Offer by Momentai,Final Rslts

Crown Eyeglass PLC 20 June 2000 PART 1 NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE UNITED STATES OF AMERICA, CANADA, AUSTRALIA OR JAPAN RECOMMENDED OFFER FOR CROWN EYEGLASS plc AND ANNOUNCEMENT OF PRELIMINARY RESULTS OF CROWN EYEGLASS plc FOR THE YEAR ENDED 2 APRIL 2000 20 JUNE 2000 Key highlights: * The Independent Director of Crown Eyeglass, having taken responsibility for considering the Offer on behalf of Crown Eyeglass Shareholders, and the board of Momentai plc ('Momentai') announce the terms of a recommended offer to be made by Momentai to acquire the whole of the issued share capital of Crown Eyeglass. * The Offer will be 90 pence in cash for each Crown Eyeglass Share, valuing the whole of the existing issued share capital of Crown Eyeglass at £1.44 million. * The Offer represents a premium of approximately 28 per cent. to the Closing Price of 70 pence per Crown Eyeglass Share on 14 June 2000, being the last dealing day prior to the announcement that the Company was in talks with its Executive Directors concerning a possible offer for Crown Eyeglass. * As an alternative to receiving cash, accepting Crown Eyeglass Shareholders (other than certain overseas Crown Eyeglass Shareholders) may elect to receive, in respect of all or part of their Crown Eyeglass Shareholding, unsecured 10 per cent. loan notes 2005 in Momentai. * The Loan Notes to be issued pursuant to the Loan Note Alternative will bear interest at a rate of 10 per cent. per annum payable in two instalments on 30 April and 31 October in each year ('Interest Payment Dates'). * The Loan Notes will be redeemed in full on 30 April 2005. The Loan Notes will also be redeemable at the option of the holders of the Loan Notes on any Interest Payment Date occurring on or after 30 April 2002. * The Loan Notes are unsecured and are not guaranteed or convertible into equity. No application is intended to be made for the Loan Notes to be issued or dealt in on any stock exchange. * Momentai is a newly incorporated company which has not traded and has been acquired by the Executive Directors, specifically for the purpose of making the Offer for Crown Eyeglass. Momentai is, and if the Offer were to become or to be declared unconditional in all respects would still be, wholly owned by the Executive Directors. * As at the date of this announcement, Momentai has received irrevocable undertakings to accept the Offer from the Executive Directors, their immediate families and a related family trust and certain other Crown Eyeglass Shareholders in respect of 1,051,575 Crown Eyeglass Shares in aggregate, representing approximately 65.7 per cent. of the existing issued share capital of Crown Eyeglass. * Crown Eyeglass also today announces its preliminary results for the financial year ended 2 April 2000 and the text of the statement issued by the Company is set out in Part 3 of this announcement. * Because of the aggregate size of the shareholdings in Crown Eyeglass held by the Executive Directors, their immediate families and a related family trust, the Panel has required the Offer to be first approved by an ordinary resolution passed by the Independent Crown Eyeglass Shareholders. Certain of the Independent Crown Eyeglass Shareholders have undertaken to vote in favour of the ordinary resolution in respect of 466,700 Crown Eyeglass Shares, carrying 45.97 per cent. of the votes capable of being cast at the EGM. Alan Watson, the Independent Director, commented: 'Against a background of poor trading conditions in Sweden, an increasingly competitive environment in the UK and the low stock market rating of the Company, I believe the Offer provides Crown Eyeglass Shareholders with the opportunity of realising their investment on a fair and reasonable basis.' This summary should be read in conjunction with the full text of this press announcement, which includes further information. For further enquiries, contact: Joe Lee or Martin Lee, Momentai 01254 51535 Philip Johnson, Brown Shipley 0161 214 6540 PART 2 RECOMMENDED OFFER BY MOMENTAI FOR CROWN EYEGLASS INTRODUCTION On 15 June 2000, Crown Eyeglass announced that it was in talks with the Executive Directors which may or may not lead to an offer being made for the entire issued share capital of Crown Eyeglass. Further to that statement, the board of Momentai and the Independent Director announce today that they have reached agreement on the terms of a recommended offer to be made by Momentai to acquire the entire issued share capital of Crown Eyeglass. The Offer will be 90 pence in cash for each Crown Eyeglass Share which values the entire issued share capital of Crown Eyeglass at approximately £1.44 million and represents a premium of approximately 28 per cent. to the Closing Price of 70 pence per Crown Eyeglass Share on 14 June 2000, being the last dealing day prior to the date on which Crown Eyeglass announced that it was in talks with the Executive Directors which might lead to an offer being made for Crown Eyeglass. Momentai is a newly incorporated company that has not traded and has been acquired by the Executive Directors specifically for the purposes of making the Offer. Momentai is, and if the Offer were to become or to be declared unconditional in all respects would still be, wholly owned by the Executive Directors. In view of the involvement of the Executive Directors in the Offer, the Independent Director, Alan Watson, has taken responsibility for considering the Offer and for making the appropriate recommendation to Crown Eyeglass Shareholders. As at the date of this announcement, Momentai has received irrevocable undertakings to accept the Offer from the Executive Directors, their immediate families and a related family trust in respect of their