Rec. Cash Offer for Reg Vardy

Pendragon PLC
05 December 2005

Not for release, publication or distribution, in whole or part, in, into or from
                 the United States, Canada, Australia or Japan.


For immediate release                                            3 December 2005



                             RECOMMENDED CASH OFFER


                                       by


                        CITIGROUP GLOBAL MARKETS LIMITED


                                  on behalf of


                          PENDRAGON PLC ('PENDRAGON')


                                      for


                          REG VARDY PLC ('REG VARDY')


Summary



•         The Boards of Pendragon and Reg Vardy announce that they have agreed
the terms of a recommended cash offer for the whole of the issued and to be
issued share capital of Reg Vardy.

•         The Offer of 800 pence in cash for each Reg Vardy share values the
entire issued share capital of Reg Vardy at approximately £450 million.

•         The Offer represents a premium of:

          •         21 per cent. to the Closing Price of 662 pence per Reg Vardy
          Share on 15 November 2005, being the last business day prior to the 
          announcement by Reg Vardy that it had received an approach from 
          Pendragon; and

          •         43 per cent. to the average closing price of 558 pence per 
          Reg Vardy Share for the six months prior to 15 November 2005, being 
          the last business day prior to the announcement by Reg Vardy that it 
          had received an approach from Pendragon.

•         Pendragon has received irrevocable undertakings from the Reg Vardy
Directors and from certain persons connected to them to accept the Offer in
respect of 15,291,007 Reg Vardy Shares, representing approximately 27.2 per
cent. of the existing issued share capital of Reg Vardy.  These irrevocable
undertakings will only cease to be binding in the event that the Offer lapses or
is withdrawn.

•         Sir Peter Vardy has agreed to enter into an arrangement which would
allow Pendragon to acquire, at its option, 9,348,111 Reg Vardy Shares,
representing 16.6 per cent. of the existing issued share capital of Reg Vardy,
at the Offer Price of 800 pence per share.

•         The Reg Vardy Directors, who have been so advised by their financial
adviser, Dresdner Kleinwort Wasserstein, consider the terms of the Offer to be
fair and reasonable.  In giving advice to the Reg Vardy Directors, Dresdner
Kleinwort Wasserstein has taken into account the commercial assessments of the
Reg Vardy Directors.  Accordingly, the Reg Vardy Directors intend unanimously to
recommend Reg Vardy Shareholders to accept the Offer.

•         The Offer is a Class 1 transaction for Pendragon under the Listing
Rules and is therefore conditional, inter alia, on the approval by Pendragon
Shareholders of the Offer at an extraordinary general meeting.  The Directors of
Pendragon will unanimously recommend Pendragon Shareholders to vote in favour of
the necessary resolution.


Commenting on the Offer, Sir Nigel Rudd, Chairman of Pendragon, said:


'Pendragon has pursued a strategy of growth through significant acquisitions and
consistent with this we are pleased to announce this recommended offer for Reg
Vardy.  We believe that the combination of the two companies will strengthen
relationships with principal manufacturer partners, lead to improved returns for
our shareholders and provide greater opportunities within the enlarged group for
all team members.'


John F Standen, Chairman of Reg Vardy, said:


'Pendragon's offer represents an attractive price for Reg Vardy Shareholders.
Also, it reflects the considerable contribution of all the Reg Vardy colleagues
over many years to create a major force in UK motor retailing.  It should
provide the opportunity for the Reg Vardy colleagues and customers to benefit
from being stakeholders in what would undoubtedly be the UK's largest motor
retailing group in a fast changing market place.'


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


ENQUIRIES


Pendragon PLC                            Reg Vardy plc
Trevor Finn, Chief Executive             Sir Peter Vardy, Chief Executive
David Forsyth, Finance Director          Robert Forrester, Managing Director
Telephone: [phone]

Citigroup Global Markets Limited         Dresdner Kleinwort Wasserstein Limited
(Financial adviser and corporate         (Financial adviser and corporate broker
broker to Pendragon)                      to Reg Vardy)
Philip Robert-Tissot                     Charles Batten
Sam Small                                Michael Covington
Chris Zeal (Corporate Broking)           Telephone: [phone]
Telephone: [phone]

Finsbury Group                           Financial Dynamics
(Public relations adviser to Pendragon)  (Public relations adviser to Reg Vardy)
Rupert Younger                           Jonathon Brill            07836 622 683
Gordon Simpson                           Billy Clegg               07977 578 153
Telephone: [phone]



Citigroup Global Markets Limited, which is authorised and regulated in the
United Kingdom by the Financial Services Authority, is acting exclusively for
Pendragon and for no one else in connection with the Offer and will not be
responsible to any other person for providing the protections afforded to
clients of Citigroup Global Markets Limited or for providing advice in relation
to the Offer.


Dresdner Kleinwort Wasserstein Limited, which is authorised and regulated in the
United Kingdom by the Financial Services Authority, is acting for Reg Vardy and
for no one else in connection with the Offer and will not be responsible to
anyone other than Reg Vardy for providing the protections afforded to clients of
Dresdner Kleinwort Wasserstein Limited or for providing advice in relation to
the Offer.


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


The Offer is not being and will not be made, directly or indirectly, in or into,
or by use of the mails of, or by any means or instrumentality (including,
without limitation, facsimile transmission, electronic mail, telex or telephone)
of interstate or foreign commerce of, or any facilities of a national securities
exchange of, the United States, Canada, Australia or Japan and the Offer will
not be capable of acceptance by any such use, means, instrumentality or
facility, directly or indirectly from or within the United States, Canada,
Australia or Japan.


Dealing disclosure requirements


Under the provisions of Rule 8.3 of the City Code, if any person is, or becomes,
'interested' (directly or indirectly) in 1% or more of any class of 'relevant
securities' of Reg Vardy, all 'dealings' in any 'relevant securities' of Reg
Vardy (including by means of an option in respect of, or a derivative referenced
to, any such 'relevant securities') must be publicly disclosed by no later than
3.30pm (London time) on the London business day following the date of the
relevant transaction.  This requirement will continue until the date on which
the offer becomes, or is declared, unconditional as to acceptances, lapses or is
otherwise withdrawn or on which the 'offer period' otherwise ends.  If two or
more persons act together pursuant to an agreement or understanding, whether
formal or informal, to acquire an 'interest' in 'relevant securities' of Reg
Vardy, they will be deemed to be a single person for the purpose of Rule 8.3.


