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Wednesday 13 June, 2007

Tulip Holdings Ltd

Offer Update

Tulip Holdings Limited
13 June 2007


Tulip Holdings Limited


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

13 June 2007

                            TULIP HOLDINGS LIMITED

         REVISED CASH OFFER BY TULIP HOLDINGS LIMITED FOR TRACE GROUP PLC
                           WITH LOAN NOTE ALTERNATIVE


Summary

     
-        The Directors of Tulip Holdings Limited are pleased to announce the
terms of a revised cash offer (the 'Revised Offer') to be made by Tulip for the
entire issued and to be issued share capital of Trace at a price of 156p per
share.



-        The Revised Offer Price of 156p per share in cash values the existing
issued ordinary share capital of Trace at approximately £22.2 million.



-        The Revised Offer Price represents a premium of 74.3 per cent. over the
Closing Price of 89.5p per Trace Share on 19 April 2007, being the last Business
Day prior to the Trace Scheme Announcement (and commencement of the Offer
Period).



-        The Revised Offer is 1p more per share than the offer made by Microgen
on 1 June 2007.  Apart from a higher cash price, the fundamental difference
between the two offers is that under the Microgen Offer ownership of Trace would
pass to Microgen.  Under Tulip's Revised Offer it is intended that 95 per cent.
of the ownership of each of the three main Trace subsidiaries, Financial, Isys
and Solutions, will in due course vest with current and future employees of
those subsidiaries, except for a small percentage which will be held by head
office staff. The remaining 5 per cent. of Trace will be held by a charitable
trust.  The fourth subsidiary, Payroll Services, is expected to remain within
the Enlarged Tulip Group and appropriate alternative and  beneficial provisions
will be made for its staff.



-        The Board of Tulip urges Trace Shareholders to recognise that the staff
are also significant stakeholders in the Trace Group by REJECTING THE MICROGEN
OFFER and ACCEPTING TULIP'S REVISED OFFER.



-        Tulip has received irrevocable undertakings to vote (or to procure to
vote) in favour of the Revised Offer in respect of, in aggregate, 7,035,104
Trace Shares, representing approximately 49.37% per cent. of the Trace Shares.
The irrevocable undertakings to vote (or to procure to vote) in favour of the
Revised Offer are listed in Appendix III Part B of this Announcement.



-        Tulip is a company formed for the purposes of acquiring Trace. The
initial directors of Tulip are Richard Wolfe and Peter Stolerman (Directors of
Trace) together with John Murphy (Managing Director of a Trace Subsidiary). It
is intended that Andrew Bell, Connel Torley and Michael Flynn (all Managing
Directors of Trace Subsidiaries) will become directors of Tulip on completion of
the Acquisition. Richard Wolfe is currently the sole shareholder of Tulip.





Commenting on the Revised Offer, Richard Wolfe, Chief Executive of Trace and a
director of Tulip said:



'The aim and intent behind the Revised Offer remains as stated previously.  The
offer by Tulip will provide a significant premium for Trace Shareholders
compared to the market valuation prior to the commencement of the Offer Period.
Furthermore, by making this offer we are seeking to safeguard and promote the
interests of Trace staff and clients, which we believe will be best served by
staff ownership of Trace.



The reaction of Trace staff and clients to the original Trace Scheme proposed by
Tulip has been very positive, as evidenced by the level of irrevocable
commitments provided by employees and the comments and expressions of support
received from clients'



The formal Tulip Offer Document and the Form of Acceptance setting out the full
terms and conditions of the Revised Offer is expected to be posted to Trace
Shareholders shortly. In deciding whether or not to accept the Offer, Trace
Shareholders should rely on the information contained in, and procedures
described in, the Tulip Offer Document and the Form of Acceptance.



This summary should be read in conjunction with the full text of this
Announcement.



Enquiries:

Tulip Holdings Limited                       Telephone: +44 (0) 20 7825 1000
Richard Wolfe
Peter Stolerman

Charles Stanley Securities                   Telephone: +44 (0) 20 7149 6000
(Financial adviser to Tulip)
Russell Cook
Henry Fitzgerald-O'Connor


This Announcement does not, and is not intended to, constitute or form part of
any offer to sell, or an invitation to purchase, any securities or the
solicitation of any vote or approval in any jurisdiction.  The Revised Offer
will be made solely by means of the Tulip Offer Document, which will contain the
full terms and conditions of the Revised Offer. Trace Shareholders are advised
to read carefully the formal documentation in relation to the Revised Offer once
it has been despatched.



The availability of the Revised Offer and the release, publication or
distribution of this Announcement to persons who are not resident in the United
Kingdom may be affected by the laws of the relevant jurisdictions in which they
are located.  Persons who are not resident in the United Kingdom should inform
themselves of, and observe, any applicable requirements. Any failure to comply
with such applicable requirements may constitute a violation of the securities
laws of any such jurisdictions.  This Announcement has been prepared for the
purposes of complying with English law and the City Code and the information
disclosed may not be the same as that which would have been disclosed if this
Announcement had been prepared in accordance with the laws of jurisdictions
outside the United Kingdom.



The Revised Offer will not be made in or into any jurisdiction where to do so
would constitute a violation of the relevant laws of such jurisdiction.
Custodians, nominees and trustees should observe these restrictions and should
not send or distribute the document in or into any jurisdiction where to do so
would constitute a violation of the relevant laws of such jurisdiction.



Charles Stanley, which is authorised and regulated in the United Kingdom by the
Financial Services Authority, is acting exclusively for Tulip and no one else in
connection with the Revised Offer and will not be responsible to anyone other
than Tulip for providing the protections afforded to clients of Charles Stanley
nor for providing advice in relation to the Revised Offer, the content of this
Announcement or any matter referred to herein.



Appendix I contains the Conditions to and a summary of certain further terms of
the Revised Offer.



Appendix II sets out the bases and sources of information from which the
financial calculations used in this Announcement have been derived.



Appendix III Part A contains details of the irrevocable undertakings provided in
relation to the Trace Scheme. Appendix III Part B contains details of
irrevocable undertakings that remain in place for Tulip's Revised Offer and new
irrevocable undertakings provided in relation to the Revised Offer.



Appendix IV contains the definitions of terms used in this Announcement
(including this summary).



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



13 June 2007
                              TULIP HOLDINGS LIMITED

         REVISED CASH OFFER BY TULIP HOLDINGS LIMITED FOR TRACE GROUP PLC
                            WITH LOAN NOTE ALTERNATIVE



1.      Introduction



The Directors of Tulip Holdings Limited are pleased to announce the terms of a
revised offer (the 'Revised Offer') to be made by Tulip for the entire issued
and to be issued share capital of Trace at a price of 156p per share in cash.
The Offer Price of 156p per share values the existing issued ordinary share
capital of Trace at approximately £22.2 million.