own shareholdings amounting to 584,875 Crown Eyeglass Shares representing, in aggregate, 36.5 per cent. of the existing issued share capital of Crown Eyeglass. In addition, certain other Crown Eyeglass Shareholders have irrevocably undertaken to accept the Offer in respect of 466,700 Crown Eyeglass Shares representing, in aggregate, 29.2 per cent. of the existing issued share capital of Crown Eyeglass. The Independent Director, who has been so advised by Brown Shipley, considers the terms of the Offer to be fair and reasonable. Accordingly, the Independent Director recommends all Crown Eyeglass Shareholders to accept the Offer. In providing advice to the Independent Director, Brown Shipley has taken into account the commercial assessments of the Independent Director. Crown Eyeglass today announces its preliminary results for the financial year ended 2 April 2000, further details of which are set out in Part 3 of this announcement. The Offer Momentai will offer to acquire, on the terms and conditions set out or referred to in Appendix II to this announcement, the Offer Document and in the Form of Acceptance, all of the Crown Eyeglass Shares on the following basis: for each Crown Eyeglass Share 90 pence in cash The Loan Note Alternative As an alternative to some or all of the cash consideration to which they would otherwise be entitled under the Offer, accepting Crown Eyeglass Shareholders (other than certain overseas Crown Eyeglass Shareholders referred to below) may elect to receive Loan Notes on the following basis: for every £1 of cash consideration £1 nominal of Loan Notes under the Offer The Loan Notes represent unsecured obligations of Momentai and are not guaranteed by any bank, other financial institution or third party. No application is to be made for the Loan Notes to be listed or dealt in on any stock exchange. The Loan Notes will not be convertible into equity. Pannell Kerr Forster have advised that, based on market conditions on 19 June 2000 (the latest practicable date prior to this announcement), the estimate of the value of each Loan Note would have been approximately 90 pence per £1 in nominal value. Further details of the Loan Note Alternative and the rights attaching to the Loan Notes will be set out in the Offer Document. The Loan Note Alternative will not be available to Crown Eyeglass Shareholders who are, or who are acting on behalf of, certain overseas persons or are resident in any jurisdiction in which the Loan Note Alternative would constitute a violation of applicable laws. Momentai reserves the right, at any time on or after the date on which the Offer becomes or is declared unconditional as to acceptances, to close the Loan Note Alternative on giving not less than 14 days' notice, notwithstanding that the Offer remains open for acceptance. Terms and conditions of the Offer Crown Eyeglass Shares will be acquired by Momentai fully paid and free from all liens, equities, charges, encumbrances and other interests and together with all rights now or in the future attaching to them, including the right to receive and retain all dividends and other distributions declared, made or payable after the date of this announcement. The conditions of the Offer are set out in full in Appendix II. Compulsory acquisition and cancellation of AIM quotation Assuming sufficient acceptances are received, Momentai intends to apply the provisions of sections 428 to 430F (inclusive) of the Act to enable it to acquire compulsorily any outstanding Crown Eyeglass Shares. If the Offer becomes or is declared unconditional in all respects then, irrespective of the level of acceptances and whether or not Momentai is in a position to apply the provisions of sections 428 to 430F (inclusive) of the Act to enable it to acquire compulsorily all outstanding Crown Eyeglass Shares, Crown Eyeglass Shareholders are given notice that Momentai intends to apply for the cancellation of Crown Eyeglass's AIM quotation with effect from 20 business days from such date. Background to and reasons for the Offer In considering the Offer, the Independent Director has taken into account the benefits to Crown Eyeglass Shareholders of accepting the Offer as compared with the benefits of remaining as a shareholder in Crown Eyeglass. In the Chairman's statement in the preliminary results for the year ended 2 April 2000, set out in Part 3 of this announcement, reference is made to the poor trading conditions of the Swedish subsidiary, Direkt Optik AB, an increasingly competitive environment in the UK and the fact that Crown Eyeglass suffers a disproportionately high tax charge which reduces the profits distributable to Crown Eyeglass Shareholders. Against this background,and having regard to the low stock market rating of the Company, the lack of demand from institutional investors and the limited liquidity of Crown Eyeglass Shares, the Independent Director believes that the Offer provides an opportunity for Crown Eyeglass Shareholders to realise their investment, without incurring dealing charges, on a fair and reasonable basis. The Offer is at a premium of approximately 28 per cent. to the Closing Price on the date before Crown Eyeglass announced that it was in talks with the Executive Directors, which in the opinion of the Independent Director, represents fair value and which may not otherwise be available to Crown Eyeglass Shareholders in the near future. Information relating to Momentai Momentai is a newly incorporated company which has not traded and which has been acquired by the Executive Directors for the purpose of making the Offer. The Executive Directors of Crown Eyeglass who comprise the board of directors of Momentai will, following the Offer becoming or being declared unconditional in all respects, continue