Under the provisions of Rule 8.1 of the Code, all 'dealings' in 'relevant
securities' of Reg Vardy by Pendragon or Reg Vardy, or by any of their
respective 'associates', must be disclosed by no later than 12.00 noon (London
time) on the London business day following the date of the relevant transaction.


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


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


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


Not for release, publication or distribution, in whole or part, in, into or from
                 the United States, Canada, Australia or Japan.


For immediate release                                            3 December 2005



                             RECOMMENDED CASH OFFER


                                       by


                        CITIGROUP GLOBAL MARKETS LIMITED


                                  on behalf of


                                 PENDRAGON PLC


                                      for


                                 REG VARDY PLC



1.      Introduction


The boards of Pendragon and Reg Vardy announce that they have reached agreement
on the terms of a recommended cash offer to be made by Citigroup on behalf of
Pendragon to acquire the whole of the issued and to be issued share capital of
Reg Vardy.  The Offer values each Reg Vardy Share at 800 pence and Reg Vardy's
entire issued share capital at approximately £450 million.


Pendragon has received irrevocable undertakings to accept the Offer from certain
Reg Vardy Shareholders in respect of a total of 15,291,007 Reg Vardy Shares
representing approximately 27.2 per cent. of the existing issued share capital
of Reg Vardy.


Sir Peter Vardy has agreed to enter into an arrangement which would allow
Pendragon to acquire, at its option, 9,348,111 Reg Vardy Shares, representing
16.6 per cent. of the existing share capital of Reg Vardy, at the Offer Price of
800 pence per share.


The Offer is a Class 1 transaction for Pendragon under the Listing Rules and is
therefore conditional, inter alia, on the approval by Pendragon Shareholders of
the Offer at an extraordinary general meeting to be held shortly.


2.      Recommendation of the Reg Vardy Board


The Reg Vardy Directors, who have been so advised by their financial adviser,
Dresdner Kleinwort Wasserstein, consider the terms of the Offer to be fair and
reasonable.  In giving advice to the Reg Vardy Directors, Dresdner Kleinwort
Wasserstein has taken into account the commercial assessments of the Reg Vardy
Directors.  Accordingly, the Reg Vardy Directors intend unanimously to recommend
that Reg Vardy Shareholders should accept the Offer, as they intend to do so in
respect of their entire holdings, and the holdings of certain persons connected
with them, amounting to an aggregate of 13,244,820 Reg Vardy Shares,
representing approximately 23.5 per cent. of Reg Vardy's existing issued share
capital.


3.      The Offer


On behalf of Pendragon, Citigroup will offer to acquire, on the terms and
subject to the conditions to be set out in the Offer Document and in the
accompanying Form of Acceptance, the entire issued and to be issued share
capital of Reg Vardy on the following basis:


   for each Reg Vardy Share                                800 pence in cash


The Offer values the entire existing issued share capital of Reg Vardy at
approximately £450 million.


The Offer represents a premium of:

•         21 per cent. to the Closing Price of 662 pence per Reg Vardy Share
on 15 November 2005, being the last business day prior to the announcement by
Reg Vardy that it had received an approach from Pendragon; and

•         43 per cent. to the average closing price of 558 pence per Reg Vardy
Share for the six months prior to 15 November 2005, being the last business day
prior to the announcement by Reg Vardy that it had received an approach from
Pendragon.


The Reg Vardy Shares will be acquired by Pendragon fully paid up and free from
all liens, equitable interests, charges, encumbrances, rights of pre-emption and
other third party rights or interests and together with all rights now or
hereafter attaching thereto, including the right to receive and retain all
dividends and other distributions (if any) declared, made or paid on or after
the date hereof.


The Offer will extend to any Reg Vardy Shares which are unconditionally allotted
or issued fully paid (or credited as fully paid) prior to the date on which the
Offer closes (or such earlier date as Pendragon may, subject to the City Code
and/or with the consent of the Panel, determine, being not 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) pursuant to the exercise of options
under the Reg Vardy Share Option Schemes or otherwise.  The Offer will initially
be open for acceptance for a period of 21 days following the posting of the
Offer Document but may be extended in accordance with the provisions of the City
Code.


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


4.      Irrevocable undertakings and call option


Pendragon has received irrevocable undertakings to accept the Offer from each of
the Reg Vardy Directors who own Reg Vardy Shares in respect of their entire
holdings of Reg Vardy Shares and the holdings of certain persons connected with
them comprising, in aggregate, 15,291,007 Reg Vardy Shares (of which 10,379,962
are held beneficially and 4,911,045 are non-beneficial holdings), representing
approximately 27.2 per cent. of the entire existing issued share capital of Reg
Vardy.  These irrevocable undertakings will lapse only in the event of the Offer
lapsing or being withdrawn.


Sir Peter Vardy has agreed to enter into an arrangement which would allow
Pendragon to acquire, at its option, 9,348,111 Reg Vardy Shares, representing
16.6 per cent. of the existing issued share capital of Reg Vardy, at the Offer
Price of 800 pence per share.


Further details of these undertakings, including the circumstances in which they
may cease to be binding, are set out in Appendix II to this announcement.


5.      Background to and reasons for the Offer


(i) Background


The changes to the Block Exemption rules in 2003 have enabled Pendragon to
pursue with more confidence its stated strategy of growing its business with
selected manufacturer partners.  The Block Exemption rules introduced the
following principal advantages for large dealer groups such as Pendragon:

•         greater certainty and opportunity for motor dealers to build value
within their franchises as manufacturers are no longer able to terminate
franchise agreements without clear and objective reasons.  This allows dealers
to take a longer term view and to build value in their businesses;

•         the ability to acquire franchised dealerships without prior approval
from manufacturers provided that the acquirer already has at least one
franchised dealership of the particular brand;

•         the ability to source parts from the original manufacturer rather
than from the vehicle manufacturer;

•         greater ability to have more than one franchise on a single site;
and

•         the ability to operate as a stand-alone authorised service and
repair provider.


In 2004, Pendragon successfully acquired the then second largest dealer group in
the UK, CD Bramall.  That business has been successfully integrated with
Pendragon's business over the past 22 months.  During the period since the CD
Bramall acquisition, Pendragon has also made a number of small dealership
purchases and added different franchises to some of its existing sites.