Tulip is a company formed for the purposes of acquiring Trace. The initial
directors of Tulip are Richard Wolfe and Peter Stolerman (Directors of Trace)
together with John Murphy (Managing Director of a Trace Subsidiary). It is
intended that Andrew Bell, Connel Torley and Michael Flynn (all Managing
Directors of Trace Subsidiaries) will become directors of Tulip on completion of
the Acquisition. Richard Wolfe is currently the sole shareholder of Tulip.





2.      Background



a) Trace Scheme Proposal



On 20 April 2007, the Tulip Board and the Trace Independent Directors announced
that they had reached agreement on the terms of a recommended proposal for the
acquisition of Trace by Tulip at a price of 135p per Trace Share in cash to be
effected by means of a scheme of arrangement between Trace and Trace
Shareholders pursuant to section 425 of the Companies Act 1985 ('Trace Scheme').



For the purposes of the City Code, the Non-Independent Directors were deemed to
have a conflict of interest. Accordingly, a committee of the Board of Trace
comprising the Independent Directors (namely Daniel Chapchal, Colin Clarke,
David Begg and Robin Woodall) was established for the purpose of considering any
offers for the Company and making recommendations to Trace Shareholders.



In the most recent update provided by Tulip on 24 May 2007, Tulip confirmed that
it had received the following irrevocable undertakings in favour of the Trace
Scheme:



(i)       irrevocable undertakings that do not fall away in the event of a
higher offer and are for a period of 12 months from either 19 April or 14 May
2007 (the 'Hard Irrevocables with Standstill') in respect of 5,485,773 Trace
Shares in aggregate representing approximately 38.50 per cent. of the Trace
Shares;



(ii)     irrevocable undertakings that do not fall away in the event of a higher
offer, effective for 12 months from either 19 April 2007 or 24 May 2007, but
which will lapse if (i) the Trace Scheme lapses or is withdrawn and within 21
days thereafter Tulip has not made or announced it will make an offer to acquire
the share capital of Trace for a cash price of not less than 135p per share; or
(ii) the Trace Scheme is not approved at the Trace Court Meeting; or (iii) the
Trace Scheme is not sanctioned by the Court (the 'Hard Irrevocables without
Standstill') in respect of 1,493,939 Trace Shares in aggregate representing
approximately 10.48 per cent. of the Trace Shares; and



(iii)    irrevocable undertakings that lapse in the event of a higher offer
being made at a price of not less than 150p (the 'Soft Irrevocables') in respect
of 3,440,000 Trace Shares in aggregate representing approximately 24.14 per
cent. of the Trace Shares.



b) Microgen Offer



On 25 May 2007 the Board of Microgen and the Trace Independent Directors
announced that they had agreed the terms of a recommended competing cash offer
to be made by Microgen at a price of 155p per Trace Share.



Immediately following the recommendation of the Microgen Offer, and without
prior consultation with the Tulip Directors, the Trace Independent Directors
applied for and obtained  a court order which concerned the lapsing of the Trace
Scheme and which contained the following direction:



'THE COURT DIRECTS that in the event an offer is received to acquire the entire
issued share capital of the Company for a price of 155p or higher and which the
said Independent Directors propose to recommend the Chairman of the Court
Meeting is directed to adjourn the Court Meeting sine diem with the consequence
that the proposals for the Scheme will automatically lapse upon the said
Independent Directors recommending an offer for each Trace Share at 155p or
more.'  (Order No. 2850 of 2007 25 May 2007)



The Independent Directors, on behalf of themselves and their connected parties,
holding in aggregate 1,436,453 Trace Shares representing 10.08 per cent. of the
Trace Shares, undertook to accept the Microgen Offer upon the lapsing of their
irrevocable commitments to the Trace Scheme.  Such lapsing has occurred in
respect of 10,000 of these Trace Shares (representing 0.07 per cent. of the
Trace Shares) as a consequence of a higher offer being made at a price of not
less than 150p.



However, as a result of the Tulip Revised Offer, in respect of 1,426,453 of
these Trace Shares (representing 10.01 per cent. of the Trace Shares) this
commitment has not lapsed..



c) Tulip Revised Offer



Tulip announces a Revised Offer at a cash price of 156p per Trace Share and
accordingly the irrevocable undertakings in favour of Tulip given by Mr Colin
Clarke (an Independent Director) and Mrs Clarke in respect of 1,426,453 Trace
Shares (representing 10.01 per cent. of the Trace Shares) remain in full force
and effect.



Further details of Tulip's Revised Offer are set out below in Sections 3 and 4
of this Announcement and details of the irrevocable undertakings to vote in
favour of Tulip's Revised Offer are set out in Section 5 and Appendix III Part B
of this Announcement.





3.      Tulip's Revised Offer



Cash Offer



The Revised Offer, which will be subject to the Conditions set out in Appendix I
of this Announcement and to the full terms and conditions set out in the Tulip
Offer Document and Form of Acceptance, will be made on the following basis:



            for each Trace Share                              156p in cash



This represents a premium of 74.3 per cent. to the Closing Price of 89.5p per
Trace Share on 19 April 2007 (being the last Business Day prior to the
commencement of the Offer Period).



The terms of the Revised Offer at 156p per share in cash value the fully diluted
share capital of Trace at approximately £22.2 million.



Loan Note Alternative



Trace Shareholders (other than Restricted Overseas Persons) will be entitled to
elect to receive Loan Notes to be issued by Tulip in respect of all or part of
the cash consideration to which they would otherwise be entitled under the
Scheme on the following basis:



            for each Trace Share            156p nominal value of Loan Notes



The Loan Notes will carry a fixed coupon rate of 3 per cent. per annum.



Compound interest will apply to each loan note up to a maximum of 19p in
interest for each 156p of Loan Notes.



The Loan Notes may be redeemed at each Loan Note Holder's request at any time
from 1 March 2008.



Further information on the Loan Note is described in Section 6 of this
Announcement.





4.      Background to and reasons for the Revised Offer



Trace was established in 1974 and is a leading UK provider of IT solutions.
Trace's IT solutions combine internally developed industry specific software
packages with a full range of complementary services, including custom built
software, consultancy, training, installation, maintenance, facilities
management and the provision of skilled personnel. Since flotation on the
Official List of the London Stock Exchange in May 1989 Trace has increased
turnover from £9.8 million for the year ended 31 May 1989, to £14.3 million for
the year ended 31 May 2006.



Trace is a specialist in business software solutions for three principal
markets; financial (Financial), insurance and reinsurance broking (Isys) and
property (Solutions) and has become an acknowledged leader in its chosen fields
within these markets.



In conjunction with its software-based activities, Trace also offers imaging and
workflow solutions and additionally it offers a range of payroll and HR services
including a fully managed payroll service to small and medium sized enterprises
(Payroll Services). Trace's growth plans are presently focused on a strategy of
broadening and improving its portfolio of best of breed products through
internal development.



