anthony Mason (Group Chief Executive), Paul John Gilmour (Group Finance Director) and Kevin Patrick Gorton (Group Managing Director). The Management Team has irrevocably undertaken to accept the Loan Note Alternative in respect of all the Morson Shares in which they are interested, namely 21,209,630 Morson Shares representing 46.78 per cent of the existing issued share capital of Morson.

PRESS ENQUIRIES

For further information contact:

 
           MMGG 
           Ged Mason                         0161 707 1516 
           Paul Gilmour                      0161 707 1516 
 
 
           Morson 
           Ian Knight                        07775 941804 
 
 
           SPARK Advisory Partners Limited (financial adviser 
            to MMGG) 
           Matt Davis, Partner                        020 3368 3552 
           Mark Brady, Partner                        020 3368 3551 
 
           W H Ireland Limited (financial adviser to Morson) 
           Adrian Hadden, Managing 
            Director                                  020 7220 1751 
           Nick Field, Corporate Finance 
            Executive                                 020 7220 1658

This summary should be read in conjunction with the full text of the attached announcement.

Apart from the responsibilities, if any, which may be imposed on SPARK Advisory Partners Limited by the Financial Services and Markets Act 2000, the European Communities (Markets in Financial Instruments) Regulations 2007 (as amended) or the regulatory regimes established thereunder or the Code, SPARK Advisory Partners Limited does not accept any responsibility whatsoever for the contents of this announcement or for any statements made or purported to be made by it or on its behalf in connection with the Offer. SPARK Advisory Partners Limited accordingly disclaims all and any liability whether arising in tort, contract or otherwise (save as referred to above) which it might otherwise have in respect of this announcement or any such statement.

Apart from the responsibilities, if any, which may be imposed on W H Ireland Limited by the Financial Services and Markets Act 2000, the European Communities (Markets in Financial Instruments) Regulations 2007 (as amended) or the regulatory regimes established thereunder or the Code, W H Ireland Limited does not accept any responsibility whatsoever for the contents of this announcement or for any statements made or purported to be made by it or on its behalf in connection with the Offer. W H Ireland Limited accordingly disclaims all and any liability whether arising in tort, contract or otherwise (save as referred to above) which it might otherwise have in respect of this announcement or any such statement. SPARK Advisory Partners Limited, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for MMGG and no-one else in connection with the Offer and will not be responsible to any person other than MMGG for providing the protections afforded to customers of SPARK Advisory Partners Limited or for providing advice in relation to the Offer or any other matter referred to in this announcement.

SPARK Advisory Partners Limited has given and not withdrawn its written consent to the release of this announcement with the inclusion of the reference to its name in the form in which it is included.

W H Ireland Limited, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Morson in connection with the Offer and will not be responsible to any person other than Morson for providing the protections afforded to clients of W H Ireland Limited or for providing advice in relation to the Offer or any other matter referred to in this announcement.

W H Ireland Limited has given and not withdrawn its written consent to the release of this announcement with the inclusion of the reference to its name in the form in which it is included.

This announcement does not constitute, or form part of, any offer for, or any solicitation of any offer for, securities. Any acceptance or other response to the Offer should be made only on the basis of information contained or referred to in the Offer Document which MMGG intends to despatch shortly to Morson Shareholders and, for information only, to holders of options under the Morson Share Schemes.

The availability of the Offer to persons who are not resident in the United Kingdom may be affected by the laws of their relevant jurisdiction. Such persons should inform themselves of, and observe, any applicable legal or regulatory requirements of their jurisdiction. Further details in relation to overseas shareholders will be contained in the Offer Document. Unless otherwise determined by MMGG and permitted by applicable law and regulation, subject to certain exceptions, the Offer is not being made and will not be made, directly or indirectly, in or into, and the Offer will not be capable of acceptance from a Restricted Jurisdiction. Accordingly, unless otherwise determined by MMGG, copies of this announcement, the Offer Document, the Form of Acceptance and any other related document are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from a Restricted Jurisdiction and persons receiving such documents (including custodians, nominees and trustees) must not mail or otherwise distribute or send them in, into or from such jurisdictions as doing so may be a breach of applicable law and regulation in that jurisdiction and may make invalid any purported acceptance of the Offer by persons in any such jurisdiction. This announcement does not constitute an offer in a Restricted Jurisdiction and the Offer will not be capable of acceptance by any such use, means, instrumentality or facilities or otherwise from or within a Restricted Jurisdiction. Accordingly this announcement is not being, and should not be, mailed, transmitted or otherwise distributed, in whole or in part, in or into or from a Restricted Jurisdiction.

Morson Shareholders (including, without limitation, nominees, trustees or custodians) must not forward this announcement to a Restricted Jurisdiction

CAUTIONARY NOTICE REGARDING FORWARD LOOKING STATEMENTS

This document contains certain forward-looking statements with respect to the financial condition, results of operations and business of the Morson Group and certain plans and objectives of the boards of directors of Morson and MMGG. These forward-looking statements can be identified by 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 statements are based on assumptions and assessments made by the Management Team and MMGG in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe appropriate.

Forward-looking statements also include statements about MMGG's beliefs and expectations related to the Offer being declared wholly unconditional, benefits that would be afforded to customers, and benefits to MMGG that are expected to be obtained as a result of the Offer being declared wholly unconditional. There can be no assurance that the Offer will be declared wholly unconditional. By their nature, forward-looking statements involve risk and uncertainty, and the factors described in the context of such forward-looking statements in this announcement could cause actual results and developments to differ materially from those expressed in or implied by such forward-looking statements.

Should one or more of these risks or uncertainties materialise, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this announcement.

The statements contained in this announcement are made as at the date of this announcement, unless some other time is specified in relation to them, and service of this announcement shall not give rise to any implication that there has been no change in the facts set out in this announcement since such date. Nothing contained in this document shall be deemed to be a forecast, projection or estimate of the future financial performance of Morson or MMGG except where expressly stated.

All subsequent oral or written forward looking statements attributable to MMGG or Morson or any of their respective members, directors, officers or employees or any persons acting on their behalf are expressly qualified in their entirety by the cautionary statement above. All forward looking statements included in this announcement are based on information available to MMGG and Morson on the date hereof and are made only as of the date of this announcement. Undue reliance should not be placed on such forward looking statements.

Subject to compliance with the Code, neither Morson nor MMGG intends, or undertakes any obligation, to update any information contained in this announcement.

DEALING DISCLOSURE REQUIREMENTS

Under Rule 8.3(a) of the Code, any person who is interested in 1% 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% 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.

You should note that, for the purposes of the above summary of Rule 8 of the Code, MMGG is not treated as a paper offeror and therefore there is no requirement to disclose interests or dealings in the shares of MMGG under Rule 8 of the Code.

Publication on website

A copy of this announcement will be available free of charge, subject to certain restrictions relating to persons in Restricted Jurisdictions, on MMGG's website at www.MMGG.co.uk and on Morson's website at www.Morson.com by no later than 12.00 p.m. (London time) on 28 May 2012.

Neither the content of the websites referred to in this announcement nor the content of any website accessible from hyperlinks on MMGG's website and/or Morson's website (or any other website) is incorporated into, or forms part of, this announcement.

EMBARGOED 09.00AM 25 MAY 2012

25 May 2012

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF THAT JURISDICTION

RECOMMENDED CASH OFFER BY MMGG ACQUISITION PLC ("MMGG") FOR MORSON GROUP PLC ("MORSON")

1. Introduction

The board of MMGG and the Independent Director are pleased to announce that they have reached agreement on the terms of a recommended cash offer, with a loan note alternative (further details of which are given in paragraph 4 below), to be made by MMGG for the whole of the issued and to be issued share capital of Morson.

The Offer values each Morson Share at 50 pence and Morson's existing issued share capital at approximately GBP23 million.

The Offer Price represents a premium of 20.5 per cent. to the Closing Price of 41.5 pence per Morson Share on 24 May 2012, being the last Business Day prior to the Offer being announced. In aggregate, MMGG has received irrevocable undertakings to accept or procure acceptance of the Offer in respect of a total of 26,014,380 Morson Shares, representing 57.37 per cent. of the existing issued share capital of Morson.

2. Recommendation

The Independent Director, who has been so advised by W H Ireland Limited, considers the terms of the Offer to be fair and reasonable. However, the Independent Director does not express any view on the terms of the Loan Note Alternative. In providing its advice to the Independent Director, W H Ireland Limited has taken into account the commercial assessments of the Independent Director. WH Ireland is acting as the independent financial adviser to Morson for the purposes of providing independent financial advice to the Independent Director on the Offer under Rule 3.1 of the Code.

Accordingly, the Independent Director recommends that Morson Shareholders accept the Cash Offer as he has irrevocably undertaken to do in respect of his own beneficial shareholding of 20,000 Morson Shares (representing approximately 0.04 per cent. of the existing issued share capital of Morson).

The Independent Director, who has been so advised by WH Ireland Limited, considers that whilst the nominal value at completion of the Loan Note Alternative may be the same as that of the Cash Offer, additional risk attaches to the Loan Note Alternative, arising from inter alia, the possibility that the Company will in due course become a private limited company, the significant increase in the indebtedness of the Company that will arise should the Offer proceed and the claims of other creditors (including Barclays) ranking ahead of the Loan Note Alternative and therefore gives no recommendation to Morson Shareholders in relation to the Loan Note Alternative.

3. The Offer

The Offer, which will be on the terms and subject to the conditions set out below and in Appendix I, and to be set out in full in the Offer Document and, in relation to certificated shareholders, the Form of Acceptance, will be made on the following basis:

   For each Morson Share               50 pence in cash

Morson Shares will be acquired by MMGG pursuant to the Offer fully paid and free from all liens, equities, charges, equitable interests, encumbrances, rights of pre-emption and other third party rights and/or interests of any nature whatsoever and together with all rights attaching to them, now or in the future, including the right to receive and retain all dividends, interest and other distributions declared, paid or made in the future.

As an alternative to the cash consideration which they would otherwise be entitled to receive, Morson Shareholders will be able to elect to receive Offer Loan Notes, which will be issued on the basis of 50 pence in nominal value of Offer Loan Notes for each Morson Share.

Morson Shareholders must elect to receive either cash or Offer Loan Notes for their entire holding of Morson Shares. There is no option for Morson Shareholders to accept the Offer and elect to receive partly cash and partly Offer Loan Notes.

   4.   The Loan Note Alternative

MMGG has decided to offer a loan note alternative to the Cash Offer in the form of the Offer Loan Notes.

The Offer Loan Notes will be created by a resolution of the Board of MMGG (or a duly authorised committee thereof) and will be constituted by the Offer Loan Note Instrument executed as a deed by MMGG.

The issue of the Offer Loan Notes will be conditional on the Offer being declared wholly unconditional.

The Offer Loan Notes will not be transferable.

No application will be made for the Offer Loan Notes to be listed or dealt in on any stock exchange.

The Offer Loan Notes will not be qualifying corporate bonds for United Kingdom taxation purposes for Morson Shareholders who are individuals.

The Offer Loan Notes will bear interest at 4% per annum but this interest will be accrued and only paid when the Offer Loan Notes are redeemed. The Offer Loan Notes are, on the face of the Offer Loan Note Instrument, redeemable on 1 January 2018. However, payments under the Offer Loan Notes are subject to the terms of the Intercreditor Agreement and it cannot be guaranteed that redemption will occur on that date. Morson Shareholders who elect to receive Offer Loan Notes must accede to the terms of the Intercreditor Agreement on such terms as Barclays may require. A summary of the terms of the Intercreditor Agreement is set out in Part B of Appendix II.

MMGG may (subject to the terms of the Intercreditor Agreement), at any time, elect to redeem all or any part of the Offer Loan Notes (or any Offer Loan Notes or part of any Offer Loan Notes held by certain of the Offer Loan Noteholders as the board of MMGG may elect).

Morson Shareholders should consider carefully, in light of their own investment objectives and tax position, whether they wish to elect for the Offer Loan Notes under the Loan Note Alternative and are strongly advised to seek their own independent financial advice before making any such election.

Further information on the Offer Loan Notes is given in Part A of Appendix II.

   5.   Background to and Reasons for the Offer

Background to the Offer

In Morson's admission document dated 27 March 2006, by which the Morson Shares were admitted to trading on AIM at a price of 160 pence per Morson Share, it was stated that:

"Admission will give the Group access to a new source of funds and tradeable shares to facilitate the Group's future growth, both organically and by acquisition. The Directors believe that a quotation on AIM will raise the status and market profile of the Group, promoting further awareness of Morson and that this increased awareness will strengthen the Group's ability to attract new business and take advantage of growth opportunities.

In addition, the Directors believe that Admission will provide liquidity and a value for the Company's equity which, in conjunction with the EMI scheme, will help the Group to continue to attract, motivate and retain staff of an appropriate calibre to achieve the growth opportunities."

Mindful of the factors below, set alongside the statement from the AIM admission document, the Management Team have been evaluating the continued appropriateness of the Company's admission to trading on AIM.

Share price volatility

Since its admission to trading on AIM in 2006, Morson's share price has been extremely volatile, rising to a high of approximately 258 pence per Morson Share in June 2007 and falling to a low of approximately 39 pence per Morson Share in February of this year and as recently as 10 April this year.

During this time, the Group has continued to report profits above those recorded at the time of its admission to trading on AIM and yet its share price has, since 29 May 2008, remained below the price at which admission occurred, namely 160p. This has defeated one of the core reasons for the original admission, namely to attract, motivate and retain staff of an appropriate calibre to achieve the growth opportunities which the Company intended to achieve through share options and share ownership. The volatility in the share price has resulted in options being granted with exercise prices, ranging from 89.5 - 245 pence per Morson Share, which are now substantially above the current share price and those that subscribed for shares at admission are now sitting on substantial losses, despite the Group delivering continued profitability in difficult UK economic conditions.

