Offer for Prologic plc (3350A)

TIDMPGC

RNS Number : 3350A

ESWC Acquisitions Limited

29 March 2012

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN OR ANY JURISDICTION IF TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

29 March 2012

RECOMMENDED CASH OFFER

by ESWC Acquisitions Ltd (the "Offeror")

for the entire issued share capital of Prologic plc ("Prologic" or the "Company")

Summary

-- Further to Prologic's announcement on 19 December 2011 that it was carrying out a strategic review of its business which would consider all options and which may or may not result in an offer being made for Prologic, the Directors of the Offeror and Prologic are pleased to announce that they have reached agreement on the terms of a recommended cash offer to be made by ESWC for Prologic.

-- The Offer values the entire issued and to be issued capital of Prologic at GBP3.65 million, on a fully diluted basis, (but excluding employee or other options or warrants that are not in the money) representing a price of 36.5p per Prologic share.

-- Under the terms of the Offer, Prologic Shareholders will be entitled to receive 36.5p in cash for each Ordinary Share held. The Offer Price represents a premium of approximately:

-- 37.7% to the Closing Price per Ordinary Share of 26.5p on 16 December 2011 (being the last Business Day prior to Prologic's announcement of its strategic review which commenced the Offer Period)

-- 46.0% to the Closing Price per Ordinary Share of 25p on 28 March 2012 (being the last Business Day prior to the date of this Announcement)

-- ESWC is a newly-incorporated company formed on behalf of and wholly-owned by Joseph Liemandt, a US-based private individual.

   --         The Offer will be made in cash and is funded from the existing resources of Mr Liemandt. 

-- The Offer is subject to the terms and conditions in Appendix I which include acceptances of the Offer being received in respect of Prologic Shares representing at least 90 per cent. (or such lower percentage as ESWC may decide) of the share capital of Prologic.

Grant Thornton is acting as the independent financial adviser to the board of Prologic in connection with the Offer under Rule 3 of the Takeover Code. The Directors of Prologic, who have been so advised by Grant Thornton, consider the terms of the Offer to be fair and reasonable and intend unanimously to recommend that Prologic Shareholders accept the Offer. In providing, its advice to the Directors of Prologic, Grant Thornton has taken into account the Directors' commercial assessments.

The Offeror has received irrevocable undertakings to accept the Offer from certain directors of the Company namely Sam Jackson, David Parry and Colin Wells in respect of an aggregate total of 2,563,984 Ordinary Shares representing, in aggregate, approximately 25.6 per cent. of the entire issued share capital of Prologic.

The Offeror has also received irrevocable undertakings to accept the Offer from certain shareholders (being previous directors of Prologic) namely Monica Tourlamain, Christina Baker and Gareth Chick in respect of an aggregate total of 1,910,188 Ordinary Shares representing approximately 19.1 per cent. of the entire issued share capital of Prologic.

The Offeror has also obtained irrevocable undertakings to accept the Offer from ISIS Equity Partners, Unicorn Asset Management and Northern 3 VCT PLC in respect of an aggregate total of 2,975,300 Ordinary Shares representing approximately 29.8 per cent. of the entire issued share capital of the Company.

In aggregate therefore irrevocable undertakings to accept the Offer have been received in respect of a total of 7,449,472 Ordinary Shares representing approximately 74.5 per cent. of the entire issued share capital of Prologic. Further details of these irrevocable undertakings are set out in Appendix III to this Announcement.

Commenting on the Offer, Andrew Price from ESWC said:

"ESWC has made this offer for Prologic because it believes that Prologic has a strong technological offering and attractive corporate client list. ESWC believes that it can improve the operating performance of Prologic by providing customers with enhanced service levels with the benefit of active input from senior executives from within Mr Liemandt's group of business interests."

Atlas Technology Group introduced ESWC to Prologic and acted as industry consultant to ESWC.

Commenting on the Offer, Tom Fischer, chief executive of Prologic said:

"The Prologic Board is pleased to have agreed terms with ESWC on an Offer which represents an attractive premium to both current and recent market prices, particularly given the current difficult macroeconomic climate and the challenges being faced in the retail sector in general. The Offer announced today follows the process of the strategic review announced in December 2011 whose objective was to identify potential opportunities to strengthen the business. As part of a group of complementary businesses under the ownership of Mr Liemandt, Prologic's business is expected to benefit both financially and commercially. At the same time the Offer allows shareholders to exit at a significant premium to the share price level prior to the Announcement of the strategic review while providing the certainty of cash."

This summary should be read in conjunction with, and is subject to, the full text of the Announcement and its appendices. Appendix I of the Announcement sets out the conditions to and certain further terms to which the Offer will be subject. Appendix II contains the sources and bases for certain information set out in this summary Announcement and the Announcement. Appendix III sets out details of the irrevocable undertakings to accept the Offer. Appendix IV contains definitions of certain terms and expressions used in both this summary and in the Announcement.

Enquiries:

Andrew Price [phone]

ESWC Acquisitions Ltd

Edward Williams 020 7464 8823

West Hill Corporate Finance Limited

(Financial advisor to the Offeror)

Tom Fischer, CEO, Prologic plc 01442 876 277

   Philip Secrett/Salmaan Khawaja                                                        020 7383 5100 

Grant Thornton UK LLP (Rule 3 advisor to Prologic)

   Zoe Biddick, Biddicks Financial PR                                                   020 3178 6381 

(Financial PR advisor to Prologic)

Terms used in this summary of the Announcement shall have the meaning given to them in the Announcement.

This Announcement is not intended to and does not constitute, or form any part of, an offer to sell or any solicitation of an offer to purchase or subscribe for any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Offer or otherwise. The Offer will be made solely by the Offer Document and (in the case of certificated Prologic Shares) the Form of Acceptance, which together will contain the full terms and conditions of the Offer, including details of how the Offer may be accepted. Any acceptance or other response to the Offer should be made only on the basis of the information contained or referred to in the Offer Document and (in the case of certificated Prologic Shares) the Form of Acceptance. The laws of relevant jurisdictions may affect the availability of the Offer to persons not resident in the United Kingdom. Persons who are not resident in the United Kingdom, or who are subject to the laws of any jurisdiction other than the United Kingdom or who are a nominee of or custodian or trustee for, any resident or national of any country other than the United Kingdom, should inform themselves about and observe any applicable legal or regulatory requirements of their jurisdiction. The Offer Document will be available for public inspection.

West Hill Corporate Finance Limited, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for the Offeror and no one else in connection with the Offer and the matters referred to in this Announcement. West Hill Corporate Finance Limited will not be responsible to any person other than the Offeror for providing the protections afforded to customers of West Hill Corporate Finance Limited, nor for providing advice in relation to the Offer or any other matter referred to in this Announcement.

Grant Thornton, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Prologic and no one else in connection with the Offer and the matters referred to in this Announcement. Grant Thornton will not be responsible to any person other than Prologic for providing the protections afforded to customers of Grant Thornton, nor for providing advice in relation to the Offer or any other matter referred to in this Announcement.