The turnover of the Trace Group has remained relatively static except for the
year ended 31 May 2002 where the turnover benefited from a significant
acquisition. The acquisition proved unsuccessful with the result that in the
year ended 31 May 2003 the Trace Group recorded a loss of £2.8 million before
tax most of which was attributable to the write off of goodwill relating to the
acquisition. Since that time Trace Group's profitability has been restored and
the Trace Group recorded a profit before tax from continuing operations of £1.6
million for the year ended 31 May 2006 with basic earnings per share from
continuing operations of 8.23p.



As previously stated in the Trace Scheme Document, it is believed that Trace
Shares have traded at an unattractive rating over the previous three years as a
result of a number of factors.



These factors include:



•                 the relatively small market capitalisation of Trace;



•                 the significant size of the shareholding held by the
Directors, amounting to 33.06 per cent. of Trace Shares, and the limited volume
of trading in Trace Shares;



•                 the relatively flat financial performance of Trace Group; and



•                 Trace Group's recent unsuccessful acquisition.





The Tulip Directors now note that:



•                 The Revised Offer Price represents a premium of 74.3 per cent.
over the Closing Price of 89.5p per Trace Share on 19 April 2007, being the last
Business Day prior to the Offer Period.



•                 The Revised Offer Price represents a premium of approximately
63.3 per cent. over the average daily Closing Price of 95.5p per Trace Share
during the six months prior to 19 April 2007, being the last Business Day prior
to the commencement of the Offer Period.



•                 The Revised Offer Price represents a premium of 48.6 per cent
over the Closing Price of 105p per Trace Share on 19 April 2006, being the date
12 months prior to 19 April 2007, the last Business Day prior to the Offer
Period.



•                 The Revised Offer Price represents approximately 19 times
reported earnings per share of 8.23p for the year ended 31 May 2006, and on a
fully diluted basis represents approximately 19 times reported diluted earnings
per share of 8.19p for the year ended 31 May 2006.



•                 The Revised Offer will provide all Trace Shareholders with an
opportunity to sell their Trace Shares for cash at the Revised Offer Price.



The initial directors of Tulip are Richard Wolfe and Peter Stolerman (Directors
of Trace) together with John Murphy (Managing Director of a Trace Subsidiary).
It is intended that Andrew Bell, Connel Torley and Michael Flynn (all Managing
Directors of Trace Subsidiaries) will become directors of Tulip on completion of
the Acquisition of Trace. Richard Wolfe is currently the sole shareholder of the
Offeror.  Tulip has not yet traded.



The Tulip Directors consider that the employees of Trace have made and will
continue to make a significant contribution towards the success of Trace and the
Tulip Directors believe that following the Acquisition the employees' interests
will be further aligned to the future of Trace if at the same time they
collectively own the company.



Tulip intends that 95% of the ownership of each of the three main Trace
subsidiaries, Financial, Isys and Solutions, will in due course vest with
current and future employees of those subsidiaries (except for a small
percentage which will be held by head office staff).  The remaining 5% will be
held by a charitable trust.  The fourth subsidiary, Payroll Services, is
expected to remain within the Enlarged Tulip Group and appropriate alternative
and beneficial provisions will be made for its staff.



The Tulip Directors consider it appropriate that the employees of Trace should
be able to benefit to the extent which such future ownership will confer.



The Tulip Directors also believe that the interests of Trace's clients will be
better served and protected by Trace being owned by its staff.





5.      Irrevocable undertakings to vote in favour of the Tulip Revised Offer



Tulip has received the following undertakings to vote (or procure votes) in
favour of the Revised Offer in respect of 7,035,104 Trace Shares in aggregate,
representing approximately 49.37 per cent. of the Trace Shares as follows:



•                irrevocable undertakings that do not fall away in the event of
a higher offer and are for a period of 12 months from either 19 April or 14 May
2007 (the 'Hard Irrevocables with Standstill') in respect of 5,485,773 Trace
Shares in aggregate representing approximately 38.50 per cent. of the Trace
Shares;





•                irrevocable undertakings that do not fall away in the event of
a higher offer, effective for 12 months from either 19 April 2007 or 24 May
2007, but which will lapse if  the Tulip Revised Offer lapses or is withdrawn
(the 'Hard Irrevocables without Standstill') in respect of 1,493,939 Trace
Shares in aggregate representing approximately 10.48 per cent. of the Trace
Shares; and



•                irrevocable undertakings dated 13 June 2007 that fall away in
the event of an offer being made for  the entire issued share capital of Trace
at a price of not less than 200 pence per Trace Share, in respect of 55,392
Trace Shares in aggregate representing approximately 0.39 per cent. of Trace
Shares.



Further Details of these undertakings are detailed in Appendix III Parts A and
B.



A summary of all of the above undertakings is at Appendix III Part C.





6.         Loan Note Alternative



Each Trace Shareholder, other than Restricted Overseas Persons, may elect to
receive the Loan Note Alternative in Tulip in respect of all or part of their
holding in Trace (with the balance of their holding in cash) instead of the full
cash consideration to which they would otherwise be entitled under the Revised
Offer.



The term of the Loan Notes will be 15 years and they will constitute unsecured,
unguaranteed obligations of Tulip.  A number of factors are relevant for Trace
Shareholders if they are considering the Loan Note Alternative:



(i)                   The Loan Notes will not be admitted to trading on any
public market;



(ii)                 The Loan Notes will carry a fixed coupon of 3 per cent. per
annum which. will apply to all outstanding loan notes, provided that the maximum
amount of interest payable per 156p of Loan Notes will be 19p;



(iii)                The Loan Notes will have a term of 15 years but may be
redeemed, at the election of Noteholders, at any time after 1 March 2008;



(iv)                The Loan Notes will have only limited rights. There are no
pre-emption rights;



(v)                  The Loan Notes will constitute unsecured obligations of
Tulip Holdings Limited, an unlisted and privately held company recently
incorporated to carry out the Acquisition;



(vi)                Tulip faces the usual sector business risks any of which
could impact on the financial performance of Tulip and thus the future value of
any of its securities; and



(vii)               The Loan Notes shall only be transferable to Family Trusts
and Connected Persons, or otherwise with the consent of Tulip, not to be
unreasonably withheld.



The irrevocable undertakings given by Richard Wolfe, Peter Stolerman, Colin
Clarke, John Murphy, Michael Flynn and Connel Torley include a commitment to
make an election under the Loan Note Alternative in respect of substantially all
of their Trace Shares, amounting to, in aggregate 3,526,960 Trace Shares
representing approximately 24.75 per cent. of the Trace Shares.







7.      Current trading



For the year ended 31 May 2006, Trace reported turnover of £14.3 million from
continuing operations on which it generated profit before tax of £1.6 million.
Approximately 29 per cent. of the turnover came from Isys, 26 per cent. from
Financial, 24 per cent. from Solutions and 10 per cent. from Payroll Services.



As at 31 May 2006, Trace had net tangible assets of £9.4 million, including cash
and cash equivalents of £2.4 million. Intangible assets (comprising capitalised
expenditure on software development) were £2.3 million as at 31 May 2006.