Management believes that it will have a greater chance of attracting, retaining and incentivising key personnel with bonus and/or share option arrangements, which may not comply with corporate governance guidelines for an AIM company and therefore may not be acceptable to institutional investors and the broader market if the Company were to remain admitted to trading on AIM.

Furthermore, the Management Team believes that concern about the Company's share price performance may result in a loss of confidence when approaching contract renewals. The Management Team also believes that the relative decline in the Company's share price may be utilised by competitors in an effort to imply financial distress despite the Company's performance in difficult UK economic conditions. The Management Team had believed that the Company's admission to AIM would strengthen its ability to gain and retain business. It is their current opinion that, as a result of share price volatility and the Company's depressed market capitalisation, being AIM listed now weakens Morson's competitive positioning.

Business Transition

Despite the current UK economic climate, the Group has been able to maintain a substantial level of profit. This has been achieved despite the loss in recent years of a number of significant contracts and reduced volumes on others; including the cessation of the Nimrod aircraft programme contributing to the closure of the BAe site at Woodford, the supply of workers to Magnox, and the loss of the "Trackforce" contract with Metronet. The Group has won new work and renewed some existing contracts. However, new contracts are predominantly obtained by a competitive tender process and renewals are typically negotiated with pressure for margin reductions but with enhancement of quality of service. The Morson Board believes that the economic outlook remains challenging in the UK, with Government expenditure under pressure and whilst there is commitment to long term projects such as HS2 and Crossrail, the material benefits that could accrue to the Group are uncertain and a number of years away.

The Morson Board has commenced the process of transitioning the business from one that is predominantly UK-centric to one that is able to take advantage of overseas opportunities. In addition, the Morson Board has invested in new offices in the UK, in permanent staff and Morson Projects. This strategy of investment for growth is one that, in the short to medium term, may impact on future cashflow and profits. The Management Team believes that this strategy will, over time, prove to enhance the security and sustainability of revenues, but acknowledges that the risk profile of the business may, for the foreseeable future, be higher than Morson Shareholders currently envisage. The Management Team believes this may impact on the Company's share price. Accordingly, Management believes that the transition of the business would be best achieved in the more flexible private company environment.

Current Trading and future prospects

As the Morson Board has stated in the preliminary results for the year ended 31 December 2011, released on 30 March 2012, the 2011 financial year was a challenging one. The markets in which the Group operates are competitive and varying levels of confidence amongst the Group's client base, due to wider economic uncertainty, has affected demand.

Whilst the Group has been successful in maintaining key client relationships in its core business, this has been achieved with downward pressure on margins and/or payment terms. Furthermore, five of the contracts under which the Group derives significant turnover are due for renewal or extension in 2012. If the recent trend of margin erosion and extension of credit terms were applied to all these contracts it would put further pressure on cash flow. Such pressure would hamper the Group's plans for overseas expansion and further reduce the likelihood of a return to dividend payments. In such circumstances, the Morson Board may be forced into action to preserve cash flow at the expense of revenue and profit. The Management Team believe that such action, whilst necessary, could have a detrimental impact on Morson's share price.

As a result of margin erosion and increased costs, the Morson Directors believe the Group has to work harder to stand still in terms of profits.

Morson Projects

The trading of Morson Projects has deteriorated over the past two years as it is achieving lower gross profit margins and incurring increased overhead costs. Morson Projects has a different business model to core recruitment operations requiring longer term investment in often fixed price contracts which the Morson Directors believe to be inherently more risky than core recruitment. To demonstrate this further on 7 May 2012, Morson Projects received an unquantified claim from a client regarding a specific piece of work. In the limited time since the claim was received Morson Projects has not received full details of the claim, the circumstances surrounding the claim and quantification of the claim. Accordingly the merits of the claim have not been fully assessed, but this claim may lead to litigation in due course. The Management Team believes Morson Projects has strong defences to any such claim and, in any event, carries professional indemnity insurance which should mitigate the position and, to the extent there is any merit in the claim, Morson Projects may also have claims against third parties regarding the work involved. Whilst the Management Team are confident about the outcome of this claim and are proceeding with the Offer as previously envisaged, the Bank have concluded that there is a risk of a cash loss and have put further clauses into their facility agreement which relate specifically to this claim, as set out in paragraph 8. Morson Projects also requires more working capital and fixed asset expenditure. The Management Team believes that this activity is not well understood by the stock market and that the value of Morson Projects is not truly reflected in Morson's market capitalisation. As a result, it is the Management Team's belief that this business unit would sit better as part of a private company.

These factors, taken together, have reduced the visibility previously enjoyed by the Morson Board when forecasting profitability, increasing the risk that the Group will perform below market expectations. Mindful of the share price impact that arises from the publication of negative news, the Management Team believes that shareholder value could be considerably eroded if future market expectations fail to be met.

Cash flow and dividends

In its trading statements issued in December 2011 and February 2012, the Morson Board highlighted that the Group's cash position had been negatively impacted by the lengthening of some trading cycles and the investment in development of overseas opportunities which has led to a substantial increase in net debt. These factors contributed to the decision to suspend dividend payments by the Company. In light of the current trading environment and the business transition referred to above, the Company can offer no guarantee that dividend payments will be recommenced when the position is next reviewed as part of the interim results process in September 2012. The Management Team believe that a number of shareholders invested in the Company to take advantage of dividend income. As a result, the Management Team believes that, in light of the change of circumstances, it is appropriate to put forward the Offer so that such Morson Shareholders can receive value for their shareholding in Morson at a premium to the pre-announcement share price.

The Offer Price

The Offer is to be funded through the Management Team's own resources, bank leverage and the Offer Loan Notes. The valuation of Morson at the Offer Price is principally a function of the leverage made available by Barclays to make the Offer. The Offer values Morson at a level at which the Management Team believe future debt service can be achieved without putting at risk the continuing stakeholders' investment and employment prospects of the staff employed in the Group.

   6.         Background to the Recommendation

The Independent Director has considered the terms of the Cash Offer and recommends, having been so advised by WH Ireland Limited, that all Morson Shareholders should accept the Cash Offer for their Morson Shares at a price of 50 pence per Morson Share.

The Independent Director believes that, for reasons set out below, in the absence of an offer for the Company, there can be no guarantee that Morson Shareholders (especially those with significant shareholdings) will be able to sell their entire shareholding in Morson in the market, should they wish to do so, at a price of 50 pence or better, in the short to medium term.

In addition, given the receipt of irrevocable undertakings amounting to 57.37 per cent. of Morson's issued share capital, there is a likelihood that if the Offer proceeds Morson will be delisted, and that shareholders choosing not to accept the Offer would be unable easily to realise value for their shareholdings and experience the elevated risks attached to investment in an unquoted company.

The Independent Director therefore advises that each Morson Shareholder should consider carefully the information set out below in making a decision as to whether to accept the Offer.

In deciding to recommend the Cash Offer, the Independent Director has taken into account the factors set out below. This is not intended to be an exhaustive list of relevant factors and Morson Shareholders should consider their individual circumstances carefully before deciding whether to accept the Offer.

The economic and trading environment

- Macroeconomic weakness in the Company's principal geographic markets, accompanied by a general fiscal tightening that has significantly, negatively impacted a number of the Group's larger customers who rely on defence and other spending by governments for substantial amounts of their revenues;

- Industry overcapacity, in the Morson Projects business in particular, which has resulted from falling demand, leading to significantly increased competition for contracts, and accompanying reduction in profit margins and deterioration in other terms;

- Risks associated with the business plan being pursued by the Management Team. It is probable that underperforming operations such as the UK projects and permanent recruitment businesses will require further restructuring and that development of the overseas businesses will continue to require substantial investment; and

- Demands on the Company's cash flow from impending contract renewals, the need to renew existing banking facilities during 2013 and 2014, continued efforts to develop underperforming areas of the Group and the need to reduce indebtedness which are likely to impact the ability of the Company to reinstate dividend payments.

Incentivisation of directors and key staff

- The Independent Director would draw Morson Shareholders' attention to the likely negative impact on the business and motivation and morale of key senior managers if the current process does not conclude with the successful completion of the Offer.

The market in Morson Shares

- The Company is exposed to the infrastructure and capital goods markets, which are highly cyclical and can in periods of recession therefore fall out of favour with investors;

- Over recent years the Company's share price has declined from over GBP2.50 to around 80p in the second half of 2011, and fallen further to around 40p following announcement of the dividend suspension in December 2011. This decline indicates negative market sentiment, arising from concerns around the sector and the underlying trading performance of the Company, as well as the suspension of the dividend. It appears unlikely that catalysts for a significant improvement in the market perception of the Company will arise in the short to medium term, particularly given the challenges posed to a return to dividends by the Company's indebtedness and other demands on cashflow;

- The lack of trading liquidity in Morson Shares, arising in part from the large shareholding of the Management Team, has made it challenging for potential new investors to become Morson Shareholders and is believed to be likely to have deterred others. The average daily trading volume in Morson Shares for the 12 month period ended 24 May 2012 was 53,984 Morson Shares being 0.1 per cent. of Morson's existing issued share capital;

- The shareholding of the Management Team (46.78 per cent.) is likely to deter others from making a competing offer for the Company; and

- The level of irrevocable acceptances secured for the Offer is such that as the Offer proceeds the probability that the Company will be delisted is significant and in this situation the liquidity of shareholders would be substantially curtailed, restricting further their ability to realise value for their Morson Shareholdings .

Accordingly, the Independent Director believes that the Cash Offer represents an appropriate way for Morson Shareholders to realise value for their investment at a premium to the prevailing share price.

It should be noted however that the Independent Director's recommendation only applies to the Cash Offer and does not apply to the Loan Note Alternative, as he considers that whilst the nominal value at completion of the Loan Note Alternative may be the same as that of the Cash Offer, additional risk attaches to the Loan Note Alternative, arising from inter alia, the possibility that the Company will in due course become a private limited company, the significant increase in the indebtedness of the Company that will arise should the Offer proceed and the claims of other creditors (including Barclays) ranking ahead of the Loan Note Alternative.

   7.         Irrevocable Undertakings to Accept the Offer

In aggregate, MMGG has received irrevocable undertakings to accept or procure acceptance of the Offer in respect of a total of 26,014,380 Morson Shares, representing 57.37 per cent. of the existing issued share capital of Morson.

Details of these undertakings are set out in Appendix IV. Morson Shareholders should be aware that the Management Team has irrevocably undertaken to accept the Loan Note Alternative in respect of their entire combined interests of 21,209,630 Morson Shares amounting to approximately 46.78 per cent. of the existing issued share capital of Morson.

   8.         Financing of the Offer

Full acceptance of the Offer (other than in respect of the interests of the Management Team), in cash, will result in the payment by MMGG of approximately GBP12.067 million in cash to Morson Shareholders. The cash consideration provided by MMGG in support of the Cash Offer is being financed by debt financing being provided by Gerard Anthony Mason and Barclays.

MMGG has entered into a facilities agreement with Barclays whereby Barclays will provide certain facilities to assist in financing the consideration under the Offer and any squeeze out of shares following the Offer, the costs of the Offer and refinancing certain existing financial indebtedness of the Morson Group. The facilities, which amount to up to GBP14 million, comprise a term loan of up to GBP12 million which is repayable in quarterly instalments over a four year period from the date on which the Offer is declared unconditional and a term loan of up to GBP2million which is repayable on the date which falls four years from the date on which the Offer is declared unconditional. In certain circumstances, the facilities may be repayable earlier, including in circumstances where the claim against Morson Projects referred to in paragraph 5 above involves Morson Projects incurring an aggregate liability equal to or in excess of GBP1 million taking into account any relevant net insurance recovery (after taking into account any excess payable in respect of such insurance recovery).

MMGG has entered into a facility agreement with Gerard Anthony Mason whereby he will provide GBP2,500,000 of loans to assist in financing the consideration under, and the costs of, the Offer. Repayment of this facility is due on 30 June 2017. In certain circumstances, these facilities may be repayable earlier. In any event, repayment of this facility issubject to the terms of the Intercreditor Agreement.

SPARK Advisory Partners Limited is satisfied that sufficient resources are available to MMGG to satisfy in full the cash consideration payable pursuant to the Offer.

   9.         Information on MMGG

MMGG was incorporated in England and Wales on 5 March 2012 for the purpose of making the Offer. All of the issued ordinary shares in MMGG are owned by the Management Team comprising Gerrard Godfrey Mason (Chairman), Gerard Anthony Mason (Group Chief Executive), Paul John Gilmour (Group Finance Director) and Kevin Patrick Gorton (Group Managing Director).

To date, MMGG has neither traded nor engaged in any activities, other than those in relation to its incorporation, re-registration as a public limited company, the issuing of shares to the Management Team and the making of the Offer.

   10.       Information on Morson

Morson operates through three main subsidiaries, Morson Human Resources Limited, which trades as Morson International, and Morson Wynnwith Limited, both of which provide specialist engineering and technical personnel and Morson Projects Limited, which provides outsourced engineering and project management design services.

Nuclear, aerospace, rail and power are the core markets in which Morson operates. However, a wide range of ancillary engineering and design markets also draw on the Group's engineering talent. The Morson Board believes that other areas, including telecommunications, oil and gas, marine and automotive provide opportunities for growth. Morson seeks to work in partnership with its customers in order to seek to establish common goals for efficiency, innovation and technical expertise. This approach provides Morson with knowledge of the needs and aims of clients, enabling Morson to make changes and improvements to its service. The Morson Board believes that success in its markets can be achieved by securing and maintaining long-term relationships with customers.