Pendragon has structured its organisation for growth by focusing its management
on individual franchises and by investing in the development and implementation
of its in-house software and technology systems.  Pendragon believes that it is
well positioned to participate actively in the consolidation of the motor
retailing industry in the UK.  Pendragon believes that its ability to optimise
the benefits of scale of any acquisition will be enhanced through efficiencies
gained by the use of in-house technology systems which enable effective
management and control of all aspects of its business.


(ii) Reasons for the Offer


The Offer for Reg Vardy is consistent with Pendragon's stated strategy of
increasing its scale with a select number of manufacturing partners.  The
acquisition last year of CD Bramall was an important step towards this strategy
and the Offer for Reg Vardy advances Pendragon further in that direction.


Pendragon expects to benefit from economies of scale in both its cost base and
in purchasing as the new business is integrated.  It believes that there will be
duplicated costs which can be eliminated, such as costs associated with Reg
Vardy's listed company status.  Increased scale also enables the spreading of
costs incurred in the development of information technology and placing of
advertising across the Enlarged Pendragon Group.


The Pendragon Directors believe that the Acquisition will be immediately
earnings enhancing (although this statement should not be interpreted to mean
that the earnings per share of the Enlarged Pendragon Group will necessarily be
greater than or equal to those of prior years).


Upon the Offer becoming or being declared unconditional in all respects,
Pendragon's borrowings will increase considerably.  The Pendragon Directors are
satisfied with the Enlarged Pendragon Group's ability to meet repayments as they
fall due and expect borrowings to decrease as a result of, inter alia, the
strong operating cash flows of the Enlarged Pendragon Group, working capital
efficiencies and the sale and lease back of certain properties.


The Pendragon Directors believe that they have demonstrated over recent history
their ability to manage substantial acquisitions and subsequently integrate the
enlarged entity.  This was most recently shown by the acquisition last year of
CD Bramall and before this by the businesses bought from Lex Service in 1998 and
2000 and the acquisition of Evans Halshaw in 1999.  In each of these cases,
Pendragon's borrowings increased significantly, but management was able quickly
to return the Group to its ongoing target borrowing levels.



6.      Information on Reg Vardy


The Reg Vardy Group is one of the UK's largest motor vehicle retailers with a
total of 97 franchises from 98 outlets and is also involved in leasing, contract
hire and rental of vehicles.  Reg Vardy's car division includes franchises with
Aston Martin, BMW, Citroen, Fiat, Ford, Jaguar, Kia, Land Rover, Mercedes-Benz,
Nissan, Renault, Vauxhall and Volkswagen.


For the year ended 30 April 2005 (on a UK GAAP basis), Reg Vardy's consolidated
annual turnover was £1,717.9 million (2004: £1,610.4 million) and profit before
tax was £43.8 million (2004: £45.6 million).  As at 30 April 2005, the gross
assets of the Reg Vardy Group were £555.0 million and net assets of the Reg
Vardy Group were £205.5 million.


7.      Information on Pendragon


The Pendragon Group is one of the largest UK motor car retailers, operating a
total of 287 franchises from 230 outlets in the UK and 22 franchises from 15
outlets overseas.  Pendragon has motor car franchises for Alfa Romeo, Aston
Martin, BMW, Cadillac, Chevrolet, Chrysler Jeep, Daihatsu, Ferrari, Fiat, Ford,
Honda, Hyundai, Isuzu, Iveco, Kia, Jaguar, Land Rover, LDV, Lotus, Maserati,
Mercedes-Benz, MINI, Nissan, Peugeot, Porsche, Saab, smart, Subaru, Suzuki,
Vauxhall and Volvo, together with franchises for Japanese and American motor
cycles and heavy commercial vehicles.  In addition to retailing new and used
motor vehicles, Pendragon provides aftersales services and vehicle contract hire
and leasing.  Pendragon also sells software products to the motor trade, mainly
through its subsidiary, Pinewood Technologies PLC.


Pendragon primarily operates in the UK but also has motor car retailing
businesses in Germany and the USA.


For the year ended 31 December 2004 (on a UK GAAP basis), Pendragon Group's
consolidated annual turnover was £3,173.2 million (2003: £1,841.6 million) and
profit before tax was £65.0 million (2003: £44.3 million).  As at 31 December
2004, the gross assets of the Pendragon Group were £1,240.3 million and net
assets of the Pendragon Group were £179.3 million.


The Pendragon Group announced its interim results for the six month period ended
30 June 2005 on 4 August 2005.  In those interim results, the Pendragon Group
reported (on an IFRS basis) for the six months to 30 June 2005 turnover of
£1,751.2 million (2004: £1,598.4 million), operating profit of £55.2 million
(2004: £53.7 million), profit on ordinary activities before taxation of £35.3
million (2004: £38.1 million) and earnings per share of 19.7 pence (2004: 21.3
pence).


8.      Current trading and prospects for the Pendragon Group


In its interim results for the six month period ended 30 June 2005, the
Pendragon Group stated that the then latest industry forecast for 2005 new car
registrations in the UK was down 4.6 per cent. on 2004 levels.  Since then, the
market has continued to weaken.  This is due primarily to a slowdown in the
corporate market, which represents 55 per cent. of the new car market.  During
the first half of 2005, the corporate market traded at levels which were
consistent with the prior period.  However, sales to the corporate market have
declined during the second half of the year.  Industry forecasts for 2005 new
car registrations in the UK are now 5.2 per cent. below those for 2004.


The Pendragon Directors expect that for the remainder of the current financial
year, trading will be broadly in line with expectations and that consumer
confidence will remain at current levels throughout 2006.  The Pendragon
Directors do not envisage any up turn in the new car market in the next year.




9.      Management and employees


The Pendragon Board has confirmed that, following the Offer becoming or being
declared unconditional in all respects, the existing employment rights,
including pension rights, of all the employees of Reg Vardy will be fully
safeguarded.  The Pendragon Board will, following the Offer becoming or being
declared unconditional in all respects, assume full responsibility for the
management of the business currently carried on by the Reg Vardy Board.


10.  Inducement fee


In consideration of, and as an inducement to, Pendragon making the Offer, Reg
Vardy has agreed to pay to Pendragon an inducement fee of £4.55 million in
certain limited circumstances, including if an independent competing offer is
announced prior to the offer lapsing or being withdrawn and which subsequently
becomes unconditional in all respects or is completed.  This agreement is
described in further detail in Appendix II to this announcement.


