Merger Offer - Part 2

Evolution Group PLC
30 May 2002

The Evolution Group PLC


30 May 2002





Part 2



This announcement is not for release, publication or distribution in or into the
United States, Canada, Australia or Japan





  RECOMMENDED MERGER OF THE EVOLUTION GROUP PLC WITH BEESON GREGORY GROUP PLC







1.         Introduction



The Boards of Evolution and Beeson Gregory today announce that they have agreed
terms for a proposed merger of their businesses.  The Merger will be achieved
through a recommended all share offer to be made by Altium Capital Limited, on
behalf of Evolution, for all of the issued and to be issued share capital of
Beeson Gregory not already owned by Evolution.



The boards of Evolution and Beeson Gregory believe there is a compelling
strategic, commercial and financial logic in combining the operations of
Evolution and Beeson Gregory to create a leading, fully integrated investment
bank servicing small and mid cap companies.





2.         The Merger Offer



The Merger Offer will be made on the basis of 1.77 New Evolution Shares for
every 1 Beeson Gregory Share.



The Merger Offer values each Beeson Gregory Share at approximately 124 pence and
the entire issued and to be issued share capital of Beeson Gregory (assuming
full exercise of the options granted under the Beeson Gregory Share Option
Schemes) at £92.1 million, based on the Closing Price of 70 pence per Evolution
Share on 29 May 2002, the business day immediately prior to the date of this
announcement.



The Merger Offer represents a premium of 12.6 per cent. to the Closing Price of
110 pence per Beeson Gregory Share on 29 May 2002, the business day immediately
prior to the date of this announcement and a premium of 41.6 per cent. to the
Closing Price of 87.5 pence per Beeson Gregory Share on 25 April 2002, the
business day before Beeson Gregory announced it had received an approach which
may lead to discussions concerning a potential offer for Beeson Gregory.



Full acceptance of the Merger Offer (assuming full exercise of the options
granted under the Beeson Gregory Share Option Schemes) would involve the issue
of approximately 131,513,076 New Evolution Shares, representing approximately
50.0 per cent. of the enlarged fully diluted ordinary share capital of
Evolution.





3.         Irrevocable Undertakings



Evolution has received irrevocable undertakings from the Directors of Beeson
Gregory and certain other employees of Beeson Gregory to accept the Merger Offer
in respect of their aggregate holdings of 16,799,666 Beeson Gregory Shares
(representing approximately 24.3 per cent. of the existing issued share capital
of Beeson Gregory).  These undertakings will be binding in the event of a
competing offer being made for Beeson Gregory.



Evolution has also received irrevocable undertakings from the following Beeson
Gregory Shareholders: 3i Investments plc (on behalf of 3i Smaller Quoted
Companies Trust plc), 3i Group plc, Artemis Unit Trust Managers Ltd, Edinburgh
Fund Managers plc and R Farleigh, Esq. to accept the Merger Offer in respect of
their aggregate holdings of 13,859,481 Beeson Gregory Shares (together
representing approximately 20.1 per cent. of the existing issued share capital
of Beeson Gregory). These irrevocable undertakings will cease to be binding in
the event a competing offer is made which values Beeson Gregory at 10 per cent.
more than the Merger Offer.



Furthermore, Evolution has received an irrevocable undertaking from INVESCO
Asset Management Limited to accept the Merger Offer in respect of its aggregate
holding of 1,356,000 Beeson Gregory Shares (representing approximately 2.0 per
cent. of the existing issued share capital of Beeson Gregory). This undertaking
will cease to be binding if a competing offer is announced which represents an
improvement to the terms of the Merger Offer.



Evolution already owns 250,000 Beeson Gregory Shares (representing approximately
0.36 per cent. of the existing issued share capital of Beeson Gregory).



Consequently, at the date of this announcement, Evolution owns or has received
irrevocable commitments to accept the Merger Offer in respect of 32,265,147
Beeson Gregory Shares (representing approximately 46.7 per cent. of the existing
issued share capital of Beeson Gregory).



Evolution has also received undertakings from Gartmore Investment Ltd and the
Evolution Board to vote in favour of the resolutions at the extraordinary
general meeting to be convened to approve the Merger in respect of their
aggregate holdings of 16,380,976 Evolution Shares (representing in aggregate
approximately 13.9 per cent. of the issued share capital of Evolution).





4.         Financial effects of acceptance



The financial effects of acceptance of the Merger Offer are set out in Appendix
I to this announcement.





5.         Information on Evolution



Evolution provides corporate and retail financial services through its two
subsidiaries: Evolution Capital and Christows.



Evolution Capital is an independent investment bank which provides equity
research, institutional sales and trading, strategic and financial advice for
public and private companies seeking to develop new enabling technologies
capable of global, commercial exploitation.



Evolution Capital's institutional sales and trading business was established
during 2001.  Evolution Capital has a diversified institutional client base,
including UK and US institutions and hedge funds, which has been built on a
growing reputation in secondary market trading and execution and in providing
independent research on new enabling technologies and emerging sectors.  The
recruitment of high calibre professionals and access to top tier financial
institutions has enabled the business to expand successfully and create a strong
brand association within the secondary market for growth companies in the UK
technology sector.



The institutional sales and trading activities are supported by an experienced
research department which has grown rapidly through the course of the last
financial year.  Evolution Capital's key sectors of research and expertise are:
IP Exploitation, Emerging Engineering, Alternative and Renewable Energies,
Wireless and Electronics, Software and Services, Life Sciences and
Nanotechnology.   Evolution publishes research in these areas for institutional
investors and provides due diligence and advisory services to both private and
public companies.



Evolution's retail stockbroking and asset management business is conducted by
Christows, a firm of portfolio and fund managers operating from offices in
London, Exeter and Bournemouth which offers stockbroking, portfolio management
and discretionary retail investment management services to over 3,800 client
accounts. Christows has approximately £390 million of funds under management.



In 2001, a full operational review of the Christows business was conducted and
has enabled the business to return to operating profitability.  The combination
of lower operating costs with the current levels of new fund inflows should
ensure that Christows is particularly well placed to benefit from any upturn in
the market.



For the financial year ended 31 December 2001, Evolution reported an increase in
group turnover of 58 per cent. to £7.6 million (2000: £4.8 million) and
operating profit on recurring activities of £885,000 (2000: loss £29,000),
before major non-recurring costs.  As at 31 December 2001, Evolution's net
assets were £43.0 million, of which £36.0 million was cash.





6.         Information on Beeson Gregory



Beeson Gregory, which was founded in 1989, has two core businesses, investment
banking, specialising in small and mid-cap growth companies, and IP2IPO, which
commercialises intellectual property.  The investment bank offers sales, trading
and research services to investors and advises corporate clients at every stage
from start-up to initial public offering and beyond, thus capturing income
across the entire investment lifecycle; its key strengths are a strong brand
name and its sector focus.  Beeson Gregory currently has a total of 105
employees most of whom operate from its London office, with the IP2IPO team
located in Oxford.  For the year ended 31 December 2001, Beeson Gregory recorded
a profit on continuing activities of £2.8 million, before provisions on fixed
asset investments of £7.8 million and had net assets of £58.7 million.



Investment Banking



Beeson Gregory's corporate finance department is one of the largest in London
dedicated to growth companies, currently advising over 90 quoted companies.  The
services offered range from flotations and secondary fund raisings to general
mergers and acquisitions advisory work, including public takeovers.  Beeson
Gregory also has considerable expertise in sales, distribution and market-making
(covering over 150 stocks), supported by a research function that tracks over
170 companies with particular focus on the sectors listed below.



Beeson Gregory has sought to differentiate itself from its competitors by
building up multi-disciplinary teams from across the investment banking
business, each of whom focuses on a specific sector.  These teams are able to
offer specialist research, corporate finance and broking services. Beeson
Gregory currently focuses on ten sectors:



•        Business and Support Services

•        Clean Technologies

•        Electronics, IT Hardware and Semiconductors

•        Entertainment Software and Technologies

•        Leisure

•        Life Sciences

•        Media

•        Natural Resources

•        Software and IT Services

•        Investment Funds



During 2000 and 2001, Beeson Gregory either sponsored or co-managed 29 initial
public offerings and over 70 other fundraisings, both public and private,
raising from these transactions a total of over £1.1 billion.  For the year
ended 31 December 2001 the investment banking activity produced turnover of
£15.0 million and a pre-tax profit of £2.3 million in exceptionally difficult
market conditions.