The interim unaudited results for the six months to 30 November 2006 were
announced on 27 February 2007. Operating profit from continuing operations
showed a small increase to £444,000 (2005 - £417,000) on turnover up to £6.6
million from £6.1 million. Net finance income was maintained and after a small
increase in net property rental costs, the Company reported a profit before tax
of £490,000 (2005 - £496,000). Basic earnings per share from continuing
operations increased marginally from 2.55p to 2.62p per share. As at 30 November
2006, Trace had net tangible assets of £9.46 million including cash and cash
equivalents of £3.4 million.



Shareholders should note that Tulip has contracted to procure the sale of the
Company's St John Street Property upon Tulip acquiring at least 50.1% of the
Trace Shares (see paragraph 9 below for further details).  The proposed sale
price is £9.1 million on the basis of the Sale and Leaseback Agreement as
described in paragraph 9 below. The value of this property, as assessed by
independent valuers, in the annual report & accounts for the year ended 31 May
2006 was £5.8 million on an existing use basis.





8.      Effect of the Acquisition on Directors, management and employees



Following the Revised Offer becoming or being declared wholly unconditional the
existing employment rights, including pension rights of all management and
employees of Trace will be fully safeguarded.





Save as disclosed in this Announcement, no agreement, arrangement or
understanding (including any compensation arrangement) exists between Tulip or
any person acting in concert with it and any of the directors, recent directors,
shareholders or recent shareholders of the Company, or any person interested or
recently interested in Trace Shares, having any connection with or dependence
upon the offer for Trace Shares comprised in the Revised Offer.





9.      Effect of the Acquisition on Trace



Business premises



Tulip proposes to enter into a conditional contract with the Property Purchaser
for the sale and leaseback of the Company's St John Street Property. It is
intended that the contract will provide that, subject to Tulip acquiring at
least 50.1% of the Trace Shares, Tulip shall procure that Trace (which would
then be its subsidiary) enters into the Sale and Leaseback Agreement.



Under the terms of the proposed Sale and Leaseback Agreement Trace's freehold
interest in the St John Street Property will be sold to the Property Purchaser
for £9.1 million in cash and the property will then be leased back to Trace for
a term of 15 years under a standard commercial lease at an initial rental of
£500,000 per annum with an option for Trace to terminate after 10 years.





Trace's business



Over its 32 year history, Trace has developed a leading position amongst UK IT
solution providers in its chosen fields.



This position is the result of a series of strategic initiatives by Trace
management, including a focus on broadening and improving their portfolio of '
best of breed' products through internal development and ensuring high service
levels provided by Trace to its clients.



A continuing focus on the quality of its service levels, combined with the
ongoing development of new products, will remain central to the further
development of the business and to delivering organic growth in revenue and
profitability.





10.        Tulip, Cash Confirmation and Financing Arrangements



Tulip is a newly incorporated company which has been formed for the purposes of
the Acquisition. Tulip has not traded since incorporation, and has not entered
into any obligations other than in connection with the Revised Offer and the
financing of the Revised Offer, including the conditional sale and leaseback
arrangements described in paragraph 9 above.



The current directors of Tulip are Richard Wolfe, Peter Stolerman and John
Murphy. Richard Wolfe is currently the sole shareholder of Tulip.



As at the date of this Announcement, Richard Wolfe, Peter Stolerman, Colin
Clarke, John Murphy, Michael Flynn, Connel Torley and 60 other Trace
Shareholders have undertaken to Tulip to make an election under the Loan Note
Alternative in respect of substantially all of their Trace Shares, amounting to
an aggregate of 5,223,591 Trace Shares.



Charles Stanley, which is acting as financial adviser to Tulip in relation to
the Acquisition, has confirmed that it is satisfied that sufficient financial
resources are available to Tulip to satisfy in full the cash consideration
payable to Trace Shareholders under the terms of the Revised Offer in respect of
the balance of 9,025,224Trace Shares, plus new shares expected to be issued upon
exercise of share options.  Implementation of the Acquisition will therefore
result in cash consideration of approximately £14.4 million being payable by
Tulip to Trace Shareholders.



The cash consideration payable by Tulip to Trace Shareholders under the terms of
the Acquisition will be financed by debt facilities to be provided by Fortis
Bank Plc up to an amount of £14 million.



The debt facility will initially be in the form of a bridging loan, which is
intended to be repaid, after completion, through the sale and leaseback of the
Company's head office at St John Street and the provision of a medium term loan
facility.



If required to complete the Acquisition, additional finance of up to £1,000,000
will be provided to Tulip by Richard Wolfe by way of a shareholder loan.





11.     Trace Group Share Schemes



SAYE Scheme



On 26 October 2005 Trace granted options to employees under its SAYE scheme over
a total of 314,683 Trace Shares. The option period is three years, at which
stage the options vest. The exercise price was fixed at 84.5p per share, a
discount of 8.4 per cent. to the prevailing market price. Options may only be
exercised during the six month period following vesting and if an employee
leaves the Trace Group before the date of exercise or vesting, then options will
normally lapse.





EMI Scheme and LTIP Scheme



Following approval by Trace Shareholders at the Trace 2005 annual general
meeting, Trace introduced an EMI and an LTIP. The EMI options are exercisable at
a price equal to the quoted market price of a Trace Share on the date of grant.
LTIP awards are exercisable, in total, for the nominal sum of £1 per employee.
The vesting period for each plan is three years and the exercise period is
generally between three and six years from the date of grant. If an employee
leaves the Trace Group before the date of exercise or vesting then options and
awards will normally lapse.



Details of SAYE and EMI options and LTIP awards outstanding are as follows:


                                             Number of              Number of        
                                                 share                  share        Number of share   
                                          options LTIP            options EMI           options SAYE

Outstanding at 1 June 2005                           -                      -                      -
Granted during the financial year              128,276                 64,664                314,683
Lapsed during the financial year                     -                      -                (8,852)
Outstanding at 31 May 2006                     128,276                 64,664                305,831
Lapsed after 31 May 2006                       (2,222)                  (833)               (44,259)
Total                                          126,054                 63,831                261,572



The EMI options outstanding at 31 May 2006 had a weighted average exercise price
of 95.5p. The SAYE options outstanding at 31 May 2006 had a weighted average
exercise price of 84.5p. The LTIP awards are all exercisable at the nominal
value of £1 per employee award. The EMI options and LTIP awards outstanding have
a weighted average remaining contractual life of 91/2 years. The SAYE options
have a weighted average remaining contractual life of 3 years.



Options granted under each of the EMI Scheme, the SAYE Scheme and the LTIP
Scheme will become exercisable when the Revised Offer is declared unconditional
and any performance conditions attaching to those options will be waived. Such
options will be exercisable for a maximum period of six months from the
Effective Date (40 days in the case of options granted under the EMI Scheme)
after which they shall lapse. It is intended that participants will be offered a
cashless exercise facility for the payment to Trace of the exercise price in
connection with the exercise of their options (to the extent appropriate).