The Offer will not be made, directly or indirectly, and this Announcement should not be sent, in or into or from the United States, Canada, Australia, South Africa, Japan or any other Restricted Jurisdiction or by use of the mails of or by any means or instrumentality (including, without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of, any of these jurisdictions and doing so may render invalid any purported acceptance of the Offer. Accordingly, copies of this Announcement and any other document relating to the Offer are not being, and must not be, mailed or otherwise distributed or sent in or into the United States, Canada, Australia, South Africa, Japan or any other Restricted Jurisdiction. Any person (including, without limitation, custodians, nominees and trustees) who may have contractual or legal obligations, or may otherwise intend, to forward this Announcement to any jurisdiction outside the United Kingdom should read the relevant provisions of the Offer Document before taking any action.

The availability of the Offer to Prologic Shareholders who are not resident in the United Kingdom may be affected by the laws of the relevant jurisdiction in which they are resident. Persons who are not resident in the United Kingdom should inform themselves about and observe any applicable legal or regulatory requirements of those jurisdictions.

Forward-looking statements

This Announcement, including information included or incorporated by reference in this Announcement, may contain "forward-looking statements" concerning ESWC and Prologic. Generally, the words "will", "may", "should", "continue", "believes", "expects", "intends", "anticipates" or similar expressions identify forward-looking statements. The forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those suggested by them. Many of these risks and uncertainties relate to factors that are beyond the abilities of ESWC to control or estimate precisely, such as future market conditions and the behaviours of other market participants, and therefore undue reliance should not be placed on such statements which speak only as at the date of this Announcement. Neither ESWC nor Prologic nor their respective boards of directors assume no obligation and do not intend to update these forward-looking statements, except as required pursuant to applicable law.

Disclosure requirements of the UK Takeover Code (the "Code")

Under Rule 8.3(a) of the Code, any person who is interested in one per cent. or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the Announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 p.m. (London time) on the 10th Business Day following the commencement of the offer period and, if appropriate, by no later than 3.30 p.m. (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 one per cent. or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 p.m. (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 [phone].

Publication on website

A copy of this Announcement will be available at www.prologic.com by no later than 12 noon (London time) on 30 March 2012.

Information relating to Prologic Shareholders

Please be aware that addresses, electronic addresses and certain information provided by Prologic Shareholders, persons with information rights and other relevant persons for the receipt of communications from Prologic may be provided to the Offeror during the offer period as requested under Section 4 of Appendix 4 of the Code to comply with Rule 2.12(c).

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN OR ANY JURISDICTION IF TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

For immediate release

29 March 2012

RECOMMENDED CASH OFFER

by ESWC Acquisitions Ltd (the "Offeror")

for the entire issued share capital of Prologic plc ("Prologic" or the "Company")

   1.          Introduction 

Further to Prologic's announcement on 19 December 2011 that it was carrying out a strategic review of its business which would consider all options and which may or may not result in an offer being made for Prologic, the Directors of the Offeror and Prologic are pleased to announce that they have reached agreement on the terms of a recommended cash offer to be made by ESWC for Prologic.

   2.          Terms of the Offer 

The Offer, which will be made on the terms and subject to the conditions set out below and in Appendix 1 to this Announcement, and subject to the further terms and conditions to be set out in the Offer Document and (in the case of Prologic Shares held in certificated form) in the Form of Acceptance, will be made on the following basis:

   For each Prologic Share                                                   36.5 pence in cash 

The Offer values the existing issued share capital of Prologic at GBP3.65 million.

Under the terms of the Offer, Prologic Shareholders will be entitled to receive 36.5p in cash for each Ordinary Share held. The Offer Price represents a premium of approximately:

-- 37.7% to the Closing Price per Ordinary Share of 26.5p on 16 December 2011 (being the last Business Day prior to Prologic's announcement of its strategic review which commenced the Offer Period)

-- 46.0% to the Closing Price per Ordinary Share of 25p on 28 March 2012 (being the last Business Day prior to the date of this Announcement)

The Offer extends to all Prologic Shares which are issued and fully paid on the date of the Offer. The Prologic Shares will be acquired pursuant to the Offer fully paid free from all liens, charges, equitable interests and encumbrances and together with all rights now and hereafter attaching thereto including voting rights and the right to receive and retain all dividends and other distributions (if any) declared, made or paid hereafter.

   3.          Background to and Reasons for the Offer 

Prologic has a strong franchise and client list in providing software solutions to leading retail sector clients. However, the business has to an extent suffered from a lack of scale and requires additional capital to support the continued development of the business. Accordingly, upon the announcement of its interim results for the six months ended 30 September 2011, on 19 December 2011, Prologic confirmed that it had completed a restructuring of the business resulting in a simpler, leaner management structure with clearer lines of responsibility and a reduced cost base and had also concluded that a strategic review of the business was required in order to consider all options available to the Company (including the possibility of shareholder value being maximised through an offer for the Company).

This strategic review resulted in Prologic holding discussions with the Offeror's Shareholder's group of companies together with a number of other parties potentially interested in offering to acquire the business.

The Offeror's Shareholder's group of companies has a history of acquiring software businesses such as Prologic with a strong technological offering and attractive corporate client lists, with a view to enhancing the financial and operating performance of the businesses acquired. Whilst ESWC has not yet completed a full strategic plan for the integration of Prologic with the Offeror's Shareholder's other business interests, ESWC anticipates that it will be possible to enhance Prologic's operating and financial performance through a number of actions, including:

-- a determined focus on providing customers with enhanced service levels, which is the benchmark by which the Offeror's Shareholder's group of companies measure their operating performance;

-- active and enhanced management of Prologic's business by senior executives within the Offeror's Shareholder's group of companies, with a particular focus on existing customer relationships;

-- elimination of duplicated central and administration, software development and other costs within Prologic. This is likely to involve transferring central management, administration, sales and marketing and certain other functions to the existing operations of the Offeror's Shareholder's group of companies and a migration of the software development functions of Prologic to an offshore software development affiliate; and

   --     cost and resource savings arising if Prologic Shares cease to be traded on AIM. 
   4.          Recommendation 

The Prologic Board, which has been so advised by Grant Thornton, considers the terms of the Offer to be fair and reasonable. In providing financial advice to the Prologic Board, Grant Thornton has taken into account the commercial assessments of the Prologic Directors.

Accordingly, the Prologic Directors unanimously intend to recommend Prologic Shareholders to accept the Offer, as they (or their nominees) have irrevocably undertaken to do in respect of their personal holdings totalling 2,563,984 Prologic Shares (representing approximately 25.6 per cent. of the existing issued share capital of Prologic).

   5.          Irrevocable Undertakings 

The Offeror has received irrevocable undertakings to accept the Offer from certain directors of the Company namely Sam Jackson, David Parry and Colin Wells in respect of an aggregate total of 2,563,984 Ordinary Shares representing, in aggregate, approximately 25.6 per cent. of the entire issued share capital of Prologic.

The Offeror has also received irrevocable undertakings to accept the Offer from certain shareholders (being previous directors of Prologic) namely Monica Tourlamain, Christina Baker and Gareth Chick in respect of an aggregate total of 1,910,188 Ordinary Shares representing approximately 19.1 per cent. of the entire issued share capital of Prologic.

The Offeror has also obtained irrevocable undertakings to accept the Offer from ISIS Equity Partners, Unicorn Asset Management and Northern 3 VCT PLC in respect of an aggregate total of 2,975,300 Ordinary Shares representing approximately 29.8 per cent. of the entire issued share capital of Prologic.

In aggregate, therefore, irrevocable undertakings to accept the Offer have been received in respect of a total of 7,449,472 Ordinary Shares representing approximately 74.5 per cent. of the entire issued share capital of Prologic. Further details of these irrevocable undertakings are set out in Appendix III to this Announcement.