to be employed under their existing service contracts with Crown Eyeglass. These Crown Eyeglass Shareholders who have provided irrevocable undertakings to Momentai to accept the Offer received by Momentai at the date of this announcement have elected to accept the Loan Note Alternative. As a result, the maximum aggregate cash consideration payable under the Offer will be approximately £493,583. Barclays Bank has agreed to make available a committed loan facility in the maximum amount of £700,000 to Momentai for the purpose of financing the Offer and the costs associated with the Offer. The financing from Barclays Bank is conditional upon, amongst other things, the Offer becoming or being declared unconditional in all respects. Information relating to Crown Eyeglass The principal activity of Crown Eyeglass is the manufacture and distribution of spectacles, readymade reading glasses and related accessories. Financial effects of acceptance The following tables set out, for illustrative purposes only and on the bases and assumptions set out below, the financial effects of acceptance on capital value and gross income for a holder of 1,000 Crown Eyeglass Shares accepting the Offer if the Offer becomes or is declared unconditional in all respects: Notes The The Loan Offer Note Alternative £ £ A - Decrease in capital value Cash consideration for 1000 Crown Eyeglass Shares 900 - Value of £900 nominal Loan Notes (i) - 810 Market value of 1000 Crown Eyeglass Shares (ii) 1,050 1,050 Decrease in capital value 150 240 This represents a decrease of 14.29% 22.86% Notes The The Loan Offer Note Alternative £ £ B - Increase in income Increase from cash consideration (iii) 51 - Interest income on £900 Loan Notes (iv) - 90 Dividend income from 1,000 Crown Eyeglass Shares (v) 22 22 Increase in income 29 68 This represents an increase of 131.81% 309.09% Notes (i) The value of the Loan Notes is based upon Pannel Kerr Forster's estimate of 90 pence per £1 nominal value of Loan Notes, had such Loan Notes been in issue. (ii) Based on the Closing Price of 105 pence per Crown Eyeglass Share on 19 June 2000, the last dealing date prior to this announcement. (iii)The gross income from the cash consideration has been calculated on the assumption that the cash is re-invested to yield approximately 5.63 per cent. per annum, being the gross redemption yield shown by the FTSE Actuaries 5 year Gilts Index as published in the Financial Times on 19 June 2000, the latest practicable date prior to the announcement of the Offer. (iv) The gross interest income on the Loan Notes is based on an interest rate of 10 per cent. per annum per Loan Note payable half yearly on 30 April and 31 October in each year. (v) The gross dividend income from Crown Eyeglass Shares is based on the total dividend of 2 pence per Crown Eyeglass Share for the financial year ended 2 April 2000 together with the associated tax credit of 1/9th of the amount payable. (vi) No account has been taken of any liability to taxation. Management and employees The existing rights of employees of Crown Eyeglass and its subsidiaries, including pension rights, will be fully safeguarded. The Independent Director intends to resign from the board of Crown Eyeglass if the Offer becomes or is declared unconditional in all respects. Extraordinary General Meeting Because of the aggregate size of the shareholdings in Crown Eyeglass held by the Executive Directors, their immediate families and a related family trust, the Panel has required the Offer to be first approved by an ordinary resolution passed by the Independent Crown Eyeglass Shareholders at the EGM. Certain of the Independent Crown Eyeglass Shareholders have signed irrevocable undertakings to accept the Offer and to vote in favour of the ordinary resolution to be proposed at the EGM to approve the Offer. Those Independent Crown Eyeglass Shareholders who have so undertaken to vote in favour of the proposed ordinary resolution hold 466,700 Crown Eyeglass Shares carrying 45.97 per cent.of the votes capable of being cast by the Independent Crown Eyeglass Shareholders at the EGM. The passing of this resolution is a condition to the Offer. Further details of the recommended Offer Momentai will despatch the Offer Document containing the full terms and conditions of the Offer and a notice of extraordinary general meeting of Crown Eyeglass, together with a Form of Acceptance and form of proxy to Crown Eyeglass Shareholders in due course. The market prices of the Crown Eyeglass Shares used in this announcement are derived from the Daily Official List of the London Stock Exchange. The availability of the Offer to persons not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions. Persons who are not resident in the United Kingdom should inform themselves about and observe any applicable requirements. The Executive Directors, their immediate families and a related family trust hold, in aggregate, 584,875 Crown Eyeglass Shares. Gillian Douglas, the daughter of Joe Lee, who is deemed to be acting in concert with Momentai, owns 64,000 Crown Eyeglass Shares, which shares are included in the number 584,875 referred to above. This announcement does not constitute an offer or an invitation to purchase any securities. The conditions and principal further terms of the Offer are set out in Appendix II to this announcement. Save as disclosed in this announcement, Momentai has not received any irrevocable commitments to accept the Offer and neither Momentai, nor any person deemed to be acting in concert with Momentai, owns or controls any Crown Eyeglass Shares or has any options to acquire any Crown Eyeglass Shares. The Offer will not be made, directly or indirectly, in or into, or by use of the mails, or by any means or instrumentality