11.  Reg Vardy Share Option Schemes


The Offer will extend to any Reg Vardy Shares which are issued or
unconditionally allotted fully paid (or credited as fully paid) before the date
on which the Offer closes (or such earlier date as Pendragon may, subject to the
City Code, determine being not earlier than the date on which the Offer becomes
or is declared wholly unconditional as to acceptances or, if later, the First
Closing Date) pursuant to the exercise of options granted under the Reg Vardy
Share Option Schemes.


To the extent that options under the Reg Vardy Share Option Schemes are not
exercised before the date on which the Offer closes, and if the Offer becomes or
is declared unconditional in all respects, Pendragon will make appropriate
proposals to Reg Vardy Option Holders in due course.


12.  Financing the Offer


The Offer will be fully funded through a combination of cash in hand and
drawings under new committed facilities of £700 million underwritten by the
Royal Bank of Scotland plc.


13.  Compulsory acquisition, delisting and cancellation of trading


If the Offer becomes or is declared unconditional in all respects, it is the
intention of Pendragon, assuming it becomes so entitled, to acquire compulsorily
any outstanding Reg Vardy Shares pursuant to the provisions of sections 428 to
430F (inclusive) of the Act.


Following the Offer becoming or being declared unconditional in all respects and
sufficient acceptances being received, Pendragon intends to procure that Reg
Vardy will apply for the cancellation of the listing of the Reg Vardy Shares on
the Daily Official List and trading on the London Stock Exchange's market for
listed securities.  It is anticipated that such cancellation will take effect no
earlier than 20 business days after Pendragon has acquired or agreed to acquire
75 per cent. of the voting rights attending to the Reg Vardy Shares.  It is also
proposed that resolutions will be proposed to re-register Reg Vardy as a private
company.  De-listing is likely to reduce significantly the liquidity and
marketability of any Reg Vardy Shares in respect of which the Offer has not been
accepted.


14.  Pendragon Extraordinary General Meeting


The Offer is a Class 1 transaction for Pendragon under the Listing Rules and is
therefore conditional, inter alia, on the approval by Pendragon Shareholders of
the Offer and its funding at an extraordinary general meeting.  Accordingly, a
circular convening the extraordinary general meeting will be posted to Pendragon
Shareholders as soon as practicable.  All Pendragon Directors intend to vote in
favour of the necessary resolutions in respect of beneficial holdings of, in
aggregate, 6,971,438 Pendragon Shares (representing approximately 5.3 per cent.
of the existing ordinary share capital of Pendragon).


15.  General


Your attention is drawn to the further information contained in the Appendices
which form part of this announcement.


The full text of the conditions and certain further terms of the Offer set out
in Appendix I to this announcement form part of and should be read in
conjunction with this announcement.


Appendix II to this announcement provides details of additional information
regarding the Offer, including the basis of calculations and sources of certain
information included in this announcement.


Appendix III to this announcement contains definitions of the terms used in this
announcement.


The Offer will be subject to the applicable requirements of the Code.  The Offer
Document and Form of Acceptance setting out in full the terms and conditions of
the Offer will be dispatched to Reg Vardy Shareholders as soon as possible.


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


ENQUIRIES


Pendragon PLC                            Reg Vardy plc
Trevor Finn, Chief Executive             Sir Peter Vardy, Chief Executive
David Forsyth, Finance Director          Robert Forrester, Managing Director
Telephone: [phone]

Citigroup Global Markets Limited         Dresdner Kleinwort Wasserstein Limited
(Financial adviser and corporate         (Financial adviser and corporate broker
broker to Pendragon)                      to Reg Vardy)
Philip Robert-Tissot                     Charles Batten
Sam Small                                Michael Covington
Chris Zeal (Corporate Broking)           Telephone: [phone]
Telephone: [phone]

Finsbury Group                           Financial Dynamics
(Public relations adviser to Pendragon)  (Public relations adviser to Reg Vardy)
Rupert Younger                           Jonathon Brill            07836 622 683
Gordon Simpson                           Billy Clegg               07977 578 153
Telephone: [phone]



Citigroup Global Markets Limited, which is authorised and regulated in the
United Kingdom by the Financial Services Authority, is acting exclusively for
Pendragon and for no one else in connection with the Offer and will not be
responsible to any other person for providing the protections afforded to
clients of Citigroup Global Markets Limited or for providing advice in relation
to the Offer.


Dresdner Kleinwort Wasserstein Limited, which is authorised and regulated in the
United Kingdom by the Financial Services Authority, is acting for Reg Vardy and
for no one else in connection with the Offer and will not be responsible to
anyone other than Reg Vardy for providing the protections afforded to clients of
Dresdner Kleinwort Wasserstein Limited or for providing advice in relation to
the Offer.


The Offer is not being and will not be made, directly or indirectly, in or into,
or by use of the mails of, or by any means or instrumentality (including,
without limitation, facsimile transmission, electronic mail, telex or telephone)
of interstate or foreign commerce of, or any facilities of a national securities
exchange of, the United States, Canada, Australia or Japan and the Offer will
not be capable of acceptance by any such use, means, instrumentality or
facility, directly or indirectly from or within the United States, Canada,
Australia or Japan.


Dealing disclosure requirements


Under the provisions of Rule 8.3 of the City Code, if any person is, or becomes,
'interested' (directly or indirectly) in 1% or more of any class of 'relevant
securities' of Reg Vardy, all 'dealings' in any 'relevant securities' of Reg
Vardy (including by means of an option in respect of, or a derivative referenced
to, any such 'relevant securities') must be publicly disclosed by no later than
3.30pm (London time) on the London business day following the date of the
relevant transaction.  This requirement will continue until the date on which
the offer becomes, or is declared, unconditional as to acceptances, lapses or is
otherwise withdrawn or on which the 'offer period' otherwise ends.  If two or
more persons act together pursuant to an agreement or understanding, whether
formal or informal, to acquire an 'interest' in 'relevant securities' of Reg
Vardy, they will be deemed to be a single person for the purpose of Rule 8.3.


Under the provisions of Rule 8.1 of the Code, all 'dealings' in 'relevant
securities' of Reg Vardy by Pendragon or Reg Vardy, or by any of their
respective 'associates', must be disclosed by no later than 12.00 noon (London
time) on the London business day following the date of the relevant transaction.


