RECOMMENDED CASH OFFER FOR PORTRAIT SOFTWARE PLC ( PORTRAIT ) PITNEY BOWES MAPINFO UK LIMITED, A WHOLLY-OWNED SUBSIDIARY OF PITNEY BOWES, INC.

Transcription

1 Not for release, publication or distribution, in whole or in part, in or into or from the United States, Canada, Australia, Japan or the Republic of South Africa or any other jurisdiction where it would be unlawful to do so 10 June 2010 RECOMMENDED CASH OFFER FOR PORTRAIT SOFTWARE PLC ( PORTRAIT ) BY PITNEY BOWES MAPINFO UK LIMITED, A WHOLLY-OWNED SUBSIDIARY OF PITNEY BOWES, INC. Summary The boards of directors of Pitney Bowes MapInfo UK Limited (an indirect whollyowned subsidiary of Pitney Bowes, Inc.) and Portrait are pleased to announce that they have reached agreement on the terms of a recommended cash offer for the entire existing issued and to be issued ordinary share capital of Portrait to be made by Pitney Bowes MapInfo UK Limited. The Offer will be 31.0 pence in cash for each Portrait Share and values Portrait s entire existing issued and to be issued ordinary share capital at approximately 44.4 million, representing: a premium of approximately 70 per cent. to the average daily Closing Price of 18.2 pence per Portrait Share over the last twelve months up to and including 9 June 2010, being the last Business Day prior to this announcement; a premium of approximately 38 per cent. to the average daily Closing Price of 22.5 pence per Portrait Share over the last six months up to and including 9 June 2010, being the last Business Day prior to this announcement; and a premium of approximately 35 per cent. to the Closing Price of 23.0 pence per Portrait Share on 9 June 2010, being the last Business Day prior to this announcement. The Pitney Bowes Group provides mail processing equipment and integrated mail solutions in the United States and internationally, assisting organisations in managing the flow of information, mail, documents and packages. The proposed acquisition of Portrait provides an opportunity for the Pitney Bowes Group to enhance its coverage across key Customer Relationship Management (CRM) technologies and to expand its existing platform offering in this area. 1

2 The Pitney Bowes Group s added scale, capital position and broad geographic footprint across more than 130 countries will provide Portrait with a significant platform from which to achieve future growth. Pitney Bowes has received irrevocable undertakings from all of the Portrait Directors and certain other Portrait Shareholders to accept (or procure the acceptance of) the Offer in respect of, in aggregate, 70,010,153 Portrait Shares, representing approximately per cent. of the existing issued ordinary shares of Portrait. The terms of the irrevocable undertakings given by each of the Portrait Directors also extend to any Portrait Shares which may be issued to, or acquired by, Portrait Directors pursuant to the terms of the Portrait Share Option Schemes, amounting to, in aggregate, a further 10,804,545 Portrait Shares. Further details of these irrevocable undertakings are set out in Appendix 3 of this announcement, including details of the circumstances in which each of the irrevocable undertakings will lapse. The Portrait Directors, who have been so advised by Singer Capital Markets Limited, unanimously recommend that Portrait Shareholders accept the Offer, as they have irrevocably undertaken to do in respect of their own beneficial holdings of Portrait Shares, amounting to, in aggregate, 2,196,787 Portrait Shares (and representing approximately 1.77 per cent. of the existing issued ordinary shares of Portrait). In providing its advice, Singer Capital Markets Limited has taken into account the commercial assessments of the Portrait Directors. Commenting on the Offer, Murray D. Martin, Chairman, President and Chief Executive Officer of Pitney Bowes, Inc. said: We are delighted to have reached agreement with the Board of Portrait on this recommended transaction. The acquisition of Portrait will expand our platform offering in customer relationship management technology and further enhance our range of integrated solutions we provide to our customers. The acquisition represents a good opportunity for Portrait and its shareholders to receive a premium over the current market value of their shares. The Pitney Bowes Group s scale and broad geographic footprint will open up new markets for Portrait s products and will provide a platform from which to achieve growth in the future. Commenting on the Offer, Paul Hewitt, Non-Executive Chairman of Portrait said: We believe this to be an excellent offer for all Portrait stakeholders and provides a great opportunity for our people and our customers whilst delivering significantly enhanced value to our shareholders. Further it is recognition of the progress we have made within the business which has resulted in a significant increase in revenues and profits, market penetration, and high profile industry recognition, even during an extremely tough economic environment. Pitney Bowes global reach will enable the Portrait business to accelerate its growth and to go on to greater success. This summary should be read in conjunction with the attached announcement. In accordance with Rule of the City Code, a copy of this announcement will be available on Pitney Bowes Inc. s website, 2