of interstate or foreign commerce of, or of any facilities of a national securities exchange of, the United States, nor is it being made directly or indirectly in or into Canada, Australia or Japan. Persons wishing to accept the Offer should not use such mails or any such means, instrumentality or facility for any purpose directly or indirectly related to the Offer since doing so may render invalid any purported acceptance of the Offer. The Loan Notes which may be issued pursuant to the Offer under the Loan Note Alternative have not been, and will not be, registered under the United States Securities Act of 1933 (as amended) or under any of the relevant securities laws of Canada, Australia or Japan. Accordingly, unless an exemption under such Act or laws is available, the Loan Notes may not be offered, sold or delivered, directly or indirectly, in or into the United States, Canada, Australia or Japan. The directors of Momentai accept responsibility for the information contained in this announcement other than information relating to the Crown Eyeglass Group, the directors of Crown Eyeglass, members of their respective immediate families and a related family trust. To the best of the knowledge and belief of the directors of Momentai (who have taken all reasonable care to ensure that such is the case), the information contained in this announcement for which they are responsible is in accordance with the facts and does not omit anything likely to affect the import of such information. The directors of Crown Eyeglass accept responsibility for the information contained in this announcement relating to Crown Eyeglass, the directors of Crown Eyeglass (solely in their capacity as directors of Crown Eyeglass), and members of their respective immediate families and a related family trust,but with the exception of any opinion of the Independent Director relating to the recommendation of the Offer and the recommendation itself. To the best of the knowledge and belief of the directors of Crown Eyeglass (who have taken all reasonable care to ensure that such is the case), the information contained in this announcement for which they are responsible is in accordance with the facts and does not omit anything likely to affect the import of such information. The Independent Director accepts responsibility for his opinion relating to the recommendation of the Offer and for the recommendation itself. To the best of the knowledge and belief of the Independent Director (who has taken all reasonable care to ensure that such is the case), the information contained in this announcement for which he is responsible is in accordance with the facts and does not omit anything likely to affect the import of such information. The contents of this announcement, for which the directors of Momentai and the directors of Crown Eyeglass are responsible, have been approved, solely for the purposes of section 57 Financial Services Act 1986, by Walker Morris which is regulated in the conduct of investment business by the Law Society of England and Wales. Brown Shipley, which is regulated in the United Kingdom by The Securities and Futures Authority Limited, is acting for Crown Eyeglass, acting through its Independent Director, and no-one else in connection with the Offer and will not be responsible to anyone other than Crown Eyeglass, acting through its Independent Director, for providing the protections afforded to customers of Brown Shipley nor for giving advice in relation to the Offer. PART 3 CROWN EYEGLASS PLC'S PRELIMINARY ANNOUNCEMENT OF RESULTS FOR THE YEAR ENDED 2 APRIL 2000. THE FOLLOWING IS THE TEXT OF THE ANNOUNCEMENT OF CROWN EYEGLASS'S PRELIMINARY STATEMENT OF RESULTS FOR THE YEAR ENDED 2 APRIL 2000: Chairman's Statement Following an improved performance in the second half of the financial year, both Group turnover and profit for the year to 2 April 2000 (53 weeks) were ahead compared with the previous financial year (52 weeks). Group turnover for the full year was £10.743 million compared with £9.891 million, whilst operating profit rose to £209,000 from £36,000. As was the case last year, the inability to offset losses incurred in Sweden against UK profits for tax purposes was the main reason for the disproportionately large tax charge. The ongoing effect of this tax situation is that the amount of profit available for distribution to the shareholders via dividends is significantly reduced as is evidenced by the Board's decision not to propose a final dividend. Earnings per share were 2.0p compared with last year's loss per share of 7.4p. Although the grounds for cautious optimism for our UK business to which I referred in my interim report last December proved justified for the second half of the year, we are still faced with the problem of turning our Swedish subsidiary, Direkt Optik AB, into profit . The continuing strength of the pound has made this task even more difficult, and although the income from our 20 Swedish shops has made a better start to the new financial year compared with last year, there is still a long way to go. In the UK, where we currently operate 31 company owned optical centres and 20 franchises, we are still faced with operating in an increasingly competitive environment. Therefore, we intend to maintain a prudent strategy and view expansion in a cautious manner. The Company has experienced very little interest from institutional investors and a low level of share liquidity. The share price performance has therefore been disappointing. In view of these factors and the fact that the Company has not sought to expand through an acquisition strategy, the directors are agreed that there do not appear to be any benefits to the Company of retaining its quotation on the Alternative