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


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


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


                                   Appendix I


               Conditions and certain Further Terms of the Offer



PART A: CONDITIONS OF THE OFFER


The Offer will be subject to the following conditions:


(a)        valid acceptances being received (and not, where permitted,
withdrawn) by not later than 3.00pm on the First Closing Date (or such later
time(s) and/or date(s) as Pendragon may, subject to the rules of the Code or
with the consent of the Panel, decide) in respect of not less than 90 per cent.
(or such lesser percentage as Pendragon may decide) in nominal value of the Reg
Vardy Shares to which the Offer relates, provided that this condition will not
be satisfied unless Pendragon and/or any of its wholly-owned subsidiaries shall
have acquired or agreed to acquire, whether pursuant to the Offer or otherwise,
Reg Vardy Shares carrying, in aggregate, more than 50 per cent. of the voting
rights then normally exercisable at a general meeting of Reg Vardy, including
for this purpose, to the extent (if any) required by the Panel, any such voting
rights attaching to any Reg Vardy Shares that are unconditionally allotted or
issued before the Offer becomes or is declared unconditional as to acceptances,
whether pursuant to the exercise of any outstanding conversion or subscription
rights or otherwise; and for this purpose:


(i) the expression 'Reg Vardy Shares to which the Offer relates' shall be
construed in accordance with sections 428-430F of the Act; and


(ii) Reg Vardy Shares that have been unconditionally allotted shall be deemed to
carry the voting rights that they will carry upon issue;


(b)        the passing at an extraordinary general meeting of Pendragon (or at
any adjournment thereof) of a resolution to approve, fund, implement and effect
the Offer and the acquisition of any Reg Vardy Shares;


(c)        no relevant authority having intervened in a way that would or might
reasonably:


(i) make the Offer or its implementation or the acquisition by the Offeror or
any member of the Pendragon Group of any shares or other securities in, or
control of, Reg Vardy, void, illegal or unenforceable or directly or indirectly
restrict, restrain, prohibit, delay or otherwise materially interfere with the
implementation of, or impose additional material conditions or obligations with
respect to, or otherwise materially challenge, the Offer or the acquisition of
any shares or other securities in, or control of, Reg Vardy by the Offeror or
any member of the Pendragon Group; or


(ii) require, impede, delay or prevent the divestiture, or alter the terms of
any proposed divestiture, by any member of the wider Reg Vardy Group or by any
member of the wider Pendragon Group of all or any portion of their respective
businesses (or any of them), assets or property or impose any limitation on the
ability of any of them to conduct their respective businesses or to own or
continue to enjoy the benefits currently enjoyed in relation to their respective
assets or property or any part of them in any such case to an extent which is
material in the context of the wider Reg Vardy Group or the wider Pendragon
Group; or


(iii) impose any limitation on, or result in a delay in the ability of, any
member of the wider Reg Vardy Group or the wider Pendragon Group to acquire or
to hold or effectively to exercise (whether directly or indirectly) all or any
rights of ownership of shares or other securities (or the equivalent) in, or
management control over, any member of the wider Reg Vardy Group in any such
case to an extent which is material in the context of the wider Reg Vardy Group
or the wider Pendragon Group; or


(iv) except as required pursuant to the Code require any member of the wider
Pendragon Group or the wider Reg Vardy Group to offer to acquire any shares or
other securities (or the equivalent) or interest in any member of the wider Reg
Vardy Group and the Pendragon Group owned by any third party; or


(v) require the divestiture by any member of the wider Pendragon Group of any
shares or other securities in Reg Vardy; or


(vi) impose any limitation on the ability of any member of the wider Reg Vardy
Group or the wider Pendragon Group to co-ordinate their respective businesses,
or any part of them, with the businesses of any other member of the wider Reg
Vardy Group or the wider Pendragon Group in any such case to an extent which is
material in the context of the wider Reg Vardy Group or the wider Pendragon
Group; or


(vii) otherwise materially and adversely affect the business, financial
position, profits or prospects of any member of the wider Pendragon Group or of
any member of the wider Reg Vardy Group;


and all applicable waiting and other time periods during which any relevant
authority could intervene having expired, lapsed or terminated;


(d)        all necessary filings having been made to relevant authorities,
clearances obtained from relevant authorities and all appropriate waiting and
other time periods under any applicable legislation or regulations in any
jurisdiction having expired, lapsed or been terminated and all authorisations
necessary for, or in respect of, the Offer or the proposed acquisition of any
shares or other securities in, or control of, Reg Vardy by any member of the
wider Pendragon Group or the carrying on by any member of the wider Reg Vardy
Group or the wider Pendragon Group of its business having been obtained, in
terms and in a form satisfactory to Pendragon (acting reasonably), from all
relevant authorities and all such authorisations remaining in full force and
effect and there has not been received any notice or intimation of an intention
to revoke, or not to renew, any of the same and all applicable statutory or
regulatory obligations in any jurisdiction having been complied with in all
material respects;


(e)        save as disclosed in the Reg Vardy annual report and accounts for the
year ended 30 April 2005 ('Reg Vardy's Financial Results') and/or as publicly
announced by Reg Vardy by notifying a Regulatory Information Service on or prior
to 2 December 2005 ('publicly announced') and/or as disclosed in writing to
Pendragon on or prior to 2 December 2005 ('disclosed to Pendragon') there being
no provision of any arrangement, agreement, licence, permit, franchise or other
instrument to which any member of the wider Reg Vardy Group is a party or by or
to which any such member or any of its assets are or may be bound, entitled or
subject and which, in consequence of the Offer or the Acquisition or the
proposed acquisition of any shares or other securities in, or control of Reg
Vardy by Pendragon or any member of the wider Pendragon Group or because of a
change in the control or management of any member of the wider Reg Vardy Group
or otherwise, would or might result in (to an extent which is material in the
context of  the wider Reg Vardy Group):


(i) any monies borrowed by, or other indebtedness (actual or contingent) of, or
grant available to any such member of the wider Reg Vardy Group being or
becoming repayable, or becoming capable of being declared repayable, immediately
or prior to its stated maturity, or the ability of any such member to borrow
monies or incur any indebtedness being withdrawn or inhibited or being capable
of being withdrawn or materially inhibited; or


(ii) the creation or enforcement of any mortgage, charge or other security
interest over the whole or any significant part of the business, property or
assets of any such member of the wider Reg Vardy Group, or any such mortgage,
charge or other security interest (whenever arising or having arisen) becoming
enforceable; or


(iii) any such arrangement, agreement, licence, permit, franchise or other
instrument or the rights, liabilities, obligations or interests of any such
member of the wider Reg Vardy Group under any such arrangement, agreement,
licence, permit, franchise or other instrument being terminated or modified
adversely or affected adversely or any action being taken, or any obligation or
liability arising thereunder; or