IP2IPO



Beeson Gregory holds 80 per cent. of IP2IPO, an intellectual property business
which aims to establish long-term partnerships with universities and similar
institutions so as to become a stakeholder in their intellectual property. The
objective is to generate shareholder value through the acquisition of
significant equity stakes in technology businesses created from university-owned
IP or through licence/royalty revenues from these sources.  It also works with
universities to develop and improve the processes by which they commercialise
their IP and with companies spun out of the universities to maximise their
chances of success.



IP2IPO contracted its first such partnership with The University of Oxford in
late 2000, whereby in return for a £20 million investment, IP2IPO is entitled to
50 per cent. of the university's equity and share of licence and royalty income
in companies spinning out of its chemistry department for the following 15
years.   To date, IP2IPO has overseen the spin out of three companies from The
University of Oxford's chemistry department, which involved raising seed funds
from external investors, and has identified a strong pipeline of future spin-out
opportunities emanating from the department.  There is no requirement for IP2IPO
to commit further capital to the spin-out companies and The University of Oxford
itself initiates and maintains patent protection for the intellectual property
upon which each investment depends.



In March 2002, IP2IPO entered into a second such relationship, with Southampton
University whereby it will invest £5m in spin-out companies over 4 years.
Southampton is one of the UK's top research universities, with a strong
reputation across most fields of science, medicine and engineering, and has a
proven track record in the creation of spin-out companies. IP2IPO will work with
Southampton University's Centre for Enterprise and Innovation in the
identification and facilitation of spin-out companies across the university.  As
part of the partnership, IP2IPO will receive a 20 per cent. shareholding in
Southampton Asset Management Limited, the company set up to hold the
university's own share of future spin-out companies.



The Beeson Gregory Directors believe that one of the key advantages of IP2IPO's
business model is that its focus is to create value from IP and not to create,
develop and protect the IP itself.  As a result, although IP2IPO assumes some of
the risks associated with developing and commercialising IP by virtue of
entering into long-term university partnerships, as a general rule, it is the
universities and spin-out companies which will bear the costs of creating,
protecting and developing this IP.  The Beeson Gregory Directors believe that
this feature of IP2IPO's business model will serve to keep the company's
overheads significantly lower than they would otherwise be.





7.         Background to, reasons for and benefits of the Merger



The boards of Evolution and Beeson Gregory believe that there is a compelling
strategic, commercial and financial logic in combining the investment banking
operations of Evolution and Beeson Gregory.  The combination will create a fully
integrated investment bank utilising Evolution's institutional sales,
independent research, asset management and retail stockbroking operations and
Beeson Gregory's established investment banking business comprising corporate
finance, sales, market making and research activities.



Benefits of the Merger include:



•        The Boards of Evolution and Beeson Gregory believe that the current
polarisation of investment banking activities within the United Kingdom, with
larger banks primarily servicing larger companies, provides an opportunity for
the Enlarged Group to become a leading integrated investment bank servicing
small and mid cap companies.



•        Beeson Gregory's corporate finance capability will facilitate the
generation of additional transaction and advice related revenue from companies
with whom Evolution has relationships through its research activities.



•        The institutional sales operations of Evolution and Beeson Gregory each
have extensive client bases which provide an opportunity to increase combined
revenues through improved distribution channels and increased primary and
secondary commissions.



•        Beeson Gregory operates a market making function which will enhance the
Enlarged Group's trading and execution abilities.



•        Evolution's successful and profitable retail stockbroking and asset
management subsidiary, Christows, will be the Enlarged Group's platform for
developing its retail asset management operations which should provide the
Enlarged Group with a more predictable revenue stream.



•        Both Evolution and Beeson Gregory are committed to IP2IPO and its
strategy of exploiting intellectual property created by academic institutions.
The Enlarged Group will control approximately 84 per cent. of the issued share
capital of IP2IPO and will seek to establish further university partnerships to
create additional value for shareholders.



•        The Enlarged Group will seek to reduce combined overheads through the
elimination of duplicate costs.



The Enlarged Group will be well capitalised with combined cash balances of
approximately £37 million (net of debt and before taking into account any merger
costs) as at 30 April 2002.





8.         The Enlarged Group



The Enlarged Group will operate the following divisions:



Investment Banking



The Enlarged Group will incorporate Evolution Capital's institutional sales and
trading and research functions and Beeson Gregory's established investment
banking business comprising corporate finance, sales, market making and research
activities.



Retail Stockbroking and Asset Management



The Enlarged Group's retail stockbroking and asset management activity will be
developed using Christow's existing operations which has approximately £390
million of funds under management, over 3,800 discretionary client accounts and
a strategy to develop a more focussed product offering, increasing geographic
coverage and improving the annuitised revenue stream.



Private Equity



The Enlarged Group will merge the private equity portfolios of Evolution and
Beeson Gregory and will seek to drive active value creation through exits. The
Enlarged Group will continue with Evolution's and Beeson Gregory's common
strategy of ceasing to make new principal private equity investments. However,
the Enlarged Group may, in certain circumstances, invest further in existing
investee companies.  The Enlarged Group intends to develop a significant private
equity activity, based around the Enlarged Group's core expertise through the
creation of a new fund and the provision of private equity advisory services.



IP2IPO



Evolution and Beeson Gregory are committed to IP2IPO and its strategy of
exploiting intellectual property created by academic institutions.  The Enlarged
Group will control approximately 84 per cent. of the issued share capital of
IP2IPO and will seek to establish further university partnerships.  The
objective will be to generate shareholder value through the acquisition of
significant equity stakes in technology businesses created from university-owned
IP or through licence and royalty revenues from these sources.



The Enlarged Group intends to move to the Official List at the first appropriate
opportunity.  The Enlarged Group also intends to restructure its share capital
as soon as is practicable to enable it to pay dividends out of future profits.





9.         Evolution's current trading and prospects



In Evolution's AGM statement released on 29 May 2002, Alex Snow, Chairman and
Chief Executive, updated Evolution Shareholders on current trading as follows:



"Evolution Capital has continued to grow its franchise and earnings capability
during the first quarter of 2002.  The institutional sales and trading team has
continued to see the level of activity increase and is continuing to create
additional key client relationships with top tier financial institutions.  This
increasing level of secondary market activity has been complemented by
increasing output from the research team, which, the Evolution Directors
believe, has created a strong reputation amongst financial institutions and
industry for high quality, incisive company and sector research on new enabling
technologies.



"In the first quarter of 2002, Christows operated profitably, despite difficult
markets.  New discretionary funds under management are growing and this has been
due to an increased sales and marketing effort, and additionally from the
strength of the discretionary service product.  Christows has also developed a
specialised IFA discretionary product which has been adopted by IFAs and other
financial intermediaries and will be an increasingly important area of business
as the landscape of regulation continues to change.



"On 29 January 2002, Evolution announced that it had made a strategic investment
in Inter-Alliance Group PLC ("Inter-Alliance"), the UK's largest national
independent financial advisory group.  On 11 April 2002, Evolution announced
that, following a placing and open offer by Inter-Alliance, Evolution owned
approximately 22 per cent. of the enlarged issued share capital of
Inter-Alliance.  The Evolution Directors believe that the investment in
Inter-Alliance has already created significant value for Evolution Shareholders
and that greater value will be created in the medium term."





10.       Beeson Gregory's current trading and prospects



In Beeson Gregory's AGM statement released on 2 May 2002, Andrew Beeson,
Chairman, updated Beeson Gregory Shareholders on current trading as follows:



"In my most recent communication with shareholders six weeks ago, I said that
our corporate finance order book was satisfactory, though much depends as
always, on liquidity in the financial markets.  While my comments on the
financial markets remain unchanged, I am pleased to advise shareholders of a
strengthening in our short term order book.  When combined with our reduced cost
base, this bodes well for our first half performance."