Investment Market. As a consequence, the Executive Directors have today announced details of their proposal to take the Company private. The details of the Offer accompany this statement and will be followed shortly by a document setting out the terms of the Offer, being sent to all shareholders. Finally, on behalf of the Board, I should like to thank all of our employees for their continued support and commitment. Joe Lee Chairman 20 June 2000 CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 2 APRIL 2000 Year Ended Year Ended 2 April 31 March 2000 1999 £'000 £'000 Turnover 10,743 9,891 Cost of sales (4,202) (3,765) __________ _________ Gross profit 6,541 6,126 Net operating expenses (6,332) (6,090) __________ _________ Operating profit 209 36 Net interest receivable/(payable) 6 (29) __________ _________ Profit on ordinary activities before taxation 215 7 Taxation on profit on ordinary activities (183) (125) __________ __________ Profit/(Loss) on ordinary activities after taxation attributable to 32 (118) shareholders of Crown Eyeglass plc Dividends (32) 0 __________ __________ Retained Profit/(Loss) 0 (118) __________ __________ Earnings/(Loss) per ordinary share 2.0p (7.4p) CONSOLIDATED BALANCE SHEET AS AT 2 APRIL 2000 As at 2 April 2000 As at 31 March 1999 £'000 £'000 £'000 £'000 FIXED ASSETS Tangible assets 1,240 1,485 Investments 20 20 _______ ______ 1,260 1,505 CURRENT ASSETS Stocks 890 846 Debtors 868 665 Cash at bank and in hand 946 505 _______ _______ 2,704 2,016 CREDITORS:Amounts falling due within one year (2,046) (1,602) _______ _______ NET CURRENT ASSETS 658 414 ______ _______ TOTAL ASSETS LESS CURRENT LIABILITIES 1,918 1,919 PROVISIONS FOR LIABILITIES ANDCHARGES Deferred taxation (115) (130) ______ _______ 1,803 1,789 CAPITAL AND RESERVES Called up share capital 80 80 Share premium account 376 376 Profit and loss account 1,347 1,333 ______ _______ 1,803 1,789 PART 4 APPENDIX 1 Definitions The following definitions apply throughout this document and in the accompanying Form of Acceptance unless the context requires otherwise: 'Act' means the Companies Act 1985 as amended; 'AIM' means the Alternative Investment Market of the London Stock Exchange; 'Barclays Bank' means Barclays Bank PLC; 'Brown Shipley' means Brown, Shipley & Co. Limited; 'City Code' means the City Code on Takeovers and Mergers; 'Closing Price' means the closing middle market price of a Crown Eyeglass Share as derived from the Daily Official List of the London Stock Exchange; 'Crown Eyeglass' or 'Company' means Crown Eyeglass plc; 'Crown Eyeglass Group' means Crown Eyeglass and its subsidiary undertakings (as defined in the Act); 'Crown Eyeglass Shareholder' means a holder of Crown Eyeglass Shares; 'Crown Eyeglass Shareholding' means a holding of Crown Eyeglass Shares; 'Crown Eyeglass Shares' means the existing unconditionally allotted or issued and fully paid ordinary shares of 5 pence each in Crown Eyeglass and any further such shares which may be issued or unconditionally allotted while the Offer remains open for acceptance or, subject to the provisions of the City Code, such earlier date as Momentai may decide; 'Executive Directors' means the executive directors of Crown Eyeglass being Joseph Geoffrey Lee, Martin Bernard Lee, Deena Singer and Kathleen Thompson; 'EGM' means the extraordinary general meeting of the Company proposed to be held at which the ordinary resolution approving the Offer is to be proposed; 'Form of Acceptance' means the form of acceptance, authority and election relating to the Offer to be despatched to Crown Eyeglass Shareholders with the Offer Document; 'Independent Director' means the independent director of Crown Eyeglass, Alan Arthur Watson; 'Independent Crown Eyeglass Shareholders' means all Crown Eyeglass Shareholders excluding the Executive Directors, their immediate families and a related family trust; 'Loan Note Alternative' means the alternative by which Crown Eyeglass Shareholders (other than certain overseas Crown Eyeglass Shareholders) validly accepting the Offer may elect to receive Loan Notes instead of all or part of the cash consideration to which they would otherwise be entitled under the Offer; 'Loan Notes' means the unsecured 10 per cent. loan notes 2005 of Momentai to be constituted by a loan note instrument; 'London Stock Exchange' means London Stock Exchange plc; 'Offer' means the recommended offer by Momentai contained in this document to acquire all the Crown Eyeglass Shares, including, where the context so requires, any subsequent revision, variation, extension or renewal of such offer; 'Offer Document' means the document containing the offer to be despatched to Crown Eyeglass Shareholders; 'Panel' means the Panel on Takeovers and Mergers; 'UK' or 'United Kingdom' means the United Kingdom of Great Britain and Northern Ireland; 'UKLA' means the Financial Services Authority acting in its capacity as the competent authority for the purposes of Part IV of the Financial Services Act 1986; 'United States of America' or 'United States' means the United States of America, its territories and possessions, any states of the United States and the District of Columbia; and 'wider Crown Eyeglass Group' means Crown Eyeglass and the subsidiaries and subsidiary undertakings of Crown Eyeglass or any company of which 20 per cent. or more of the voting capital is held directly or indirectly by Crown Eyeglass or any partnership, joint venture or firm in which Crown Eyeglass may be directly or indirectly interested. APPENDIX II Conditions and certain further terms of the Offer The Offer will comply with applicable rules and regulations of the UKLA and the City Code and will be governed by English Law and subject to the jurisdiction of the Courts of England. PART A: CONDITIONS