3 /phoenix.zhtml?c=83377&p-irol-irhome, and on Portrait s website, portraitsoftware.com/company/investor_information, by not later than 12 noon on 11 June In accordance with Rule 2.10 of the Takeover Code, Portrait confirms that it has 123,857,508 ordinary shares of 2.5 pence each in issue and admitted to trading on the Alternative Investment Market of the London Stock Exchange under the ISIN code GB Enquiries Pitney Bowes, Inc., and Pitney Bowes MapInfo UK Limited Matthew Broder Morgan Stanley (financial adviser to Pitney Bowes, Inc. and Pitney Bowes MapInfo UK Limited) Matthew Jarman Bryce Facktor Portrait Software plc Luke McKeever Matthew White Singer Capital Markets Limited (Rule 3 adviser to Portrait) Shaun Dobson Claes Spang ICIS (PR firm to Portrait) Tom Moriarty Caroline Evans-Jones This announcement is not intended to and does not constitute or form any part of an offer to sell or an invitation to purchase or the solicitation of an offer to subscribe for any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Offer or otherwise. The Offer will be made solely through the Offer Document and, in the case of Portrait Shares in certificated form, the Form of Acceptance, which will together contain the full terms and conditions of the Offer, including details of how to accept the Offer. Any acceptance or other response to the Offer should be made only on the basis of the information contained in the Offer Document and, in the case of Portrait Shares in certificated form, the Form of Acceptance. Morgan Stanley is acting as financial adviser exclusively to Pitney Bowes, Inc. and Pitney Bowes MapInfo UK Limited and to no one else in connection with the Offer and accordingly will not be responsible to anyone other than Pitney Bowes, Inc. and Pitney 3

4 Bowes MapInfo UK Limited for providing the protections afforded to clients of Morgan Stanley nor for giving advice in relation to the Offer or the contents of this document. Singer Capital Markets Limited, which is authorised and regulated by the Financial Services Authority, is acting exclusively for Portrait Software plc and for no-one else in connection with the Offer and is not advising any other person and accordingly will not be responsible to anyone other than Portrait Software plc for providing the protections afforded to clients of Singer Capital Markets Limited nor for giving advice in relation to the Offer or the contents of this document. The Offer is not being made, directly or indirectly, in, into or from, or by use of the mails of, or by any means of instrumentality (including electronically or by facsimile transmission, internet, , telex or telephone) of interstate or foreign commerce of, or any facility of a national, state or other securities exchange of, the United States, Australia, Canada, Japan, Republic of South Africa or any other Prohibited Jurisdiction if to do so would constitute a violation of the relevant laws in such other jurisdiction and, subject to certain exceptions, the Offer cannot be accepted by any such use, means, instrumentality or facility or from within the United States, Australia, Canada, Japan, Republic of South Africa or any other Prohibited Jurisdiction if to do so would constitute a violation of the relevant laws in such other jurisdiction. Accordingly, copies of this document, the Form of Acceptance and any related or accompanying document are not being, and must not be, directly or indirectly, mailed, distributed, transmitted, forwarded or otherwise sent, in whole or in part, in, into or from the United States, Australia, Canada, Japan, Republic of South Africa or any other Prohibited Jurisdiction. Doing so may render invalid any purported acceptance of the Offer. All Portrait Shareholders or other persons (including nominees, trustees or custodians) receiving this document, the Form of Acceptance or any related or accompanying document should not distribute, mail, transmit, forward or send them or any of them in, into or from the United States, Australia, Canada, Japan, Republic of South Africa or any other Prohibited Jurisdiction or use such mails or any such means, instrumentality or facility for any purpose related to the Offer. It is the responsibility of each Overseas Shareholder to inform himself, herself or itself about and observe any applicable legal requirements. No Overseas Shareholder receiving a copy of this announcement and/or any other documentation relating to the Offer in a Prohibited Jurisdiction may treat the same as constituting an invitation or offer to him and in such circumstances, this announcement and/or any other documentation relating to the Offer are sent for information only. It is the responsibility of any Overseas Shareholder receiving a copy of this announcement and/or any other documentation relating to the Offer in any jurisdiction outside the United Kingdom who wishes to accept the Offer to satisfy himself as to the full observance of the laws and regulatory requirements of that jurisdiction in connection with the Offer, including obtaining any governmental, exchange control or other consents which may be required, and compliance with any other necessary formalities which need to be observed and the payment of any transfer or other taxes or duties that may be or become due under the laws of such jurisdiction. Any such Overseas Shareholder will be responsible for any such transfer or other taxes or duties by whomsoever payable and Pitney Bowes, Inc. and Pitney Bowes MapInfo UK Limited (and any person acting on behalf of Pitney Bowes, Inc. or Pitney Bowes MapInfo UK Limited) shall be fully indemnified and held harmless by such Overseas Shareholder for 4

