ALTO Intermediary Group Ltd Offer for COBRA Holdings plc (5650G)

TIDMCBRA

RNS Number : 5650G

ALTO Intermediary Group Ltd

29 June 2012

Not for release, publication or distribution, in whole or in part, directly or indirectly in, into or from any jurisdiction where to do so would constitute a violation of the relevant laws or regulations of such jurisdiction.

29 June 2012

RECOMMENDED CASH offer by

ALTO INTERMEDIARY GROUP LIMITED

FOR

COBRA Holdings PLC

Summary

The Independent Directors of COBRA and the Alto Board are pleased to announce that they have reached agreement on the terms of a recommended cash offer to be made by Alto for the entire issued and to be issued share capital of COBRA.

Highlights

   --      Under the terms of the Offer COBRA Shareholders will be entitled to receive either: 
   --              recommended cash consideration of 20 pence for each COBRA Share; or

-- as an alternative (which is not recommended) one non-transferable redeemable B preferred share in the capital of Alto for each COBRA Share

-- The Offer, if it were to be satisfied entirely by the Cash Consideration, values the entire issued share capital of COBRA at approximately GBP7.3 million.

-- The Offer Price represents a discount of approximately 17 per cent. to the Closing Price of 24 pence per COBRA Share on 2 April 2012 (being the last Business Day prior to the commencement of the Offer Period) and is equal to the Closing Price of 20 pence per COBRA Share on 28 June 2012 (being the last Business Day prior to the publication of this Announcement).

-- Alto is a newly incorporated company in England and Wales, formed by Stephen Burrows (the current chief executive officer of COBRA) for the specific purpose of making the Offer. Alto has not traded since incorporation nor has it entered into any obligations other than in connection with the Offer and financing the Offer. The current shareholders of Alto are Stephen Burrows and Dominic Wainford who are joint offerors in accordance with the Code and David Stanley is a proposed shareholder. All three of them are directors of Alto.

-- Stephen Burrows, Dominic Wainford and David Stanley, are directors of COBRA as well as directors of Alto and are interested in 8,717,582, 2,507,624 and 500 COBRA Shares respectively, representing in aggregate 11,225,706 COBRA Shares, being approximately 30.86 per cent. of the existing issued share capital of COBRA. They have irrevocably undertaken to accept or procure the acceptance of the Offer in respect of their entire shareholdings. All of these Irrevocable Undertakings will cease to be binding in the event that the Offer is withdrawn or lapses.

-- As part of their Irrevocable Undertakings, Dominic Wainford and David Stanley have further undertaken to elect for the Share Alternative in respect of their entire holdings in COBRA Shares. As part of his Irrevocable Undertaking, Stephen Burrows has undertaken to elect for the Share Alternative in respect of 1,967,582 COBRA Shares and the Cash Consideration in respect of 6,750,000 COBRA Shares which, under the terms of the Offer, will result in the payment to him of GBP1.35 million. As part of the funding arrangements being made available to Alto, Stephen Burrows is required to pay off existing personal loans and in order to do this he is required to receive the Cash Consideration for some of his COBRA Shares as opposed to electing for the Share Alternative in full. Stephen Burrows has given a personal guarantee of GBP750,000 as part of the funding arrangements which will, at the sole discretion of Macquarie Bank Limited and subject to ongoing compliance with the Facility Letter, only be released when capital repayments totalling GBP1.35 million have been made by Alto.

-- Alto has also received Irrevocable Undertakings from those Independent Directors who have an interest in COBRA Shares to accept the Offer in respect of their entire holdings of 4,128,992 COBRA Shares, representing, in aggregate, approximately 11.35 per cent. of the existing issued share capital of COBRA.

-- In addition other COBRA Shareholders have given Irrevocable Undertakings to accept the Offer in respect of 17,734,543 COBRA Shares representing, in aggregate, approximately 48.76 per cent. of the existing issued share capital of COBRA.

-- Accordingly Alto has received, in aggregate, Irrevocable Undertakings to accept the Offer in respect of 33,089,241 COBRA Shares, representing approximately 90.97 per cent. of the existing issued share capital of COBRA. Under the terms of these Irrevocable Undertakings, Alto has received undertakings to elect for the Cash Consideration in respect of a total of 17,860,496 COBRA Shares, representing 49.10 per cent. of the existing issued share capital of COBRA and undertakings to elect for the Share Alternative in respect of a total of 15,228,745 COBRA Shares, representing 41.87 per cent. of the existing issued share capital of COBRA.

-- The Independent Directors of COBRA, who have been so advised by Fairfax, consider the terms of the Offer to be fair and reasonable in respect of the Cash Consideration. In providing advice to the Independent Directors of COBRA, Fairfax has taken into account the Independent Directors' commercial assessment of the Offer. The Independent Directors have agreed to recommend unanimously that COBRA Shareholders accept the Offer in respect of the Cash Consideration.

-- The Independent Directors, having been so advised by Fairfax, are of the opinion that in respect of the Share Alternative the value of an Offer Share is less attractive than the Cash Consideration. The Independent Directors do not recommend that COBRA Shareholders accept the Share Alternative. Further details on the recommendation are set out in paragraph 3 of the full text of this Announcement.

-- Stephen Burrows, Dominic Wainford and David Stanley are directors of COBRA and directors of Alto. As such they have not taken any part in the discussions or decisions relating to the recommendation to COBRA Shareholders to accept the Offer in respect of the Cash Consideration. The Independent Directors have considered the terms of the Offer on behalf of COBRA Shareholders.