OF THE OFFER 1 THE OFFER WILL BE SUBJECT TO THE FOLLOWING CONDITIONS 1.1 Valid acceptances being received (and not, where permitted, withdrawn) by no later than 3.00 pm on the first closing date of the Offer (or such later time(s) and/or date(s) as Momentai may, subject to the rules of the City Code, decide) in respect of not less than 90 per cent. (or such lesser percentage as Momentai may decide) of the Crown Eyeglass Shares to which the Offer relates,provided that this condition will not be satisfied unless Momentai shall have acquired or agreed to acquire, directly and indirectly and whether pursuant to the Offer or otherwise, Crown Eyeglass Shares carrying, in aggregate, more than 50 per cent. of the voting rights normally exercisable at general meetings of Crown Eyeglass. For the purpose of this condition: 1.1.1 Crown Eyeglass Shares which have been unconditionally allotted but not issued shall be deemed to carry the voting rights they will carry upon the holders being entered in the register of members of Crown Eyeglass; and 1.1.2 the expression 'Crown Eyeglass Shares to which the Offer relates' shall mean: (a) Crown Eyeglass Shares unconditionally allotted or issued on or before the date the Offer is made; and (b) Crown Eyeglass Shares unconditionally allotted or issued after that date but before the time at which the Offer closes, or such earlier date, not being earlier than the date on which the Offer closes, as Momentai may decide (not,without the consent of the Panel, being earlier than the date on which the Offer becomes or is declared unconditional as to acceptances or, if later, the first closing date of the Offer), but excluding any Crown Eyeglass Shares which, on the date the Offer is made, are held or (otherwise than under such a contract as described in section 428(5) of the Act) contracted to be acquired by Momentai and/or its associates within the meaning of section 430E of the Act). 1.2 No government or governmental, quasi-governmental, supranational, statutory or regulatory body, court, trade agency, professional association or any other person or body in any jurisdiction (each a 'Third Party') having decided to take, instituted, implemented or threatened any action, proceedings, suit, investigation, enquiry or reference, or made, proposed or enacted, any statute, regulation, decision or order, or taken any other steps which would or might be reasonably likely to: 1.2.1 make the Offer or its implementation or the proposed acquisition by Momentai of any shares, directly or indirectly, in, or control of, Crown Eyeglass void, illegal or unenforceable, or (in all the following cases to an extent which is material in the context of the Offer) otherwise restrain, prohibit, restrict or delay or otherwise interfere with the implementation of, or impose additional conditions or obligations with respect to the Offer or such acquisition, or otherwise challenge, materially hinder or interfere with the Offer or such acquisition; 1.2.2 require the divestiture by the wider Crown Eyeglass Group or Momentai of all or any portion of their respective businesses, assets or property or impose any limitation on the ability of any of them to conduct all or any portion of their respective businesses or own all or any portion of their respective assets or property; 1.2.3 impose any material limitation upon, or result in a material delay in, the ability of Momentai directly or indirectly to acquire or to hold or to exercise effectively any rights of ownership of shares in Crown Eyeglass or on the ability of any member of the wider Crown Eyeglass Group or Momentai to hold or exercise effectively any rights of ownership of shares or loans or securities convertible into shares or any other securities (or the equivalent) in any member of the wider Crown Eyeglass Group or to exercise management control over any such member of the wider Crown Eyeglass Group; 1.2.4 save pursuant to the Offer or Part XIIIA of the Act, require Momentai to offer to acquire any shares or other securities or interest in any member of the wider Crown Eyeglass Group owned by any third party; or 1.2.5 otherwise adversely affect the business, assets, profits or prospects of Momentai or any member of the wider Crown Eyeglass Group in a manner which would be material in the context of the Crown Eyeglass Group taken as a whole; and all applicable waiting and other time periods during which any Third Party could decide to take, institute,implement or threaten any such action, proceeding, suit investigation or enquiry having expired or been terminated. 1.3 All necessary filings having been made in connection with the Offer and all statutory or regulatory obligations in any relevant jurisdiction having been complied with in connection with the Offer or the acquisition by Momentai of any shares or other securities in, or control of, Crown Eyeglass and all appropriate waiting periods under any applicable legislation or regulations of any relevant jurisdiction having expired, lapsed or been terminated and all authorisations, orders, recognitions, grants, consents, licences, confirmations, clearances, permissions and approvals necessary for or in respect of the Offer and the proposed acquisition of any securities in, or control of, Crown Eyeglass by Momentai having been obtained in terms and in a form reasonably satisfactory to Momentai from all appropriate Third Parties or persons with whom any member of the wider Crown Eyeglass Group has entered into contractual arrangements and all such authorisations, orders, recognitions, grants, consents licences, confirmations, clearances, permissions and approvals, together with all authorisations, orders, recognitions, grants, licences, confirmations, clearances, permissions and approvals necessary to carry on the business of any member of the wider Crown Eyeglass Group, remaining in full force and effect and there being no written intimation of any intention to revoke or amend or not to renew any of them which is or are material at the time at which the Offer becomes otherwise unconditional and all necessary statutory or regulatory obligations in any relevant jurisdiction having been complied with in all material respects. 