5 any such transfer or other taxes or duties or other requisite payments as Pitney Bowes, Inc. or Pitney Bowes MapInfo UK Limited (and any person acting on behalf of Pitney Bowes, Inc. or Pitney Bowes MapInfo UK Limited) may be required to pay. This announcement has been prepared for the purpose 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 England, including those of the United States. Dealing Disclosure Requirements Under Rule 8.3(a) of the City Code, any person who is interested in one per cent. or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the Offer Period and, if later, following the announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of: (i) the offeree company; and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the Offer Period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure. Under Rule 8.3(b) of the City Code, any person who is, or becomes, interested in one per cent. or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of: (i) the offeree company; and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing. If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3. Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4 of the City Code). Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at 5

6 including details of the number of relevant securities in issue, when the Offer Period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should contact the Panel s Market Surveillance Unit on +44 (0) Forward-looking statements This document includes certain statements about Portrait and/or Pitney Bowes MapInfo UK Limited and/or Pitney Bowes, Inc. (and their respective groups and/or subsidiary undertakings) that are or may be forward-looking statements in its general meaning and within the meaning of the Private Securities Litigation Reform Act of All statements other than statements of historical fact included in this document may be forward-looking statements. These statements are based on the current expectations of the management of Portrait and/or Pitney Bowes MapInfo UK Limited and/or Pitney Bowes, Inc. (as the case may be) and are naturally subject to uncertainty and changes in circumstances. The forward-looking statements contained herein may include statements about, following the Offer being declared unconditional in all respects, the expected timing and scope of the Offer, anticipated earnings enhancements, estimated cost savings and other synergies, costs to be incurred in achieving synergies, other strategic options and all other statements in this document other than those which concern historical fact. Forward-looking statements include statements typically containing words such as intend, expect, anticipate, target, estimate, goal, believe, will, may, should, would, could, plan or words of similar meaning or import. By their nature, forward-looking statements are not guarantees of future performance and involve risks and uncertainties and actual results may differ materially from those in the forward looking statements because they relate to events and depend on circumstances that will or may occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed in, or implied by, such forward-looking statements. These factors include the satisfaction of the conditions to the Offer and the Pitney Bowes Group s ability to successfully integrate the operations and employees of the Portrait Group, as well as additional factors such as changes in economic conditions, changes in the level of capital investment, the success of business and operating initiatives and restructuring objectives, customers strategies and stability, changes in the regulatory environment, fluctuations in interest and exchange rates and the outcome of litigation, government actions and natural phenomena such as floods, earthquakes and hurricanes. Other unknown or unpredictable factors could cause actual results to differ materially from those in the forward-looking statements. Investors should not place undue reliance on such forward-looking statements and neither Portrait nor Pitney Bowes MapInfo UK Limited, nor Pitney Bowes, Inc., nor any of their respective directors, undertakes any obligation to update publicly or revise forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent legally required. This summary should be read in conjunction with the full text of this announcement. Appendix 1 to this announcement contains the conditions to, and certain further terms of, the Offer. Appendix 2 to this announcement contains further details of the sources of information and bases of calculations set out in this announcement, Appendix 3 contains a summary of the irrevocable undertakings given by the Portrait Directors and 6

7 certain other Portrait Shareholders and Appendix 4 contains definitions of certain expressions used in this summary and in this announcement. Not for release, publication or distribution, in whole or in part, in or into or from the United States, Canada, Australia, Japan or Republic of South Africa or any other jurisdiction where it would be unlawful to do so. 7

8 10 June INTRODUCTION Recommended cash offer for Portrait Software plc ( Portrait ) by Pitney Bowes MapInfo UK Limited a wholly-owned subsidiary of Pitney Bowes, Inc. The Boards of Pitney Bowes MapInfo UK Limited (an indirect wholly-owned subsidiary of Pitney Bowes, Inc.) and Portrait are pleased to announce that agreement has been reached on the terms of a recommended cash offer to be made by Pitney Bowes MapInfo UK Limited to acquire all of the issued and to be issued ordinary share capital of Portrait. 2. THE OFFER The Offer, which will be subject to the conditions and further terms set out in Appendix 1 to this document and will be set out in the Offer Document, will be made on the following basis: for each Portrait Share 31.0 pence in cash The Offer Price represents: a premium of approximately 70 per cent. to the average daily Closing Price of 18.2 pence per Portrait Share over the last twelve months up to and including 9 June 2010, the last Business Day prior to this announcement; a premium of approximately 38 per cent. to the average daily Closing Price of 22.5 pence per Portrait Share over the last six months up to and including 9 June 2010, the last Business Day prior to this announcement; and a premium of approximately 35 per cent. to the Closing Price of 23.0 pence per Portrait Share on 9 June 2010, the last Business Day prior to this announcement. The Offer values the entire issued and to be issued ordinary share capital of Portrait at approximately 44.4 million. 3. RECOMMENDATION The Directors of Portrait, who have been so advised by Singer Capital Markets Limited, consider the terms of the Offer to be fair and reasonable. In providing advice to the Directors of Portrait, Singer Capital Markets Limited has taken into account the commercial assessments of the Portrait Directors. Accordingly, the Directors intend unanimously to recommend that Portrait Shareholders accept the Offer as they have irrevocably undertaken to do in respect of their own entire 8