   6.         Background to and reasons for recommending the Offer 

In considering whether to recommend the Offer, the Board of Prologic took into account:

-- the extensive consultation process involving multiple interested parties which led to the Offer;

-- ESWC's ability to move quickly to an announcement of the Offer and the certainty this provides Prologic's key stakeholders;

-- the Prologic directors' view that it would be unlikely that the Ordinary Shares would trade at the valuation level implied by the Offer in the short to medium term, particularly given the pre-Announcement share price level, the uncertain, macro-economic outlook and the risks inherent in the business;

-- the recognition by the board of the Company's need to secure additional financial resources both to meet its day to day obligations and to allow the Company to continue the development of its business; in particular the requirement to provide sufficient cash resources to enable the Company to enter into the EFT settlement agreement referred to in section 7 below;

-- that the Offer provides an opportunity for all Prologic shareholders to realise their investment in full and in cash;

-- the combination with the financially strong, global business interests of Mr Liemandt with complementary operations is expected to afford Prologic's business greater flexibility to respond rapidly and robustly to changes in market conditions to the benefit of its various stakeholders; and

-- the credibility and track record of the businesses of the Offeror's Shareholder's group of companies and their historic performance of maximising value from transactions and expertise in providing strategic, financial and operational guidance to the Company.

   7.          Information on Prologic 

The Company is a specialist software developer and service provider to the fashion and lifestyle sectors. The business was founded in 1984 by Sam Jackson and floated on AIM in June 2004. Today Prologic remains focused on the fashion and lifestyle sector, having expanded its solution portfolio and extended into managed services. The company has an enviable track record and has supported the growth of many of the UK's best known and most successful mid market brands.

Prologic helps fashion businesses to trade more profitably by streamlining and integrating sales channels and back-end business processes through a comprehensive single database business application called CIMS. This proven Oracle based application, which has been designed and developed by Prologic, supports wholesale, retail and ecommerce sales channels, cross-channel merchandising, supply-chain, store-systems, warehousing together with enterprise reporting.

The Company has supported the growth of some of the UK's best known fashion retailers such as Ted Baker, Paul Smith, Fat Face and Hobbs.

Settlement of EFT issue

During 2011, Prologic identified that a security breach had taken place that impacted its electronic funds transfer ("EFT") processing business, and that some credit card information might have been compromised. Prologic immediately disabled the threat, notified the relevant authorities and initiated an independent assessment of the situation. Prologic has co-operated fully with the card schemes and acquiring banks throughout this process and can confirm that none of Prologic's customers incurred any loss as a result of the breach.

Whilst Prologic does not believe it has any direct liability in relation to this matter, it is aware that its customers could be subject to fines being imposed on them by their acquiring banks. Therefore, it believes that it would help its relationship with its customers if it was to agree a direct settlement with the acquiring banks on behalf of its customers. Following the announcement of the Offer today, Prologic will today enter into a full and final settlement agreement with the relevant acquiring banks and will therefore be making a provision of GBP505,000, to cover all costs associated with the settlement agreement.

   8.          Information relating to the Offeror and Joseph Liemandt 
   (a)   ESWC Acquisitions Ltd (the "Offeror" or "ESWC") 

ESWC is a newly established private limited liability company, formed at the direction of and controlled by Joseph Liemandt, a US-based private individual, for the purpose of making the Offer. It has not traded since its incorporation.

ESWC was incorporated in England and Wales on 23 March 2012. The registered office of ESWC is at Fifth Floor, 10 Noble Street, London EC2V 7QJ and its registered number is 8004368. The Directors of ESWC are Andrew Price (Chief Financial Officer of Trilogy, Inc., a company owned and controlled by Mr Liemandt) and Danielle Royston (an executive consultant to Trilogy, Inc.). The issued share capital of ESWC is 1,000 ordinary shares of GBP1 par value held by Mr Liemandt.

Upon completion of the Offer, Prologic will be the only subsidiary of ESWC and, on a consolidated basis, will represent all or substantially all of its consolidated earnings, assets and liabilities. ESWC will fund the offer from the existing cash resources of its shareholder, Mr Liemandt, which will be provided to ESWC by means of an equity subscription. No external debt or other financing will be utilised to finance the offer. No view has yet been formed by ESWC on possible fair value accounting adjustments with regard to the acquisition of Prologic. ESWC has not prepared financial accounts and is not rated by rating agencies.

Save as disclosed in this Announcement, there has been no material change in the financial or trading position of the Offeror since 23 March 2012, the date of its incorporation.

   (b)   Joseph Liemandt 

Joseph Liemandt is a US-based private individual, who is the sole shareholder of ESWC.

After studying economics at Stanford University, Mr Liemandt founded the Trilogy group of companies in 1989, and he remains Chief Executive Officer and controlling shareholder of Trilogy, Inc., the holding company of the group. Trilogy focuses upon serving the market's need for software applications that maximise corporate and customer information and, under Mr Liemandt's control, has grown rapidly through acquisitions and organically. The Trilogy group is founded on the principle of utilizing disruptive technology to unleash significant business value to its customers and has secured a large number of global 1000 companies as its customers. Major operating subsidiaries Trilogy, Inc. include Versata Software, Inc. and Trilogy Enterprises, Inc.

Mr Liemandt founded ESW Capital, which is legally separate and independent of the Trilogy group, in 2008. ESW Capital is a Delaware incorporated limited liability company, which acts as a holding company for a number of subsidiaries engaged in technology related activities. In addition to its ownership of subsidiary undertakings, ESW Capital holds a number of other assets, including liquid investments and minority interests in certain private companies.

Trilogy, Inc. and ESW Capital, both of which are controlled by Mr Liemandt, have combined unconsolidated net assets of in excess of $200m and an excess of liquid assets over short term indebtedness.

   9.          Financing of the Offer 

Full acceptance of the Offer would involve payment by ESWC of GBP3.65 million in cash.

West Hill Corporate Finance, financial adviser to the Offeror, is satisfied that sufficient financial resources are available to the Offeror to satisfy in full the cash consideration payable to Prologic Shareholders under the terms of the Offer.

   10.        Prologic Share Schemes and Warrants 

All options granted under the Prologic Share Schemes and the warrants to subscribe for Prologic Shares ("Warrants") are exercisable at prices above the Offer value of 36.5p per Prologic Share. Accordingly, no appropriate proposal is required under Rule 15 of the Code and no such proposal will be made. The Offer will not extend to any Prologic Shares which are unconditionally allotted or issued pursuant to the Warrants or the exercise of options granted under the Prologic Share Schemes from the date of the Offer until the time at which the Offer ceases to be open for acceptance.

   11.        Management, employees and locations 

ESWC has given assurances to Prologic that, following the Offer becoming wholly unconditional, the existing contractual employment and pension rights of all employees and management of Prologic will be fully safeguarded.

Whilst ESWC has not yet finalised the full strategic plan for the integration of Prologic's business, ESWC would anticipate investing heavily in delivery of enhanced customer service levels, as a core element of ESWC's strategy in order to retain and enhance the relationship with Prologic's client base.