Trading since the above announcement was made has confirmed this view.





11.       Directors, management and employees



Following the Merger Offer becoming or being declared unconditional in all
respects, the board of the Enlarged Group will be:


Name                          Position

Andrew Beeson*                Chairman
Alex Snow                     Chief Executive Officer
Graeme Dell                   Group Finance Director
Richard Griffiths             Director
David Norwood*                Director
Oliver Vaughan                Non Executive Director
Sir Malcolm Field*            Non Executive Director
George Loudon*                Non Executive Director





* Proposed Directors who will join the Evolution Board from Beeson Gregory upon
the Merger Offer becoming or being declared unconditional in all respects.



Conditionally upon the Merger Offer becoming or being declared unconditional in
all respects, James Chilcott will step down as a Director of Evolution but will
remain with the Enlarged Group as an integral part of the research department,
leading the IP exploitation franchise.



The Evolution Directors and the Proposed Directors have confirmed that the
existing employment rights, including the pension rights, of all management and
employees of Beeson Gregory will be fully safeguarded following completion of
the Merger.





12.              Lock-in arrangements



Evolution has received undertakings from certain Proposed Directors, Andrew
Beeson and Sir Malcolm Field to retain 50 per cent. of their New Evolution
Shares for a period of 12 months following the Merger Offer becoming wholly
unconditional.  Evolution has also received an undertaking from David Norwood,
an executive director of Beeson Gregory, who will be appointed to the board of
Evolution as an executive director, to retain 75 per cent. of his New Evolution
Shares for a period of 12 months following the Merger Offer becoming wholly
unconditional.





13.              Incentive Arrangements



Evolution has offered to certain Beeson Gregory employees ("relevant employees
"), not being directors of Beeson Gregory, the opportunity to elect to receive
either:



(i)                  a loyalty bonus of up to a maximum of £557,655  in
aggregate, payable in cash in the event that the Merger Offer becomes or is
declared unconditional in all respects ("Loyalty Bonus"); or



(ii)                an enhanced and deferred bonus ("Enhanced Bonus") equal to
150 per cent of the Loyalty Bonus, which is payable in three equal tranches. The
first tranche is payable in cash within fourteen days of the Merger Offer
becoming or being declared unconditional in all respects, and the second and
third tranches are payable six months and twelve months respectively after the
Merger Offer becomes or is declared unconditional in all respects. A relevant
employee's entitlement to receive the second and third tranches is subject to
his not having served notice to terminate his employment (other than in
circumstances constituting constructive dismissal) and not having been dismissed
for cause prior to the relevant payment date. Evolution will pay the second and
third tranches by issuing (or procuring the transfer of) Evolution Shares to the
relevant employees at a deemed value of 70 pence (being the closing middle
market price of the Evolution Shares on 29 May 2002).



The Beeson Gregory Directors, who have been so advised by UBS Warburg, consider
the terms of the above arrangements between Evolution and the relevant employees
to be fair and reasonable so far as Beeson Gregory Shareholders (other than the
relevant employees) are concerned.





14.              Beeson Gregory Share Option Schemes



Options under the Beeson Gregory Share Option Schemes will, if not already
exercisable, become exercisable once the Merger Offer becomes or is declared
unconditional in all respects subject to the terms of the relevant Beeson
Gregory Share Option Scheme.



Optionholders who decide to exercise their options will be able to accept the
Merger Offer (while it remains open for acceptance) in respect of the Beeson
Gregory Shares they receive on exercise.  However, it may not be in the
interests of all Beeson Gregory optionholders to exercise their options,
depending on the relevant option exercise price and the value of the Evolution
Shares.  Evolution will make appropriate proposals to Beeson Gregory
optionholders in due course.





15.       Evolution Shareholder approval



In view of the size of Beeson Gregory, the Merger Offer will be treated as a
reverse takeover under the AIM Rules. Accordingly, it will be necessary for
Evolution Shareholders to approve the Merger Offer and to authorise the
Evolution Directors to allot the New Evolution Shares in accordance with the
Act. The necessary resolution will be put to an extraordinary general meeting of
Evolution. Further details of this meeting will be sent to Evolution
Shareholders in due course.



Evolution has also received undertakings from Gartmore Investment Ltd and the
Evolution Board to vote in favour of the resolutions at the extraordinary
general meeting to be convened to approve the Merger in respect of their
aggregate holdings of 16,380,976 Evolution Shares (representing in aggregate
approximately 13.9 per cent. of the issued share capital of Evolution).





16.       Compulsory acquisition, de-listing, re-admission to AIM and dealings



If Evolution receives acceptances under the Merger Offer in respect of, and/or
otherwise acquires an aggregate of 90 per cent. or more of the Beeson Gregory
Shares to which the Merger Offer relates, Evolution intends to exercise its
rights pursuant to the provisions of sections 428 to 430F of the Act to acquire
compulsorily the remaining Beeson Gregory Shares to which the Merger Offer
relates.



Furthermore, once the Merger Offer becomes or is declared unconditional in all
respects, Evolution intends to procure the making of an application by Beeson
Gregory to delist the Beeson Gregory Shares from the Official List and to the
London Stock Exchange for the cancellation of trading of Beeson Gregory Shares.
It is anticipated that such cancellation will take effect no earlier than 20
business days after the Merger Offer becomes or is declared unconditional in all
respects.



Certificates for New Evolution Shares to be issued to Beeson Gregory
Shareholders will be despatched no later than 14 days after the Merger Offer
becomes or is declared unconditional in all respects. No certificates for New
Evolution Shares will be issued in respect of the entitlements of those Beeson
Gregory Shareholders who hold their shares in uncertificated form in CREST,
settlement for which will be made through the applicable CREST procedure (unless
Evolution decides otherwise).



As the Merger Offer constitutes a reverse takeover under the AIM Rules,
application will be made to the London Stock Exchange for the Evolution Shares
and the New Evolution Shares to be re-admitted and admitted respectively to
trading on AIM in accordance with the AIM Rules. It is expected that Admission
will become effective and that dealings for normal settlement in the Evolution
and the New Evolution Shares will commence on the first business day following
the day on which the Merger Offer becomes or is declared unconditional in all
respects (save for the condition relating to admission to trading on AIM).



It is likely that some New Evolution Shares will be issued after the expected
Admission date referred to above to Beeson Gregory Shareholders who have not
validly accepted the Merger Offer before that date and, accordingly, admission
of such New Evolution Shares to trading on AIM may become effective and dealings
in them may commence on one or more subsequent dates.



In relation to New Evolution Shares issued in certificated form, temporary
documents of title will not be issued pending the despatch by post of definitive
certificates for such New Evolution Shares in accordance with the terms of the
Merger Offer.



Further details on settlement, listing and dealing will be included in the
formal documents to be sent to Beeson Gregory Shareholders and Evolution
Shareholders in due course.





17.       Overseas shareholders



The availability of the Merger Offer to persons not resident in the UK may be
affected by the laws of the relevant jurisdictions. In particular, the Merger
Offer will not be made, directly or indirectly, in or into the United States,
Canada, Australia or Japan. Beeson Gregory Shareholders who are not resident in
the UK should inform themselves about and observe any applicable requirements.



Further details in relation to overseas shareholders will be contained in the
Offer Document.





18.       Inducement Fee Arrangements



Evolution has agreed to pay Beeson Gregory the sum of £250,000 (or such lesser
sum as may be equal to 1 per cent. of the aggregate value of the Offer) if, (a)
a competing offer for Evolution is announced and subsequently becomes or is
declared wholly unconditional or (b) Evolution Shareholders do not approve the
Merger Offer or (c) any event or circumstance occurs which has a materially
adverse effect on the financial position of the Evolution Group taken as a whole
which causes the Board of Beeson Gregory to withdraw its recommendation of the
Merger Offer and, as a result, the Merger Offer fails to become wholly
unconditional or (d) Evolution fails to despatch the Offer Document within 28
days of the date of this announcement (or such later date as may be agreed by
the Panel) or (e) the Offer lapses or is withdrawn as a result of a breach of or
failure to satisfy any condition to the Merger Offer directly or indirectly due
to an act, omission, failure or delay of Evolution or (f) having declared the
Merger Offer unconditional in all respects, except as to Admission, Evolution
fails to obtain Admission of the New Evolution Shares and the Merger Offer
lapses.