12.     Acceptance condition and shareholding levels



Whilst Tulip will seek to acquire 100 per cent. of the Trace Shares, Tulip
cannot predict with certainty its future level of shareholding in Trace.  It is
a condition of the Revised Offer that Tulip will only declare the Revised Offer
unconditional as to acceptances once it has received valid acceptances of the
Revised Offer in respect of not less than 90 per cent of the Trace Shares to
which the Revised Offer relates or such lesser percentage as Tulip may decide
provided that such amount is more than 50 per cent. of the voting share capital
of Trace.



Further details of this acceptance condition are set out in Appendix I of this
Announcement.



Should it wish to do so, Tulip's existing financing arrangements would enable
Tulip to declare the Revised Offer unconditional as to acceptances once it has
received valid acceptances of the Revised Offer or has acquired voting shares
representing not less than 75 per cent. of the voting capital of Trace.  In this
event, and upon the Revised Offer becoming or being declared unconditional in
all respects ('Offer Completion'), Trace would become a subsidiary undertaking
of Tulip and would continue to carry on business as determined by the Trace
Board. It is the intention of Tulip to hold the Revised Offer open for
acceptances from Trace Shareholders (subject to any notice to the contrary
permitted under the Code) once Offer Completion has occurred and therefore
enable Trace Shareholders to continue to accept the Revised Offer following
Offer Completion, should they choose to do so.



In these circumstances, under the Code, Tulip would be entitled and may elect to
Close the Revised Offer at any time following Offer Completion by giving not
less than 14 days' notice to this effect.



In the event that Tulip acquires at least 75 per cent of the voting share
capital of Trace and then decides to declare the Revised Offer unconditional as
to acceptances, Tulip will make application to the UK Listing Authority for the
de-listing of Trace Shares.  However, there may be a period of time after Trace
has become a subsidiary undertaking of Tulip during which Trace's shares are
listed on the Official List.  In these circumstances, and in view of Tulip's
resulting substantial shareholding in Trace, it is anticipated that the
liquidity in Trace Shares would be substantially reduced.





13.     Compulsory acquisition and de-listing of Trace Shares



Following the Revised Offer becoming or being declared unconditional in all
respects, provided that Tulip has received acceptances under the Revised Offer
of at least 90 per cent., Tulip intends to use the procedures set out in Part 28
of the Companies Act 2006 to acquire compulsorily any outstanding Trace Shares
to which the Revised Offer relates.



Tulip will also procure the making of an application by Trace for the
cancellation of the listing of Trace Shares on the Official List in the event
that (i) Tulip acquires at least 75 per cent. of the voting share capital of
Trace having decided to declare the Revised Offer unconditional as to
acceptances at that level; and (ii) there is less than 25 per cent. of the
voting share capital of Trace in public hands.



An announcement will be made following (i) the Revised Offer becoming or being
declared unconditional in all respects and the necessary percentage being
reached under the Listing Rules; or (ii) the commencement of the compulsory
acquisition procedures under Part 28 of the Companies Act 2006 in respect of the
Trace Shares, stating the anticipated time and date when the listing and trading
in shares will be cancelled being not less than 20 business days following such
event.



The cancellation of the listing of Trace Shares would substantially reduce the
liquidity and marketability of any Trace Shares not assented to under the
Revised Offer and their value may be affected as a consequence.





14.     General



The formal Tulip Offer Document and the Form of Acceptance setting out the full
terms and conditions of the Revised Offer is expected to be posted to Trace
Shareholders and, for information only, to option holders in Trace shortly. In
deciding whether or not to accept the Revised Offer, Trace Shareholders should
rely on the information contained in, and procedures described in, the Tulip
Offer Document and the Form of Acceptance.



The Revised Offer will be governed by English law and subject to the applicable
requirements of the Code, the Panel, the London Stock Exchange and the Financial
Services Authority.





Enquiries:

Tulip Holdings Limited                        Telephone: +44 (0) 20 7825 1000
Richard Wolfe
Peter Stolerman

Charles Stanley Securities                    Telephone: +44 (0) 20 7149 6000
(Financial adviser to Tulip)
Russell Cook
Henry Fitzgerald-O'Connor




This Announcement does not, and is not intended to, constitute or form part of
any offer to sell, or an invitation to purchase, any securities or the
solicitation of any vote or approval in any jurisdiction. The Revised Offer will
be made solely by means of the Tulip Offer Document, which will contain the full
terms and conditions of the Revised Offer. Trace Shareholders are advised to
read carefully the formal documentation in relation to the Revised Offer once it
has been despatched.



The availability of the Revised Offer and the release, publication or
distribution of this Announcement to persons who are not resident in the United
Kingdom may be affected by the laws of the relevant jurisdictions in which they
are located. Persons who are not resident in the United Kingdom should inform
themselves of, and observe, any applicable requirements. Any failure to comply
with such applicable requirements may constitute a violation of the securities
laws of any such jurisdictions. This Announcement has been prepared for the
purposes of complying with English law and the City Code and the information
disclosed may not be the same as that which would have been disclosed if this
Announcement had been prepared in accordance with the laws of jurisdictions
outside the United Kingdom.



The Revised Offer will not be made in or into any jurisdiction where to do so
would constitute a violation of the relevant laws of such jurisdiction.
Custodians, nominees and trustees should observe these restrictions and should
not send or distribute the document in or into any jurisdiction where to do so
would constitute a violation of the relevant laws of such jurisdiction.



Charles Stanley, which is authorised and regulated in the United Kingdom by the
Financial Services Authority, is acting exclusively for Tulip and no one else in
connection with the Revised Offer and will not be responsible to anyone other
than Tulip for providing the protections afforded to clients of Charles Stanley
nor for providing advice in relation to the Revised Offer, the content of this
Announcement or any matter referred to herein.





CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS



This Announcement contains certain forward-looking statements with respect to
the financial condition, results of operations and business of Trace or the
Trace Group and certain plans and objectives of the boards of directors of Trace
and Tulip. These forward-looking statements can be identified by the fact that
they do not relate only to historical or current facts. Forward-looking
statements often use words such as 'anticipate', 'target', 'expect', 'estimate',
'intend', 'plan', 'goal', 'believe', 'project', 'strategy' 'will', 'may',
'should', 'would', 'could' or other words of similar meaning. Forward-looking
statements include statements relating to the expected timetable for completing
this transaction.



These statements are based on assumptions and assessments made by the Tulip
Board and Trace Board in light of their experience and their perception of
historical trends, current conditions, expected future developments and other
factors they believe appropriate.



These forward-looking statements are not guarantees of future performance. By
their nature, forward-looking statements involve risk and uncertainty, and the
factors described in the context of such forward-looking statements in this
Announcement could cause actual results and developments to differ materially
from those expressed in or implied by such forward-looking statements.



Should one or more of these risks or uncertainties materialise, or should
underlying assumptions prove incorrect, actual results may vary materially from
those described herein. Trace and Tulip assume no obligation to update or
correct the information contained in this Announcement.