Morson released its preliminary final results on 30 March 2012 and published its annual report and accounts for the year ended 31 December 2011 on 17 April 2012. The annual report is available on Morson's website.

   11.       Current trading and future prospects of MMGG

To date, MMGG has neither traded nor engaged in any activities, other than those in relation to its incorporation, its re-registration as a public limited company, the issuing of shares to the Management Team and the making of the Offer.

MMGG currently has in issue 50,000 ordinary shares of GBP1 each which are fully paid and which are held by the Management Team as follows:

 
 MMGG Shareholder         Number of ordinary shares 
                           in MMGG held 
-----------------------  -------------------------- 
 Gerrard Godfrey Mason    23,600 
-----------------------  -------------------------- 
 Gerard Anthony Mason     23,600 
-----------------------  -------------------------- 
 Paul John Gilmour        1,400 
-----------------------  -------------------------- 
 Kevin Patrick Gorton     1,400 
-----------------------  -------------------------- 
 
   12.       Management and Employees

The MMGG Board attaches great importance to the skills and experience of the management and employees of Morson. The MMGG Board has provided assurances to the Independent Director that, upon the Offer becoming or being declared unconditional in all respects, the existing employment rights of all employees of Morson will be fully safeguarded.

No change is expected to the current locations of the Group's places of business.

In addition, following the Offer becoming unconditional in all respects, key members of the Management Team will remain in their current roles with no changes to their current terms and conditions of employment.

The Independent Director of Morson has agreed to resign subject to and with effect from the Offer being declared unconditional in all respects. Particulars of the payments to the Independent Director in respect of termination of his appointment as a director (and in accordance with the terms of his letter of appointment) will be set out in full in the Offer Document).

   13.       Morson Share Option Schemes

The Offer extends to any Morson Shares which are unconditionally allotted or issued whilst the Offer remains open for acceptance (or by such earlier time and/or date as MMGG may, subject to the Code and/or with the consent of the Panel, determine, but not being earlier than the date on which the Offer becomes or is declared unconditional as to acceptances) as a result of the exercise of options or other awards granted under the Morson Share Schemes. Participants in the Morson Share Schemes will be contacted separately regarding the effect of the Offer on their options and MMGG and Morson will make appropriate proposals to the holders of any in-the-money options. However, as has been outlined in paragraph 5 above, at the Offer Price, none of the options granted under the Morson Share Option Schemes would be in-the-money options.

   14.       Disclosure of Interests in Morson

Other than pursuant to the irrevocable undertakings referred to in paragraph 7 above, MMGG confirms that it does not currently hold any interest in Morson Shares.

MMGG is, however, acting in concert with the Management Team which has the interests in Morson Shares set out below:

 
 Name            Number of Morson   Percentage 
                  Shares             holding 
 G G Mason(1)    9,984,215          22.02 
 G A Mason(2)    10,906,090         24.05 
 P J Gilmour     630,000            1.39 
 K P Gorton      611,200            1.35

Note

1. Of these Morson Shares included in G G Mason's holding, 921,875 are held by the trustees of a discretionary trust of which G G Mason is a trustee.

2. Of these Morson Shares included in G A Mason's holding, 921,875 are held by the trustees of a discretionary trust of which G G Mason is a trustee. These shares are included in G A Mason's holding by reason of the inclusion of G A Mason's children as beneficiaries. G A Mason has no beneficial interest in these shares.

   15.       Securities in Issue

As at the close of business on, 24 May, 2012, there were 45,343,750 Morson Shares in issue.

   16.       Cancellation of Trading, Re-registration and compulsory acquisition

If MMGG acquires or agrees to acquire, by virtue of its shareholding and acceptances of the Offer, issued share capital carrying 75 per cent. or more of the voting rights of Morson, MMGG intends to procure that Morson applies for cancellation of the trading in Morson Shares on AIM not less than 20 Business Days following MMGG first having acquired or agreed to acquire such issued share capital and thereafter to procure that the Company is re-registered as a private limited company. However, even though the Company would no longer be a public company, it would still remain subject to the provisions of the City Code for a period of 10 years from its re-registration as a private limited company.

If sufficient valid acceptances of the Offer are received and/or sufficient Morson Shares are otherwise acquired, MMGG intends to apply the provisions of sections 979 to 982 (inclusive) of the Companies Act to acquire compulsorily any outstanding Morson Shares to which the Offer relates.

   17.       General

The Offer Document will be posted to Morson Shareholders as soon as practicable and, in any event (save with the consent of the Panel), within 28 days of the date of this announcement.

The Offer will be made solely by the Offer Document and the Form of Acceptance, which will contain the full terms and conditions of the Offer, including details of how the Offer may be accepted.

Appendix V contains definitions of the terms used in this announcement.

   18          Offer-related arrangements

MMGG and Morson entered into an agreement on 14 March 2012 (the "Confidentiality Agreement") pursuant to which, amongst other things, MMGG has undertaken to (i) keep confidential certain non-public information it receives relating to the Morson Group, (ii) use such information solely for the purpose of evaluating a possible offer for Morson and (iii) not to disclose such information to third parties (other than certain permitted disclosees) unless required by law, regulation, a court of competent jurisdiction or any governmental or competent regulatory authority.

MMGG has further undertaken that subject to certain limited exclusions, during the period of two years from the date negotiations cease it will not directly or indirectly solicit, endeavour to entice away or offer to employ or to enter into any contract for services with any person who is (i) in a managerial, supervisory, technical or sales capacity of any member of the Morson Group or (ii) is a consultant to any member of the Morson Group where the person in question has confidential information or would be in a position to exploit any member of the Morson Group's trade connections.

MMGG has entered into a facility agreement with Gerard Anthony Mason, further details of which are set out in paragraph 8 above.

   19          Documents on display

Copies of the following documents will, subject to certain restrictions relating to persons in Restricted Jurisdictions, be made available free of charge on MMGG's and Morson's websites at www.MMGG.co.uk and www.Morson.com respectively by no later than 12:00 p.m. (London time) on the Business Day following this announcement until the end of the Offer Period:

- this announcement;

- the irrevocable undertakings referred to in paragraph 7 above and described in Appendix IV to this announcement;

- the facilities agreement and the facility agreement referred to in paragraph 8 above;

- the Intercreditor Agreement referred to in paragraphs 4 and 8 above; and

- the Confidentiality Agreement referred to in paragraph 18 above.

PRESS ENQUIRIES

For further information contact:

 
           MMGG 
           Ged Mason                        0161 707 1516 
           Paul Gilmour                     0161 707 1516 
           Morson 
           Ian Knight                       07775 941804 
 
 
           SPARK Advisory Partners Limited (financial adviser 
            to MMGG) 
           Matt Davis, Partner                        020 3368 3552 
           Mark Brady, Partner                        020 3368 3551 
 
           W H Ireland Limited (financial adviser to Morson) 
           Adrian Hadden, Managing 
            Director                                  020 7220 1751 
           Nick Field, Corporate Finance 
            Executive                                 020 7220 1658

SPARK Advisory Partners Limited, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for MMGG and no-one else in connection with the Offer and will not be responsible to any person other than MMGG for providing the protections afforded to customers of SPARK Advisory Partners Limited or for providing advice in relation to the Offer or any other matter referred to in this announcement.

W H Ireland Limited has given and not withdrawn its written consent to the release of this announcement with the inclusion of the reference to its name in the form in which it is included.

The availability of the Offer to persons who are not resident in the United Kingdom may be affected by the laws of their relevant jurisdiction. Such persons should inform themselves of, and observe, any applicable legal or regulatory requirements of their jurisdiction. Further details in relation to overseas shareholders will be contained in the Offer Document. Unless otherwise determined by MMGG and permitted by applicable law and regulation, subject to certain exceptions, the Offer is not being made and will not be made, directly or indirectly, in or into, and the Offer will not be capable of acceptance from a Restricted Jurisdiction. Accordingly, unless otherwise determined by MMGG, copies of this announcement, the Offer Document, the Form of Acceptance and any other related document are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from a Restricted Jurisdiction and persons receiving such documents (including custodians, nominees and trustees) must not mail or otherwise distribute or send them in, into or from such jurisdictions as doing so may be a breach of applicable law and regulation in that jurisdiction and may make invalid any purported acceptance of the Offer by persons in any such jurisdiction. This announcement does not constitute an offer in a Restricted Jurisdiction and the Offer will not be capable of acceptance by any such use, means, instrumentality or facilities or otherwise from or within any Restricted Jurisdiction. Accordingly this announcement is not being, and should not be, mailed, transmitted or otherwise distributed, in whole or in part, in or into or from any Restricted Jurisdiction.

Morson Shareholders (including, without limitation, nominees, trustees or custodians) must not forward this announcement to any Restricted Jurisdiction.

CAUTIONARY NOTICE REGARDING FORWARD LOOKING STATEMENTS

Should one or more of these risks or uncertainties materialise, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this announcement.

Subject to compliance with the Code, neither Morson nor MMGG intends, or undertakes any obligation, to update any information contained in this announcement.

APPENDIX I

Conditions and Certain Further Terms of the Offer

A. Conditions of the Offer

The Offer will be subject to the following conditions:

(a) valid acceptances of the Offer being received (and not, where permitted, withdrawn) by 1.00 p.m. on the first closing date (or such later time(s) and/or date(s) as MMGG may, subject to the rules of the Code or with the consent of the Panel, decide) in respect of not less than 90 per cent. (or such lesser percentage as MMGG may decide) in nominal value of the Morson Shares to which the Offer relates, and not less than 90 per cent. (or such lesser percentage as MMGG may decide) of the voting rights carried by the Morson Shares to which the Offer relates, provided that this condition will not be satisfied unless MMGG shall have acquired or agreed to acquire, whether pursuant to the Offer or otherwise, Morson Shares carrying in aggregate more than 50 per cent. of the voting rights then exercisable at a general meeting of Morson including, to the extent (if any) required by the Panel, any voting rights attaching to any Morson Shares which are unconditionally allotted before the Offer becomes or is declared unconditional as to acceptances pursuant to the exercise of any outstanding conversion or subscription rights or otherwise. For the purposes of this condition:

(i) Morson Shares which have been unconditionally allotted but not issued before the Offer becomes or is declared unconditional as to acceptances, whether pursuant to the exercise of any outstanding subscription or conversion rights or otherwise, shall be deemed to carry the voting rights which they will carry upon issue; and

(ii) the expressions "Morson Shares to which the Offer relates" and "associates" shall be construed in accordance with sections 974 to 991 of the Companies Act 2006;

(b) each clearance or consent of, filing with, or notice to, any Third Party (as defined below) that is reasonably considered by MMGG to be necessary or appropriate in connection with the Offer or its implementation, including the acquisition of any share or securities in, or control of, any member of the Wider Morson Group, in any country, territory or jurisdiction in which a member of the Wider MMGG Group or the Wider Morson Group is established or conducts business, having been granted, filed or delivered (as appropriate), in each case in terms satisfactory to MMGG;

(c) no antitrust regulator, central bank, government or governmental, quasi-governmental, supranational, statutory, regulatory or investigative body, authority, court, trade agency, association or institution or professional or environmental body or any other similar person or body whatsoever in any relevant jurisdiction (each a "Third Party") having, without the consent of MMGG, decided to take, institute, implement or threaten any action, proceedings, suit, investigation, enquiry or reference or having required any action to be taken or information to be provided or otherwise having done anything or having made, proposed or enacted any statute, regulation, order or decision or having done anything which would or might reasonably be expected to:

(i) make the Offer or its implementation, or the acquisition or the proposed acquisition by MMGG of any shares or other securities in, or control or management of, Morson or the Wider Morson Group void, unlawful, illegal or unenforceable in any jurisdiction, or otherwise directly or indirectly restrain, prohibit, restrict, prevent or delay the same or impose additional conditions or financial or other obligations with respect thereto, or otherwise challenge or interfere therewith, or require adverse amendment to the Offer or the acquisition of any shares or other securities in, or control or management of, Morson by MMGG;

(ii) require, prevent or materially delay the divestiture or alter the terms envisaged for any proposed divestiture by MMGG or any member of the Wider MMGG Group of any Morson Shares or of any shares in a member of the Wider Morson Group;

(iii) require, prevent or materially delay the divestiture or alter the terms envisaged for any proposed divestiture by any member of the Wider MMGG Group or by any member of the Wider Morson Group of all or any material portion of their respective businesses, assets or property, or (to an extent which is material in the context of the Offer or the Wider Morson Group concerned taken as a whole) impose any limit on the ability of any of them to conduct their respective businesses (or any of them) or to own or control any of their respective assets or properties or any part thereof;

(iv) impose any material limitation on, or result in any material delay in, the ability of any member of the Wider MMGG Group or any member of the Wider Morson Group to acquire, hold or exercise effectively, directly or indirectly, all or any rights of ownership of Morson Shares or any shares or securities convertible into Morson Shares or to exercise voting or management control over any member of the Wider Morson Group or any member of the Wider MMGG Group in any such case which is material in the context of the Wider Morson Group;

(v) except pursuant to Chapter 3 of Part 28 of the Companies Act require any member of the Wider MMGG Group and/or of the Wider Morson Group to acquire or offer to acquire any shares or other securities (or the equivalent) in and/or indebtedness of any member of the Wider Morson Group owned by or owed to any Third Party in circumstances which would impose on any member of the MMGG Group or any member of the Morson Group a liability which is material in the context of the Wider MMGG Group or the Wider Morson Group as the case may be;