Beeson Gregory has agreed to pay Evolution the sum of £250,000 (or such lesser
sum as may be equal to 1 per cent. of the aggregate value of the Offer) if (a) a
competing offer for Beeson Gregory is announced and subsequently becomes or is
declared wholly unconditional or (b) the Beeson Gregory Board withdraws its
recommendation of, or its intention to recommend, the Merger Offer other than as
a result of, (i) the matters referred to in (c) in the above paragraph or (ii)
an offer for Evolution being announced which is (or is stated in the
announcement as intended to be) recommended by the Evolution Board, or an offer
for Evolution which is not recommended by the Evolution Board but which becomes
or is declared wholly unconditional or (iii) the shareholders of Evolution not
giving the necessary approvals or authorities to complete the Merger Offer or
(iv) Evolution not posting the Offer Document within 28 days of this
announcement (or such later date as the Panel may agree) or (d) any event or
circumstance occurs which has a material adverse effect on the Beeson Gregory
Group taken as a whole and, as a result, Evolution does not proceed with the
Merger Offer or, as the case may be, entitles Evolution to lapse or withdraw the
Merger Offer in either case with the consent of the Panel.





19.       Further details of the Merger Offer



The Merger Offer will extend, subject to the terms and conditions set out or
referred to in this document or in the Form of Acceptance, to all Beeson Gregory
Shares unconditionally allotted or issued while the Merger Offer remains open
for acceptance (or prior to such earlier date and/or time as Evolution may,
subject to the Code, decide) including any Beeson Gregory Shares which are
allotted or issued as a result of the exercise of options granted under the
Beeson Gregory Share Option Schemes.



The Beeson Gregory Shares that are the subject of the Merger Offer will be
acquired by Evolution fully paid and free from all liens, charges, encumbrances,
rights of pre-emption and any other third party rights of any nature whatsoever
and together with all rights attaching to them, including the right to receive
all dividends and other distributions (if any) declared, made or paid after 29
May 2002.



The New Evolution Shares to be issued pursuant to the Merger Offer will be
issued credited as fully paid and free from all liens, charges, encumbrances,
rights of pre-emption and other third party rights or interests of any nature
whatsoever and will rank pari passu in all respects with the existing Evolution
Shares.



Fractions of New Evolution Shares will not be allotted or issued to persons
accepting the Merger Offer and such entitlements to New Evolution Shares under
the Merger Offer will be rounded down to the nearest whole number of New
Evolution Shares. Fractional entitlements to New Evolution Shares will be
aggregated and sold in the market with the proceeds retained for the benefit of
the Enlarged Group.



The Merger Offer will be conditional, inter alia, on (i) the passing of a
resolution by Evolution Shareholders to authorise implementation of the Merger
Offer, (ii) the re-admission and admission respectively to trading on AIM of the
Evolution Shares and the New Evolution Shares in accordance with the AIM Rules,
and (iii) the obtaining of approval from the Financial Services Authority in
respect of the change of control.



In addition, the Merger Offer will be subject to the conditions set out in
Appendix II to this announcement and to the additional terms that are to be
contained in the Offer Document.





20.       General



The Offer Document, setting out full details of the Merger Offer, together with
an AIM Admission Document and a Form of Acceptance, will be posted to Beeson
Gregory Shareholders as soon as practicable and in any event within 28 days of
this announcement.  The Offer Document and the AIM Admission Document will also
be despatched to Beeson Gregory optionholders for information only.  A circular
containing a notice convening an extraordinary general meeting of Evolution
Shareholders to approve the Merger, together with the AIM admission document
(and the Offer Document for information only), will be despatched at the same
time to Evolution Shareholders, and to Evolution optionholders for information
only.





21.       Recommendation and undertakings



The Beeson Gregory Directors, who have been so advised by their financial
advisers, UBS Warburg, consider the terms of the Merger Offer to be fair and
reasonable. In providing its advice to the Beeson Gregory Directors, UBS Warburg
has taken into account the commercial assessments of the Beeson Gregory
Directors.



Accordingly, the Beeson Gregory Directors will unanimously recommend Beeson
Gregory    Shareholders to accept the Merger Offer, as they have undertaken to
do in respect of their own beneficial holdings of, in aggregate, 9,706,586
Beeson Gregory Shares, representing approximately 14.0 per cent. of Beeson
Gregory's existing issued share capital.



The Evolution Directors, who have been so advised by their financial advisers
Altium Capital, consider the terms of the Merger Offer to be fair and
reasonable. In providing its advice to the Evolution Directors, Altium Capital
has taken into account the Evolution Directors' commercial assessment of the
Merger.



The Evolution Directors will be unanimously recommending Evolution Shareholders
to vote in favour of the resolutions necessary to effect the Merger Offer as
they have undertaken to do in respect of their own beneficial holdings of, in
aggregate, 9,218,946 Evolution Shares, representing approximately 7.8 per cent.
of Evolution's existing issued share capital.




Enquiries:

The Evolution Group PLC                              Tel: [phone]

Alex Snow

Richard Griffiths

Graeme Dell



Altium Capital Limited                               Tel: [phone]

Garry Levin

Ben Bailey

Sam Fuller



Hogarth Partnership Limited                          Tel: [phone]

Andrew Jaques

Georgina Briscoe



Beeson Gregory Group PLC                             Tel: [phone]

Andrew Beeson

Charles Byford



UBS Warburg                                          Tel: [phone]

Michael Del Mar

Christopher Fox

Rachael Young



Buchanan Communications                              Tel: [phone]

Richard Oldworth

Nicola Cronk





Altium Capital is acting for Evolution and no one else in connection with the
Merger Offer and will not be responsible to anyone other than Evolution for
providing the protections afforded to clients of Altium Capital, nor for
providing advice in relation to the Merger Offer or the New Evolution Shares.



UBS Warburg is acting for Beeson Gregory and no one else in connection with the
Merger Offer and will not be responsible to anyone other than Beeson Gregory for
providing the protections afforded to clients of UBS Warburg, nor for providing
advice in relation to the Merger Offer.



This announcement does not constitute an offer or an invitation to purchase any
securities.



This announcement does not constitute an offer of securities for sale in the
United States and the New Evolution Shares have not been, and will not be,
registered under the United States Securities Act of 1933, as amended, nor under
any laws of any state of the United States, and the relevant clearances have not
been and will not be obtained from the relevant authorities in Canada, Australia
or Japan. Accordingly, New Evolution Shares may not be offered, sold or
delivered, directly or indirectly, in or into the United States, Canada,
Australia or Japan except pursuant to exemptions from applicable requirements of
such jurisdictions.



The Merger Offer will not be made, directly or indirectly, in or into, by use of
mails or any means of instrumentality (including, without limitation, facsimile
transmissions, telex, telephone or e-mail) of interstate or foreign commerce of,
or any facilities of a securities exchange of, the United States nor is it being
made in or into Canada, Australia, or Japan and the Merger Offer will not be
capable of acceptance by any such use, means, instrumentality or facilities or
from or within the United States, Canada, Australia or Japan. Accordingly,
copies of this press announcement are not being, and must not be, mailed or
otherwise distributed or sent in, into or from the United States, Canada,
Australia or Japan and persons receiving the press announcement (including
custodians, nominees and trustees) must not distribute or send it in, into or
from the United States, Canada, Australia or Japan.



