Rule 10.8 Waiver

Berkeley Berry Birch PLC
28 February 2006


                          Update on financial position
           Sale of the business and related assets and liabilities of
               Berry Birch & Noble Insurance Brokers Limited, and
              Heads of terms for sale of further group businesses

Update on financial position

Berkeley Berry Birch plc ('BBB' or 'the Company') is the holding company for a
financial services distribution group. Its principal subsidiaries are Berkeley
Independent Advisers Limited ('BIA'), Berry Birch & Noble Insurance Brokers
Limited ('BBN IB') and Berry Birch & Noble Financial Planning Limited (Weston)
Limited ('Weston'), all of which are regulated by the Financial Services
Authority ('FSA'), the latter via BIA. Trading in the Company's shares was
suspended from 1 December 2005 at BBB's request pending clarification of its
financial position.

For a number of months the Directors have been trying to refinance the Company 
and address the regulatory capital deficits within BIA and Weston and to 
provide the funds to meet the Group's working capital requirements.  On 29 July 
2005, the FSA issued Decision Notices against BIA and Weston as a result of 
their regulatory capital deficits.

As announced on 18 January 2006, the FSA agreed that it would not serve Final 
Notices in respect of the Decision Notices before 27 February 2006 and would, 
in any event, not serve Final Notices in respect of the Decision Notices if 
BIA and Weston could provide the FSA with written opinions from its auditors 
that they are compliant with the Prudential Rules on capital adequacy.  
Weston has since become a member of the BIA Network and is therefore now 
authorised via BIA and is no longer a directly regulated company.  Following 
the transfer of Weston into the BIA network, the regulatory capital deficit in 
BIA is around £4 million.

BBB's interim results for the six months ended 30 September 2005, announced on
29 December 2005, disclosed an operating loss of £1,385,000. Since 30 September
2005 trading has remained difficult. This has been as a result of the continued
impact of the well-publicised issues affecting the business. As at 30 September
2005 the Group had consolidated net liabilities of £496,000. Included in this
figure is a liability of £3,245,000 in respect of the Group's defined benefit
pension scheme.

The Directors announce that they have been unsuccessful in completing their 
plan to recapitalise BIA by the FSA 
deadline which involved:

(a) the sale of BBN IB's business and related assets;

(b) the sale of 50% of BIA together with the application of the
    proceeds of the sale of BBN IB to recapitalise BIA; and

(c) a subsequent equity and debt capital raising.

Although the sale of BBN IB's business and related assets and liabilities has 
been completed, a number of factors have prevented the Board from completing 
its plans, including a further deterioration in the trading prospects of BIA and 
the withdrawal of a potential investor in BIA at a late stage.

The Directors have been advised that although the proceeds from the sale of 
the BBN IB business and related assets, together with the cash balance held by 
BBN IB, might have been sufficient to refinance BIA, the Directors, in the light 
of their obligations to BBB's creditors, including the Group defined benefit 
pension scheme, could only do so if there was a realistic prospect of raising 
sufficient funds, over and above those from the sale of the BBN IB business and 
related assets and liabilities, to enable the Company to continue trading for 
at least the next 12 months, an amount estimated by the Board to be around £5 
million.  The Directors have concluded that the uncertainties around the future 
of BIA as an independent entity following its deterioration in trading prevent 
them raising funds externally and have therefore concluded that they are unable 
to recapitalise BIA.  Instead, the Directors must take all steps to sell the 
Group's remaining businesses with a view to attempting a solvent outcome for 
the Company.  In this respect the Company has entered into conditional heads 
of terms with Tenet Group Limited ('Tenet') for the proposed sale of its 
remaining trading businesses, as set out below.

The FSA will issue Final Notices no later than 9 am on Monday, 6 March 2006.  
This will allow the sale of BIA and the other businesses to proceed in an 
orderly fashion.  Tenet have informed BBB that they are committed to this 
timetable.

Following the completion of any sale, the Group will cease all regulated 
activity and BBB will apply to enter administration as soon as possible.

Sale of the business and related assets and liabilities of BBN IB

The Group has today completed the sale of the business and related assets and 
liabilities of BBN IB, a wholly owned subsidiary of the Company, to Smart & 
Cook Limited.  Given the financial position of the BBB Group, the United Kingdom 
Listing Authority ('UKLA') has granted a waiver under Listing Rule 10.8 in 
respect of the requirement to issue a circular and obtain shareholder approval 
in respect of this disposal.