9 beneficial holdings of Portrait Shares, amounting to, in aggregate, 2,196,787 Portrait Shares (and representing approximately 1.77 per cent. of the existing issued ordinary shares of Portrait). Further details of these undertakings are set out below and in Appendix IRREVOCABLE UNDERTAKINGS TO ACCEPT THE OFFER Pitney Bowes MapInfo UK Limited has received irrevocable undertakings to accept the Offer from all of the Portrait Directors in respect of their entire beneficial holdings of Portrait Shares, amounting to, in aggregate, 2,196,787 Portrait Shares (and representing approximately 1.77 per cent. of the existing issued ordinary shares of Portrait). The terms of the irrevocable undertakings given by each of the Portrait Directors also extend to any Portrait Shares which may be issued to, or acquired by, Portrait Directors pursuant to the terms of the Portrait Share Option Schemes, amounting to, in aggregate, a further 10,804,545 Portrait Shares. Furthermore, Pitney Bowes MapInfo UK Limited has received irrevocable undertakings to accept, or procure acceptance of, the Offer from certain Portrait Shareholders in respect of, in aggregate, 67,813,366 Portrait Shares, representing approximately per cent. of the existing issued ordinary shares of Portrait. Further details of these irrevocable undertakings are set out in Appendix 3 to this Document, including details of the circumstances in which each of the irrevocable undertakings will lapse. Accordingly, subject to such irrevocable undertakings not having lapsed in accordance with their terms and therefore ceasing to be binding, Pitney Bowes MapInfo UK Limited has received from the Portrait Directors and certain other Portrait Shareholders, in aggregate, irrevocable undertakings to accept, or procure acceptance of, the Offer in respect of 70,010,153 Portrait Shares, representing approximately per cent. of the existing issued ordinary shares of Portrait. 5. BACKGROUND TO AND REASONS FOR THE OFFER Over the past 12 months there have been key shifts in the business priorities for customer facing organisations, with increasing pressure on organisations to improve the customer experience and build and nurture the existing customer base. Traditional growth strategies have, in parts given way to retention and cross-promotion strategies as customers expect sales and service channels to deliver a premium experience. An increasing number of companies are focusing on Customer Relationship Management (CRM) strategies as a way to contact customers and foster continued financial growth. The Pitney Bowes Group has a long history in helping companies connect with customers, through its mail solutions and multi-channel platforms. The Pitney Bowes Group operates using a combination of software, hardware and other services to help companies engage customers, gain business insight, manage document workflow and improve communication. Portrait s business model is also centred around a customer centric approach. Portrait provides software to enhance existing CRM systems, enabling clients to achieve improved customer retention and increased profitability. Using advanced customer analytics combined with a multi-channel customer interaction platform, Portrait serves more than 300 customers including industry-leading organisations in customer-intensive sectors. 9

10 The acquisition of Portrait will enhance the Pitney Bowes Group s coverage across key CRM technologies and expand its existing platform offering in this area. Portrait s product portfolio is ideally positioned to develop customer data and customer communication channels, rapidly delivering business benefit by deriving customer insight in a fast, flexible and affordable manner. The Pitney Bowes Group recognises value in the domain expertise and client goodwill that the current Portrait management team has developed in the CRM space, and are attracted by the broad application of Portrait s customer centric product range. Portrait will provide the Pitney Bowes Group with strong coverage of critical CRM technologies, particularly sales and service platform applications, as well as enhanced capabilities in marketing and analytics software. The acquisition will enhance the Pitney Bowes Group s product profiles as an integrated solutions provider, increase impact on customer relationships and enhance the range of integrated solutions the Pitney Bowes Group provides to its customers. The Pitney Bowes Group s added scale and capital position will provide Portrait with a significant platform from which to achieve future growth. The Group s broad geographic footprint across more than 130 countries and its substantial distribution capabilities will open up new markets for Portrait, allowing for deeper penetration and cross selling opportunities within existing markets. 6. BACKGROUND TO AND REASONS FOR RECOMMENDING THE OFFER In considering the merits of the Offer, the Directors have taken into account the following factors: Over the past few years, Portrait has refocused its strategy away from large and expensive integration projects, which involve higher execution risk and lower predictability, and more towards smaller incremental CRM projects which extend and evolve existing customer systems, creating better repeatability of sales propositions, shorter sales cycles and greater sales volumes. During a period of continued economic turbulence, Portrait s ability to offer clients multi award winning products which provide a swift return on investment means that it has continued to grow its extensive client base in highly customer focused vertical sectors; Portrait has enjoyed considerable success in this strategy, characterised by the recent growth in its revenues and profitability. Although Portrait is confident of its ability to continue to progress in its competitive environment, the continued achievability of its forecast growth is not without significant risk; Portrait is placed firmly in the enterprise software category and all viable competitors in the customer interaction market have significantly more scale and breadth of offering. Accordingly, the Board of Portrait believes that if Portrait s business is to grow and remain competitive it will require a significant amount of long-term investment; The Offer, which will provide significant upside to current shareholders and will limit execution risk, should therefore be seen in the context of an increasingly competitive environment in which Portrait would have to incur substantial development and operational costs to progress and would carry some execution risk. Whilst the Portrait Directors are confident that Portrait 10