In delivering this enhanced service to clients, ESWC also anticipates that central management, administration, sales and marketing, software development and other functions currently performed by Prologic will be substantially or completely transferred to existing operations of the Offeror's Shareholder's group of companies or to its affiliates. This process will involve (subject to any applicable law or consultation process) a reduction in headcount within Prologic. Prior to completion of the Offer, it is not anticipated that there will be any reductions in Prologic's headcount, although ESWC would anticipate commencing transferring the operations mentioned above shortly after completion of the Offer.

The non-executive directors of Prologic intend to resign as Directors of Prologic on the completion of the Offer.

Subject to finalisation of the integration plans for Prologic's business, it is likely that ESWC will seek to vacate Prologic's premises at the next break point in the lease. Accordingly, the location of Prologic's place of business is expected to change in due course. At the point when Prologic's premises are vacated, a decision will be taken as to the deployment of other fixed assets within the business.

   12.        Admission to trading and compulsory acquisition 

It is ESWC's intention that if the Offer becomes or is declared unconditional in all respects and assuming sufficient acceptances are received under the Offer in respect of (and/or otherwise acquires) Prologic Shares to which the Offer relates, to exercise such rights to acquire compulsorily the remaining Prologic Shares pursuant to the provisions of sections 974 to 991 (inclusive) of the Act. ESWC also anticipates that, after the Offer becomes or is declared unconditional in all respects and ESWC has by virtue of its shareholdings and acceptances of the Offer acquired, or agreed to acquire, issued share capital representing at least 75 per cent. of the voting rights of Prologic normally exercisable at general meetings of Prologic, it will procure the making of an application by Prologic for cancellation of the admission to trading of Prologic Shares on AIM and that such cancellation of admission to trading would take effect no earlier than 20 Business Days after the date upon which the Offer becomes or is declared unconditional in all respects. Any cancellation of the admission of Prologic Shares to trading on AIM would significantly reduce the liquidity and marketability of any Prologic Shares not assented to the Offer.

   13.        Confirmation regarding Opening Position Disclosure 

The Offeror confirms that it is, on the date of this Announcement, making an Opening Position Disclosure, setting out the details required to be disclosed by it under Rule 8.1(a) of the Code.

   14.        Overseas Shareholders 

The availability of the Offer to persons not resident in, and distribution of this Announcement to Prologic Shareholders 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. Prologic Shareholders who are in any doubt regarding such matters should consult an appropriate independent professional adviser in the relevant jurisdiction without delay.

This Announcement does not constitute an offer for sale for any securities or an offer or an invitation to purchase any securities. Prologic Shareholders are advised to read carefully the Offer Document and related Form of Acceptance once these have been dispatched.

   15.        Documents on display 

Copies of the following documents will, by no later than 12 noon (London time) on 30 March 2012, be published on Prologic's website at www.prologic.com until the Offer is declared unconditional in all respects or lapses in accordance with its terms.

-- the irrevocable undertakings referred to in paragraph 5 above and summarised in Appendix III to this Announcement; and

   --     the Confidentiality Agreement entered into with Prologic. 
   16.        General 

The Offer will be subject to the conditions and certain further terms set out in Appendix I and the further terms and conditions set out in the Offer Document.

The formal Offer Document will be sent to Prologic Shareholders, together with (in the case of holdings of Prologic Shares in certificated form) the Form of Acceptance, as soon as reasonably practicable and, in any event, within 28 days of the date of this Announcement (unless agreed otherwise with the Panel). This Announcement is not intended to and does not constitute an offer or an invitation to purchase any securities. Details of the sources and bases of certain information set out in this Announcement are included in Appendix II. The definitions of terms used in this Announcement are contained in Appendix IV.

Enquiries:

Andrew Price [phone]

ESWC Acquisitions Ltd

Edward Williams 020 7464 8823

West Hill Corporate Finance Limited

(Financial advisor to the Offeror)

Tom Fischer, CEO, Prologic plc 01442 876 277

   Philip Secrett/Salmaan Khawaja                                                        020 7383 5100 

Grant Thornton UK LLP (Rule 3 advisor to Prologic)

   Zoe Biddick, Biddicks Financial PR                                                   020 3178 6381 

(Financial PR advisor to Prologic)

This Announcement is not intended to and does not constitute, or form any part of, any offer to sell or any solicitation of any offer to purchase or subscribe for any securities or the solicitation of any vote or approval in any jurisdiction. The Offer will be made solely by the Offer Document and (in the case of certificated Prologic Shares) the Form of Acceptance, which together will contain the full terms and condition of the Offer, including details of how the Offer may be accepted. Any acceptance or other response to the Offer should be made only on the basis of the information contained or referred to in the Offer Document and (in the case of certificated Prologic Shares) the Form of Acceptance. The laws of relevant jurisdictions may affect the availability of the Offer to persons not resident in the United Kingdom. Persons who are not resident in the United Kingdom, or who are subject to the laws of any jurisdiction other than the United Kingdom, should inform themselves about and observe any applicable legal or regulatory requirements of their jurisdiction. The Offer Document will be available for public inspection.

West Hill Corporate Finance Limited, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for the Offeror and no one else in connection with the Offer and the matters referred to in this Announcement. West Hill Corporate Finance Limited will not be responsible to any person other than the Offeror for providing the protections afforded to customers of West Hill Corporate Finance Limited, nor for providing advice in relation to the Offer or any other matter referred to in this Announcement.

Grant Thornton, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Prologic and no one else in connection with the Offer and the matters referred to in this Announcement. Grant Thornton will not be responsible to any person other than Prologic for providing the protections afforded to customers of Grant Thornton, nor for providing advice in relation to the Offer or any other matter referred to in this Announcement.

The Offer will not be made, directly or indirectly, and this Announcement should not be sent, in or into or from the United States, Canada, Australia, South Africa, Japan or any other Restricted Jurisdiction or by use of the mails of or by any means or instrumentality (including, without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of, any of these jurisdictions and doing so may render invalid any purported acceptance of the Offer. Accordingly, copies of this Announcement and any other document relating to the Offer are not being, and must not be, mailed or otherwise distributed or sent in or into the United States, Canada, Australia, South Africa, Japan or any other Restricted Jurisdiction. Any person (including, without limitation, custodians, nominees and trustees) who may have contractual or legal obligations, or may otherwise intend, to forward this Announcement to any jurisdiction outside the United Kingdom should read the relevant provisions of the Offer Document before taking any action.

The availability of the Offer to Prologic Shareholders who are not resident in the United Kingdom may be affected by the laws of the relevant jurisdiction in which they are resident. Persons who are not resident in the United Kingdom should inform themselves about and observe any applicable legal or regulatory requirements of those jurisdictions.

Dealing Disclosure Requirements

Under the provisions of Rule 8.3 of the Code, if any person is, or becomes, 'interested' (directly or indirectly) in one per cent. or more of any class of 'relevant securities' of Prologic, all 'dealings' in any 'relevant securities' of Prologic (including by means of an option in respect of, or a derivative referenced to, any such 'relevant securities') must be publicly disclosed by no later than 3.30 p.m. (London time) on the Business Day following the date of the relevant transaction. This requirement will continue until the date on which the Offer becomes or is declared wholly unconditional, lapses, or is otherwise withdrawn or on which the 'Offer Period' otherwise ends. If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire an 'interest' in 'relevant securities' of Prologic, they will be deemed to be a single person for the purpose of Rule 8.3 of the Code.