(iv) any assets or interests of any such member of the wider Reg Vardy Group
being or falling to be disposed of or charged or any right arising under which
any such asset or interest could be required to be disposed of or charged; or


(v) the financial or trading position or prospects of the wider Reg Vardy Group
being adversely affected.


and no event having occurred which, under any provision of such, arrangement,
agreement, licence, permit, franchise or other instrument to which any member of
the wider Reg Vardy Group is a party or by or to which any such member or any of
its assets is bound, entitled or subject will result in or give rise to any of
the events or circumstances as are referred to in paragraphs (i) to (v) of this
paragraph (e);


(f)        except as disclosed in Reg Vardy's Financial Results and/or publicly
announced and/or disclosed to Pendragon, no member of the wider Reg Vardy Group
having, since 30 April 2005, otherwise than with the written agreement of
Pendragon:


(i) issued or agreed to issue or authorised or proposed the issue of additional
shares of any class, or of securities convertible into, or rights, warrants or
options to subscribe for or acquire, any such shares or convertible securities
(save as between Reg Vardy and wholly-owned subsidiaries of Reg Vardy and save
for options granted, or the issue of any Reg Vardy Shares upon exercise of
options granted, under the Reg Vardy Share Option Schemes prior to 30 April
2005); or


(ii) recommended, declared, paid or made or proposed to recommend, declare, pay
or make any bonus, dividend or other distribution except to a member of the
wider Reg Vardy Group; or


(iii) purchased, redeemed or repaid or announced any proposal to purchase,
redeem or repay any of its own shares or other securities (whether or not
convertible into shares) or reduced or made any other change to any part of its
share capital; or


(iv) issued, authorised or proposed or announced the issue of any debentures or
made, recognised or proposed or announced any change in its loan capital or,
save in the ordinary course of business, incurred or increased any indebtedness
or contingent liability or become subject to any contingent liability other than
to a wholly owned subsidiary of Reg Vardy; or


(v) merged with or acquired any body corporate or acquired or disposed of or
transferred, mortgaged or encumbered any material asset (including shares and
trade investments) or any right, title or interest in any material asset, or
undertaken any material liability, other than in the ordinary course of
business, or proposed or announced any intention to propose any such merger,
acquisition, disposal, mortgage or encumbrance (in each case other than in the
ordinary course of business); or


(vi) entered into or varied, or authorised, proposed or announced its intention
to enter into or vary any contract, transaction, arrangement or commitment which
might reasonably be considered to be of a long term, unduly onerous or unusual
nature or magnitude or which might reasonably be considered to be materially
restrictive on the business of any member of the wider Reg Vardy Group or which
involves or might reasonably be expected to involve an obligation of such a
nature or magnitude or which is not in the ordinary course of business
(including, without limitation, the acquisition or disposal of any interest in
any undertaking or the implementation of any merger, demerger, reconstruction,
scheme or amalgamation); or


(vii) taken any corporate action or had any legal proceedings instituted or
threatened against it or any order made for its winding-up (voluntarily or
otherwise), dissolution or reorganisation or any analogous procedures in any
jurisdiction, or for the appointment of a receiver, administrator,
administrative receiver, trustee or similar officer over all or any of its
assets or revenues; or


(viii) entered into, or varied the terms of any contract, arrangement or
commitment with any of the directors of Reg Vardy or senior executives of any
member of the wider Reg Vardy Group; or


(ix) been unable or having 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; or


(x) made or agreed or consented to any change to the terms of any trust deed
constituting the pension scheme(s) established for its directors and/or
employees and/or their dependants or to the benefits which accrue, or to the
pensions which are payable thereunder, or to the basis on which qualification
for or accrual or entitlement to such benefits or pensions are calculated or
determined, or to the basis upon which the liabilities of such pension schemes
are funded or made, or agreed or consented to any change to the trustees
involving the appointment of a trust corporation; or


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


(xii) waived or compromised any claim other than in the ordinary course of
business; or


(xiii) entered into any agreement, arrangement or commitment or passed any
resolution or made any announcement, with respect to any of the transactions,
matters or events referred to in this paragraph (f);


(g)        except as disclosed in Reg Vardy's Financial Results and/or as
otherwise publicly announced since 30 April  2005 and/or as disclosed to
Pendragon, since 30 April 2005:


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


(ii) there having been no litigation, arbitration proceedings, prosecution or
other legal proceedings or investigation instituted, announced or threatened by
or against or remaining outstanding in respect of any member of the wider Reg
Vardy Group which in any such case is material in the context of the Reg Vardy
Group taken as a whole; and


(iii) no contingent or other liability having arisen which would or might
reasonably be expected to materially adversely affect the business of the wider
Reg Vardy Group, taken as a whole;


(h)             Pendragon not having discovered that, save as publicly announced
or otherwise disclosed to Pendragon:


(i) any financial or business or other information concerning the wider Reg
Vardy Group disclosed at any time by or on behalf of any member of the wider Reg
Vardy Group (whether publicly or otherwise) to Pendragon either contains a
misrepresentation of fact or omits to state a material fact necessary to make
the information contained therein not misleading, in either case, where the
misrepresentation or omission is material in the context of the wider Reg Vardy
Group taken as a whole; or


(ii) any member of the wider Reg Vardy Group is subject to any liability,
contingent or otherwise other than such a liability incurred in the ordinary
course of business, which is not disclosed in Reg Vardy's Financial Results or
has not been publicly announced or otherwise disclosed to Pendragon and which is
material in the context of the Reg Vardy Group taken as a whole; or


(iii) 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 Reg Vardy Group which could give rise to any liability (whether actual
or contingent) or cost on the part of any member of the wider Reg Vardy Group
which is or would be material in the context of the wider Reg Vardy Group taken
as a whole; or


(iv) any past or present member of the wider Reg Vardy Group has not complied
with all applicable laws or regulations of any relevant jurisdiction in relation
to environmental matters, which non-compliance would be likely to give rise to
any liability (whether actual or contingent) or cost on the part of any member
of the wider Reg Vardy Group which would be material in the context of the
business of the wider Reg Vardy Group taken as a whole; or


(v) circumstances exist whereby a person or class of persons would be likely to
have any claim or claims in respect of any product or service provided by or
carried out by any past or present member of the wider Reg Vardy Group and which
is material in the context of the wider Reg Vardy Group taken as a whole; or


(vi) there is or is likely to be any liability (whether actual or contingent) or
requirement of any past or present member of the wider Reg Vardy Group to make
good, repair, reinstate or clean up any property now or previously owned,
occupied, made use of or harmed by any past or present member of the wider Reg
Vardy Group or any controlled waters under any environmental legislation,
regulation, notice, circular or order of any relevant authority or otherwise
which is material in the context of the business of the wider Reg Vardy Group
taken as a whole.