BBN IB is an insurance broker established in 1964 which specialises in giving
advice on a range of personal and commercial insurance products for individual
and corporate clients and employs around 70 staff.

The estimated total cash consideration receivable from the disposal, including
the maximum deferred consideration, is £4,521,000. The initial consideration
receivable from the sale is £3,117,000, payable in cash on completion,
comprising £3,276,000 in respect of 70 per cent. of the total consideration
payable for the business less £159,000 in respect of the estimated net liability
position. The balance of the consideration for the business is payable 13 month
after completion, although this will be reduced if the general insurance fees
and commissions, net of any paid away commissions, in the year following
completion is less than the level agreed at completion of £3,900,000. The
deferred consideration cannot be lower than £nil and the maximum deferred
consideration payable is £1,404,000.

For the year ended 31 March 2005 BBN IB reported turnover of £4,594,000 which
included approximately £11,000 in respect of the Private Insurance Portfolio
('PIP') division that was sold in January 2006. Profit before tax for the year
ended 31 March 2005 was £473,000, which is net of an estimated loss for the PIP
division of £242,000. The turnover and profit before tax have been extracted
from the Annual Report and Accounts for the year ended 31 March 2005, upon which
the auditors issued a qualified opinion arising from limitation in audit scope
in respect of a £200,000 provision against unreconciled debtors for which the
auditors were unable to obtain sufficient evidence. The gross assets being sold
are estimated to be £2,747,000. All of BBN IB's staff, including the management
of the company, will be transferring as part of the disposal.

Heads of terms for the sale of further trading assets of the Group

The Company has entered into conditional heads of terms with Tenet for the sale
of its remaining businesses and related assets, including those of BIA and 
Weston.  Tenet is the largest independently owned IFA Group in the UK and 
currently supports over 5,000 advisers through seven of the industry's major 
brands.  The Board has selected Tenet as a potential purchaser because it 
believes that Tenet's size and industry credibility provide the greatest 
likelihood of a positive outcome for the Group's employees and clients.  
The UKLA has granted a waiver under Listing Rule 10.8 in respect of the 
requirement to issue a circular and obtain shareholder approval in respect of 
the disposal of the Group's remaining trading assets to Tenet.

A further announcement will be made on reaching agreement with Tenet on the 
terms of the sale.

Working capital

The BBB Group does not have sufficient working capital for its present
requirements. On a going concern basis, the Directors estimate that the
additional funds required for the next 12 months would be around £8 million for
the next 12 months. As noted above, the Directors have concluded they are unable
to raise the funds required and therefore the BBB Group is no longer able to
continue as a going concern. In these circumstances, the Directors have to
maximise the funds available creditors, which, as explained below, is also in
the interests of shareholders, since it gives them their best chance of a return
on their investment.

Application of funds from the disposals

Given the financial position of the Group, the funds from the sale of the
business and related assets and liabilities of BBN IB and from the disposal of
the remaining businesses to Tenet will be applied to meet the Group's
liabilities to its creditors. The Directors consider that the disposals of all
of the businesses are also in the best interests of shareholders, since,
although it is far from certain, it gives the best chance of a solvent wind up
of the Group and a return for shareholders. It will only be possible to
determine whether a solvent wind down is possible when the disposals of all of
the businesses have been completed and the full extent of the liabilities
determined.

Conclusion

The directors of BBB confirm that in respect of the disposal of the business and
related assets and liabilities of BBN IB and the proposed disposal of the
remaining businesses in the Group:

(a) negotiation does not allow time for shareholder approval;

(b) all alternative methods of financing have been exhausted and the only 
    option remaining is to dispose of its remaining businesses; and

(c) by taking the decision to dispose of its remaining businesses to raise 
    cash, the directors believe that they are acting in the best interests
    of the Company and shareholders as a whole. Unless these disposals are 
    completed administrators will be appointed tomorrow.

Arden Partners Limited, which is acting as the Company's sponsor, confirms that,
in its opinion and on the basis of information available to it, BBB is in severe
financial difficulty and it will not be in a position to meet its obligations as
they fall due unless the disposals take place according to the proposed
timetable.

Enquiries:

Andrew Shortis
Group Managing Director
Berkeley Berry Birch plc

024 7623 2010

Steve Douglas
Arden Partners Limited

0121 423 8943



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