(vi) impose any material limitation on the ability of any member of the Wider MMGG Group and/or of the Wider Morson Group to integrate or co-ordinate its business, or any material part of it, with the business of any member of the Wider Morson Group or of the Wider MMGG Group respectively; or

(vii) otherwise adversely affect any or all of the businesses, assets, prospects, profits or financial or trading position of any member of the Wider Morson Group or any member of the Wider MMGG Group to an extent which is material in the context of the Offer or any such group taken as a whole,

and all applicable waiting and other time periods during which any Third Party could institute, implement or threaten any such actions, proceedings, suit, investigation, enquiry or reference under the laws of any relevant jurisdiction, having expired, lapsed or been terminated;

(d) all necessary filings and applications having been made and all necessary waiting and other time periods (including any extensions thereof) under any applicable legislation or regulations of any relevant jurisdiction having expired, lapsed or been terminated and all statutory or regulatory obligations in any relevant jurisdiction having been complied with in each case as may be necessary in connection with the Offer and its implementation or the acquisition or proposed acquisition by MMGG or any member of the Wider MMGG Group of any shares or other securities in, or control of, Morson or any member of the Wider Morson Group and all authorisations, orders, recognitions, grants, consents, clearances, confirmations, licences, certificates, permissions and approvals ("Authorisations") which are material and necessary or appropriate for or in respect of the Offer or the acquisition or proposed acquisition by MMGG of any shares or other securities in, or control of, Morson or the carrying on by any member of the Wider Morson Group of its business or in relation to the affairs of any member of the Wider Morson Group having been obtained in terms and in a form reasonably satisfactory to MMGG from all appropriate Third Parties and all such Authorisations remaining in full force and effect and all filings necessary for such purpose having been made and there being no notice or intimation of any intention to revoke, suspend, restrict or amend or not renew the same at the time at which the Offer becomes or is declared wholly unconditional in each case where the absence of such Authorisation would have a material adverse effect on the Wider Morson Group or on the Wider MMGG Group taken as a whole;

(e) except as publicly announced by Morson prior to 25 May 2012 through a Regulatory Information Service (an "RIS") or disclosed in writing to MMGG prior to 25 May 2012, there being no provision of any arrangement, agreement, licence or other instrument to which any member of the Wider Morson Group is a party or by or to which any such member or any of its respective assets is or are or may be bound, entitled or subject or any circumstance which, in consequence of the making or implementation of the Offer or the proposed acquisition of any shares or other securities in, or control of, Morson by MMGG or because of a change in the control or management of Morson or otherwise, could reasonably be expected to result in (to an extent which is material in the context of the Wider Morson Group taken as a whole):

(i) any indebtedness or liabilities actual or contingent of, or any grant available to, any member of the Wider Morson Group being or becoming repayable or capable of being declared repayable immediately or prior to its stated maturity or the ability of any such member to borrow monies or incur any indebtedness being withdrawn or inhibited or capable of being withdrawn or inhibited;

(ii) the creation or enforcement of any mortgage, charge or other security interest over the whole or any material part of the business, property, assets or interests of any member of the Wider Morson Group or any such security (whenever created, arising or having arisen) being enforced or becoming enforceable;

(iii) any such arrangement, agreement, licence or instrument or the rights, liabilities, obligations, or interests of any member of the Wider Morson Group under any such arrangement, agreement, licence or instrument (or any arrangement, agreement, licence or instrument relating to any such right, liability, obligation, interest or business) or the interests or business of any such member in or with any other person, firm, company or body being or becoming capable of being terminated or adversely modified or adversely affected or any adverse action being taken or any onerous obligation or liability arising thereunder;

(iv) any asset or interest of any member of the Wider Morson Group being or failing to be disposed of or charged (otherwise than in the ordinary course of business) or ceasing to be available to any member of the Wider Morson Group or any right arising under which any such asset or interest could be required to be disposed of or charged or could cease to be available to any member of the Wider Morson Group;

(v) any member of the Wider Morson Group ceasing to be able to carry on business under any name under which it presently does so;

(vi) any member of the Wider MMGG Group and/or of the Wider Morson Group being required to acquire or repay any shares in and/or indebtedness of any member of the Wider Morson Group owned by any Third Party;

(vii) any change in or effect on the ownership or use of any intellectual property rights owned or used by any member of the Wider Morson Group;

(viii) the value or financial or trading position of any member of the Wider Morson Group being prejudiced or adversely affected in a manner which would be material in the context of the Wider Morson Group taken as a whole; or

(ix) the creation of any material liability, actual or contingent, by any member of the Wider Morson Group (other than in the ordinary course of business),

and no event having occurred which, under any provision of any such arrangement, agreement, licence or other instrument, might reasonably be expected to result in any of the events referred to in this condition (e) to an extent which would be material in the context of the Wider Morson Group taken as a whole;

(f) since 31 December 2011 and except as disclosed in Morson's annual report and accounts for the year ended 31 December 2011 or as disclosed by or on behalf of Morson to MMGG or its advisers in writing prior to 25 May 2012 or as otherwise publicly announced by Morson on or prior to 25 May 2012 through a RIS, no member of the Wider Morson Group having:

(i) issued or agreed to issue or authorised or proposed the issue of additional shares or securities of any class, or securities convertible into or exchangeable for shares, or rights, warrants or options to subscribe for or acquire any such shares, securities or convertible securities (save for issues between Morson and any of its wholly-owned subsidiaries or between such wholly-owned subsidiaries and save for options as disclosed to MMGG granted under the Morson Share Option Schemes before 25 May 2012 or the issue of any Morson Shares allotted upon the exercise of options granted before 25 May 2012 under the Morson Share Schemes) or redeemed, purchased, repaid or reduced or proposed the redemption, purchase, repayment or reduction of any part of its share capital or any other securities;

(ii) recommended, declared, made or paid or proposed to recommend, declare, make or pay any bonus, dividend or other distribution whether payable in cash or otherwise other than any distribution by any wholly-owned subsidiary within the Morson Group;

(iii) save as between Morson and its wholly-owned subsidiaries, effected, authorised, proposed or announced its intention to propose any change in its share or loan capital which in each case would be material in the context of the Wider Morson Group taken as a whole;

(iv) save as between Morson and its wholly-owned subsidiaries, effected, authorised, proposed or announced its intention to propose any merger, demerger, reconstruction, arrangement, amalgamation, commitment or scheme or any material acquisition or disposal or transfer of assets or shares (other than in the ordinary course of business) or any right, title or interest in any assets or shares or other transaction or arrangement in respect of itself or another member of the Wider Morson Group which in each case would be material in the context of the Wider Morson Group taken as a whole;

(v) acquired or disposed of or transferred (other than in the ordinary course of business) or mortgaged, charged or encumbered any assets or shares or any right, title or interest in any assets or shares (other than in the ordinary course of business) or authorised the same or entered into, varied or terminated or authorised, proposed or announced its intention to enter into, vary, terminate or authorise any agreement, arrangement, contract, transaction or commitment (other than in the ordinary course of business and whether in respect of capital expenditure or otherwise) which is of a loss-making, long-term or unusual or onerous nature or magnitude, or which involves or could involve an obligation of such a nature or magnitude, in each case which is material in the context of the Wider Morson Group taken as a whole;

(vi) entered into any agreement, contract, transaction, arrangement or commitment (other than in the ordinary course of business) which is material in the context of the Wider Morson Group taken as a whole;

(vii) entered into any contract, transaction or arrangement which would be restrictive on the business of any member of the Wider Morson Group or the Wider MMGG Group or which is or could involve obligations which would or might reasonably be expected to be so restrictive;

(viii) issued, authorised or proposed the issue of or made any change in or to any debentures, or (other than in the ordinary course of business) incurred or increased any indebtedness or liability, actual or contingent, which is material in the context of the Wider Morson Group taken as a whole;

(ix) been unable or admitted that it is unable to pay its debts or having stopped or suspended (or threatened to stop or suspend) payment of its debts generally or ceased or threatened to cease carrying on all or a substantial part of its business or proposed or entered into any composition or voluntary arrangement with its creditors (or any class of them) or the filing at court of documentation in order to obtain a moratorium prior to a voluntary arrangement or, by reason of actual or anticipated financial difficulties, commenced negotiations with one or more of its creditors with a view to rescheduling any of its indebtedness;

(x) made, or announced any proposal to make, any change or addition which is material in the context of the Wider Morson Group as a whole to any retirement, death or disability benefit or any other employment-related benefit of or in respect of any of its directors, employees, former directors or former employees;

(xi) save as between Morson and its wholly-owned subsidiaries, granted any lease or third party rights in respect of any of the leasehold or freehold property owned or occupied by it or transferred or otherwise disposed of any such property, in each case which is material in the context of the Wider Morson Group as a whole;

(xii) entered into or varied or made any offer (which remains open for acceptance) to enter into or vary the terms of any service agreement with any director or senior executive of Morson or any director or senior executive of the Wider Morson Group;

(xiii) taken or proposed any corporate action or had any legal proceedings started or threatened against it for its winding-up (voluntary or otherwise), dissolution, striking-off or reorganisation or for the appointment of a receiver, administrator (including the filing of any administration application, notice of intention to appoint an administrator or notice of appointment of an administrator), administrative receiver, trustee or similar officer of all or any material part of its assets or revenues or for any analogous proceedings or steps in any jurisdiction or for the appointment of any analogous person in any jurisdiction;

   (xiv)        made any amendment to its memorandum or articles of association;

(xv) waived or compromised any claim or authorised any such waiver or compromise, save in the ordinary course of business, which is material in the context of the Wider Morson Group taken as a whole;

(xvi) taken, entered into or had started or threatened against it in a jurisdiction outside England and Wales any form of insolvency proceeding or event similar or analogous to any of the events referred to in conditions (i)(ix) and (xiii) above; or

(xvii) agreed to enter into or entered into an agreement or arrangement or commitment or passed any resolution or announced any intention with respect to any of the transactions, matters or events referred to in this condition (f);

(g) except as publicly announced by Morson prior to 25 May 2012 through a RIS or disclosed in writing to MMGG prior to 25 May 2012 and save as disclosed in the annual report and accounts of Morson for the financial year ended 31 December 2011, since 31 December 2011:

(i) there having been no material adverse change or deterioration in the business, assets, financial or trading position or profits or prospects of the Wider Morson Group taken as a whole;

(ii) no material litigation, arbitration proceedings, prosecution or other legal proceedings to which any member of the Wider Morson Group is or may become a party (whether as claimant or defendant or otherwise), and no material enquiry or investigation by or complaint or reference to any Third Party, against or in respect of any member of the Wider Morson Group, having been threatened, announced or instituted or remaining outstanding by, against or in respect of any member of the Wider Morson Group in any way which is material in the context of the Wider Morson Group taken as a whole; and

(iii) no contingent or other liability having arisen or become apparent or increased which might be reasonably likely in either case to have a material adverse effect on the Wider Morson Group taken as a whole;

(h) save as disclosed by or on behalf of Morson to MMGG or its advisers in writing prior to 25 May 2012 MMGG not having discovered:

(i) that any financial, business or other information concerning Morson or the Wider Morson Group which is contained in the information publicly disclosed at any time by or on behalf of any member of the Wider Morson Group either publicly or in the context of the Offer contains a misrepresentation of fact which has not, prior to 25 May 2012, been corrected by public announcement through an RIS or omits to state a fact necessary to make the information contained therein not misleading;

(ii) any information which affects the import of any such information as is mentioned in condition (h)(i); or

(iii) that any member of the Wider Morson Group is subject to any liability, contingent or otherwise, which is not disclosed in the annual report and accounts of Morson for the financial year ended 31 December 2011

in each case which has or may reasonably have a material adverse effect in the context of the Wider Morson Group taken as a whole;

(i) save as disclosed by or on behalf of Morson to MMGG or its advisers in writing prior to 25 May 2012, MMGG not having discovered that:

(i) any past or present member of the Wider Morson Group has failed to comply with any and/or all applicable legislation or regulation, of any jurisdiction with regard to the disposal, spillage, release, discharge, leak or emission of any waste or hazardous substance or any substance likely to impair the environment or harm human health or animal health or otherwise relating to environmental matters, or that there has otherwise been any such disposal, spillage, release, discharge, leak or emission (whether or not the same constituted a non-compliance by any person with any such legislation or regulations, and wherever the same may have taken place) any of which disposal, spillage, release, discharge, leak or emission would be likely to give rise to any liability (actual or contingent) on the part of any member of the Wider Morson Group and which is material in the context of the Wider Morson Group taken as a whole; or

(ii) there is, or is likely to be, for that or any other reason whatsoever, any liability (actual or contingent) of any past or present member of the Wider Morson Group to make good, repair, reinstate or clean up any property or any controlled waters now or previously owned, occupied, operated or made use of or controlled by any such past or present member of the Wider Morson Group, under any environmental legislation, regulation, notice, circular or order of any government, governmental, quasi-governmental, state or local government, supranational, statutory or other regulatory body, agency, court, association or any other person or body in any jurisdiction and which is material in the context of the Wider Morson Group taken as a whole.

MMGG reserves the right to waive all or any of conditions (c) to (i) inclusive, in whole or in part.

Condition (b) must be fulfilled or waived within 21 days after the later of the first closing date of the Offer and the date on which condition (a) is fulfilled and conditions (c) to (i) inclusive must be satisfied as at, or waived on or before, midnight on the 21st day after the later of the first closing date of the Offer and the date on which condition (a) is fulfilled (or in each such case such later date as MMGG may, with the consent of the Panel, agree), failing which the Offer will lapse provided that MMGG shall be under no obligation to waive or treat as fulfilled any of conditions (c) to (i) inclusive by a date earlier than the latest date specified above for the fulfilment thereof notwithstanding that the other conditions of the Offer may at such earlier date have been fulfilled and that there are at such earlier date no circumstances indicating that any of such conditions may not be capable of fulfilment.