For the purposes of these conditions:


(a)             'relevant authority' means any government or governmental,
quasi-governmental, supranational, statutory, regulatory or investigative body,
court, trade agency, association, institution or professional or environmental
body or any other regulatory body or person in any jurisdiction but excluding
the Office of Fair Trading, the Competition Commission and the Pensions
Regulator;


(b)        a relevant authority shall be regarded as having 'intervened' if it
has decided or intimated a decision to take, institute, implement or threaten
any action, proceeding, suit, investigation, reference or enquiry, or made or
enacted or proposed any statute, regulation, decision or order or taken any
other steps and 'intervene' shall be construed accordingly;


(c)             'authorisations' mean authorisations, determinations, orders,
grants, recognitions, confirmations, consents, licences, clearances,
permissions, certificates and approvals; and


(d)        the 'wider Reg Vardy Group' means Reg Vardy and its subsidiary
undertakings, associated undertakings and any other undertaking in which Reg
Vardy and such undertakings (aggregating their interests) have a significant
interest and the 'wider Pendragon Group' means Pendragon and its subsidiary
undertakings, associated undertakings and any other undertaking in which
Pendragon and such undertakings (aggregating their interests) have a significant
interest and, for these purposes, 'subsidiary undertaking', 'associated
undertaking' and 'undertaking' have the meanings given by the Act (but for this
purpose ignoring paragraph 20(1)(b) of Schedule 4A of the Act) and 'significant
interest' means a direct or indirect interest in, in aggregate, 10 per cent. or
more of the equity capital of an undertaking.


Pendragon reserves the right to waive all or any of the above conditions, in
whole or in part, except conditions (a) and (b).  Pendragon shall be under no
obligation to waive or treat as fulfilled any of conditions (c) to (h) inclusive
by a date earlier than specified below notwithstanding that any of the other
conditions of the Offer may at such earlier date have been fulfilled or waived
and/or that there are at such earlier date no circumstances indicating that any
of such conditions may not be capable of fulfilment.


If Pendragon is required by the Panel to make an offer for the Reg Vardy Shares
under Rule 9 of the Code, Pendragon may make such alterations to the above
conditions, including, without limitation, condition (a), as are necessary to
comply with the provisions of that Rule.


Unless the Panel otherwise agrees, the Offer will lapse unless the conditions
set out above (other than condition (a)) are fulfilled or (if capable of waiver)
waived or, where appropriate, have been determined by Pendragon in its
reasonable opinion to be or to remain satisfied no later than 21 days after the
later of (i) the First Closing Date and (ii) the date on which the Offer becomes
or is declared unconditional as to acceptances, or such later date as the Panel
may agree.


The Offer will lapse if the Acquisition is referred to the Competition
Commission in the UK before 3.00 p.m. on the later of the First Closing Date and
the date on which the Offer becomes or is declared unconditional as to
acceptances.


If the Offer lapses, the Offer will cease to be capable of further acceptance
and accepting Reg Vardy Shareholders and Pendragon will cease to be bound by
Forms of Acceptance submitted on or before the time when the Offer lapses.



PART B: CERTAIN FURTHER TERMS OF THE OFFER


The Offer will be made on the terms and will be subject to the conditions which
are set out in this Appendix I, those terms which will be set out in the Offer
Document and the Form of Acceptance and such further terms as may be required to
comply with the provisions of the City Code.  The Offer and any acceptance of
the Offer will be governed by English law.  This announcement does not
constitute an offer or invitation or purchase any securities.


The Reg Vardy Shares will be acquired by Pendragon fully paid up and free from
all liens, equitable interests, charges, encumbrances, rights of pre-emption and
other third party rights or interests and together with all rights now or
hereafter attaching thereto, including the right to receive and retain all
dividends and other distributions (if any) declared, made or paid on or after
the date on which the Offer is made.


The Offer is not being and will not be made, directly or indirectly, in or into,
or by use of the mails of, or by any means or instrumentality (including,
without limitation, facsimile transmission, electronic mail, telex or telephone)
of interstate or foreign commerce of, or any facilities of a national securities
exchange of the United States, Canada, Australia or Japan and the Offer will not
be capable of acceptance by any such use, means, instrumentality or facility,
directly or indirectly from or within the United States, Canada, Australia or
Japan.


Accordingly, copies of this announcement and any other documents related to the
Offer are not being, and must not be, mailed or otherwise distributed or sent in
or into or from the United States, Canada, Australia or Japan and persons
receiving this announcement, the Form of Acceptance or such other documents
(including custodians, nominees and trustees) must not distribute or send them
in, or into or from, the United States, Canada, Australia or Japan.






                                  Appendix II


                             Additional information


1.            Inducement Fee

Pursuant to a letter dated 2 December 2005 from Pendragon to Reg Vardy and in
consideration of Pendragon making the Offer, it was agreed that an inducement
fee of £4.55 million would be payable by Reg Vardy to Pendragon in the event
that Pendragon announced an intention to make the Offer and:

(a)        such Offer is not then made or, if made, lapses or is withdrawn
following the announcement of an independent competing offer, with or without
pre-conditions, which becomes or is declared unconditional in all respects or is
otherwise completed or implemented; or

(b)        such Offer is not then made or, if made, lapses or is withdrawn
following the directors of Reg Vardy (or any of such directors) or any committee
thereof, having withdrawn or modified, in any manner which could reasonably be
considered to be adverse to Pendragon or to the success or likely success of the
Offer, their recommendation to accept or vote in favour of the Offer, or
approving or recommending the acceptance of any independent competing offer; or

(c)        the Panel finds that there has been a breach of Rule 21 of the City
Code.

2.            Interest in Reg Vardy Shares

As at 2 December 2005, save for the 15,291,007 Reg Vardy Shares in respect of
which Pendragon has received irrevocable undertakings to accept (or procure the
acceptance of) the Offer, neither Pendragon nor any of the Pendragon Directors
nor, as far as Pendragon is aware, any person acting in concert with Pendragon,
has any interest in or right to subscribe for Reg Vardy Shares or has any short
position (including any short positions under a derivative, any agreement to
sell or any delivery obligation or right to require another person to take
delivery) in Reg Vardy Shares or has borrowed or lent any Reg Vardy Shares (save
for any borrowed shares which have either been on-lent or sold).