11 will continue to deliver results, they believe that the Offer Price ought to balance the potential rewards and execution risk of delivering that strategy, and allows current shareholders to realise immediate value; Furthermore, owing to Portrait s relatively small size, the Portrait Directors believe that the public markets hamper Portrait s ability to realise its full potential value. Portrait s low market capitalisation and its ownership structure means that Portrait has not attracted a particularly broad institutional shareholder base and its shares are relatively illiquid. As a result, sales of even small numbers of Portrait Shares often have a disproportionate effect on Portrait s share price. The liquidity restraints and low valuation have represented barriers to the shareholders ability to realise their investment in Portrait or to attract new investment; and The Offer will represent an opportunity for Portrait Shareholders to receive an immediate cash exit for their shareholding at a material premium to the current share price of Portrait. 7. INDUCEMENT FEE On 9 June 2010, Portrait entered into an inducement fee agreement in favour of Pitney Bowes MapInfo UK Limited pursuant to which if: (a) (b) the Portrait Directors withdraw, qualify or adversely modify their recommendation of the Offer and thereafter the Offer is not made (with the consent of the Panel), lapses or is withdrawn; or a Competing Offer (as defined in the inducement fee agreement) is put to Portrait or announced (whether pursuant to Rule 2.4 or Rule 2.5 of the City Code and whether or not subject to any pre-conditions) within the Offer Period relating to the Offer and the Competing Offer (or any other Competing Offer announced under Rule 2.4 or Rule 2.5 during the offer period (as defined in the City Code) relating to the first Competing Offer and whether or not subject to any pre-conditions) subsequently becomes or is declared unconditional in all respects within one year of the end of the Offer Period relating to the Offer, Portrait shall pay to Pitney Bowes MapInfo UK Limited an inducement fee of 430, (pounds sterling), inclusive of VAT to the extent to which it is recoverable, which shall not in aggregate exceed one per cent. of the aggregate value of the Offer. Portrait and Singer Capital Markets Limited, as financial adviser to Portrait, have confirmed in writing to the Panel that, in the opinion of the Portrait Directors and Singer Capital Markets Limited, the inducement fee agreement is, in the context of the Offer, in the best interests of Portrait Shareholders. 8. INFORMATION ON THE PORTRAIT GROUP Portrait develops and provides a suite of software products to optimise customer interactions for business-to-consumer enterprises. The Portrait suite enables these organisations to engage effectively with their customers, resulting in improved customer profitability, 11

12 increased retention and reduced risk. The components of the Portrait Customer Interaction suite include: Portrait Foundation, an application platform that helps client organisations, software vendors, and integrators to develop process-driven customer applications, including real-time customer interactions and fulfilment workflow; Portrait Interaction Optimizer, an application that provides real-time targeting of sales, service and retention offers at the point and time of a customer interaction; Portrait Dialogue, an application that enables marketers to design, execute, and monitor multi-channel campaigns; Portrait Customer Analytics, a workbench that provides data visualisation and predictive modelling automation to support behavioural analysis, customer segmentation and campaign targeting; Portrait Uplift Optimizer, an analytic application that can increase campaign ROI and reduce marketing costs by predicting the change in customer behaviour that will occur due to a specific marketing activity, and allow an organization to focus its campaign investment on those customers that are persuadable. Portrait employed 126 people as of 31 March 2010 and has over 300 customers worldwide. For the financial year ending 31 March 2010, Portrait reported revenue of 15.9 million (2009: 14.4 million) and profit before taxation of 1.1 million (2009: loss before taxation 3.1 million). As of 31 March 2010, Portrait had total shareholders equity of 5.5 million (2009: 3.5 million). Portrait is listed on AIM. 9. INFORMATION ON THE PITNEY BOWES GROUP The Pitney Bowes Group provides mail processing equipment and integrated mail solutions in the United States and internationally, assisting organisations in managing the flow of information, mail, documents and packages. The Pitney Bowes Group engages in the sale, rental, and financing of mail finishing, mail creation and shipping equipment. and provides professional services for high-speed production postal systems and sorting equipment. The Pitney Bowes Group also provides sale and support services for non-equipment-based mailing, customer communication and location intelligence software and offers services in facilities management, secure mail, reprographics, document management and litigation support. In addition, it provides cross-border mail services and presort postal services in the United States, as well as offering direct marketing services for targeted customers. The Pitney Bowes Group employs approximately 33,000 people and serves about two million customers in 130 countries worldwide. For the financial year ending 31 December 2009, the Pitney Bowes Group reported revenues of $5,569 million (2008: $6,262 million) and income from continuing operations before income taxes of $693 million (2008: $713 million). As of 31 December 2009, Pitney Bowes, 12