Attention is drawn to Rule 8.3 of the City Code on Takeovers and Mergers under
which the dealings during an offer period in "relevant securities" of every
person who owns or controls, or will own or control in consequence of any
dealing (directly or indirectly), 1 per cent of any class of such securities,
and also the dealings of any other person through whom such ownership or control
is derived, must be publicly disclosed.  The rule does not apply to recognised
market makers dealing in that capacity, but relevant securities comprised in
investment accounts managed on a discretionary basis are treated as controlled
by the managers.  "Relevant Securities" include, in essence, the securities of
Beeson Gregory for which the offer is made, any equity share capital of the
offeror, any securities carrying conversion or subscription rights into, options
over and derivatives referenced to, any of the foregoing and a dealing includes
the taking, granting or exercising of any option (including a traded option),
the exercise of any such conversion or subscription rights, or the acquisition
of, entering into, closing out, exercise of rights under, or variation of the
derivative.  Disclosure must be made not later than 12 noon on the business day
following the date of the transaction and is to be made to the Company
Announcement Office of the London Stock Exchange and a copy must be faxed to the
Panel and Takeovers Mergers.  This is only a summary of the rules.  Further
information is to be found in the City Code on Takeovers and Mergers and can be
obtained from the Panel.  Telephone [phone], Fax [phone] or from the
Panel's website at www.thetakeoverpanel.org.uk.



The Evolution Directors accept responsibility for the information contained in
this announcement other than the information relating to the Beeson Gregory
Group, the Beeson Gregory Directors, their families and persons connected with
the Beeson Gregory Directors. Subject as aforesaid, to the best of the knowledge
and belief of the Evolution Directors (who have taken all reasonable care to
ensure that such is the case), the information contained in this announcement is
in accordance with the facts and does not omit anything likely to affect the
import of such information.



The Beeson Gregory Directors accept responsibility for the information contained
in this announcement relating to the Beeson Gregory Group, the Beeson Gregory
Directors, their families and persons connected with the Beeson Gregory
Directors.  Subject as aforesaid, to the best of the knowledge and belief of the
Beeson Gregory Directors (who have taken all reasonable care to ensure that such
is the case), the information contained in this announcement is in accordance
with the facts and does not omit anything likely to affect the import of such
information.





Appendix IV contains the definitions used in the announcement.



The Evolution Group PLC

30 May 2002


                                   APPENDIX I

              FINANCIAL EFFECTS OF ACCEPTANCE OF THE MERGER OFFER



The following table shows, for illustrative purposes only and on the bases set
out in the notes below, the financial effects on capital value and income for a
holder of 1 Beeson Gregory Share if he accepts the Merger Offer.


(a)                Capital Value                                          pence


Market Value of 1.77 Evolution Shares(1)                                  123.9


Less: Market Value of 1 Beeson Gregory Share (2)                          110.0


Increase                                                                   13.9


Representing an increase in capital value of                      12.6 per cent.

(b)               Income Value                                            pence


Gross dividend from 1.77 Evolution Shares(3)                                0.0


Gross dividend from 1 Beeson Gregory Share (4)                              1.1


Increase/(decrease)                                                        (1.1)


Representing an increase/(decrease) in income value of         (100.0) per cent.



Notes:

(1)     The value of an Evolution Share is based on the Closing Price per
Evolution Share of 70.0 pence on 29 May 2002, the last dealing day prior to this
announcement.

(2)     The value of a Beeson Gregory Share is based on the Closing Price per
Beeson Gregory Share of 110.0 pence on 29 May 2002, the last dealing day prior
to this announcement.

(3)     There was no final dividend per Evolution Share for the financial year
ended 31 December 2001

(4)     Based on the final dividend of 1.0 pence (net) per Beeson Gregory Share
for the financial year ended 31 December 2001 and an associated tax credit of
one ninth of the amount paid.

(5)     No account has been taken of fractions or any potential liability for
taxation of a Beeson Gregory Shareholder.


                                  APPENDIX II

                CONDITIONS AND FURTHER TERMS OF THE MERGER OFFER

                         CONDITIONS OF THE MERGER OFFER



The Merger Offer, which will be made by Altium Capital on behalf of Evolution,
will comply with the rules and regulations of the City Code, the UKLA and the
London Stock Exchange and will be governed by English law and subject to the
jurisdiction of the English courts and will be subject to the following
conditions:



(a)                valid acceptances being received (and not, where permitted,
withdrawn) by not later than 3.00 p.m. (London time) on the first closing date
of the Merger Offer (or such later time(s) and/or date(s) as Evolution may,
subject to the rules of the City Code, decide) in respect of not less than 90
per cent. (or such lower percentage as Evolution may decide) in nominal value of
the Beeson Gregory Shares to which the Merger Offer relates, provided that this
condition will not be satisfied unless Evolution and/or its wholly owned
subsidiaries shall have acquired or agreed to acquire (whether pursuant to the
Merger Offer or otherwise) Beeson Gregory Shares carrying in aggregate more than
50 per cent. of the voting rights then normally exercisable at a general meeting
of Beeson Gregory, including for this purpose (to the extent if any, required by
the Panel) any such voting rights attaching to any Beeson Gregory Shares that
are unconditionally allotted or issued before the Merger 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 "Beeson Gregory Shares to which the Merger
Offer relates" shall be construed in accordance with sections 428 to 430F
(inclusive) of the Act; and



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



(b)               the passing at an extraordinary general meeting of Evolution
(or any adjournment thereof) of such resolutions as may be necessary to approve,
implement and effect the Merger Offer and the acquisition of any Beeson Gregory
Shares pursuant to the Merger Offer;



(c)                the admission to trading on AIM of the New Evolution Shares
(or such of them as are due to be allotted at the time the Merger Offer becomes
or is declared unconditional in all other respects) in accordance with the AIM
Rules or (if determined by Evolution and subject to the consent of the Panel)
the London Stock Exchange agreeing to admit such shares to trading on AIM
subject only to (i) the allotment of such shares and/or (ii) the Merger Offer
becoming or being declared unconditional in all respects;



(d)               Evolution, and any other person as may be required by FSMA,
obtaining: (i) approval from the Financial Services Authority in respect of the
changes of control of any of Beeson Gregory's subsidiaries which are "authorised
persons", as such term is defined in the Financial Services Authority's Handbook
of Rules and Guidance, which will result from the Merger Offer; and (ii) any
other Authorisations which the Financial Services Authority may deem necessary
in connection with the Merger Offer;



(e)                no Third Party having intervened in any way and there not
continuing to be outstanding any statute, regulation, order or decision of any
Third Party in each case which would or might be reasonably likely (in any case
to an extent which is material in the context of the Evolution Group or the
Beeson Gregory Group, as the case may be, taken as a whole) to:



(i)                  make the Merger Offer, its implementation or the
acquisition or proposed acquisition by Evolution of any shares or other
securities in, or control of, Beeson Gregory or any member of the Beeson Gregory
Group void, illegal or unenforceable in any jurisdiction, or otherwise directly
or indirectly restrain, prevent, prohibit, restrict or materially delay the same
or impose additional conditions or obligations with respect to the Merger Offer
or such acquisition, or otherwise materially challenge or interfere with the
Merger Offer or such acquisition, or require material amendment to the terms of
the Merger Offer or the acquisition or proposed acquisition of any Beeson
Gregory Shares or of control by Evolution of Beeson Gregory or any member of the
Beeson Gregory Group in each case in a manner which is material in the context
of the Merger Offer;



(ii)                require, prevent or materially delay the divestiture or
materially alter the terms envisaged for any proposed divestiture by any member
of the Evolution Group or by any member of the Beeson Gregory Group of all or to
the extent which is material in the context of the Merger Offer) any material
portion 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 to own or control any of their respective assets or
properties or any material part thereof;



(iii)               require any member of the Evolution Group or of the Beeson
Gregory Group to acquire, or to offer to acquire, any shares or other securities
(or the equivalent) in any member of either group owned by any third party such
acquisition being material in the context of the Wider Evolution Group taken as
a whole;



(iv)              otherwise materially and adversely affect the business,
assets, profits, financial or trading position or prospects of any member of the
Wider Beeson Gregory Group or of the Wider Evolution Group to an extent which is
material in the context of the Wider Beeson Gregory Group and the Wider
Evolution Group taken as a whole,



and all applicable waiting and other time periods during which any Third Party
could have intervened under the laws of any relevant jurisdiction having
expired, lapsed or been terminated;