Under the provisions of Rule 8.1 of the Code, all 'dealings' in 'relevant securities' of Prologic by the Offeror or Prologic or any of their respective 'associates', must be disclosed by no later than 12 noon (London time) on the Business Day following the date of the relevant transaction.

A disclosure table, giving details of the companies in whose 'relevant securities' and 'dealings' should be disclosed, and the number of such securities in issue can be found on the Panel's website at www.thetakeoverpanel.org.uk.

'Interests in securities' arise, in summary, when a person has long economic exposure, whether conditional or absolute, to changes in the price of securities. In particular, a person will be treated as having such an 'interest' by virtue of the ownership or control of securities or by virtue of any option in respect of, or derivative referenced to, securities.

Terms in quotation marks in this section are defined in the Code, which can also be found on the Panel's website. If you are in any doubt as to whether or not you are required to disclose a 'dealing' under Rule 8, you should consult the Panel.

If you are in any doubt about the Offer, the contents of this Announcement or what action you should take, you are recommended to seek your own personal financial advice immediately from your stockbroker, bank manager, solicitor, accountant or independent professional adviser duly authorised under the Financial Services and Markets Act 2000 if you are resident in the United Kingdom or, if not, from another appropriately authorised independent financial adviser.

Appendix I

The Offer will comply with the rules and regulations of the Financial Services Authority, the AIM Rules of the London Stock Exchange, the Code and the Companies Act 2006. In addition, the Offer will be governed by English law and will be subject to the jurisdiction of the courts of England and to the terms and conditions set out below and in the Form of Acceptance.

The Offer will be subject to the following conditions:

(a) valid acceptances of the Offer being received (and not, where permitted, withdrawn) by not later than 1.00 p.m. (London time) on the First Closing Date (or such later time(s) and/or date(s) as ESWC 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 ESWC may decide) of the Prologic Shares to which the Offer relates, provided that, unless agreed by the Panel, this condition will not be satisfied unless ESWC and/or any of its wholly-owned subsidiaries shall have acquired or agreed to acquire (whether pursuant to the Offer or otherwise) directly or indirectly Prologic Shares carrying in aggregate more than 50 per cent. of the voting rights then normally exercisable at a general meeting of Prologic, including for this purpose (except to the extent, if any, required by the Panel) any such voting rights attaching to any Prologic Shares that are unconditionally allotted or 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 and, for this purpose:

(i) the expression Prologic Shares to which the Offer relates shall be construed in accordance with sections 974 to 991 of the Companies Act 2006; and

(ii) Prologic Shares which have been unconditionally allotted but not issued shall be deemed to carry the voting rights which they will carry upon issue;

(b) no Relevant Authority having intervened in any way and there not continuing to be outstanding any statute, regulation or order of any Relevant Authority in each case which would or might reasonably be expected to:

(i) make the Offer, its implementation or the acquisition or proposed acquisition by ESWC of any shares or other securities in, or control of Prologic or any other member of the Wider Prologic Group, void, prohibited, unenforceable and/or illegal in or under the laws of any relevant jurisdiction or otherwise, in any material way, directly or indirectly restrain, restrict, prohibit, prevent, delay or otherwise interfere with the Offer or such acquisition or the implementation thereof, or impose material additional conditions or obligations with respect to the Offer or such acquisition, or otherwise, in any material way, challenge, impede or prevent the Offer or its implementation, or require material amendment to the terms of the Offer or the acquisition or proposed acquisition of any Prologic Shares, or the acquisition of control of Prologic by ESWC;

(ii) require, prevent or delay, in any material way, the divestiture (or alter the terms envisaged for any proposed divestiture) by ESWC or by Prologic or any other member of the Wider Prologic Group of all or any material part of their respective businesses, assets or properties or impose any material limitation on the ability of any of them to conduct any of their respective businesses (or any of them) or to own or dispose of any of their respective assets or properties or any material part thereof;

(iii) impose any limitation on, or result in a delay in, the ability of ESWC or any member of the Wider Prologic Group to acquire or to hold or to exercise effectively, directly or indirectly, all or any rights of ownership in respect of shares or loans or securities convertible into shares or other securities (or the equivalent) in, or to exercise management control over, any member of the Wider Prologic Group which is material in the context of the Wider Prologic Group as the case may be, taken as a whole;

(iv) without limitation to the foregoing, require any member of the Wider Prologic Group to acquire, or to offer to acquire, any shares or other securities (or their equivalent) in any member of the Wider Prologic Group or any asset owned by any third party (other than the implementation of the Offer, by virtue of Part 28 of the Act or pursuant to Rule 9 of the Code), such acquisition being material in the context of the Wider Prologic Group taken as a whole;

(v) require ESWC or any member of the Wider Prologic Group to sell, or to offer to sell, any shares or other securities (or their equivalent) of the Wider Prologic Group or any interest in any asset owned by any member of the Wider Prologic Group;

(vi) impose any material limitation on the ability of ESWC or any member of the Wider Prologic Group to integrate or co-ordinate its business, or any part of it, with all or any part of other businesses, or businesses of any member of the Wider Prologic Group to an extent which is material in the context of the Wider Prologic Group taken as a whole;

(vii) result in any member of the Wider Prologic Group ceasing to be able to carry on business under any name under which it presently does so or ceasing to be able to use in its business any name, trademark or other intellectual property right which it at present uses where such name or use is material to the business of the Wider Prologic Group taken as a whole; or

(viii) otherwise adversely affect any or all of the business assets, financial or trading position, profits or prospects of any member of the Wider Prologic Group in a way which is material in the context of the Wider Prologic Group taken as a whole;

and all applicable waiting and other time periods during which any Relevant Authority could intervene in such a way under the laws of any relevant jurisdiction having expired, lapsed or been terminated;

(c) all necessary notifications and filings having been made, all regulatory and statutory obligations in any relevant jurisdiction having been complied with, all appropriate waiting and other time periods (including any extensions of such waiting and other time periods) under any applicable legislation or regulations of any relevant jurisdiction having expired, lapsed or been terminated, in each case in respect of the Offer or the acquisition or proposed acquisition of any Prologic Shares or control of Prologic or any other member of the Wider Prologic Group by ESWC;

(d) all authorisations and determinations necessary or appropriate in any relevant jurisdiction for or in respect of the Offer or the acquisition or proposed acquisition of any Prologic Shares or control of Prologic or any other member of the Wider Prologic Group by ESWC having been obtained on terms and in a form satisfactory to ESWC (acting reasonably), from all and any Relevant Authority or (without prejudice to the generality of the foregoing) from any person or bodies with whom any member of the Wider Prologic Group has entered into contractual arrangements that are material in the context of the Wider Prologic Group taken as a whole in each case where the absence of such authorisations and determinations would have a material adverse effect on the Wider Prologic Group taken as a whole and such authorisations and determinations remaining in full force and effect and there being no notice of any intention to revoke or not renew or materially suspend, restrict or modify any of the same in any such case where such revocation, suspension, restriction, modification or failure to review would be material in the context of the Wider Prologic Group;

(e) except as publicly announced by Prologic prior to 29 March 2012 or fairly disclosed in writing to ESWC or its financial or legal advisers by or on behalf of Prologic prior to 29 March 2012 in the context of the Offer, there being no provision of any agreement, arrangement, license, permit or other instrument to which any member of the Wider Prologic Group is a party, or by or to which any such member or any of its assets is or are or may be bound, entitled or subject or any circumstance which, in each case as a consequence of the Offer or the acquisition or proposed acquisition of any Prologic Shares or control of Prologic or any other member of the Wider Prologic Group by ESWC or any part thereof or any matter arising therefrom or relating thereto or otherwise, would or might reasonably be expected to result, to an extent that is material in the context of the Wider Prologic Group taken as a whole, as a consequence of the Offer, or of the proposed acquisition of any shares in, or control of, Prologic by ESWC, in:

(i) any monies borrowed by or any other indebtedness or liabilities (actual or contingent) of, or any grant available to, any member or the Wider Prologic Group being or becoming repayable or being capable of being declared repayable immediately or prior to its stated maturity or repayment date, or the ability of any such member to borrow moneys or incur any indebtedness 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 or assets of any such member of the Wider Prologic Group or any such mortgage, charge or other security interest (whenever created arising or having arisen), becoming enforceable or being enforced;

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

(iv) any member of the Wider Prologic Group ceasing to be able to carry on business under any name or in any manner under which it presently carries on business or ceasing to be able to use in its business any name, trademark or other intellectual property right which it at present uses, in each case on the same basis and terms as at present apply;

(v) any asset, property or interest of, or any asset the use of which is enjoyed by, any member of the Wider Prologic Group being disposed of by or ceasing to be available to any member of the Wider Prologic Group or any right arising under which any such asset or interest could be required to be disposed of by or charged or could cease to be available to any member of the Wider Prologic Group other than in the ordinary course of business;

   (vi)    the creation of any material liability (actual or contingent) by any such member; or 

(vii) the financial or trading position profits or prospects or business or assets of any member of the Wider Prologic Group being prejudiced or adversely affected;

and no event having occurred which, under any provision of any such authorisation, arrangement, agreement, licence, permit, lease, franchise or other instrument, would result in any of the events or circumstances which are referred to in paragraphs (e) (i) to (vii) (inclusive) in any case to an extent which is or would be material in the context of the Wider Prologic Group as a whole;

(f) since 31 March 2011, save as publicly announced prior to 29 March 2012 or approved by Prologic Shareholders at the Prologic 2011 AGM fairly disclosed in writing to ESWC or its financial or legal advisers by or on behalf of Prologic prior to 29 March 2012 in the context of the Offer, no member of the Wider Prologic Group having:

(i) issued or agreed to issue or authorised the issue of additional shares of any class, or of securities convertible into, or rights, warrants or options to subscribe for or acquire, any such shares or convertible securities or redeemed, purchased or repaid any of its own shares or other securities or reduced or made any other change to any part of its share capital, except for any options granted and any Prologic shares allotted upon the exercise of any options granted under the Prologic Share Option Scheme;

(ii) made or authorised or announced an intention to propose any material change in its loan capital or issued, authorised or proposed the issue of any debentures;

(iii) other than to a wholly owned member of the Prologic Group, recommended, declared, paid or made or proposed to recommend, declare, pay or make any dividend, bonus issue or other distribution whether payable in cash or otherwise;

(iv) merged with or demerged or acquired any body corporate or acquired or disposed of or (save in the ordinary course of business) transferred, mortgaged or charged or created any security interest over any assets or any right, title or interest in any assets (including shares and trade investments) which are material in the context of the Wider Prologic Group taken as a whole or authorised, proposed or announced its intention so to do;

(v) save as between Prologic and wholly owned subsidiaries of Prologic issued, authorised or proposed or announced an intention to propose the issue of any debentures or (save in the ordinary course of business) become subject to any contingent liability or incurred or increased any indebtedness or contingent liability which is material in the context of the Wider Prologic Group taken as a whole;

(vi) purchased, redeemed or repaid or announced any proposal for the purchase, redemption or repayment of any of its own shares or other securities or reduced or made, or proposed the reduction or making of, any other change to any part of its share capital;

(vii) entered into or varied or authorised or become bound by or proposed the entry into or variation of, or announced its intention to enter into or vary, any contract, transaction, arrangement or commitment (whether in respect of capital expenditure or otherwise) outside the ordinary course of business and which:

   (A)     is of a long term, onerous or unusual nature or magnitude; or 

(B) is restrictive (to a material extent) to the businesses of any member of the Wider Prologic Group; or

(C) involves an obligation of a long term, onerous or unusual nature or magnitude which is material in the context of the Wider Prologic Group taken as a whole;

(viii) entered into, implemented, effected, authorised or proposed or announced its intention to enter into, implement, effect, authorise or propose any contract, reconstruction, amalgamation, scheme, commitment or other transaction or arrangement otherwise than in the ordinary course of business which is material in the context of the Wider Prologic Group taken as a whole;

(ix) entered into or varied (in any material respect) or made any offer (which remains open for acceptance) to enter into or vary (in any material respect) the terms of any agreement, commitment, arrangement or contract with any of the directors or senior executives or senior managers of any member of the Wider Prologic Group;

(x) proposed, agreed to provide or modified (in any material respect) the terms of any share option scheme, share scheme, incentive scheme or other benefit relating to the employment or termination of any employee of the Wider Prologic Group;

(xi) (other than in respect of a member of the Wider Prologic Group which is dormant and was solvent at the relevant time) taken or proposed any corporate action or had any order made or legal proceedings instituted or threatened in writing against it or petition presented for its winding-up (voluntarily or otherwise), dissolution or reorganisation or for the appointment of a receiver, administrator, administrative receiver, trustee or similar officer of all or any of its assets and revenues or for any analogous proceedings or steps having occurred in any jurisdiction or for the appointment of any analogous person in any jurisdiction;

(xii) to the extent that there are trust deeds constituting pension schemes established for directors and/or employees of the Wider Prologic Group and/or their dependants made or agreed or consented to any material change to the terms of the scheme or to the benefits which accrue, or to the pensions which are payable, thereunder, or to the basis on which qualification for, or accrual of or entitlement to, such benefit or pensions are calculated or determined or to the basis upon which the liabilities (including pensions) or such pension schemes are funded or made, or agreed or consented to any change to the trustees involving the appointment of a trust corporation or allowed any deficit (actual or contingent) to arise or persist in relation to the funding of any such scheme to an extent which is material in the context of the Wider Prologic Group taken as a whole;

(xiii) been unable or admitted in writing 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;

(xiv) waived or compromised or settled any material claim otherwise than in the ordinary course of business;

(xv) made any material alteration to its memorandum or articles of association, or any other incorporation document; or

(xvi) entered into any agreement, contract, commitment or arrangement or passed any resolution or made any offer (which remains open for acceptance) or proposed with respect to any of the transactions, matters or events referred to in this condition (f);

(g) since 31 March 2011, save as publicly announced prior to 29 March 2012 or fairly disclosed in writing to ESWC or its financial or legal advisers by or on behalf of Prologic prior to 29 March 2012 in the context of the Offer;

(i) no adverse change or deterioration having occurred in the business, assets, financial or trading position or profits, assets or prospects of Prologic or any other member of the Wider Prologic Group that is material in the context of the Wider Prologic Group taken as a whole; and

(ii) no litigation or arbitration proceedings, prosecution or other legal proceedings having been instituted, announced, implemented or threatened in writing by or against or remaining outstanding against or in respect of any member of the Wider Prologic Group or to which any member of the Wider Prologic Group is a party (whether as claimant, defendant or otherwise) and no enquiry or investigation by a Relevant Authority the effect of which is adverse to any member of the Wider Prologic Group to an extent that in any case is material in the context of the Wider Prologic Group taken as a whole;