13 Inc. had total shareholders equity of $14 million and preferred shareholders equity in subsidiaries of $297 million. Pitney Bowes, Inc. is listed on the New York Stock Exchange. Pitney Bowes MapInfo UK Limited is a wholly-owned subsidiary of Pitney Bowes Software Inc., a Delaware corporation, which is itself a wholly-owned subsidiary of Pitney Bowes, Inc., a Delaware corporation which is the ultimate holding company of the Pitney Bowes Group and whose shares are publicly traded on the New York Stock Exchange. Pitney Bowes MapInfo UK Limited does not itself trade and carries on business as the holding company of the UK business of the Pitney Bowes Group. Pitney Bowes MapInfo UK Limited has two direct wholly-owned subsidiaries, both incorporated in England and Wales, Pitney Bowes Business Applications Limited and Pitney Bowes Software Limited, and one indirect wholly-owned subsidiary, Pitney Bowes Scotland Limited, which is incorporated in Scotland and which is a wholly-owned subsidiary of Pitney Bowes Business Applications Limited. 10. FINANCING OF THE OFFER The cash consideration payable by Pitney Bowes MapInfo UK Limited under the terms of the Offer will be funded from Pitney Bowes MapInfo UK Limited s existing available cash resources. Morgan Stanley & Co. Limited, an affiliate of Morgan Stanley, confirms that it is satisfied that sufficient cash resources are available to Pitney Bowes MapInfo UK Limited to satisfy the cash consideration payable to Portrait Shareholders if there is full acceptance of the Offer. 11. MANAGEMENT, EMPLOYEES AND LOCATIONS Pitney Bowes MapInfo UK Limited values the skills and experience of the existing management of Portrait and currently intends that key employees will continue to play a role in the future operations of Portrait. In due course, Pitney Bowes MapInfo UK Limited intends to integrate certain Portrait functions with those of the Pitney Bowes Group where such integration is deemed to be necessary or appropriate from a business perspective. To this end, following completion of the Offer, joint teams will be established to conduct integration process reviews to assess how best to take advantage of the strategic position, resources and reputations of the combined businesses of the Pitney Bowes Group and Portrait. These teams will look at all aspects of the new combined business, including client consolidation, software development and research, selling, marketing and administrative functions. The Board of Pitney Bowes MapInfo UK Limited has confirmed that the existing employment rights, including pension rights, of the management and employees of Portrait will be fully safeguarded. The Board of Pitney Bowes MapInfo UK Limited has also confirmed that its current plans for Portrait do not involve any material changes in the terms and conditions of employment of Portrait s employees and that it is Pitney Bowes MapInfo UK Limited s current intention to maintain Portrait s operations in their current locations, although these are each subject to any recommendation arising from the integration process review. Should any of Portrait s non-executive directors resign from the Board of Portrait conditional upon and immediately following the Offer becoming or being declared unconditional in all 13

14 respects, the Board of Portrait and the Board of Pitney Bowes MapInfo UK Limited have agreed that such non-executive directors will receive a payment upon such resignation becoming effective, in lieu of notice, in accordance with existing compensation arrangements. 12. PORTRAIT SHARE OPTION SCHEMES The Offer will extend to any Portrait Shares unconditionally allotted or issued whilst the Offer remains open for acceptance (or by such earlier date as Pitney Bowes MapInfo UK Limited may, subject to the City Code, decide) pursuant to the exercise of options under the Portrait Share Option Schemes or otherwise. Pitney Bowes MapInfo UK Limited will make appropriate proposals to option holders. 13. DISCLOSURE OF INTERESTS IN PORTRAIT RELEVANT SECURITIES As at 9 June 2010, being the latest practicable date prior to the date of this announcement, and save as disclosed in this announcement, neither Pitney Bowes, Inc. nor Pitney Bowes MapInfo UK Limited, nor any of their respective directors, nor (so far as those directors are aware having made due and careful enquiry) any person acting, or deemed to be acting, in concert (within the meaning of the City Code) with Pitney Bowes, Inc. or Pitney Bowes MapInfo UK Limited (i) (ii) (iii) had an interest in, or a right to subscribe for, relevant securities of Portrait; had any short position in (whether conditional or absolute and whether in the money or otherwise), including any short position under a derivative, or was party to any agreement to sell, or subject to any delivery obligation in respect of, or had the right to require another person to purchase or take delivery of, relevant securities of Portrait; and had borrowed or lent any relevant securities of Portrait (except for any borrowed shares which have been either on-lent or sold). As at 9 June 2010, being the latest practicable date prior to the date of this announcement and save as disclosed in this announcement, neither Pitney Bowes, Inc. nor Pitney Bowes MapInfo UK Limited, nor (so far as their respective directors are aware having made due and careful enquiry) any associate of Pitney Bowes, Inc. or Pitney Bowes MapInfo UK Limited has procured an irrevocable commitment or letter of intent to accept the Offer in respect of relevant securities of Portrait. As to irrevocable commitments to accept the Offer in respect of relevant securities of Portrait see Appendix 3. Since neither Pitney Bowes MapInfo UK Limited nor any member of the Pitney Bowes Group has any interest in relevant securities in Portrait, no Opening Position Disclosure is required under Rule 8.1(a) of the City Code. 14. DE-LISTING, RE-REGISTRATION AND COMPULSORY ACQUISITION If Pitney Bowes MapInfo UK Limited receives acceptances of the Offer which would result in Pitney Bowes MapInfo UK Limited holding Portrait Shares carrying in aggregate 75 per 14