(f)                 the Office of Fair Trading or any relevant institute in the
United Kingdom not having indicated that it is the intention of the Secretary of
State for Trade and Industry to refer the proposed acquisition of Beeson Gregory
by Evolution to the Competition Commission;



(g)                in any case to an extent which is material in the context of
the Wider Evolution Group or the Wider Beeson Gregory Group, as the case may be,
as a whole, all notifications and filings which are necessary having been made,
all appropriate waiting and other time periods (including any extensions of such
waiting and other time periods) under any applicable legislation or regulation
of any relevant jurisdiction having expired, lapsed or been terminated (as
appropriate) and all statutory or regulatory obligations in any relevant
jurisdiction having been complied with in each case in connection with the
Merger Offer, the Merger, or the acquisition or proposed acquisition of any
shares or other securities in Beeson Gregory or the control of Beeson Gregory or
any other member of the Beeson Gregory Group by Evolution or the carrying on by
any member of the Beeson Gregory Group of its business;



(h)                all Authorisations which are material and are necessary or
are appropriate in any relevant jurisdiction for or in respect of the Merger
Offer, the Merger or the acquisition or proposed acquisition of any shares or
other securities in Beeson Gregory, or the acquisition of control of any member
of the Beeson Gregory Group by, Evolution or the carrying on by any member of
the Beeson Gregory Group of its business having been obtained, in terms and in a
form reasonably satisfactory to Evolution, from all appropriate Third Parties,
and all such Authorisations remaining in full force and effect and there being
no notice or intimation of any intention to revoke, suspend, restrict, modify or
not to renew any of the same at any time prior to which the Merger Offer becomes
or is declared wholly unconditional, in each case where the absence of such
Authorisation would have a material adverse effect on the Beeson Gregory Group
or the Wider Evolution Group taken as a  whole;



(i)                  except as disclosed in Beeson Gregory's annual report and
accounts for the year ended 31 December 2001 or as otherwise publicly announced
by Beeson Gregory (by the delivery of an announcement to an authorised
regulatory information service) prior to 29 May 2002 or as disclosed to
Evolution by or on behalf of Beeson Gregory prior to 29 May 2002, there being no
provision of any arrangement, agreement, licence, permit, franchise or other
instrument to which any member of the Beeson Gregory 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 Merger Offer, the Merger or the acquisition or proposed acquisition of any
shares or other securities in Beeson Gregory or the acquisition of control of
any member of the Beeson Gregory Group by Evolution or otherwise, or could or
might reasonably be expected to result in, (in any case to an extent which is
material in the context of the Wider Beeson Gregory Group taken as a whole):



(i)                  any monies borrowed by or any other indebtedness or
liabilities (actual or contingent) of any member of the Beeson Gregory Group
being or becoming repayable or capable of being declared repayable immediately
or prior to its stated repayment date or the ability of any member of the Beeson
Gregory Group to borrow monies 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 part of the business, property, assets
or interests of any member of the Beeson Gregory Group or any such mortgage,
charge or other security interest (wherever created, arising or having arisen)
becoming enforceable;



(iii)               any such arrangement, agreement, licence, permit, franchise
or instrument, or the rights, liabilities, obligations or interests of any
member of the Beeson Gregory Group thereunder, being, or becoming capable of
being, terminated or materially and adversely modified or affected or any
adverse action being taken or any onerous obligation or liability arising
thereunder;



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



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



(vi)              the rights, liabilities, obligations or interests of any
member of the Beeson Gregory Group under any such arrangement, agreement,
licence, permit, franchise or other instrument or the interests or business of
any such member in or with any other person, firm, company or body (or any
arrangement or arrangements relating to any such interests or business) being
terminated, or materially and adversely modified or affected; or



(vii)             the financial or trading position or the prospects or the
value of any member of the Beeson Gregory Group being prejudiced or adversely
affected, and no event having occurred which, under any provision of any such
arrangement, agreement, licence, permit or other instrument, could reasonably be
expected to result in any of the events or circumstances which are referred to
in paragraphs (i) to (vi) of this condition (i), in any case to an extent which
is, or would be, material in the context of the Wider Beeson Gregory Group taken
as a whole;



(j)                 since 31 December 2001 and except as disclosed in Beeson
Gregory's annual report and accounts for the year then ended or as otherwise
publicly announced by Beeson Gregory (by the delivery of an announcement to an
authorised regulatory information service) prior to 29 May 2002, or as otherwise
disclosed to Evolution by or on behalf of Beeson Gregory prior to 29 May 2002,
no member of the Beeson Gregory Group having (other than as between Beeson
Gregory and wholly owned subsidiaries of Beeson Gregory):



(i)                  issued or agreed to issue, or authorised the issue of,
additional shares of any class, or securities convertible into or exchangeable
for, or rights, warrants or options to subscribe for or acquire, any such shares
or convertible securities, other than any options granted under any of the
Beeson Gregory Share Option Schemes prior to 29 May 2002 or any shares issued
upon the exercise of any options granted under any of the Beeson Gregory Share
Option Schemes;



(ii)                purchased or redeemed or repaid any of its own shares or
other securities or reduced or made any other change to any part of its share
capital;



(iii)               recommended, declared, paid or made any bonus, dividend or
other distribution whether payable in cash or otherwise;



(iv)              made or authorised or announced its intention to propose any
change in its loan capital;



(v)                (other than any acquisition or disposal in the ordinary
course of business) merged with, demerged or acquired any body corporate,
partnership or business or acquired or disposed of or transferred, mortgaged or
charged or created any security interest over any assets or any right, title or
interest in any assets (including shares in any undertaking and trade
investments) or authorised, proposed or announced its intention to do the same;



(vi)              issued or authorised the issue of, or made any change in or
to, any debentures or (except in the ordinary course of business) incurred or
increased any indebtedness or liability (actual or contingent);



(vii)             entered into, varied, or authorised any agreement,
transaction, arrangement or commitment (whether in respect of capital
expenditure or otherwise) which:



(A)  is of a long term, onerous or unusual nature or magnitude or which is or
might reasonably be expected to involve an obligation of such nature or
magnitude; or



(B)  could materially restrict the business of any member of the Beeson Gregory
Group; or



(C) is other than in the ordinary course of business,



and which in any case is material and adverse in the context of the Wider Beeson
Gregory Group taken as a whole;



(viii)           entered into, implemented, effected or authorised any merger,
demerger, reconstruction, amalgamation, scheme, commitment or other transaction
or arrangement in respect of itself or another member of the Beeson Gregory
Group otherwise than in the ordinary course of business which in any case is
material in the context of the Beeson Gregory Group;



(ix)              entered into or varied the terms of, any contract, agreement
or arrangement with any of the directors of Beeson Gregory or, to an extent
which is material in the context of the Beeson Gregory Group taken as a whole,
the directors or senior executives of any member of the Beeson Gregory Group;



(x)                taken any corporate action or had any legal proceedings
instituted or threatened against it or order made 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 part of its assets and revenues or any analogous
proceedings in any jurisdiction or appointed any analogous person in any
jurisdiction which in any case is material in the context of the Beeson Gregory
Group taken as a whole;



(xi)              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;



(xii)             waived or compromised any claim which is material in the
context of the Beeson Gregory Group taken as a whole;



(xiii)           made any alteration to its memorandum or articles of
association which is material in the context of the Merger Offer;



(xiv)           entered into any agreement, commitment or arrangement or passed
any resolution or made any offer (which remains open for acceptance) or
announced any intention with respect to any of the transactions, matters or
events referred to in this condition (j) which is material in the context of the
Beeson Gregory Group taken as a whole;



(xv)            in any such case, which is material and adverse in the context
of the Wider Beeson Gregory Group taken as a whole



(k)               since 31 December 2001 and except as disclosed in Beeson
Gregory's annual report and accounts for the year then ended or as otherwise
publicly announced by Beeson Gregory (by the delivery of an announcement to an
authorised regulatory information service) prior to 29 May 2002, or as otherwise
fairly disclosed to Evolution by or on behalf of Beeson Gregory prior to 29 May
2002:



(i)                  there having been no adverse change or deterioration in the
business, assets, financial or trading positions or profit or prospects of the
Beeson Gregory Group which in any case is material in the context of the Beeson
Gregory Group taken as a whole:



(ii)                no contingent or other liability of any member of the Beeson
Gregory Group having arisen or become apparent or increased which in any case is
material in the context of the Wider Beeson Gregory Group taken as a whole;



(iii)               no material litigation, arbitration proceedings, prosecution
or other legal proceedings to which any member of the Beeson Gregory Group is or
may become a party (whether as plaintiff, defendant or otherwise) having been
threatened, announced, implemented or instituted by or against or remaining
outstanding against or in respect of any member of the Beeson Gregory Group
which in any case is material in the context of the Wider Beeson Gregory Group
taken as a whole.