Except with the Panel's consent, MMGG will not invoke any of the above conditions (except for the acceptance condition in (a) and the conditions in (b) above) so as to cause the Offer not to proceed, to lapse or to be withdrawn unless the circumstances which give rise to the right to invoke the relevant conditions are of material significance to MMGG in the context of the Offer.

B. Certain Further Terms of the Offer

Except where the context otherwise requires, references in this Part B of this Appendix and in the Form of Acceptance (i) to the Offer shall mean the Offer and shall include any revision or extension thereof and (ii) to the Offer becoming unconditional shall include references to the Offer becoming or being declared unconditional and shall be construed as references to the Offer becoming or being declared unconditional as to acceptances whether or not any other condition of the Offer remains to be fulfilled. References to acceptance of the Offer shall include deemed acceptance of the Offer.

   1.      Acceptance period

(a) The Offer will initially remain open for acceptance until 1.00 p.m. on the first closing date. Although no revision is envisaged, if the Offer (in its original or previously revised form) is revised it will remain open for acceptance for a period of at least 14 days (or such other period as may be permitted by the Panel) from the date of posting of written notification of the revision to Shareholders. Except with the consent of the Panel, no such written notification of the revision of the Offer may be posted to Shareholders after 46 days after the posting of the Offer Document or, if later, the date which is 14 days before the last date on which the Offer can become unconditional.

(b) The Offer, whether revised or not, shall not (except with the consent of the Panel) be capable of becoming unconditional after midnight 60 days after the posting of the Offer Document (or on any earlier date beyond which MMGG has stated (and not, where permitted, withdrawn such statement) that the Offer will not be extended), nor of being kept open after that time unless it has previously become unconditional. However, MMGG reserves the right, with the permission of the Panel, to extend the Offer to later times and/or dates. Except with the consent of the Panel, MMGG may not, for the purpose of determining whether the condition as to acceptances set out in paragraph (a) of Part A of this Appendix (the "acceptance condition") has been satisfied, take into account acceptances received or purchases of Morson Shares in respect of which all relevant electronic instructions or documents are received by Capita Registrars after 1.00 p.m. on the 60th day after the posting of the Offer Document (or any earlier time or date beyond which MMGG has stated that the Offer will not be extended and in respect of which it has not withdrawn that statement) or such later time and/or date as the case may be to which the Offer has been extended. If the Offer is extended beyond midnight on the 60th day after the posting of the Offer Documentacceptances received and purchases made in respect of which relevant electronic instructions or documents have been received by Capita Registrars after 1.00 p.m. on the relevant date may (except where the Code otherwise permits) only be taken into account with the agreement of the Panel.

(c) If the Offer becomes unconditional, it will remain open for acceptance for not less than 14 days from the date on which it would otherwise have expired. If the Offer has become unconditional and it is stated by MMGG that the Offer will remain open until further notice, then not less than 14 days' notice will be given to those holders of Morson Shares who have not accepted the Offer prior to the closing of the Offer.

(d) If a competitive situation arises after MMGG has given a "no extension" statement or a "no increase" statement (as referred to in the Code), MMGG may (if it has specifically reserved the right to do so at the time such statement was made or otherwise with the consent of the Panel) choose not to be bound by or withdraw the terms of such statement and be free to extend or increase the Offer, provided that notice is given to that effect as soon as possible and in any event within four business days after the announcement of the competing offer and Shareholders are informed in writing thereof or, in the case of Shareholders with registered addresses outside the United Kingdom or whom MMGG knows to be nominees holding Morson Shares for such persons, by announcement in the United Kingdom at the earliest practicable opportunity. If MMGG has given a "no increase" statement or a "no extension" statement, MMGG may (if it has specifically reserved the right to do so at the time such statement was made or in such other circumstances as may be permitted by the Panel) choose not to be bound by the terms of such statement if it would otherwise prevent the posting of an increased or improved Offer which is recommended for acceptance by the Independent Director.

(e) If a competitive situation arises and is continuing 60 days after the posting of the Offer Document, MMGG will enable holders of Morson Shares in uncertificated form who have not already validly accepted the Offer but who have previously accepted the competing offer to accept the Offer by a special form of acceptance to take effect 60 days after the posting of the Offer Document. It shall be a condition of such special form of acceptance being a valid acceptance of the Offer that (i) it is received by Capita Registrars on or before 60 days after the posting of the Offer Document, (ii) the relevant Shareholder shall have applied to withdraw his acceptance of the competing offer but that the Morson Shares to which such withdrawal relates shall not have been released from escrow before the 60(th) day after the posting of the Offer Document by the escrow agent to the competing offer and (iii) the Morson Shares to which the special form of acceptance relates are not transferred to escrow in accordance with the procedure for acceptance set out in the letter from MMGG contained in the Offer Document on or before 60 days after the posting of the Offer Document, but an undertaking is given that they will be so transferred as soon as possible thereafter. Shareholders wishing to use such forms of acceptance should apply to Capita Registrars on 0871 664 0321 from within the UK or on +44 20 8639 3399 if calling from outside the UK between 9.00a.m. and 5.30p.m. Monday to Friday. Calls to the Capita Registrars 0871 664 0321 number are charged at 10 pence per minute (including VAT) plus any of your service provider's network extras. Calls to the Capita Registrars +44 20 8639 3399 number from outside the UK are charged at applicable international rates. Different charges may apply to calls made from mobile telephones and calls may be recorded and monitored randomly for security and training purposes. Capita Registrars cannot provide advice on the merits of the Offer nor give any financial, legal or tax advice. Notwithstanding the right to use such special form of acceptance, holders of Morson Shares in uncertificated form may not use a form of acceptance (or any other purported acceptance form) for the purpose of accepting the Offer in respect of such shares.

(f) For the purpose of determining at any particular time whether the acceptance condition has been satisfied, MMGG shall not be bound (unless otherwise required by the Panel) to take into account any Morson Shares which have been unconditionally allotted or issued before such time unless Capita Registrars has received written notice on behalf of MMGG, from Morson or its agents, at the address specified in paragraph 3(a) below of the relevant details of such allotment or issue before that time. Notification by telex or facsimile or other electronic transmission will not be sufficient notice for these purposes.

   2.      Announcements

(a) Without prejudice to paragraph 3 below, by 8.00 a.m. on the business day following the day on which the Offer is due to expire or becomes or is declared unconditional or is revised or extended (as the case may be) (or such later time or date as the Panel may agree) (the "relevant day") , MMGG will make an appropriate announcement to a Regulatory Information Service (an "RIS") of the position. Such announcement will also state (unless otherwise permitted by the Panel):

(i) the total number of Morson Shares and rights over Morson Shares (as nearly as practicable) for which acceptances of the Offer have been received, specifying the extent to which acceptances have been received from persons acting in concert with MMGG or in respect of shares which are the subject of an irrevocable commitment or letter of intent procured by MMGG or its associates;

(ii) details of any relevant securities (as defined by the Code) of Morson in which MMGGor any person acting in concert with it has an interest or in respect of which any such person has a right to subscribe in each case specifying the nature of the interests and rights concerned. Similar details of any short positions (whether conditional or absolute and whether in the money or otherwise), including any short position under a derivative, any agreement to sell or any delivery obligation or right to require another person to purchase or take delivery, will also be stated;

(iii) details of any relevant securities of Morson in respect of which MMGGor any of its associates has an outstanding irrevocable commitment or letter of intent;

(iv) details of any relevant securities of Morson which MMGG or any person acting in concert with it has borrowed or lent, other than any borrowed shares which have been on-lent or sold; and

(v) the total number of shares which MMGG may count towards satisfaction of the acceptance condition,

and will specify in each case the percentage of each class of relevant securities of Morson represented by these figures.

Any decision to extend the date and/or time by which the acceptance condition has to be fulfilled may be made at any time up to, and will be announced not later than, 8.00 a.m. on the relevant day (or such later time and/or date as the Panel may agree) and the announcement will state the next expiry time and date (unless the Offer is then unconditional, in which case the announcement may state that the Offer will remain open until further notice). In computing the number of shares which MMGG may count towards satisfaction of the acceptance condition, there may, at the discretion of MMGG, be included or excluded for announcement purposes acceptances and purchases which are not complete in all respects or are subject to verification provided that such acceptances or purchases of Morson Shares may only be included if they could be counted towards fulfilling the acceptance condition in accordance with paragraph 6(j) below and the provisions of the Code.

(b) References in this Appendix to the making of an announcement or giving of notice by MMGG include the release of an announcement by public relations consultants or by SPARK Advisory Partners Limited, in each case on behalf of MMGG, and the delivery by hand, telephone, telex or facsimile transmission or other electronic transmission of an announcement to a RIS. An announcement made otherwise than to a RIS will be notified simultaneously to a RIS (unless the Panel otherwise agrees).

(c) Without limiting the manner in which MMGG may choose to make any public statement and subject to MMGG's obligations under applicable law, including the Code, MMGG will have no obligation to publish, advertise or otherwise communicate any such public announcement other than by making release to a RIS.

   3.      Rights of withdrawal

(a) If MMGG, having announced the Offer to be unconditional, fails to comply by 3.30 p.m. on the relevant day (as defined in paragraph 2 of this Part B) (or such later time(s) and/or date(s) as the Panel may agree) with any of the other requirements specified in paragraph 2(a) above, an accepting certificated Shareholder may (unless the Panel otherwise agrees) immediately thereafter withdraw his acceptance by written notice (as defined in paragraph 3(d) below) given by post or by hand (during normal business hours only) to Capita Registrars Corporate Actions, The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU on behalf of MMGG. Alternatively, in the case of Morson Shares in uncertificated form, withdrawals can be effected in the manner set out in paragraph 3(e) below. Subject to paragraph 1(b) above, this right of withdrawal may be terminated not less than eight days after the relevant day by MMGG confirming, if that is the case, that the Offer is still unconditional and complying with the other requirements specified in paragraph 2(a) above. If any such confirmation is given, the first period of 14 days referred to in paragraph 1(c) above will run from the date of such confirmation and compliance.

(b) If by 1.00 p.m. on the 42(nd) day after the posting of the Offer Document (or such later time(s) and/or date(s) as the Panel may agree) the Offer has not become unconditional, an accepting Shareholder may withdraw his acceptance at any time thereafter at the address and in the manner referred to in paragraph 3(a) above (or, in the case of Morson Shares in uncertificated form, in the manner set out in paragraph 3(e) below) before the earlier of:

   (i)                  the time that the Offer becomes unconditional; and

(ii) the final time for lodgement of acceptances which can be taken into account in accordance with paragraph 1(b) above.

If the Panel determines that Morson is not permitted to invoke, or cause or permit MMGG to invoke, a condition to the Offer, it may instead determine that Shareholders shall be entitled to withdraw their acceptances on such terms and by such time as the Panel may determine and notwithstanding that the Offer has become unconditional as to acceptances. The Panel may also determine that the timetable applicable to the Offer shall be varied in such manner as it may determine. Exercise of such withdrawal rights by accepting Shareholders could result in the Offer, if it has by then become unconditional as to acceptances, ceasing to be unconditional as to acceptances.

(c) If after a competitive situation has arisen MMGG chooses not to be bound by a "no extension" statement or a "no increase" statement in accordance with paragraph 1(d) above, any Shareholder who accepts the Offer after the date of such statement may withdraw his acceptance thereafter at the address and in the manner referred to in paragraph 3(a) above (or, in the case of Morson Shares held in uncertificated form, in the manner set out in paragraph 3(e) below) not later than the eighth day after the date of posting of written notice to that effect by MMGG to the relevant Shareholders.

(d) Except as provided by this paragraph 3, acceptances of the Offer shall be irrevocable. In this paragraph 3 "written notice" (including any letter of appointment, direction or authority) means notice in writing bearing the original signature(s) of the relevant accepting Shareholder(s) or their agent(s) duly appointed in writing (evidence of whose appointment, in a form reasonably acceptable to MMGG, is produced with the notice). Notification by telex or facsimile or other electronic transmissions or copies will not be sufficient. No notice which is postmarked in or otherwise appears to have been sent from any Restricted Jurisdiction will be treated as valid.

(e) In the case of Morson Shares held in uncertificated form, if withdrawals are permitted pursuant to paragraphs 3(a), (b) or (c) above, an accepting Shareholder may withdraw his acceptance through CREST by sending (or, if a CREST sponsored member, procuring that his CREST sponsor sends) an ESA instruction to settle in CREST in relation to each Electronic Acceptance to be withdrawn. Each ESA instruction must, in order for it to be valid and settle, include the following details:

-- the number of Morson Shares to be withdrawn, together with their ISIN number, which is GB00B0R7WP21;

   --   the member account ID of the accepting shareholder, together with his participant ID;

-- the member account ID of the Escrow Agent included in the relevant Electronic Acceptance, relevant to the option elected for, together with the Escrow Agent's participant ID, which is RA10;

-- the CREST transaction ID of the Electronic Acceptance to be withdrawn to be inserted in the shared note field;

   --   the intended settlement date for the withdrawal;

-- the corporate action number for the Offer which is allocated by Euroclear UK & Ireland and can be found by viewing the relevant corporate action details in CREST; and

-- input with standard delivery instruction priority of 80.Any such withdrawal will be conditional upon Capita Registrars verifying that the withdrawal request is validly made. Accordingly, Capita Registrars will, on behalf of MMGG, reject or accept the withdrawal by transmitting in CREST a receiving agent reject (AEAD) or receiving agent accept (AEAN) message.