1.4 There being no provision of any arrangement, agreement, lease, licence, permit or other instrument to which any member of the wider Crown Eyeglass Group is a party or by or to which any such member or any of its assets are bound, entitled or subject and which, in consequence of the Offer, or the proposed acquisition of any shares or other securities in Crown Eyeglass or because of a change in the control or management of Crown Eyeglass or otherwise would or might be reasonably likely to result in (to an extent which is material in the context of the Crown Eyeglass Group taken as a whole): 1.4.1 any monies borrowed by, or any other indebtedness (actual or contingent) of, any such member being or becoming repayable or capable of being declared repayable prior to their stated maturity or the ability of such member to borrow monies or incur any indebtedness being withdrawn or inhibited or being capable of becoming or being withdrawn or inhibited modified or affected; 1.4.2 the creation of any mortgage, charge or other security interest over the whole or any part of the business, property or assets of any such member or any such security (whenever arising or having arisen) becoming enforceable; 1.4.3 any such arrangement, agreement, licence, permit or instrument of any member of the wider Crown Eyeglass Group being terminated or adversely modified or any action being taken or any obligation or liability arising under any such arrangement, agreement, licence, permit or instrument; 1.4.4 any assets of any such member being or failing to be disposed of or any right arising under which any such asset could be required to be disposed of; 1.4.5 the rights, liabilities, obligations, interests or business of any such member in or with any firm or body or, in the case of a business, person or any arrangements relating to such interest or business, being terminated or adversely modified or affected; 1.4.6 any such member ceasing to be able to carry on business under any name under which it presently does so; 1.4.7 the value of any member of the wider Crown Eyeglass Group or its financial or trading position being prejudiced or adversely affected; and 1.4.8 the creation of any liability, actual or contingent, by any member of the wider Crown Eyeglass Group; and no event having occurred which, under any provision of any agreement, arrangement, licence, permit, or other instrument to which any member of the wider Crown Eyeglass Group is a party or by or to which any such member or any of its assets is bound, entitled or subject, is reasonably likely to result in any of the events or circumstances as are referred to in subparagraphs 1.4.1 to 1.4.8. 1.5 Except as publicly announced by Crown Eyeglass to the London Stock Exchange prior to the date of this announcement or included in this announcement, no member of the wider Crown Eyeglass Group having, since 2 April 2000 (being the date to which the preliminary statement of Crown Eyeglass's final results for the year ended 2 April 2000 was made): 1.5.1 issued or agreed to issue or authorised or proposed the issue of additional shares of any class, or securities convertible into, or rights, warrants or options to subscribe for or acquire, any such shares or convertible securities; 1.5.2 recommended, declared, paid, made or proposed to recommend, declare, pay or make any bonus issue, dividend or other distribution whether payable in cash or otherwise; 1.5.3 authorised or proposed or announced its intention to propose any merger or demerger or acquisition or disposal of assets of a material value or shares or any change in its share or loan capital; 1.5.4 issued or proposed the issue of any debentures or incurred or increased any indebtedness to a material extent; 1.5.5 disposed of or transferred, mortgaged or encumbered any material asset or any right, title or interest in any material asset; 1.5.6 entered into any material contract, any reconstruction or amalgamation, any material transaction or material arrangement otherwise than in the ordinary course of business; 1.5.7 entered into a legally binding agreement, contract, arrangement or commitment or passed any resolution or made any offer (which remains open for acceptance) with respect to any of the transactions or events referred to in this paragraph 1.5; 1.5.8 entered into or varied the terms of any service agreement with any of the directors of Crown Eyeglass; 1.5.9 entered into any agreement which consents to a material restriction of the scope of the business of any member of the wider Crown Eyeglass Group; 1.5.10 waived or compromised any material claim; 1.5.11 entered into or varied or authorised or proposed any contract, transaction or commitment (whether in respect of capital expenditure or otherwise) which is of a long term, onerous or unusual nature or magnitude or which is or is likely to be materially restrictive to the businesses of any member of the wider Crown Eyeglass Group or which involves or could involve an obligation of such a nature or magnitude; 1.5.12 purchased, redeemed or repaid or announced any proposal to purchase, redeem or repay any of its own shares or other securities or reduced or made any other change to any part of its share capital; 1.5.13 taken any corporate action or had any legal proceedings started or threatened against it for its winding-up, dissolution or reorganisation or for the appointment of a receiver, administrative receiver, administrator, trustee or similar officer of all or any of its assets or revenues or any analogous proceedings in any jurisdiction or had any such person appointed; 1.5.14 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 any business; or 1.5.15 make any alteration to its memorandum or articles of association or other incorporation documents. 