(iv)              no material enquiry or investigation by, or complaint or
reference to, any Third Party having been threatened, announced, instituted by
or against or remaining outstanding against or in respect of any member of the
Beeson Gregory Group which in any case is material in the context of the Wider
Beeson Gregory Group taken as a whole;



(v)                no circumstances having arisen which would entitle a Third
Party to take patent infringement proceedings against a member of the Beeson
Gregory Group which would be material in the context of the Beeson Gregory Group
taken as a whole;



(vi)              no material agreement to which any member of the Beeson
Gregory Group is a party, and which would be material in the context of the
Beeson Gregory Group taken as a whole, having been terminated by any other party
to any such agreement; or



(l)                  Evolution not having discovered:



(i)                  that any financial or business or other information
concerning the Beeson Gregory Group which is contained in the information
publicly disclosed at any time by or on behalf of any member of the Beeson
Gregory Group to any member of the Evolution Group is materially misleading or
contains any material misrepresentation of fact or omits to state a material
fact necessary to make any information contained therein not materially
misleading and which was not subsequently corrected before 29 May 2002 by public
disclosure to an extent which in any case is material in the context of the
Wider Beeson Gregory Group as a whole; or



(ii)        that any member of the Beeson Gregory Group is subject to any
liability (actual or contingent) except as disclosed in Beeson Gregory's annual
report and accounts for the financial year ended 31 December 2001 or as
otherwise publicly announced by Beeson Gregory (by the delivery of an
announcement to an authorised regulatory information service) prior to 29 May
2002 or otherwise as fairly disclosed by or on behalf of, Beeson Gregory prior
to 29 May 2002 and which in any case is material in the context of the Wider
Beeson Gregory Group taken as a whole;



(m)              Evolution not having discovered:



(i)                  that save as fairly disclosed to Evolution by or on behalf
of the Beeson Gregory prior to 29 May 2002 any past or present member of the
Beeson Gregory Group has not complied with any applicable legislation or
regulations of any jurisdiction with regard to the use, treatment, handling,
storage, transport, release, disposal, discharge, spillage, leak or emission of
any waste or hazardous substance or any substance likely to impair the
environment or harm human health, or otherwise relating to environmental matters
or the health and safety of any person, or that there has otherwise been any
such use, treatment, handling, storage, transport, release, disposal, discharge,
spillage, leak or emission (whether or not this constituted a non-compliance by
any person with any legislation or regulations and wherever the same may have
taken place) which, in any case, would be reasonably likely to give rise to any
liability (whether actual or contingent) or cost on the part of any member of
the Beeson Gregory Group which in any case is material in the context of the
Wider Beeson Gregory Group taken as a whole;



(ii)                that save as fairly disclosed to Evolution by or on behalf
of Beeson Gregory prior to 29 May 2002 there is, or is reasonably likely to be,
any liability, whether actual or contingent, 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 Beeson Gregory Group or any other property
or any controlled waters under any environmental legislation, regulation,
notice, circular, order or other lawful requirement of any relevant authority or
third party or otherwise which in any case is material in the context of the
Wider Beeson Gregory Group taken as a whole; or



(iii)               save as fairly disclosed to Evolution by or on behalf of
Beeson Gregory prior to 29 May 2002 that circumstances exist whereby a person or
class of persons would be reasonably likely to have a claim in respect of any
product or process of manufacture or materials used therein now or previously
manufactured, sold or carried out by any past or present member of the Beeson
Gregory Group which claims would be reasonably likely to have a material and
adverse effect on any member of the Wider Beeson Gregory Group to an extent
which is material in the context of the Wider Beeson Gregory Group taken as a
whole.



For the purpose of these conditions:



(a)        "Third Party" means any government, 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 environmental body or any other
person or body whatsoever in any relevant jurisdiction;



(b)               a Third Party shall be regarded as having "intervened" if it
has taken, instituted, implemented or threatened any action, proceeding, suit,
investigation, enquiry or reference or made, proposed or enacted any statute,
regulation, decision or order or taken any measures or other steps or required
any action to be taken and "intervene" shall be construed accordingly;



(c)                "Authorisations" means authorisations, orders, grants,
recognitions, determinations, certificates, confirmations, consents, licences,
clearances, permissions and approvals.



Subject to the requirements of the Panel, Evolution reserves the right to waive
all or any of the above conditions, in whole or in part, except conditions (a)
to (c).



Conditions (d) to (m) (inclusive) must be fulfilled, be determined by Evolution
to be or remain satisfied or (if capable of waiver) be waived by midnight on the
21st day after the later of the first closing date of the Merger Offer and the
date on which condition (a) is fulfilled (or; in each case, such later date as
the Panel may agree,), failing which the Merger Offer will lapse. Evolution
shall be under no obligation to waive (if capable of waiver), to determine to be
or remain satisfied or to treat as fulfilled any of conditions (d) to (m)
(inclusive) by a date earlier than the latest date specified above for the
fulfilment of that condition.



If the Panel requires Evolution to make an offer for Beeson Gregory Shares under
the provisions of Rule 9 of the City Code, Evolution may make such alterations
to the conditions of the Merger Offer, including to condition (a), as are
necessary to comply with the provisions of that Rule.



The Merger Offer will lapse (unless otherwise agreed by the Panel) if the Merger
is referred to the Competition Commission before the later of 3.00 p.m. on the
first closing date of the Merger Offer and the date when the Merger Offer
becomes or is declared unconditional as to acceptances.



If the Merger Offer lapses it will cease to be capable of further acceptance.
Beeson Gregory Shareholders who have accepted the Merger Offer and Evolution
shall then cease to be bound by acceptances delivered on or before the date on
which the Merger Offer lapses.




                                  APPENDIX III



                BASES OF CALCULATION AND SOURCES OF INFORMATION







(a)               The value placed by the Merger Offer on the entire issued and
to be issued share capital of Beeson Gregory is based on the aggregate of
69,113,140 Beeson Gregory Shares in issue on 29 May 2002 (as sourced from the
Beeson Gregory register of members) and on 5,188,033 shares to be issued under
the Beeson Gregory Share Option Schemes (as sourced from its audited annual
report and accounts for the year ended 31 December 2001 and information from the
Beeson Gregory Directors).



(b)               The percentage ownership of the Enlarged Group held by
Evolution Shareholders and Beeson Gregory Shareholders is based on the enlarged
issued and to be issued share capital of Evolution following the Merger Offer,
being the aggregate of the 118,222,439 Evolution Shares in issue on 29 May 2002
(as sourced from the Evolution register of members) and the 13,525,193 shares to
be issued under the Evolution Share Option Schemes (as sourced from its audited
annual report and accounts for the year ended 31 December 2001 and information
from the Evolution Directors)  and the 131,513,076 New Evolution Shares to be
issued pursuant to the Merger Offer (on the assumption of full exercise of the
options granted under the Ben Nevis Share Option Schemes).



(c)               The financial information relating to Evolution is extracted
from its audited annual report and accounts for the year ended 31 December 2001.