(f) Immediately (or within such longer period not exceeding 14 days, as the Panel may permit) upon an accepting shareholder validly withdrawing his acceptance:

(i) in respect of Morson Shares held in certificated form the share certificate(s) and/or other document(s) of title will be returned by post (or such other method as may be approved by the Panel) at the risk of the Shareholder concerned, to the person or agent whose name and address is set out in the Form of Acceptance or, if no address is set out, to the first-named holder at his registered address; and

(ii) in respect of Morson Shares held in uncertificated form Capita Registrars will give instructions to Euroclear UK & Ireland to transfer all Morson Shares held in escrow balances and in relation to which it is the Escrow Agent for the purposes of the Offer to the original available balances of the Shareholder concerned.

(g) Morson Shares in respect of which acceptances have been properly withdrawn in accordance with this paragraph 3 of this Part B may subsequently be re-assented to the Offer by following one of the procedures described in the Offer Document, at any time while the Offer remains open for acceptance.

(h) Any question as to the validity (including time of receipt) of any notice of withdrawal will be determined by MMGG whose determination (save as the Panel otherwise determines) will be final and binding. None of MMGG, Morson, Capita Registrars or any other person will be under any duty to give notification of any defect in any notice of withdrawal or will incur any liability for failure to do so.

   4.      The Loan Note Alternative

(a) As an alternative to receiving cash under the Offer, Morson Shareholders may elect to receive the Loan Note Alternative in respect of their total shareholding, which subject to the terms of the Offer, is available to accepting Morson Shareholders for as long as the Offer remains open for acceptance. Morson Shareholders who elect to receive Offer Loan Notes must accede to the terms of the Intercreditor Agreement.

(b) No election for the Loan Note Alternative will be valid unless the following has occurred by the time and date on which the Loan Note Alternative closes:

(i) if the Morson Shares to which the acceptance relates are in certificated form, receipt of the Form of Acceptance containing a valid acceptance of the Offer and a valid election for the Loan Note Alternative (including acceding to the Intercreditor Agreement), duly completed in all respects and accompanied by all relevant share certificate(s) and/or other documents(s) of title; or

(ii) if the Morson Shares to which the acceptance relates are in uncertificated form, settlement of an Alternative TTE instruction in favour of the Escrow Agent in relation to those Morson Shares, in accordance with the procedures described in the Offer Document. Shareholders are also required to accede to the Intercreditor agreement.

(c) If (in respect of Morson Shares held in certificated form) any Form of Acceptance which includes an election for the Loan Note Alternative is either received after the time and date the Loan Note Alternative has closed or is received before such time but is not valid or complete in all respects at such time and date, such election shall, for all purposes, be void and the Morson Shareholder purporting to make such election shall not, for any purpose, be entitled to receive any consideration under the Loan Note Alternative, but the acceptance, if otherwise valid, shall be deemed to be an acceptance of the basic terms of the Offer in respect of the number of Morson Shares inserted or deemed to be inserted in Box 1 of the Form of Acceptance and the relevant Morson Shareholder will, on the Offer becoming or being declared wholly unconditional, be entitled to receive the consideration due under the basic terms of the Offer.

(d) If (in respect of Morson Shares held in uncertificated form) any alternative TTE Instruction in favour of the Escrow Agent is made but the Shareholder does not accede to the terms of the Intercreditor Agreement either before the time and date the Loan Note Alternative has closed or such agreement so acceding is received before such time but is not valid or complete in all respects at such time and date, such election shall, for all purposes, be void and the Morson Shareholder purporting to make such election shall not, for any purpose, be entitled to receive any consideration under the Loan Note Alternative, but the acceptance, if otherwise valid, shall be deemed to be an acceptance of the terms of the Offer in respect of the number of Morson Shares in respect of which the alternative TTE Instruction relates and the relevant Morson Shareholder will, on the Offer becoming or being declared wholly unconditional, be entitled to receive the consideration due under the basic terms of the Offer.

   5.      Revised Offer

(a) Although no revision of the Offer is envisaged, if the Offer (in its original or any previously revised form(s)) is revised (either in its terms or conditions or in the value or form of the consideration offered or otherwise) (which MMGG reserves the right to do) and such revision represents on the date on which such revision is announced (on such basis as SPARK Advisory Partners Limited may consider appropriate) an improvement (or no diminution) in the value of the consideration compared with that previously offered, the benefit of the revised Offer will (subject to paragraphs 5(b), 5(c) and 7 below) be made available to a Shareholder who has accepted the Offer (in its original or previously revised form(s)) and not previously withdrawn such acceptance (a "Previous Acceptor").

The acceptance by or on behalf of a Previous Acceptor of the Offer (in its original or any previously revised form(s)) shall, subject as provided below, be deemed an acceptance of the Offer as so revised and shall also constitute a separate appointment of MMGG or SPARK Advisory Partners Limited or any director of MMGG as his attorney and agent to accept any such revised Offer on behalf of such Previous Acceptor and, if such revised Offer includes alternative forms of consideration, to make elections and/or accept such alternative forms of consideration in such proportions as such attorney and/or agent in his absolute discretion thinks fit and to execute on behalf of and in the name of such Previous Acceptor all such further documents (if any) as may be required to give effect to such acceptances and/or elections. In making any such acceptance or election, such attorney and/or agent shall take into account the nature of any previous acceptances and/or elections made by the Previous Acceptor and such other facts or matters as he may reasonably consider relevant.

(b) The deemed acceptances and/or elections referred to in paragraph 5(a) above shall not apply and the authorities conferred by paragraph 5(a) above shall not be exercised if, as a result thereof, a Previous Acceptor would (on such basis as SPARK Advisory Partners Limited may advise MMGG) receive less in aggregate consideration than he would have received as a result of his acceptance of the Offer in the form in which it was originally accepted by him or on his behalf unless the Previous Acceptor has previously otherwise agreed in writing. The authorities conferred by paragraph 5(a) of this Part B shall not be exercised in respect of any election available under the revised Offer save in accordance with this paragraph 5(b).

(c) The deemed acceptances and/or elections referred to in paragraph 5(a) above shall not apply and the authorities conferred by paragraph 5(a) above shall be ineffective to the extent that a Previous Acceptor (i) in respect of Morson Shares in certificated form, shall lodge, within 14 days of the posting of the document pursuant to which the revision of the Offer referred to in paragraph 5(a) above is made available to the Shareholders (or such later date as MMGG may determine), a form in which he validly elects to receive the consideration receivable by him under that revised Offer in some other manner than that set out in his original acceptance or (ii) in respect of Morson Shares in uncertificated form, sends (or, if a CREST sponsored member, procures that his CREST sponsor sends) an ESA instruction to settle in CREST in relation to each Electronic Acceptance in respect of which an election is to be varied. Each ESA instruction must, in order for it to be valid and settle, include the following details:

-- the number of Morson Shares in respect of which the changed election is made, together with their ISIN number, which is GB00B0R7WP21 ;

   --      the member account ID of the Previous Acceptor, together with his participant ID;

-- the member account ID of the Escrow Agent included in the relevant Electronic Acceptance, relevant to the option elected for, together with the Escrow Agent's participant ID, which is RA10;

-- the CREST transaction ID of the Electronic Acceptance in respect of which the election is to be changed;

   --      the intended  settlement date for the changed election;

-- the corporate action number for the Offer which is allocated by Euroclear UK & Ireland and can be found by viewing the relevant corporate action details in CREST;

   --      input with standard delivery instruction priority of 80;

and, in order that the desired change of election can be effected, must include:

   --      the member account ID of the Escrow Agent relevant to the new election.

Any such change of election will be conditional upon Capita Registrars verifying that the request is validly made. Accordingly, Capita Registrars will, on behalf of MMGG, reject or accept the requested change of election by transmitting in CREST a receiving agent reject (AEAD) or receiving agent accept (AEAN) message.

(d) The authorities referred to in this paragraph 5 and any acceptance of a revised Offer and/or election pursuant thereto shall be irrevocable unless and until the Previous Acceptor becomes entitled to withdraw his acceptance under paragraph 3 above and duly and validly does so.

(e) MMGG reserves the right to treat an executed Form of Acceptance or TTE instruction relating to the Offer (in its original or any previously revised form(s)) which is received after the announcement or issue of the Offer in any revised form as a valid acceptance of the revised Offer and such acceptance shall constitute an authority in the terms of this paragraph 5 mutatis mutandis on behalf of the relevant Shareholder.

   6.      General

(a) Except with the consent of the Panel, the Offer will lapse unless all the conditions (other than the acceptance condition) have been fulfilled by or (if capable of waiver) waived by or (where appropriate) determined by MMGG in its reasonable opinion to be or to remain satisfied as at midnight on the 42(nd) day after the posting of the Offer Document or within 21 days after the date on which the Offer becomes or is declared unconditional, whichever is the later or such later date as MMGG, with the consent of the Panel, may decide. If the Offer is referred to the Competition Commission before the later of the first closing date and the date when the Offer becomes or is declared unconditional, the Offer will lapse. If the Offer lapses for any reason, the Offer will cease to be capable of further acceptance and Shareholders who have accepted the Offer and MMGG will cease to be bound by acceptances delivered on or before the date on which the Offer so lapses.

(b) All communications, notices, certificates, documents of title and remittances to be delivered by or to or sent to or from Shareholders or as otherwise directed will be delivered by or to or sent to or from them (or their designated agents) at their risk.

(c) The expression "Offer Period" when used in this document means the period commencing on the date of this announcement until whichever of the following dates shall be the latest: (i)the first closing date, (ii) the date on which the Offer lapses and (iii) the date on which the Offer becomes wholly unconditional.

(d) All references in the Offer Document and in the Form of Acceptance to the first closing date, shall (except in paragraphs 1(a) and 6(c) above and where the context otherwise requires)be deemed, if the expiry date of the Offer shall be extended, to refer to the expiry date of the Offer as so extended.

(e) Except with the consent of the Panel, settlement of the consideration to which any Shareholder is entitled under the Offer will be implemented in full in accordance with the terms of the Offer without regard to any lien, right of set-off, counterclaim or other analogous right to which MMGG may otherwise be, or claim to be, entitled as against such Shareholderand will be effected by the despatch of cheques or the crediting of CREST accounts or the issue and despatch of Offer Loan Note certificates:

(i) in the case of acceptances received, complete in all respects (including the relevant transfer to escrow or (as applicable) receipt of the relevant share certificate(s) and/or other document(s) of title or indemnities satisfactory to MMGG), by the date on which the Offer becomes or is declared unconditional in all respects, and will be effected by the dispatch of cheques or the crediting of CREST accounts within 14 calendar days of such date or the issue and despatch of Offer Loan Note certificates; or

(ii) in the case of acceptances of the Offer received, complete in all respects, after the date on which the Offer becomes or is declared unconditional in all respects, but while it remains open for acceptance, within 14 calendar days of such receipt.

All cash payments (other than payments made by means of CREST) will be made in pounds sterling by cheque drawn on a branch of a UK clearing bank. Unless otherwise determined by MMGG, no consideration will be sent to any address in a Restricted Jurisdiction.

(f) The instructions, authorities and provisions contained in, or deemed to be incorporated in, the Form of Acceptance constitute part of the terms of the Offer. Words and expressions defined in this document have the same meanings when used in the Form of Acceptance unless the context otherwise requires.

(g) The Offer and all acceptances thereof and all elections thereunder or pursuant thereto and the Form of Acceptance, Electronic Acceptance and all contracts made pursuant thereto and action taken or made or deemed to be taken or made under any of the foregoing shall be governed by and construed in accordance with English law.

(h) Any omission to despatch this document, the Form of Acceptance or any notice required to be given under the terms of the Offer to, or any failure to receive the same by, any person to whom the Offer is made or should be made shall not invalidate the Offer in any way or create any implication that the Offer has not been made to any such person. Subject to paragraph 7 below, the Offer extends to any such person and to all Shareholders to whom this document and the Form of Acceptance may not have been despatched or by whom such documents may not be received and such persons may collect the relevant documents from Capita Registrars at its address set out in paragraph 3(a) above.

(i) MMGG and SPARK Advisory Partners Limited reserve the right to treat acceptances of the Offer as valid if received by or on behalf of either of them at any place or places or in any manner determined by either of them otherwise than as stated in this document or in the Form of Acceptance. Neither MMGG, nor any agent acting on behalf of MMGG, shall have any liability to any person for any loss or alleged loss arising from any decision as to the treatment of acceptances of the Offer or otherwise in connection therewith.

(j) Notwithstanding the right reserved by MMGG to treat an acceptance of the Offer as valid even though (in the case of Morson Shares held in certificated form) the relevant Form of Acceptance is not entirely in order or not accompanied by the relevant share certificate(s) and/or other document(s) of title, except with the consent of the Panel:

(i) an acceptance of the Offer will only be counted towards fulfilling the acceptance condition if the requirements of Note 4 and, if applicable, Note 6 of Rule 10 of the Code are satisfied in respect of it;

(ii) a purchase of Morson Shares by MMGG or its nominee(s) (or, if MMGG is required to make an offer under Rule 9 of the Code, a person acting in concert withMMGG) will only be counted towards fulfilling the acceptance condition if the requirements of Note 5 and, if applicable, Note 6 of Rule 10 of the Code are satisfied in respect of it; and

(iii) Morson Shares which have been borrowed by MMGG will not be counted towards fulfilling the acceptance condition.

Save as set out in paragraphs 1(e) and 6(c) above , the Offer may not be accepted otherwise than by means of a form of acceptance or TTE instruction.