3.            Undertakings

Irrevocable undertakings to accept the Offer have been given by the Reg Vardy
Directors and persons connected with them in respect of the following holdings
of Reg Vardy Shares:
Reg Vardy Directors and connected persons                          Number of Reg
                                                                    Vardy Shares
J. F. Standen                                                             10,000
Sir Peter Vardy                                                        9,348,111
R. T. Forrester                                                            8,057
N. Hood                                                                    4,000
W. M. Teasdale                                                             4,000
Sir Peter Vardy & Richard Vardy*                                         990,000
Sir Peter Vardy & Lady Margaret Vardy*                                   116,918
Sir Peter Vardy, Lady Margaret Vardy, Richard Vardy & 
Peter David Vardy*                                                     2,740,740
Sir Peter Vardy & Richard Vardy*                                           7,200
Ogier Trustee (Jersey) Limited *                                       2,046,187
Peter David Vardy                                                          5,268
Richard Angus Vardy                                                        5,258
Victoria Vardy                                                             5,268
                                                             
* Held as trustees.


These irrevocable undertakings will lapse only in the event of the Offer lapsing
or being withdrawn.

4.            General

Unless otherwise stated, financial information relating to Pendragon has been
extracted from the audited consolidated financial statements of the Pendragon
Group for the financial year ended 31 December 2004 and the unaudited interim
results for the six months ended 30 June 2005.

Unless otherwise stated, financial information relating to Reg Vardy has been
extracted from the audited consolidated financial statements of the Reg Vardy
Group for the financial year ended 30 April 2005.

5.         Share prices

The closing middle market prices of Reg Vardy Shares have been derived from the
Daily Official List.

6.         Value of the Offer

References to the value of the Offer for the whole of the issued share capital
of Reg Vardy are based on 56,252,898 Reg Vardy Shares in issue as at 2 December
2005 and 800 pence for each Reg Vardy Share.




                                  Appendix III


                                  Definitions


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

'Acquisition'               the proposed acquisition by Pendragon of Reg Vardy under the terms of the
                            Offer

'Act'                       the Companies Act 1985 (as amended)

'Australia'                 The Commonwealth of Australia, its states, territories and possessions

'Block Exemption'           the European Commission Block Exemption rules (Commission Regulation (EC) No.
                            1400/2002)

'Canada'                    Canada, its provinces and territories and all areas subject to its
                            jurisdiction and any political sub-divisions thereof

'CD Bramall'                CD Bramall plc

'Citigroup'                 Citigroup Global Markets Limited

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

'Closing Price'             the middle-market quotation of a Reg Vardy Share at the close of business on a
                            particular trading day, as derived from the Daily Official List

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

'Dresdner Kleinwort         Dresdner Kleinwort Wasserstein Limited
Wasserstein'

'Enlarged Pendragon Group'  the Pendragon Group as enlarged by the Acquisition

'Extraordinary General      the extraordinary general meeting of Pendragon to approve, inter alia, the
Meeting'                    proposed acquisition by Pendragon of the entire issued and to be issued share
                            capital of Reg Vardy under the terms of the Offer

'First Closing Date'        the first closing date of the Offer

'Form of Acceptance'        the form of acceptance and authority relating to the Offer which will
                            accompany the Offer Document

'FSMA'                      the Financial Services and Markets Act 2000, as amended

'IFRS'                      International Financial Reporting Standards adopted for use in the European
                            Union

'Japan'                     Japan, its cities and prefectures, territories and possessions

'LIBOR'                     the London Inter Bank Offered Rate

'Listing Rules'             the Listing Rules made by the UK Listing Authority under section 73A of FSMA

'London Stock Exchange'     London Stock Exchange plc


'Offer'                     the recommended cash offer to be made by Citigroup on behalf of Pendragon to
                            acquire all of the issued and to be issued Reg Vardy Shares on the terms and
                            subject to the conditions set out in the Offer Document and the Form of
                            Acceptance and including, where the context so permits, any subsequent
                            revision, variation, extension or renewal of such offer

'Offer Document'            the offer document to be issued to Reg Vardy Shareholders detailing the terms
                            and conditions of the Offer

'Offer Price'               800 pence per Reg Vardy Share

'Panel'                     the Panel on Takeovers and Mergers

'Pendragon' or 'Company' or Pendragon PLC
'Offeror'

'Pendragon Directors' or    the directors of Pendragon
'Pendragon Board'

'Pendragon Group'           Pendragon and its subsidiary undertakings

'Pendragon Shareholders'    holders of Pendragon Shares

'Pendragon Shares'          the ordinary shares of 25 pence each in the capital of Pendragon

'Reg Vardy'                 Reg Vardy plc

'Reg Vardy Directors' or    the directors of Reg Vardy
'Reg Vardy Board'

'Reg Vardy Group'           Reg Vardy and its subsidiary undertakings

'Reg Vardy Option Holders'  holders of Reg Vardy Options

'Reg Vardy Options'         options granted under the Reg Vardy Share Option Schemes

'Reg Vardy Share Option     the Reg Vardy 1996 Company Share Option Scheme and the Reg Vardy 1996
Schemes'                    Unapproved Share Option Scheme

'Reg Vardy Shareholders'    holders of Reg Vardy Shares

'Reg Vardy Shares'          the existing unconditionally allotted or issued and fully paid ordinary shares
                            of 10 pence each in the capital of Reg Vardy and any further ordinary shares
                            which are unconditionally allotted or issued on or prior to the date on which
                            the Offer closes (or such earlier date or dates as Pendragon may, subject to
                            the Code or with the consent of the Panel, decide)

'UK GAAP'                   generally accepted accounting principles applied in the United Kingdom

'UK Listing Authority'      the Financial Services Authority acting in its capacity as the competent
                            authority for the purposes of Part VI of the Financial Services and Markets
                            Act 2000

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

'US' or 'United States'     the United States of America, including the states of the United States and
                            the District of Columbia, its territories and possessions and all areas
                            subject to its jurisdiction



The terms 'subsidiary' and 'subsidiary undertaking' as used in these definitions
shall have the meanings given by the Act.



                      This information is provided by RNS
            The company news service from the London Stock Exchange