(d)               The financial information relating to Beeson Gregory is
extracted from its audited annual report and accounts for the year ended 31
December 2001.



(e)        The combined cash of Evolution and Beeson Gregory is an aggregate of
the cash of each group as extracted from their respective management accounts
for the month  ended 30 April 2002.



(f)                 The closing prices of Evolution Shares and Beeson Gregory
Shares are derived from the London Stock Exchange Daily Official List.








                                  APPENDIX IV



                                  DEFINITIONS



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


"Act"                                                the Companies Act 1985, as amended


"Admission"                                          the admission of the New Evolution Shares to trading
                                                     on AIM becoming effective in accordance with the AIM
                                                     Rules and dealings in the New Evolution Shares
                                                     commencing on AIM


"AIM Admission Document"                             the AIM admission document of Evolution to be issued
                                                     within 28 days of this announcement


"AIM"                                                the Alternative Investment Market of the London Stock
                                                     Exchange


"AIM Rules"                                          the AIM Admission Rules published by the London Stock
                                                     Exchange as in force at the date of this announcement
                                                     or, where the context requires, as amended or modified
                                                     after the date of this announcement


"Altium Capital"                                     Altium Capital Limited


"Beeson Gregory"                                     Beeson Gregory Group plc


"Beeson Gregory Board" or                            the directors of Beeson Gregory

"Beeson Gregory Directors"


"Beeson Gregory Group"                               Beeson Gregory and its subsidiaries and subsidiary
                                                     undertakings


"Beeson Gregory Shareholders"                        holders of Beeson Gregory Shares


"Beeson Gregory Share Option                         the Beeson Gregory Share Option Scheme 1994, the
                                                     Beeson Gregory Executive Share  Incentive Scheme 1996,
Scheme"                                              the Beeson Gregory Discretionary Share Option Scheme
                                                     2000, the Beeson Gregory Deferred Share Bonus Plan,
                                                     the Beeson Gregory Conditional Share Plan and the four
                                                     individual option agreements entered into in March
                                                     2000 with executives of Index IT Partnership Limited
                                                     (a subsidiary of Beeson Gregory)


"Beeson Gregory Shares"                              the existing unconditionally allotted or issued fully
                                                     paid ordinary shares of 5 pence each in the share
                                                     capital of Beeson Gregory and any further such shares
                                                     which are unconditionally allotted or issued at or
                                                     before the time at which the Merger Offer ceases to be
                                                     open for acceptance (or such earlier date and/or time,
                                                     not being earlier than the date on which the Merger
                                                     Offer becomes or is declared unconditional as to
                                                     acceptances or, if later, the first closing date of
                                                     the Merger Offer, as Evolution, may subject to the
                                                     City Code, decide)


"certificated" or "in certificated form"             not in uncertificated form (that is, not in CREST)


"Christows"                                          Christows Limited


"Circular"                                           the circular addressed to Evolution Shareholders to be
                                                     issued within 28 days of this announcement


"City Code" or "Code"                                the City Code on Takeovers and Mergers


"Closing Price"                                      the closing middle-market price of a Beeson Gregory
                                                     Share or an Evolution Share, as the case may be, as
                                                     derived from the Daily Official List


"CREST"                                              the United Kingdom paperless share settlement system
                                                     of which CRESTCo is the Operator (as such term is
                                                     defined in the Uncertificated Securities Regulations
                                                     2001 (SI 2001 No. 3755)


"CRESTCo"                                            CRESTCo Limited


"Daily Official List"                                the Daily Official List of the London Stock Exchange


"Enlarged Group"                                     Evolution or the Evolution Group (as the context
                                                     requires) as enlarged by the Merger


"Evolution"                                          The Evolution Group Plc


"Evolution Board" or Evolution Directors"            the directors of Evolution


"Evolution Capital"                                  Evolution Capital Limited


"Evolution Group"                                    Evolution and its subsidiaries and subsidiary
                                                     undertakings


"Evolution Shareholders"                             holder of Evolution Shares


"Evolution Share Option Schemes"                     the  Evolution  Executive  Share  Option  Scheme
                                                     adopted in November 2000, the Evolution 2001 Executive
                                                     Share Option Scheme adopted in June 2001, the
                                                     Evolution Share Incentive Plan adopted in March 2002
                                                     and the individual options granted to Alex Snow and
                                                     Andrew Beeton on 14 December 2000


"Evolution Shares"                                   the existing issued and fully paid ordinary shares
                                                     with a nominal value of 1  pence each in the share
                                                     capital of Evolution


"FSMA"                                               the Financial Services and Markets Act 2000


"Form of Acceptance"                                 the form of acceptance relating to the Merger Offer


"IFA"                                                Independent Financial Adviser


"Inland Revenue"                                     the UK Inland Revenue


"IP"                                                 intellectual property


"IP2IPO"                                             IP2IPO Group Limited, Beeson Gregory's intellectual
                                                     property business which aims to establish long-term
                                                     partnerships with universities and similar
                                                     institutions so as to become a stakeholder in their
                                                     intellectual property


"Listing Rules"                                      the rules and regulations made by the Financial
                                                     Services Authority under FSMA, and contained in the
                                                     Financial Services Authority's publication of the same
                                                     name


"London Stock Exchange"                              London Stock Exchange plc


"Merger"                                             the proposed merger of Evolution and Beeson Gregory by
                                                     way of the Merger Offer


"Merger Offer"                                       the recommended offer to be made by Altium Capital on
                                                     behalf of Evolution to acquire the Beeson Gregory
                                                     Shares on the terms and subject to the conditions to
                                                     be set out in the Offer Document including,  where the
                                                     context requires, any subsequent revision, variation,
                                                     extension or renewal of such offer


"New Evolution Shares"                               the new ordinary shares with a nominal value of 1
                                                     pence each in the share capital of Evolution proposed
                                                     to be issued fully paid pursuant to the Merger Offer


"Offer Document"                                     the offer document to be sent to Beeson Gregory
                                                     Shareholders (and for information) to holders of
                                                     options under the Beeson Gregory Share Option Schemes
                                                     within 28 days of this announcement


"Official List"                                      the Official List of the UKLA


"Panel"                                              the Panel on Takeovers and Mergers


"Proposed Directors"                                 Andrew Beeson, David Norwood, Sir Malcolm Field and
                                                     George Loudon, being the Beeson Gregory Directors that
                                                     will be joining the Board of the Enlarged Group


"Securities Act"                                     the United States Securities Act of 1933, as amended


"UBS Warburg"                                        UBS Warburg Ltd.


"UKLA"                                               the Financial Services Authority acting in its
                                                     capacity as the competent authority for the purposes
                                                     of Part VI of FSMA and in the exercise of its
                                                     functions in respect of admission to the Official List


"uncertified" or "in uncertified form"               recorded on the relevant register of the share or
                                                     security concerned as being held in uncertificated
                                                     form in CREST, and title to which, by virtue of the
                                                     Uncertificated Securities Regulations 2001, may be
                                                     transferred by means of CREST


"United Kingdom" or "UK"                             the United Kingdom of Great Britain and Northern
                                                     Ireland


"US", "USA" or "United States"                       the United States of America, its territories and
                                                     possessions, any State of the United States, and the
                                                     District of Columbia and all other areas subject to
                                                     its jurisdiction


"US Person"                                          a US person as defined in Rule 902 under the
                                                     Securities Act


"Wider Beeson Gregory Group"                         any member of the Beeson Gregory Group or any company,
                                                     partnership, joint venture, firm or other body
                                                     corporate in which any member of the Beeson Gregory
                                                     Group may be interested


"Wider Evolution Group"                              any member of the Evolution Group or any company,
                                                     partnership, joint venture, firm or other body
                                                     corporate in which any member of the Evolution Group
                                                     may be interested





For the purposes or this document "subsidiary undertaking", "parent undertaking"
and "associated undertaking" have the respective meanings given to them by the
Act (but for these purposes ignoring paragraph 20(1)(b) of Schedule 4A to the
Act).



Terms defined in the CREST manual, shall unless the context otherwise requires,
bear the same meanings where used herein.







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