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 one per cent. or more of any class of
'relevant securities' of Trace, all 'dealings' in any 'relevant securities' of
that company (including by means of an option in respect of, or a derivative
referenced to, any such 'relevant securities') must be publicly disclosed by no
later than 3.30 p.m. (London time) on the Business Day following the date of the
relevant transaction.



This requirement will continue until the date on which the Revised Offer is
withdrawn or when the 'offer period' for the purposes of the City Code 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
Trace, 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 City Code, all 'dealings' in 'relevant
securities' of Trace by Tulip or Trace, or by any of their respective
'associates', must be disclosed by no later than 12.00 p.m. (London time) on the
Business Day following the date of the relevant transaction.



A disclosure table, giving details of the companies in whose 'relevant
securities' 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.



If you are in any doubt as to the application of Rule 8 to you, please contact
an independent financial adviser authorised pursuant to the Financial Services
and Markets Act 2000, consult the Panel's website, or contact the Panel on +44
(0) 20 7382 9026 or by fax on +44 (0) 20 7236 7005.



'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 City 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.







APPENDICES



Appendix I sets contains the Conditions to and a summary of certain further
terms of the Revised Offer.



Appendix II sets out the bases and sources of information from which the
financial calculations used in this Announcement have been derived.



Appendix III Part A contains details of the irrevocable undertakings previously
provided in relation to the Trace Scheme. Appendix III Part B contains the
details of irrevocable undertakings that remain in place for Tulip's Revised
Offer and new irrevocable undertakings provided in relation to Tulip's Revised
Offer.



Appendix IV contains the definitions of terms used in this Announcement.



                                   Appendix I


           Conditions and certain further terms of the Revised Offer


                    Part A: Conditions to the Revised Offer


The Revised Offer will be subject to the following conditions:



(a)        valid acceptances of the Revised Offer being received (and not, where
permitted, withdrawn) by 1.00 pm (London time) on the First Closing Date of the
Revised Offer (or such later time(s) and/or date(s) as Tulip may, subject to the
Code or with the consent of the Panel, decide) in respect of not less than 90
per cent. (or such lesser percentage as Tulip may decide) in nominal value of
the Trace Shares to which the Revised Offer relates, provided that, unless
agreed by the Panel, this condition will not be satisfied unless Tulip shall
have acquired or agreed to acquire (whether pursuant to the Revised Offer or
otherwise) Trace Shares carrying in aggregate more than 50 per cent. of the
votes then normally exercisable at a general meeting of Trace, including for
this purpose (except to the extent, if any, required by the Panel) any such
voting rights attached to Trace Shares which are unconditionally allotted or
issued before the Revised Offer becomes or is declared unconditional as to
acceptances, whether pursuant to the exercise of conversion or subscription
rights or otherwise) and, for this purpose:



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

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



(b)                 since the date of this Announcement:



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



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



(c)                 since the date of this Announcement, no government or
governmental, quasi-governmental, supranational, statutory, regulatory or
investigative body, authority, court, trade agency or professional association
or other similar body or person having statutory or regulatory competence in any
relevant jurisdiction (each a 'Relevant Authority') having instituted,
implemented or threatened, or having decided to take, institute or threaten any
action, proceeding, suit, investigation or enquiry, or having made, proposed or
enacted any statute, regulation or order, or taken any other steps, in each case
which is likely to be material in the context of the Acquisition and which would
or might reasonably be expected to:



(i)       make the Acquisition void, illegal or otherwise unenforceable or, to
an extent which is material, otherwise directly or indirectly restrain,
prohibit, restrict or delay the implementation or performance of the same or
impose unduly onerous additional conditions or obligations with respect to it,
or otherwise impede, challenge or interfere with the Acquisition; or



(ii)     otherwise adversely affect any or all of the businesses, financial
position, assets, trading results or prospects of any member of the Trace Group,
in any case to an extent which is material in the context of the Trace Group
taken as a whole.



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



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



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





               Part B: Certain further terms of the Revised Offer



(a)        If sufficient acceptances are received and/or sufficient Trace Shares
are otherwise acquired, Tulip intends to apply the provisions of sections 974 to
991 of the Companies Act 2006 ('2006 Act'). to acquire compulsorily any
outstanding Trace Shares to which the Revised Offer relates. Tulip also intends,
either on the date that acceptances under the Revised Offer attain the required
percentage for the purposes of Rule 5.2.10R(1) of the Listing Rules or on the
first date of issue of compulsory acquisition notices under section 979 of the
2006 Act ('Cancellation Commencement Date') to procure the making of an
application by Trace to the UK Listing Authority for the cancellation of the
listing of Trace Shares on the Official List and for the cancellation of trading
of the Trace Shares on the market for listed securities of the London Stock
Exchange, in respect of a date not less than 20 business days after the
Cancellation Commencement Date which shall constitute the notice period for such
purposes under Rule 5.2.10R(2) of the Listing Rules.



(b)        If the Panel requires Tulip to make an offer for Trace Shares under
the provisions of Rule 9 of the Code, Tulip may make such alterations to the
conditions of the Revised Offer, including condition (a) (set out in Part A
above), as are necessary to comply with the provisions of that Rule.



(c)        The Trace Shares which are the subject of the Revised Offer will be
acquired by Tulip fully paid and free from all liens, charges, equitable
interests, encumbrances and other interests of any nature whatsoever and
together with all rights now or hereafter attaching thereto, including the right
to receive and retain all dividends, interest and other distributions declared,
made or payable after the date of this document.



(d)        Overseas Shareholders should inform themselves about and observe any
applicable legal or regulatory requirements. If you are in any doubt about your
position, you should consult your professional advisor in the relevant
territory.



                                  Appendix II



Bases and Sources of Information



Save as otherwise stated, the following constitute the bases and sources of
certain information referred to in this Announcement:



1.      The value attributed to the entire issued share capital of Trace is
based on 14,248,815 Trace Shares being in issue as at the date of this
Announcement.



2.      Unless otherwise stated, the financial information concerning Trace
Group has been extracted from the audited annual report and consolidated
accounts of Trace Group for the financial year ended 31 May 2006.



3.      References to closing prices of Trace Shares are derived from the Daily
Official List of the London Stock Exchange



4.      The information relating to Tulip and the statements of intention for
the Trace Group which Tulip has made in this Announcement have been provided by
Tulip Directors.