(iii) no contingent or other liability which has arisen or become apparent or increased which has or might be reasonably likely to have a material adverse effect on the Wider Prologic Group taken as a whole; and

(iv) no steps taken which are reasonably likely to result in the withdrawal, cancellation, termination or modification of any licence held by any member of the Wider Prologic Group which is necessary for the proper carrying on of its business to an extent material in the context of the Wider Prologic Group taken as a whole;

(h) except as publicly announced by Prologic prior to 29 March 2012 or fairly disclosed in writing to ESWC or its financial or legal advisers by or on behalf of Prologic prior to 29 March 2012 in the context of the Offer, ESWC not having discovered:

(i) that any financial, business or other information concerning Prologic or any member of the Wider Prologic Group that has been disclosed at any time by or on behalf of any member of the Wider Prologic Group whether publicly, or to ESWC, is misleading, contains any misrepresentation of fact or omits to state a fact necessary to make the information contained therein not misleading and which was not subsequently corrected before 29 March 2012 by being publicly announced and which is material in the context of the Wider Prologic Group taken as a whole; or

(ii) that any member of the Wider Prologic Group is subject to any material liability (actual or contingent); or

(iii) any past or present member of the Wider Prologic Group has not complied with any applicable legislation or regulations of any jurisdiction with regard to environmental matters or the health and safety of any person, or that there has otherwise been any breach of environmental or health and safety law or that there is any environmental condition which, in any case, would be reasonably likely to give rise to any material liability (whether actual or contingent) or material cost on the part of any member of the Wider Prologic Group; or

(iv) circumstances exist whereby a person or class of persons would be reasonably likely to have any claim or claims in respect of any product, by-product or process of manufacture or service or materials used therein now or previously manufactured, supplied, sold or in any way dealt with or handled by any past or present member of the Wider Prologic Group where such claim is material in the context of the Wider Prologic Group taken as a whole.

For the purposes of these conditions:

(a) Relevant Authority means any government, government department or governmental, quasi-governmental, supranational, statutory, regulatory or investigative body, authority (including any national anti-trust or merger control authority), court, trade agency, association; institution or professional or environmental body or any other statutory person or body whatsoever in any relevant jurisdiction (including the London Stock Exchange, the Panel and the HMRC);

(b) a Relevant Authority shall be regarded as having intervened if it has taken or instituted or implemented or has threatened to take, institute or implement any action, proceeding, suit, investigation or enquiry or reference, or made, enacted or proposed any statute, regulation, decision or order, and "intervene" shall be construed accordingly;

(c) authorisations means authorisations, orders, grants, recognitions, confirmations, consents, licences, clearances, permissions, exemptions and approvals;

(d) publicly announced means disclosed in the results of Prologic for the six month period ended 30 September 2011 which was issued on 19 December 2011 or otherwise announced on or before 29 March 2012 or on behalf of Prologic by the delivery of an Announcement to a Regulatory Information Service in accordance with the AIM Rules; and

(e) Wider Prologic Group means Prologic, its subsidiary undertakings and associated undertakings and any other body corporate, partnership, joint venture or person in which Prologic and such undertakings (aggregating this interest) have an interest of more than 20 per cent. of the voting or equity capital or the equivalent.

Subject to the requirements of the Panel, ESWCreserves the right to waive all or any of the above conditions, in whole or in part, except condition (a). The Offer will lapse if it does not become or is not declared unconditional as to acceptances. Further, the Offer will lapse unless conditions (b) to (h) have been fulfilled or (if capable of waiver) waived, or, where appropriate, have been determined by ESWC in its reasonable opinion to be and remain satisfied, by midnight on the later of (i) the day which is 21 days after the First Closing Date of the Offer; and (ii) the date which is 21 days after the date on which condition (a) is fulfilled (the acceptance condition) or in each case such later date as ESWC may, with the consent of the Panel, decide. ESWC shall be under no obligation to waive or treat as fulfilled or satisfied any of conditions (b) to (h) inclusive by a date earlier than the latest date specified above for the fulfilment thereof notwithstanding that any such condition or the other conditions of the Offer may at such earlier date have been waived or fulfilled and that there are at such earlier date no circumstances indicating that any of such conditions may not be capable of fulfilment or satisfaction.

If the Offer lapses it will cease to be capable of further acceptance and ESWC and accepting Prologic Shareholders shall thereupon cease to be bound by Forms of Acceptance submitted at or before the time when the Offer so lapses.

If ESWC is required by the Panel to make an offer for Prologic Shares under the provisions of Rule 9 of the Code, ESWC may make such alterations to the terms and conditions of the Offer (including condition (a) above) as are necessary to comply with the provisions of that Rule.

Appendix II

Bases and sources

a) References to the existing issued share capital of Prologic are reference to Prologic Shares in issue on 28 March 2012 (being the last practicable Business Day prior to the release of this Announcement), being 10,000,000 Prologic Shares.

b) The value of GBP3.65 million attributed to the current issued share capital of Prologic, is based upon the number of Prologic shares currently in issue being 10,000,000 and excluding all outstanding options and awards granted under the Prologic Share Schemes which have an exercise price per Prologic Share higher than the Offer Price. The Offer will not be extended to any Shares held in treasury as, under the Code, it is not necessary to do so and as such they are excluded from all calculations of percentage holdings of voting rights, share capital and relevant securities.

c) Unless otherwise stated financial and other information relating to Prologic has been extracted from the audited annual report and accounts of Prologic for the financial period ended 31 March 2011.

Prologic Share prices have been derived from the AIM Appendix to the Daily Official List and represent closing middle market prices on the relevant date.

Appendix III

Irrevocable Undertakings

The following Prologic Shareholders have entered into irrevocable undertakings to accept the Offer (or procure acceptance of the Offer, as the case may be) at the Offer Price in respect of the following Prologic Shares:

 
 Shareholder                 No. of Prologic Shares   % held (#1) 
 Samuel Jackson                           2,278,728         22.8% 
 David Parry                                185,256          1.9% 
 Colin Wells                                100,000          1.0% 
 ISIS Equity Partners 
  (#2)                                    1,500,100         15.0% 
 Unicorn Asset Management 
  (#3)                                    1,075,200         10.8% 
 Monica Tourlamain                          905,094          9.1% 
 Christina Baker                            905,094          9.1% 
 Northern 3 VCT PLC (#4)                    400,000          4.0% 
 Gareth Chick                               100,000          1.0% 
 TOTAL                                    7,449,472         74.5% 
 

All the undertakings lapse in the event that the Offer Document is not posted to Prologic Shareholders within the time specified in Rule 24.1 of the Code or the Offer lapses or is withdrawn.

Note 1: Shareholding as at 28 March 2012, being the latest practicable Business Day prior to the date of this Announcement.

Note 2: This undertaking shall lapse in the event of a third party making an offer for Prologic at a price of not less than 40.15 pence per Prologic Share.

Note 3: This undertaking shall lapse in the event of a third party making a cash offer for Prologic at a price of not less than 40 pence per Prologic Share.

Note 4: This undertaking shall lapse in the event of a third party making a cash offer for Prologic at a price representing at least a 10 per cent. increase to the Offer Price.

Copies of the irrevocable undertakings will be on display on Prologic's website: www.prologic.com from 12 noon (London time) on 30 March 2012 until the end of the Offer.