15 cent., or more of the total voting rights exercisable at general meetings of Portrait, and subject to any applicable regulatory requirements, Pitney Bowes MapInfo UK Limited may apply for the cancellation of admission of Portrait Shares to trading on AIM and for Portrait s listing on AIM to be cancelled. Cancellation of listing and admission to trading would significantly reduce the liquidity and marketability of any Portrait Shares not assented to the Offer at that time. It is also intended that, if such cancellation was to be approved, Portrait would also be re-registered as a private company under the relevant provisions of the Companies Act. If Pitney Bowes MapInfo UK Limited receives acceptances under the Offer in respect of, and/or otherwise acquires, 90 per cent. or more in nominal value of the Portrait Shares to which the Offer relates (and 90 per cent. or more of the voting rights of Portrait Shares to which the Offer relates) and assuming all other conditions of the Offer have been satisfied or waived (if they are capable of being waived), Pitney Bowes MapInfo UK Limited intends to exercise its rights pursuant to the provisions of Chapter 3 of Part 28 of the Companies Act to acquire compulsorily the remaining Portrait Shares in respect of which the Offer has not been accepted. 15. GENERAL The Offer Document is expected to be posted to Portrait Shareholders (other than to Portrait Shareholders or any nominee, custodian or trustee of such Portrait Shareholders in Prohibited Jurisdictions) as soon as practicable and in any event (save with the consent of the Panel) within 28 days of this announcement. There are no agreements or arrangements to which Pitney Bowes MapInfo UK Limited is a party which relate to the circumstances in which it may or may not invoke or seek to invoke a condition to the Offer. Your attention is drawn to the further information contained in the Appendices which form part of, and should be read in conjunction with, this announcement. The Offer will be subject to the conditions and further terms in relation to the Offer set out in Appendix 1 to this announcement. Appendix 2 to this announcement provides details of the bases of calculations and sources of certain information included in this announcement. Appendix 3 to this announcement contains details of the irrevocable undertakings received in relation to the Offer. Appendix 4 to this announcement contains definitions of certain terms used in this announcement. Enquiries Pitney Bowes, Inc., and Pitney Bowes MapInfo UK Limited Matthew Broder Morgan Stanley (financial adviser to Pitney Bowes, Inc. and Pitney Bowes MapInfo UK Limited) Matthew Jarman Bryce Facktor

16 Portrait Software plc Luke McKeever Matthew White Singer Capital Markets Limited (Rule 3 adviser to Portrait) Shaun Dobson Claes Spang ICIS (PR firm to Portrait) Tom Moriarty Caroline Evans-Jones This announcement is not intended to and does not constitute or form any part of an offer to sell or an invitation to purchase or the solicitation of an offer to subscribe for any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Offer or otherwise. The Offer will be made solely through the Offer Document and, in the case of Portrait Shares in certificated form, the Form of Acceptance, which will together contain the full terms and conditions of the Offer, including details of how to accept the Offer. Any acceptance or other response to the Offer should be made only on the basis of the information contained in the Offer Document and, in the case of Portrait Shares in certificated form, the Form of Acceptance. Morgan Stanley is acting as financial adviser exclusively to Pitney Bowes, Inc. and Pitney Bowes MapInfo UK Limited and to no one else in connection with the Offer and accordingly will not be responsible to anyone other than Pitney Bowes, Inc. and Pitney Bowes MapInfo UK Limited for providing the protections afforded to clients of Morgan Stanley nor for giving advice in relation to the Offer or the contents of this document. Singer Capital Markets Limited, which is authorised and regulated by the Financial Services Authority, is acting exclusively for Portrait Software plc and for no-one else in connection with the Offer and is not advising any other person and accordingly will not be responsible to anyone other than Portrait Software plc for providing the protections afforded to clients of Singer Capital Markets Limited nor for giving advice in relation to the Offer or the contents of this document. The Offer is not being made, directly or indirectly, in, into or from, or by use of the mails of, or by any means of instrumentality (including electronically or by facsimile transmission, internet, , telex or telephone) of interstate or foreign commerce of, or any facility of a national, state or other securities exchange of, the United States, Australia, Canada, Japan, Republic of South Africa or any other Prohibited Jurisdiction if to do so would constitute a violation of the relevant laws in such other jurisdiction and, subject to certain exceptions, the Offer cannot be accepted by any such use, means, instrumentality or facility or from within the United States, Australia, Canada, Japan, Republic of South Africa or any other Prohibited Jurisdiction if to do so would constitute a violation of the relevant laws in such other jurisdiction. Accordingly, copies of this document, the Form of Acceptance and any related or 16