                                  Appendix III



                                     Part A



As previously announced on 24 May 2007 Tulip holds the following irrevocable
undertakings in respect of a cash offer for Trace:



Hard Irrevocables without the Standstill:



Irrevocable undertakings that do not fall away in the event of a higher offer,
effective for 12 months from either 19 April 2007 or 24 May 2007, but which will
lapse if Tulip's Revised Offer lapses or is withdrawn:


Shareholder Name                        Number of Trace Shares to which the                Percentage of 
                                            irrevocable undertaking applies                 Trace Shares
Colin Clarke 1 *                                                  1,426,453                       10.01%
Debbie Able                                                          28,266                        0.20%
Clare Garretty                                                       15,757                        0.11%
Mark Holden                                                           3,160                        0.02%
Gladys Flynn                                                          2,724                        0.02%
Emmy Golding                                                          2,614                        0.02%
William Muir                                                          2,540                        0.02%
Alan Beck                                                             2,297                        0.02%
Sharon Thompson                                                       2,294                        0.02%
Anne Marie Taylor                                                     1,936                        0.01%
Robert Wolf                                                           1,918                        0.01%
Elizabeth Kaufmann                                                      938                        0.01%
Elizabeth Higgins                                                       768                        0.01%
Charlotte Burr                                                          664                        0.00%
Katrina Hopkins                                                         573                        0.00%
Nick Kaufmann                                                           476                        0.00%
Phillippa Kaufmann                                                      461                        0.00%
Mike Taylor                                                             100                        0.00%

Total irrevocable undertakings that do                            1,493,939                       10.48%
not fall away in the event of a higher
offer but do not include a standstill
agreement giving rise to a concert
party.



Hard Irrevocables with Standstill (giving rise to a Concert Party):



Irrevocable undertakings that do not fall away in the event of a higher offer
and include a standstill agreement for a period of 12 months from either 19
April or 14 May 2007.


Shareholder name                           Number of Trace  Shares to which               Percentage of 
                                        the irrevocable undertaking applies                Trace Shares
Richard Wolfe1, 2                                                 3,265,771                       22.92%
Zigmond Levy                                                        590,187                        4.14%
John Murphy2                                                        134,562                        0.94%
Michael Flynn                                                       115,614                        0.81%
Connel Torley                                                        81,956                        0.58%
Peter Stolerman1, 2                                                   8,000                        0.06%
Doug Eastabrook                                                     330,469                        2.32%
Ann Claxton                                                         223,141                        1.57%
Roger Claxton                                                       180,788                        1.27%
Ian Winchester                                                      100,000                        0.70%
Carole Moore                                                         54,647                        0.38%
Peter Carabott                                                       52,438                        0.37%
Julian Mancell-Smith                                                 33,303                        0.23%
Nick Tonge                                                           30,169                        0.21%
Patricia Matheson                                                    24,131                        0.17%
Tony Davis                                                           21,634                        0.15%
Julia Mancell-Smith                                                  17,890                        0.13%
James Ebel                                                           17,043                        0.12%
Marilyn Lawless                                                      15,891                        0.11%
Adam Levy                                                            15,175                        0.11%
David Bacon                                                          14,907                        0.10%
Paul Mortimer                                                        13,637                        0.10%
Richard Fok-Seang                                                    12,478                        0.09%
Bianca Levy                                                          12,000                        0.08%
Chrispin Levy                                                        12,000                        0.08%
Ruth Wolfe Charitable Trust                                          10,000                        0.07%
Paul Donnelly                                                         9,456                        0.07%
Julian Penfold                                                        8,573                        0.06%
John Davis                                                            8,498                        0.06%
Kathy Donnelly                                                        6,513                        0.05%
Phil Pearson                                                          6,397                        0.04%
Trudy Pearson                                                         6,250                        0.04%
Garreth O'Neill                                                       6,112                        0.04%
Xenia McGrane                                                         5,172                        0.04%
Aisha Hussain                                                         4,838                        0.03%
Ian Treadgold                                                         4,475                        0.03%
Sheila Bow                                                            4,000                        0.03%
Hermine King                                                          3,648                        0.03%
Kathy Tong                                                            3,131                        0.02%
Andrew Booth                                                          3,000                        0.02%
Linda Letch                                                           2,738                        0.02%
Eamonn Brown                                                          2,375                        0.02%
Mary Davis                                                            2,237                        0.02%
Terry Hooper                                                          2,198                        0.02%
Pete Geraghty                                                         2,029                        0.01%
Graham Pointer                                                        1,748                        0.01%
Tony Abbott                                                           1,536                        0.01%
Sid Chekhar                                                           1,107                        0.01%
Dave Marchant                                                         1,000                        0.01%
Jerry Baker                                                             900                        0.01%
Kevin Grice                                                              11                        0.00%

Total irrevocable undertakings that do                            5,485,773                       38.50%
not fall away in the event of a higher
offer and include a standstill
agreement for a period of 12 months
from 14 May 2007



1 Director of Trace

2 Director of Tulip

                                     Part B



In addition to the irrevocable undertakings listed above, Tulip now holds the
following irrevocable undertakings in respect of a cash offer for Trace:



Irrevocable undertakings dated 13 June 2007 that fall away in the event of an
offer of not less than 200p per Trace Share:




Shareholder name                           Number of Trace  Shares to which               Percentage of 
                                        the irrevocable undertaking applies                Trace Shares
Ann Webb                                                               7000                        0.05%
Derek Webb                                                           24,585                        0,17%
John Barber                                                           4,000                        0.03%
Kathryn Selwyn-Smith                                                  2,020                        0.01%
Nick Brooks                                                          17,787                        0.12%
Total irrevocable undertakings which
fall away in the event of an offer of
not less than 200p per Trace Share                                   55,392                        0.39%





                                     Part C



In aggregate, Tulip currently holds the following irrevocable undertakings in
respect of a cash offer for Trace:


Type of Irrevocable Undertaking            Number of Trace  Shares to which   Percentage of Trace Shares
                                         the irrevocable undertakings apply
Irrevocable undertakings that do not                              1,493,939                       10.48%
fall away in the event of a higher
offer but do not include a standstill
agreement giving rise to a concert
party.

Irrevocable undertakings that do not                              5,485,773                       38.50%
fall away in the event of a higher
offer and include a standstill
agreement for a period of 12 months
from 14 May 2007



Irrevocable undertakings which fall                                  55,392                        0.39%
away in the event of an offer of not
less than 200p per Trace Share

Totals                                                            7,035,104                       49.37%





                                  Appendix IV


Definitions



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


Acquisition                         the proposed acquisition by Tulip of the entire issued and to be
                                    issued share capital of Trace;


Announcement                        this announcement dated 13 June 2007;

Board                               the board of directors of Trace or Tulip as constituted from time
                                    to time, as the case may be and the terms 'Trace Board' and '
                                    Tulip Board' shall be construed accordingly;

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

Cash Consideration                  the value of the Acquisition at the Cash Offer price;

Cash Offer                          156p for each Trace Share;

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

Charles Stanley                     Charles Stanley Securities, a division of Charles Stanley & Co.
                                    Limited;

City Code                           the City Code on Takeovers and Mergers

Closing Price                       the closing middle market quotation of a Trace Share derived from
                                    the Daily Official List of the London Stock Exchange on any
                                    particular day;

Company or Trace                    Trace Group plc;

Companies Act                       the Companies Act 2006;