1.6 Except as publicly announced by Crown Eyeglass to the London Stock Exchange prior to the date of this announcement or included in this announcement: 1.6.1 there having been no adverse change in the business, financial or trading position or profits or prospects of Crown Eyeglass or any other member of the wider Crown Eyeglass Group, which is material in the context of the Crown Eyeglass Group taken as a whole; 1.6.2 there having been no litigation, arbitration proceedings, prosecution or other legal proceedings to which any member of the wider Crown Eyeglass Group is or may become a party (whether as plaintiff or defendant or otherwise), no such proceedings having been threatened against any member of the wider Crown Eyeglass Group, and no investigation by a Third Party against or in respect of any member of the wider Crown Eyeglass Group having been instituted, threatened or announced by or against or remaining outstanding in respect of any member of the wider Crown Eyeglass Group, which in any such case might adversely affect any member of the wider Crown Eyeglass Group in any way which is material in the context of the Crown Eyeglass Group taken as a whole; and 1.6.3 no contingent or other liability having arisen which might be likely materially and adversely to affect the Crown Eyeglass Group taken as a whole. 1.7 Momentai not having discovered save as publicly announced by Crown Eyeglass to the London Stock Exchange prior to the date of this document, or included in this document: 1.7.1 that the financial, business or other information concerning the wider Crown Eyeglass Group as contained in the information publicly disclosed at any time by any member of the wider Crown Eyeglass Group either contains a misrepresentation of a material fact or omits to state a material fact necessary to make the information contained in it not misleading in some material respect; 1.7.2 that any member of the wider Crown Eyeglass Group is subject to any material liability, contingent or otherwise, that has not been publicly announced, such liability being material in the context of the wider Crown Eyeglass Group taken as a whole; 1.7.3 that any partnership or company in which any member of the wider Crown Eyeglass Group has a significant economic interest (being, in the case of a company, an interest carrying 25 per cent. or more of the voting capital of that company) and which is not a subsidiary of Crown Eyeglass is subject to any material liability, contingent or otherwise that has not been publicly announced, such liability being material in the context of the wider Crown Eyeglass Group taken as a whole; 1.7.4 that any past or present member of the wider Crown Eyeglass Group has not complied with all applicable laws of any relevant jurisdiction relating to environmental matters in circumstances where noncompliance would be likely to give rise to any liability (whether actual or contingent) which would be material in the context of the Crown Eyeglass Group as a whole; 1.7.5 that there has been an emission, disposal, discharge, deposit, spillage or leak of waste or hazardous or harmful substances on or about or from any property now or previously owned, occupied or made use of by any past or present member of the wider Crown Eyeglass Group which would be likely to give rise to any liability (whether actual or contingent) or cost which is material in the context of the Crown Eyeglass Group taken as a whole; or 1.7.6 that there is or is likely to be any liability whether actual or contingent) or requirement to make good, repair, reinstate or clean up any property now or previously owned, occupied or made use of by any past or present member of the wider Crown Eyeglass Group which is material in the context of the Crown Eyeglass Group taken as a whole. 1.8 An ordinary resolution to approve the Offer being passed at the EGM (or any adjournment of it). 2 Momentai reserves the right to waive, in whole or in part, all or any of conditions 1.2 to 1.7 inclusive. Momentai shall be under no obligation to waive or treat as satisfied any of conditions 1.2 to 1.7 inclusive by a date earlier than the latest date specified in condition 3 for the satisfaction of any such condition notwithstanding that 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 such conditions may not be capable of fulfilment. If Momentai is required by the Panen to make an offer for Crown Eyeglass Shares under the provisions of Rule 9 of the City Code, Momentai may make such alterations to the conditions, including that in condition 1.1 above, as are necessary to comply with the provisions of that Rule. 3 The Offer will lapse unless the conditions set out above (other than condition 1.1) are fulfilled or (if capable of waiver) waived or, where appropriate, have been determined by Momentai in its reasonable opinion to be or to remain satisfied, by midnight on the date which is 21 days after the first closing date of the Offer, and the date on which the Offer becomes or is declared unconditional as to acceptances, whichever is the later, or such later date as Momentai may, with the consent of the Panel, decide. 4 The Loan Note Alternative is conditional upon the Offer becoming or being declared unconditional in all respects.

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