17 accompanying document are not being, and must not be, directly or indirectly, mailed, distributed, transmitted, forwarded or otherwise sent, in whole or in part, in, into or from the United States, Australia, Canada, Japan, Republic of South Africa or any other Prohibited Jurisdiction. Doing so may render invalid any purported acceptance of the Offer. All Portrait Shareholders or other persons (including nominees, trustees or custodians) receiving this document, the Form of Acceptance or any related or accompanying document should not distribute, mail, transmit, forward or send them or any of them in, into or from the United States, Australia, Canada, Japan, Republic of South Africa or any other Prohibited Jurisdiction or use such mails or any such means, instrumentality or facility for any purpose related to the Offer. It is the responsibility of each Overseas Shareholder to inform himself, herself or itself about and observe any applicable legal requirements. No Overseas Shareholder receiving a copy of this announcement and/or any other documentation relating to the Offer in a Prohibited Jurisdiction may treat the same as constituting an invitation or offer to him and in such circumstances, this announcement and/or any other documentation relating to the Offer are sent for information only. It is the responsibility of any Overseas Shareholder receiving a copy of this announcement and/or any other documentation relating to the Offer in any jurisdiction outside the United Kingdom who wishes to accept the Offer to satisfy himself as to the full observance of the laws and regulatory requirements of that jurisdiction in connection with the Offer, including obtaining any governmental, exchange control or other consents which may be required, and compliance with any other necessary formalities which need to be observed and the payment of any transfer or other taxes or duties that may be or become due under the laws of such jurisdiction. Any such Overseas Shareholder will be responsible for any such transfer or other taxes or duties by whomsoever payable and Pitney Bowes, Inc. and Pitney Bowes MapInfo UK Limited (and any person acting on behalf of Pitney Bowes, Inc. or Pitney Bowes MapInfo UK Limited) shall be fully indemnified and held harmless by such Overseas Shareholder for any such transfer or other taxes or duties or other requisite payments as Pitney Bowes, Inc. or Pitney Bowes MapInfo UK Limited (and any person acting on behalf of Pitney Bowes, Inc. or Pitney Bowes MapInfo UK Limited) may be required to pay. This announcement has been prepared for the purpose 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 England, including those of the United States. Dealing Disclosure Requirements Under Rule 8.3(a) of the City Code, any person who is interested in one per cent. or more of any class of relevant securities of an offeree company or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the Offer Period and, if later, following the announcement in which any paper offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of: (i) the offeree company; and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the Offer Period and, if appropriate, by no 17

18 later than 3.30 pm (London time) on the 10th business day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure. Under Rule 8.3(b) of the City Code, any person who is, or becomes, interested in one per cent. or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of: (i) the offeree company; and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing. If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3. Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4 of the City Code). Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at including details of the number of relevant securities in issue, when the Offer Period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should contact the Panel s Market Surveillance Unit on +44 (0) Forward-looking statements This document includes certain statements about Portrait and/or Pitney Bowes MapInfo UK Limited and/or Pitney Bowes, Inc. (and their respective groups and/or subsidiary undertakings) that are or may be forward-looking statements in its general meaning and within the meaning of the Private Securities Litigation Reform Act of All statements other than statements of historical fact included in this document may be forward-looking statements. These statements are based on the current expectations of the management of Portrait and/or Pitney Bowes MapInfo UK Limited and/or Pitney Bowes, Inc. (as the case may be) and are naturally subject to uncertainty and changes in circumstances. The forward-looking statements contained herein may include statements about, following the Offer being declared unconditional in all respects, the expected timing and scope of the Offer, anticipated earnings enhancements, estimated cost savings and other synergies, costs to be incurred in achieving synergies, other strategic options and all other statements in this document other than those which concern historical fact. Forward-looking statements include statements typically 18