(k) Except with the consent of the Panel, the Offer will not become unconditional unless Capita Registrars has issued a certificate to MMGG or SPARK Advisory Partners Limited (or their respective agents) which states the number of Morson Shares in respect of which acceptances have been received and the number (if any) of Morson Shares otherwise acquired, whether before or during the Offer Period, which comply with paragraph 6(j) above.

   (l)    If the Offer does not become unconditional in all respects:

(i) in respect of Morson Shares held in certificated form the share certificate(s) and/or other document(s) of title will be returned by post (or such other method as may be approved by the Panel) within 14 days of the Offer lapsing, at the risk of the Shareholder concerned, to the person or agent whose name and address is set out in the Form of Acceptance or, if no address is set out, to the first-named holder at his registered address; and

(ii) in respect of Morson Shares held in uncertificated form Capita Registrars will, immediately after the lapsing of the Offer (or within such longer period as the Panel may permit, not exceeding 14 days after the lapsing of the Offer), give instructions to Euroclear UK & Ireland to transfer all Morson Shares held in escrow balances and in relation to which it is the Escrow Agent for the purposes of the Offer to the original available balances of the Shareholders concerned.

(m) For the purposes of this document, the time of receipt of a TTE instruction, an ESA instruction or an Electronic Acceptance shall be the time at which the relevant instruction settles in CREST.

(n) All powers of attorney and authorities on the terms conferred by or referred to in this Part B or in the Form(s) of Acceptance are given by way of security for the performance of the obligations of the Shareholder concerned and are irrevocable in accordance with section 4 of the Powers of Attorney Act 1971, except in the circumstances where the donor of such power of attorney or authority validly withdraws his acceptance in accordance with paragraph 3 above.

(o) If sufficient Morson Shares are acquired by MMGG, whether pursuant to acceptances of the Offer or otherwise, MMGG intends to apply the provisions of sections 974 to 991 of the Companies Act 2006 to acquire compulsorily any outstanding Morson Shares. If MMGG acquires or agrees to acquire, by virtue of its shareholding and acceptances of the Offer, issued share capital carrying 75 per cent. or more of the voting rights of Morson, MMGG intends to procure that Morson applies for cancellation of the trading in Morson Shares on AIM not less than 20 business days following MMGG first having acquired or agreed to acquire such issued share capital and thereafter to procure that the Company applies to be re-registered as a private limited company under the Companies Act,

(p) No acknowledgement of receipt of any Form of Acceptance, share certificate(s) and/or other document(s) of title, or of any TTE instruction will be given by MMGG or Spark Advisory Partners Limited or any of their respective agents.

(q) The Offer will be made by an Offer Document to be issued within 28 days of the date of this announcement and will be capable of acceptance from and after that time. The Offer will be notified to certain Shareholders by means of an advertisement to be inserted in the London Gazette promptly following the date of the Offer Document. Copies of this document, and, once issued, the Offer Document, the Form of Acceptance and any related documents are or will be available for collection from Capita Registrars, The Registry, 34 Beckenham Road, Beckenham, Kent, BR3 4TU.

(r) In relation to any acceptance of the Offer in respect of a holding of Morson Shares which are held in uncertificated form in CREST, MMGG reserves the right to make such alterations, additions or modifications to the terms of the Offer as may be necessary or desirable to give effect to any acceptance of the Offer, whether in order to comply with the facilities or requirements of CREST or otherwise to confer on MMGG or, as the case may be, the relevant Shareholder the benefits and entitlements provided for under the terms of the Offer, provided that such alterations, additions or modifications are consistent with the requirements of the Code or are otherwise made with the consent of the Panel.

(s) MMGG may, with the agreement of the Independent Director and the Panel, elect to implement the acquisition by way of a court sanctioned scheme of arrangement under Part 26 of the Companies Act. Any such scheme of arrangement will be implemented on the same terms (subject to appropriate amendments), so far as applicable, as those which would apply to the Offer.

(t) If the Panel requires MMGG to make an offer for any Morson Shares under the provisions of Rule 9 of the Code, MMGG may make such alterations to the Conditions, including condition (a) of Part A of this Appendix, as are necessary to comply with the provisions of that rule.

   7.      Overseas Shareholders of Morson

(a) The making of the Offer in, or to, certain persons who are citizens, residents or nationals of, jurisdictions outside the United Kingdom may be prohibited or affected by the laws of the relevant jurisdiction. Shareholders in that position should inform themselves about and observe any applicable legal or regulatory requirements. It is the responsibility of any such person wishing to accept the Offer to satisfy himself as to the full observance of the laws and regulatory requirements of the relevant jurisdiction or territory 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 and the payment of any issue, transfer or other taxes due in such jurisdiction. Any such shareholder will be responsible for any payment of any issue, transfer or other taxes or other requisite payments due in such jurisdiction by whomsoever payable, and MMGG and Spark Advisory Partners Limited and any person acting on their behalf shall be entitled to be fully indemnified and held harmless by such shareholder for any such issue, transfer or other taxes as such person may be required to pay.

If you are an Overseas Shareholder and are in any doubt as to your position, you should consult your independent financial adviser in the relevant jurisdiction.

(b) In particular, the Offer is not being made, directly or indirectly, in a Restricted Jurisdiction, or by use of the mails of or by any means or instrumentality of interstate or foreign commerce of, or of any facilities of a national securities exchange of, any Restricted Jurisdiction. This includes, but is not limited to, the post, facsimile transmission, e-mail, telex, the internet and telephone. The Offer cannot be accepted by any such use, means or instrumentality or from within any Restricted Jurisdiction. Accordingly, copies of this document, the Offer Document with the Form of Acceptance and any related offering documents, are not being mailed or otherwise distributed or sent into any Restricted Jurisdiction, including to Shareholders with registered addresses in any Restricted Jurisdiction, or to persons whom MMGG knows to be nominees, trustees or custodians holding Morson Shares for such persons. Persons receiving such documents (including, without limitation, custodians, nominees and trustees) must not distribute or send them in, into or from any Restricted Jurisdiction, or use such mails or any such means or instrumentality for any purpose, directly or indirectly, in connection with the Offer, and doing so will render invalid any related purported acceptance of the Offer. Persons wishing to accept the Offer must not use such mails or any such means, instrumentality or facility for any purpose directly or indirectly related to the acceptance of the Offer.

Envelopes containing a Form of Acceptance must not be postmarked in any Restricted Jurisdiction, or otherwise despatched from any Restricted Jurisdiction, and all acceptors must provide addresses outside any Restricted Jurisdiction for the remittance of cash or the return of the Form of Acceptance, Morson share certificate(s) and/or other document(s) of title.

(c) Notwithstanding the other provisions of this paragraph 7, MMGG may at its sole discretion provide cash consideration to a person in or resident of any Restricted Jurisdiction if requested to do so by or on behalf of that person and if MMGG and/or SPARK Advisory Partners Limited is satisfied in that particular case that to do so will not constitute a breach of any securities or other relevant legislation of any Restricted Jurisdiction, as appropriate.

APPENDIX II

A - Summary of the Terms of the Offer Loan Notes

The Offer Loan Notes

The Offer Loan Notes will be created by a resolution of the MMGG Board (or a duly authorised committee thereof) and will be constituted by the Offer Loan Note Instrument executed as a deed by MMGG.

The issue of the Offer Loan Notes will be conditional on the Offer being declared wholly unconditional.

The Offer Loan Notes will not be transferable.

No application will be made for the Offer Loan Notes to be listed or dealt in on any stock exchange.

The Offer Loan Notes will not be qualifying corporate bonds for United Kingdom taxation purposes for Morson Shareholders who are individuals.

The Offer Loan Notes will bear interest at 4% per annum but this interest will be accrued and only paid when the Offer Loan Notes are redeemed. The Offer Loan Notes are, on the face of the Offer Loan Note Instrument, redeemable on 1 January 2018. However, payments under the Offer Loan Notes are subject to the terms of the Intercreditor Agreement and it cannot be guaranteed that redemption will occur on that date. The Offer Loan Notes are and shall remain unguaranteed, unsecured and unsubordinated.

MMGG may, at any time, elect to redeem all or any part of the Offer Loan Notes (or any Offer Loan Notes or part of any Offer Loan Notes held by certain Offer Loan Noteholders as the board of MMGG may elect), but subject to the terms of the Intercreditor Agreement.

The Offer Loan Note Instrument

The Offer Loan Note Instrument will contain provisions, among other things, to the effect set out below.

(a) Form and status

The Offer Loan Notes will be issued by MMGG, credited as fully paid, in denominations or multiples of 50 pence nominal value and shall be held subject to and with the benefit of the conditions and the provisions set out in the Offer Loan Note Instrument. The Offer Loan Notes constitute direct, unsecured obligations of MMGG but subject to the terms of the Intercreditor Agreement with Barclays.

(b) Interest

Interest shall accrue at the rate of 4% per annum but such interest shall not be compounded and not paid until redemption of the Offer Loan Notes.

Subject to the Intercreditor Agreement, MMGG may, at any time, elect to redeem all or any part of the Offer Loan Notes (or any Offer Loan Notes or part of any Offer Loan Notes held by certain Offer Loan Noteholders as the board of MMGG may elect) at par (together with any accrued interest), without penalty, by serving written notice on the Offer Loan Noteholders in question in advance of any such redemption specifying the amount of the Offer Loan Notes which are to be redeemed.

The Offer Loan Notes are, on the face of the Offer Loan Note Instrument, redeemable on 1 January 2018. However, payments under the Offer Loan Notes are subject to the terms of the Intercreditor Agreement with Barclays and it cannot be guaranteed that redemption will occur on that date.

(d) Purchase and cancellation

Subject to the Intercreditor Agreement, MMGG may purchase Offer Loan Notes at any time from any person. All Offer Loan Notes purchased by MMGG shall be cancelled and MMGG may not reissue the same.

(e) Transfer

An Offer Loan Noteholder may not transfer his interest in any Offer Loan Notes.

(f) Modification

Subject to the Intercreditor Agreement, the Offer Loan Note Instrument and the rights of the Offer Loan Noteholders may be modified, abrogated, compromised or extinguished with the sanction of a special resolution of the Offer Loan Noteholders. Under the terms of the Offer Loan Note Instrument, a special resolution is defined as a resolution passed at a meeting of the Offer Loan Noteholders (duly convened and held in accordance with the provisions of Schedule 3 of the Offer Loan Note Instrument) by a majority consisting of not less than 51% of the persons voting (in person or by proxy) upon a show of hands and, if a poll is demanded, by a majority consisting of not less than 51% of the votes given (in person or by proxy) on the poll.

(g) Governing law

The Offer Loan Notes and the Offer Loan Note Instrument will be governed by, and construed in accordance with, English law.

B - Summary of the Intercreditor Agreement

The Intercreditor Agreement has been entered into on 24 May 2012 between Barclays Bank PLC (in various capacities), Gerard Anthony Mason and MMGG and the companies named therein (as debtors and intra-group lenders). Following the Offer being declared wholly unconditional and Morson being re-registered as a private limited company, certain members of the Morson Group are required to accede to the terms of the Intercreditor Agreement. It is a term of the Offer that persons accepting the Offer and electing for the Loan Note Alternative must, for such election to be valid, accede to the terms of the Intercreditor Agreement as subordinated lenders. Morson Shareholders should be aware that the terms of the Intercreditor Agreement make it uncertain when any payments, whether of interest or principal or otherwise, may be made pursuant to the Offer Loan Notes notwithstanding the terms of the Offer Loan Note Instrument.

The Intercreditor Agreement contains provisions, among other things, to the effect set out below.

(a) Ranking

The parties to the Intercreditor Agreement (including those who accede to its terms) agree that monies owed to Barclays under the terms of its various facilities (which currently include the facilities referred to in paragraph 8 of this announcement as well as other facilities made available to members of the Morson Group (e.g. an overdraft facility, a confidential invoice discounting facility, hedging and other facilities) (as amended or varied or supplemented from time to time) will rank in priority to any monies payable under the Mason Loan, the Offer Loan Notes and any intra group obligations between MMGG and members of the Morson Group.

Monies payable after Barclays has been repaid in full or as permitted by the Intercreditor Agreement will firstly be repaid pursuant to the Mason Loan, secondly the Offer Loan Notes and thirdly any intra group obligations between MMGG and members of the Morson Group.

(b) Security

The parties to the Intercreditor Agreement (including those who accede to its terms) agree that any security granted will secure monies due to Barclays which ranks, as referred to in (a) above in priority to other security. Barclays has security by a debenture granted by both MMGG and the Morson Group and will take, inter alia, further security from the Morson Group following the Offer being declared wholly unconditional and Morson being re-registered as a private limited company. The Mason Loan is secured in MMGG and he will take, inter alia, further security from the Morson Group following the Offer being declared wholly unconditional and Morson being re-registered as a private limited company which will rank behind that of Barclays as referred to in (a) above. The Offer Loan Notes are neither guaranteed or secured.

The terms of the Intercreditor Agreement mean that payments to Barclays can be made without restriction. Payments in respect of the Mason Loan are subject to certain conditions, and/or the satisfaction of certain financial covenants and the receipt of certain information and certificates from MMGG. In addition, payments in respect of the Mason Loan may be made in certain circumstances where the Company is deemed to have excess cashflow (as defined in the Intercreditor Agreement) but there can be no certainty such circumstances will occur. Payments under the Offer Loan Notes cannot be made until Barclays have been repaid to their satisfaction and in any event only with the consent of Gerard Anthony Mason whilst the Mason Loan remains outstanding in whole or in part.

(d) Amendments to Offer Loan Notes

Whilst the Offer Loan Note Instrument permits amendments in certain circumstances, no amendments (unless of a minor or administrative nature) may be made without the consent of Barclays (whilst they have any of their facilities outstanding) and Gerard Anthony Mason (whilst any of the Mason Loan remains outstanding).