Appendix IV

Definitions

The following definitions apply throughout this Announcement, unless the context requires otherwise:

Acquisition means the proposed acquisition of the entire issued share capital of Prologic by the Offeror by means of the Offer;

Act means the Companies Act 2006;

AIM means AIM, being a market operated by the London Stock Exchange;

AIM Rules means the rules published by the London Stock Exchange governing admission to, and operation of, AIM;

Announcement means this Announcement by ESWC of a firm intention to make the Offer dated 29 March 2012;

Australia means the Commonwealth of Australia, its states and its dependent territories;

Business Day means a day (excluding Saturdays, Sundays and public holidays) on which banks are generally open for business in the City of London;

Canada means Canada, its provinces and territories and all areas subject to its jurisdiction and any political subdivision thereof;

certificated or in certificated form means a share or other security which is not in uncertificated form (that is, not in CREST);

Closing Price means the closing middle market quotation of a Prologic Share as derived from the AIM Appendix to the Daily Official List;

Code means The City Code on Takeovers and Mergers;

Conditions means the conditions of the Offer set out in Appendix I to this document;

CREST means the relevant system (as defined in the CREST Regulations) for the paperless settlement of trades and holding of securities in respect of which CRESTCo is the Operator (as defined in the CREST Regulations);

CRESTCo means CRESTCo Limited;

CREST Member means a person who has been admitted by CRESTCo as a system member (as defined in the CREST Regulations);

CREST Participant means a person who is, in relation to CREST, a system participant (as defined in the CREST Regulations);

CREST Payment shall have the meaning given in the CREST manual issued by CRESTCo from time to time;

CREST Regulations means the Uncertificated Securities CREST Regulations 2001 (SI 2001 No.3755);

CREST Sponsor means a CREST Participant admitted to CREST as a CREST sponsor;

CREST Sponsored Member means a CREST Member admitted to CREST as a sponsored member;

Daily Official List means the Daily Official List of the London Stock Exchange;

dealing day means a day on which dealings in domestic securities may take place on, and with the authority of, the London Stock Exchange;

ESW Capital means ESW Capital, LLC, a limited liability company incorporated in the state of Delaware, USA;

Electronic Acceptance means the inputting and settling of a TTE Instruction which constitutes or is deemed to constitute an acceptance of the Offer;

ESA instruction means an Escrow Account Adjustment Input (AESN), transaction type "ESA" (as described in the CREST manual issued by CRESTCo) from time to time;

Escrow Agent means the Receiving Agent (in its capacity as an Escrow Agent as described in the CREST manual issued by CRESTCo) from time to time;

ESWC means ESWC Acquisitions Ltd, a company incorporated in England and Wales with registered number 8004368;

First Closing Date means the date to be described as such in the Offer Document in relation to the Offer;

Form of Acceptance means the form of acceptance relating to the Offer which will accompany the Offer Document;

FSA means the Financial Services Authority and any successor body;

FSMA means the Financial Services and Markets Act 2000, as amended from time to time;

Grant Thornton means Grant Thornton UK LLP;

Interim Results means the results of Prologic for the six months to 30 September 2011 published on 19 December 2011;

Japan means Japan, its cities, prefectures, territories and possessions and all areas subject to its jurisdiction and any political sub-division thereof;

London Gazette means the daily publication issued in London with such name;

London Stock Exchange means London Stock Exchange plc;

member account ID means the identification code or number attached to any member account in CREST;

Offer means the recommended cash offer to be made by ESWC to acquire the entire issued share capital of Prologic at the Offer Price on the terms and subject to the conditions to be set out in the Offer Document and the Form of Acceptance (including, where the context so requires, any subsequent revision, variation, extension or renewal of such offer);

Offeror means ESWC Acquisitions Ltd, a company incorporated in England and Wales with registered number 8004368;

Offeror's Shareholder means Joseph Liemandt;

Offer Document means the document to be despatched to Prologic Shareholders (other than certain Overseas Shareholders) setting out the full terms and conditions of the Offer;

Offer Period means the period commencing on (and including) 19 December 2011 and ending: (i) at 1.00 p.m. (London time) on the First Closing Date; (ii) on the date on which the Offer lapses; and (iii) on the date on which the Offer becomes or is declared unconditional as to acceptances;

Offer Price means 36.5p for each Prologic Share;

Overseas Shareholders or Overseas Prologic Shareholders means Prologic Shareholders resident in, or nationals or citizens of, or who are subject to jurisdictions outside, the UK or who are nominees of, or custodians, trustees or guardians for, citizens or nationals of or persons subject to such jurisdictions;

Panel means The Panel on Takeovers and Mergers;

Participant ID means the identification code or membership number used in CREST to identify a particular CREST Member or other CREST Participant;

Prologic means Prologic plc, incorporated in England and Wales with registered number 05031466;

Prologic 2004 Admission means the placing and admission to AIM (details of which are set out in the prospectus of Prologic dated 29 June 2004) which was effective on 5 July 2004;

Prologic 2011 AGM means the annual general meeting of Prologic held on 26 September 2011;

Prologic Board means the directors of Prologic at the relevant time;

Prologic Group means Prologic and its subsidiaries;

Prologic Shares means the existing unconditionally allotted or issued and fully paid ordinary shares of 0.5p each in the capital of Prologic excluding any such shares held or which become held as treasury shares (for the purposes of the Act);

Prologic Shareholders holders of Prologic Shares;

Prologic Share Schemes means the share option and other share schemes of the Prologic Group;

Receiving Agent means Neville Registrars Limited;

Restricted Jurisdiction means any jurisdiction where local laws or CREST Regulations may result in a significant risk of civil, regulatory or criminal exposure or prosecution if information concerning the Offer is sent or made available to Prologic Shareholders in that jurisdiction;

RIS or Regulatory Information Service means any of the services approved by the London Stock Exchange and included in the list maintained on the London Stock Exchange's website;

South Africa means the Republic of South Africa;

Subsidiary means a subsidiary as defined in section 1159 of the Act;

TTE Instruction means a transfer to escrow instruction (as defined by the CREST manual issued to CRESTCo from time to time);

UK or United Kingdom means the United Kingdom of Great Britain and Northern Ireland;

uncertificated or in uncertificated form means recorded on the relevant register of Prologic as being held in uncertificated form in CREST, and title to which, by virtue of the CREST Regulations, may be transferred by means of CREST;

United States or US means the United States of America, its territories and possessions, any State of the United States and the District of Colombia, and all other areas subject to its jurisdiction;

US Securities Act means the US Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder;

US Persons means persons resident or situated in the United States; and

West Hill Corporate Finance or West Hill means West Hill Corporate Finance Limited, financial advisor to ESWC.

All references to legislation in this Announcement are to English legislation unless the contrary is indicated. Any reference to any provision of any legislation shall include any amendment, modification, re-enactment or extension thereof.

Words importing the singular shall include the plural and vice versa, and words importing the masculine gender shall include the feminine or neutral gender.

For the purposes of this Announcement, 'subsidiary', 'subsidiary undertaking', 'associated undertaking', 'undertaking' and 'parent undertaking' have the respective meanings given to them by the Companies Act 2006.

References to "GBP","Sterling", "p", "penny" and "pence" are to the lawful currency of the United Kingdom.

References to time are to London time.

This information is provided by RNS

The company news service from the London Stock Exchange

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