Conditions                          the conditions to the implementation of the Offer, which are set
                                    out in Appendix I;


CREST                               the relevant system (as defined in the CREST Regulations) for the
                                    paperless settlement of share transfers and the holding of shares
                                    in uncertificated form (as defined in the CREST Regulations) in
                                    respect of which CRESTCo Limited is the Operator (as defined in
                                    the CREST Regulations);

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

CRESTCo                             CRESTCo. Limited;

De-list or De-listing               the proposed cancellation by the London Stock Exchange of the
                                    admission of the Trace Shares to trading on the Official List;

Director                            means a director of Trace or Tulip, as the case may be;

EMI Scheme                          the Trace enterprise management incentive share option plan, as
                                    approved by Trace Shareholders at the annual general meeting of
                                    Trace in 2005;

Enlarged Tulip Group                Tulip and the Trace Group following the Acquisition;

Financial                           Trace Financial Limited, a company incorporated and registered in
                                    England and Wales with company number 1516137  , which is a
                                    wholly-owned subsidiary of Trace;

First Closing Date                  the date set as the first closing date of the Revised Offer in
                                    the Revised Offer Document;

Form of Acceptance                  the form of acceptance and authority for use by Trace
                                    Shareholders in connection with the Revised Offer;

Independent Directors               Mr Daniel Chapchal (Chairman) and Professor David Begg, Mr Colin
                                    Clarke and Mr Robin Woodall (Trace Directors);

Isys                                Trace Isys Limited, a company incorporated and registered in
                                    England and Wales with company number 1184694  , which is a
                                    wholly-owned subsidiary of Trace;

Loan Note(s)                        the 3.00 per cent. unsecured loan notes 2022 of Tulip to be
                                    issued pursuant to the Loan Note Alternative, particulars of
                                    which are summarised in paragraph 3 of this Announcement;

Loan Note Alternative               the alternative consideration for which a holder of Trace Shares
                                    (other than a Restricted Overseas Person) may elect under the
                                    Revised;

London Stock Exchange               London Stock Exchange plc;

LTIP Scheme                         the Trace long term incentive plan as approved by Trace
                                    Shareholders at the annual general meeting of Trace in 2005;

Microgen                            Microgen plc, a company incorporated and registered in England
                                    and Wales with company number 1602662;

Microgen Offer                       The offer made by Microgen to acquire all of the Trace Shares on
                                    01 June 2007;

Non-Independent Directors           Richard Wolfe and Peter Stolerman;

Noteholder                          a holder of Loan Notes;

Offer Period                        the period commencing on 20 April 2007 and ending on whichever of
                                    the following dates shall be the latest: (i) at 1.00 p.m. on the
                                    First Closing Date; (ii) the date on which the Revised Offer
                                    lapses; and (iii) the date on which the Revised Offer becomes or
                                    is declared unconditional as to acceptances

Official List                       the Official List of the London Stock Exchange

Overseas Persons                    Scheme Shareholders who are resident in, ordinarily resident in,
                                    or citizens of, jurisdictions outside the United Kingdom

Panel or Takeover Panel             the Panel on Takeovers and Mergers

Payroll Services                    Trace Payroll Services Limited, a company incorporated and
                                    registered in England and Wales with company number 863160  ,
                                    which is a wholly-owned subsidiary of Trace

Property Purchaser                  Carlington Properties Limited

Registrar of Companies              the Registrar of Companies in England and Wales

Revised Offer                       Tulip's revised offer for the entire issued ordinary share
                                    capital of Trace to be made at the Revised Offer Price and
                                    subject to the Conditions;

Revised Offer Document              the formal offer document setting out the terms and conditions of
                                    the Revised Offer which is expected to be posted to Trace
                                    Shareholders (other than those in a Restricted Jurisdiction)
                                    shortly

Revised Offer Price                 the consideration of 156p per share to be offered by Tulip for
                                    the Trace Shares;

Restricted Jurisdiction             any jurisdiction where local laws or regulations may result in a
                                    significant risk of civil, regulatory or criminal exposure or
                                    prosecution if information concerning the Revised Offer made
                                    available to Trace Shareholders in that jurisdiction

Restricted Overseas Persons         a person (including an individual, partnership, unincorporated
                                    syndicate or organisation, incorporated association, trust,
                                    trustee, executor, administrator or other legal representative)
                                    in or resident in the United States, Canada, Australia or Japan
                                    or any other jurisdiction where it would be unlawful to elect for
                                    the Loan Note Alternative or sell Loan Notes or a U.S. Person (as
                                    defined in Regulation S under the U.S. Securities Act);

Sale and Leaseback Agreement        an agreement proposed to be entered into between Tulip and the
                                    Property Purchaser pursuant to which Tulip is to procure that a
                                    sale and leaseback agreement is to be entered into between Trace
                                    and the Property Purchaser following the implementation of the
                                    Scheme and the Acquisition, pursuant to which the St John Street
                                    Property is to be sold to the Property Purchaser and leased back
                                    to Trace;

SAYE Scheme                         Trace's save as you earn share option scheme approved by Trace
                                    Shareholders in 1998

Solutions                           Trace Solutions Limited, a company incorporated and registered in
                                    England and Wales with company number 2052844 which is a
                                    wholly-owned subsidiary of Trace;

St John Street Property             Trace's head office building situated at 224-232 St John Street,
                                    London EC1V 4QR;

Trace Directors                     the Non-Independent Directors and the Independent Directors;

Trace Group                         Trace and the Trace Subsidiaries;

Trace Scheme                        the proposal for the acquisition of Trace by Tulip which was to
                                    be effected by means of a scheme of arrangement under section 425
                                    of the Companies Act between Trace and the Trace Shareholders and
                                    which lapsed on 25 May 2007;

Trace Scheme Announcement           the announcement of the Trace Scheme made by Tulip and the
                                    Independent Directors of Trace on 20 April 2007

Trace Scheme Document               the document dated 26 April 2007 issued by Trace to Trace
                                    Shareholders in connection with the Trace Scheme

Trace Share Option Schemes          the EMI Scheme, SAYE Scheme and LTIP Scheme

Trace Shares                        the existing issued and fully paid ordinary shares of 5p each in
                                    the capital of Trace excluding shares held in treasury

Trace Shareholder(s)                holders of Trace Shares

Trace Subsidiaries                  Solutions, Financial, Isys and Payroll Services

Tulip                               Tulip Holdings Limited, a company incorporated and registered in
                                    England and Wales with company number 6046342 whose registered
                                    office is at 224-232 St John Street, London EC1V 4QR

Tulip Directors                     Richard Wolfe, Peter Stolerman and John Murphy

Tulip Offer Document                the formal offer document setting out the terms and conditions of
                                    the Revised Offer which is expected to be posted shortly to Trace
                                    Shareholders (other than those in Restricted Jurisdiction); and

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 and in the exercise of its
                                    functions in respect of the Admission to the Official List
                                    otherwise than in accordance with Part VI of FSMA.





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

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