(e) Enforcement

No enforcement action may be taken by Gerard Anthony Mason in respect of the Mason Loan until Barclays have been repaid to its satisfaction and by the holders of the Offer Loan Notes in respect of amounts due under the Offer Loan Notes until Barclays have been repaid to their satisfaction and the Mason Loan has been repaid.

APPENDIX III

Sources and Bases of Information

Unless otherwise stated in this announcement:

1. The value attributed to the issued share capital of Morson is based on 45,343,750 Morson Shares in issue as at 24 May 2012, being the last practicable date prior to the date of this announcement.

2. The financial information relating to Morson has been extracted (without any adjustment) from the audited consolidated financial statements of Morson for the relevant years, prepared in accordance with IFRS.

3. All prices quoted for Morson Shares have been derived from the Daily Official List and represent Closing Prices on the relevant dates(s).

APPENDIX IV

Part 1: Irrevocable Undertakings to accept the Cash Offer

 
  Name of Morson            Number of Morson    Percentage of 
   Shareholder               Shares              Morson issued 
                                                 share capital 
------------------------  ------------------  ---------------- 
 HSBC Global Custody 
  Nominee (UK) Ltd 
  A/C 912109 (1)(2)        185,350             0.41 
------------------------  ------------------  ---------------- 
 HSBC Global Custody 
  Nominee (UK) Ltd 
  A/C 811597 (1)(2)        2,090,000           4.61 
------------------------  ------------------  ---------------- 
 Statestreet Nominees 
  Ltd A/C 2GHL (1)(2)      2,450,000           5.40 
------------------------  ------------------  ---------------- 
 BNP Paribas Securities 
  Nominees Ltd Des: 
  309304 (1)(2)            59,400              0.13 
------------------------  ------------------  ---------------- 
 I G Knight (1)            20,000              0.04 
------------------------  ------------------  ----------------

Note

These irrevocable undertakings cease to be binding if:

   1.     the Offer Document is not posted by 30 June 2012; or

2. prior to the Offer being declared unconditional a person other than the Offeror announces a firm intention to make an offer to acquire the entire issued share capital of the Company at a price not less than 10 per cent. above the value of the Offer.

Part 2: Irrevocable Undertakings to accept the Offer Loan Notes

Irrevocable Undertakings

 
  Name of Morson     Number of Morson    Percentage of 
   Shareholder        Shares              Morson issued 
                                          share capital 
-----------------  ------------------  ---------------- 
 G G Mason (1)      9,984,215           22.02 
-----------------  ------------------  ---------------- 
 G A Mason (2)      9,984,215           22.02 
-----------------  ------------------  ---------------- 
 P J Gilmour        630,000             1.39 
-----------------  ------------------  ---------------- 
 K P Gorton         611,200             1.35 
-----------------  ------------------  ----------------

Note

1. Of the Morson Shares included in G G Mason's holding, 921,875 are held by the trustees of a discretionary trust of which G G Mason is a trustee.

2. The Morson Shares included in G A Mason's irrevocable undertaking are 921,875 less than those in G A Mason's director's interests. The interests include the Morson Shares referred to in Note 1 above, over which G A Mason has no ability to accept the Offer.

APPENDIX V

Definitions

In this announcement the following expressions have the following meaning:

 
  "Accounting Date"            31 December 2011 
 
  "AIM"                        the AIM market of the 
                                London Stock Exchange 
  "Announcement Date"          25 May 2012 
  "Authorisations"             authorisations, orders, 
                                recognitions, grants, 
                                consents, licences, confirmations, 
                                clearances, permissions 
                                and approvals 
  "Barclays"                   Barclays Bank PLC 
  "Business Day"               any day (other than a 
                                Saturday or Sunday or 
                                a public holiday) on which 
                                banks generally are open 
                                for business in London 
                                (other than solely for 
                                settlement and trading 
                                in euro) 
  "Capita Registrars"          A trading name of Capita 
                                Registrars Limited 
  "Cash Offer"                 the recommended cash offer 
                                to be made by MMGG to 
                                acquire all of the issued 
                                and to be issued Morson 
                                Shares on the terms and 
                                subject to the conditions 
                                to be set out in the Offer 
                                Document and the Form 
                                of Acceptance and, where 
                                the context so requires, 
                                any subsequent revision, 
                                variation, extension or 
                                renewal thereof 
  "Closing Price"              the closing middle-market 
                                quotation of a Morson 
                                Share as derived from 
                                the Daily Official List 
  "Code" or "City              the City Code on Takeovers 
   Code"                        and Mergers as from time 
                                to time interpreted by 
                                the Panel 
  "Companies Act"              the Companies Act 2006, 
   or "Companies Act            as amended 
   2006" 
  "Daily Official              the official list of share 
   List"                        prices produced by the 
                                London Stock Exchange 
  "Directors"                  the directors of Morson 
                                and "Director" means any 
                                one of them 
  "Disclosed"                  fairly disclosed in writing 
                                by or on behalf of Morson 
                                to MMGG or its advisers 
  "first closing               the date falling 21 days 
   date"                        after the date on which 
                                the Offer Document is 
                                posted 
  "Form of Acceptance"         the form of acceptance 
                                and authority relating 
                                to the Offer which will 
                                accompany the Offer Document 
  "FSA"                        the Financial Services 
                                Authority of the United 
                                Kingdom 
  "FSMA"                       the Financial Services 
                                and Markets Act 2000, 
                                as amended 
  "HS2"                        High Speed 2 which is 
                                a planned high-speed railway 
                                between London and the 
                                Midlands, Northern England 
                                and, potentially at a 
                                later stage, the central 
                                belt of Scotland 
  "Independent Director"       Ian Graham Knight, the 
                                only Director who is not 
                                also a member of the Management 
                                Team 
  "intellectual property"      all patents, trademarks, 
                                trade names, service marks, 
                                copyrights, designs, databases 
                                and any applications therefore, 
                                schematics, technology, 
                                know--how, computer software, 
                                programs or applications 
                                (in both source code and 
                                object code form), and 
                                tangible or intangible 
                                proprietary information 
                                or material 
  "Intercreditor               the intercreditor agreement 
   Agreement"                   to be entered into between 
                                amongst others, MMGG (in 
                                various capacities), Barclays 
                                and Gerard Anthony Mason 
                                (and others from time 
                                to time) on 24 May 2012, 
                                further details of which 
                                are set out in the Offer 
                                Document and the Form 
                                of Acceptance 
  "legal proceedings"          actions, suits, proceedings, 
                                investigations, references 
                                or enquiries 
  "Loan Note Alternative"      the option whereby Morson 
                                Shareholders may elect 
                                to receive Offer Loan 
                                Notes instead of all of 
                                the cash consideration 
                                to which they would otherwise 
                                be entitled under the 
                                Offer 
 
  "London Stock Exchange"      London Stock Exchange 
                                plc 
  "Management Team"            each of Gerrard Godfrey 
   or "Management"              Mason, Gerard Anthony 
                                Mason, Paul John Gilmour 
                                and Kevin Patrick Gorton 
  "Mason Loan"                 the loan to MMGG from 
                                Gerard Anthony Mason described 
                                in paragraph 8 of this 
                                announcement 
  "MMGG" or "Offeror"          MMGG Acquisition PLC registered 
                                with company number 07976532 
                                and whose registered office 
                                is at c/o Atticus Legal 
                                LLP, Castlefield House, 
                                Liverpool Road, Manchester, 
                                M3 4SB 
  "MMGG Board" or              the board of directors 
   "MMGG Directors"             of MMGG 
  "Morson" or "Company"        Morson Group plc registered 
                                with company number 05111937 
                                and whose registered office 
                                is at Adamson House, Centenary 
                                Way, Salford, Manchester, 
                                M50 1RD 
  "Morson Board"               the board of directors 
   or "Morson Directors"        of Morson 
  "Morson Group"               Morson, its subsidiaries 
   or "Group"                   and its subsidiary undertakings 
  "Morson Projects"            Morson Projects Limited, 
                                a subsidiary of the Company 
  "Morson Shareholders"        the holders of Morson 
   or "Shareholders"            Shares from time to time 
  "Morson Shares"              the existing unconditionally 
                                allotted or issued and 
                                fully paid ordinary shares 
                                of five pence each of 
                                Morson and any further 
                                such shares which are 
                                unconditionally allotted 
                                or issued fully paid, 
                                or credited as fully paid, 
                                before the date on which 
                                the Offer closes (or before 
                                such earlier date as MMGG 
                                may, subject to the Code, 
                                decide, not being earlier 
                                than (a) the date on which 
                                the Offer becomes or is 
                                declared unconditional 
                                as to acceptances or (b), 
                                if later, the first closing 
                                date of the Offer) 
  "Morson Share Schemes"       The Morson Enterprise 
                                Management Incentive Scheme 
                                2006, the Morson Unapproved 
                                Share Option Scheme 2006 
                                and the Morson Group plc 
                                2008 Discretionary Share 
                                Option Plan UK Approved 
                                Addendum 
  "Offer"                      the offer to be made by 
                                MMGG to acquire all of 
                                the issued and to be issued 
                                Morson Shares on the terms 
                                and subject to the conditions 
                                to be set out in the Offer 
                                Document and the Form 
                                of Acceptance and, where 
                                the context so requires, 
                                any subsequent revision, 
                                variation, extension or 
                                renewal thereof and includes 
                                any election available 
                                in connection with it 
  "Offer Document"             the document to be sent 
                                to Morson Shareholders 
                                and, for information only, 
   "Offer Loan Note             to holders of options 
   Instrument"                  under the Morson Share 
                                Schemes which will contain 
                                the Offer 
                                an instrument to be executed 
                                by MMGG creating the Offer 
                                Loan Notes 
  "Offer Loan Noteholders"     holders of Offer Loan 
                                Notes from time to time 
  "Offer Loan Notes"           the unguaranteed and unsecured 
                                loan notes in MMGG to 
                                be issued as an alternative 
                                to the Cash Offer, further 
                                details of which are set 
                                out in the Offer Document 
                                and the Form of Acceptance 
  "Offer Price"                the sum of 50 pence per 
                                Morson Share 
  "Opening Price"              the opening middle-market 
                                quotation of a Morson 
                                Share as derived from 
                                the Daily Official List 
  "Panel"                      the Panel on Takeovers 
                                and Mergers 
  "Publicly Announced"         specifically disclosed 
                                in the annual report and 
                                accounts of Morson for 
                                the year ended on the 
                                Accounting Date, in this 
                                announcement or in any 
                                other announcement made 
                                to a Regulatory Information 
                                Service since the date 
                                of publication of such 
                                report and accounts and 
                                prior to the Announcement 
                                Date 
  "Regulatory Information      as defined in the UK Listing 
   Service"                     Rules 
  "relevant persons"           governments, governmental, 
                                quasi--governmental, supra-national, 
                                statutory, investigative, 
                                regulatory or administrative 
                                bodies or trade agencies, 
                                associations, institutions 
                                or courts, or professional 
                                or environmental bodies, 
                                or any other persons or 
                                bodies whatsoever in any 
                                jurisdiction 
  "Restricted Jurisdiction"    the United States, Canada, 
                                Japan, Australia and any 
                                other jurisdiction where 
                                local laws or regulations 
                                may result in a significant 
                                risk of civil, regulatory 
                                or criminal exposure for 
                                MMGG or Morson if information 
                                or documentation concerning 
                                the Offer is sent or made 
                                available to Morson Shareholders 
                                in that jurisdiction 
  "SPARK Advisory              SPARK Advisory Partners 
   Partners"                    Limited, financial adviser 
                                to MMGG 
  "Subsidiary Undertaking"     has the same meaning as 
                                in section 1162 of the 
                                Companies Act 2006 of 
                                England and Wales 
  "Subsidiary"                 has the same meaning as 
                                in section 1159(1) of 
                                the Companies Act 2006 
  "substantial interest"       a direct or indirect interest 
                                in 20 per cent or more 
   "TTE Instruction"            of the equity capital 
                                of an undertaking 
                                a transfer to escrow instruction 
                                (as defined by the Crest 
                                manual issued to CrestCo 
                                from time to time) 
  "third party"                person, firm, company 
                                or body 
  "UK" or "United              the United Kingdom of 
   Kingdom"                     Great Britain and Northern 
                                Ireland and its dependent 
                                territories 
  "UK Listing Rules"           means the Listing Rules 
                                made by the FSA under 
                                section 73A of FSMA 
  "United States"              the United States of America, 
   or "US"                      its territories and possessions, 
                                any state of the United 
                                States and the District 
                                of Columbia and all other 
                                areas subject to its jurisdiction 
  "US Securities               the US Securities Act 
   Act"                         1933, and the rules and 
                                regulations promulgated 
                                under it 
  "Wider Morson Group"         as the context requires, 
                                Morson, its subsidiaries, 
                                subsidiary undertakings, 
                                associated undertakings 
                                and any other body corporate, 
                                partnership, joint venture 
                                or person in which Morson 
                                and/or such undertakings 
                                (aggregating their interests) 
                                have a direct or indirect 
                                interest in 20 per cent. 
                                or more of the voting 
                                or equity capital or equivalent 
  "Wider MMGG Group"           as the context requires, 
                                MMGG, its subsidiaries, 
                                subsidiary undertakings, 
                                associated undertakings 
                                and any other body corporate, 
                                partnership, joint venture 
                                or person in which MMGG 
                                and/or such undertakings 
                                (aggregating their interests) 
                                have an interest of more 
                                than 20 per cent. of the 
                                voting or equity capital 
                                or equivalent

In this document references to time are to London time.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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