-- The Offer is conditional upon, amongst other things, (i) the Independent Shareholders passing Resolution 1 to approve the Arrangements at the General Meeting, and (ii) valid acceptances being received in respect of not less than 90 per cent. (or such lower percentage as Alto may, subject to the Code, decide) of the COBRA Shares to which the Offer relates. Further details are set out in Appendix I to this Announcement.

-- The above Irrevocable Undertakings given by the COBRA Shareholders except for Stephen Burrows, Dominic Wainford and David Stanley (who are not permitted to vote in accordance with the provision of the Code) also undertake to vote in favour of Resolution 1, representing 86.94 per cent. of the votes capable of being cast. Further details of these undertakings are set out in Appendix III to this Announcement.

-- Dominic Wainford is the sole shareholder of Wainford Holdings Limited which is the sole holder of the outstanding Convertible Notes. Subject to the Offer being declared unconditional in all respects Wainford Holdings Limited has, as part of the funding arrangements being made available to Alto, agreed to exchange the Convertible Notes for Preference Shares equal to GBP7 million, representing the outstanding capital sum. The Preference Shares will, for the first three years only, attract a fixed dividend of 12.5 per cent. per annum which will be made up of a fixed dividend of 12.4 per cent. which will be calculated daily and satisfied annually by the issue of additional Preference Shares plus a further fixed dividend of 0.1 per cent. which will be calculated daily and satisfied quarterly by a cash payment. After three years the fixed dividend will be 0.1 per cent. per annum which will be calculated daily and satisfied quarterly by way of a cash payment.

-- The Cash Consideration payable to COBRA Shareholders under the terms of the Offer will be funded by a debt facility from Macquarie Bank Limited. Taking into account the Irrevocable Undertakings received electing to accept the Share Alternative, full acceptance of the Offer and election for the Cash Consideration would result in a maximum cash payment by Alto of approximately GBP4.23 million in cash.

-- Alto will despatch the Offer Document and Form of Acceptance to COBRA Shareholders and, for information only, to holders of share options in COBRA and the holder of the Convertible Notes, and publish it on Alto's website (www.altoinsurancegroup.com/offer and the COBRA website www.cobraholdings.co.uk/offer.html), as soon as practicable and in any event within 28 days of this Announcement.

Commenting on the Offer, Stephen Burrows, director of Alto said:

"Following the receipt of disappointing initial indicative offers for the COBRA Group earlier this year, I am delighted to be able to offer COBRA Shareholders the chance to exit with a cash payment or to remain a shareholder as Alto moves forward. I am looking forward to delivering the long term strategy of the business."

Commenting on the Offer, Peter Robinson, Chairman of COBRA said:

"Following an approach from a potential purchaser earlier this year, COBRA and its advisers have had discussions with several potential purchasers, leading to the receipt of indicative offers, the highest of which was Alto's at 20 pence per COBRA Share. Two interested parties (Towergate Insurance Group and Alto) conducted pre-acquisition enquiries with due diligence and, following Towergate's withdrawal, Alto made its offer. We, the Independent Directors are therefore pleased to recommend COBRA Shareholders to accept the Offer in respect of the Cash Consideration."

Enquiries

 
 
  Alto Intermediary Group Limited             Tel: 020 7204 
                                              0014 
 Steve Burrows 
 
 BDO LLP, Financial Adviser to Alto          Tel: 020 7486 
                                              5888 
 John Stephan 
 Paul Smith 
 
 COBRA Holdings plc                          Tel: 020 7204 
                                              0014 
 Peter Robinson, Chairman 
 
 
 Fairfax I.S. PLC, Nominated and Financial   Tel: 020 7598 
  Adviser to COBRA                            5368 
 David Floyd 
 Simon Bennett

This summary should be read in conjunction with, and is subject to, the full text of this Announcement including the Appendices to this Announcement. In particular the Offer will be subject to the terms and conditions set out in Appendix I to this Announcement and to the further terms and conditions of the Offer to be set out in the Offer Document and the Form of Acceptance. Appendix II of this announcement contains further details of the sources of information and bases of calculations set out in this summary and the Announcement. Appendix III includes details on Irrevocable Undertakings received from COBRA Shareholders to accept the Offer in respect of their holdings of COBRA Shares and Appendix IV to this Announcement contains definitions of certain expressions used in this summary and in this Announcement.

Terms used in this summary shall have the meaning given to them in the full Announcement.

This Announcement does not constitute, or form part of, an offer or an invitation to purchase or subscribe for any securities. The Offer will be made solely by way of the Offer Document and, where appropriate, the related Form of Acceptance which together will contain the full terms and conditions of the Offer, including details of how the Offer may be accepted.

COBRA Shareholders who accept the Offer may only rely on the Offer Document and, where appropriate, the related Form of Acceptance for all the terms and the conditions of the Offer. In deciding whether or not to accept the Offer in relation to their COBRA Shares, COBRA Shareholders should rely only on the information contained, and procedures described, in the Offer Document and the accompanying Form of Acceptance. COBRA Shareholders are strongly advised to read the Offer Document being posted to them shortly, and in any event within 28 days of this Announcement, which contains important information with respect to the Offer.

Please be aware that addresses, electronic addresses and certain other information provided by COBRA Shareholders, persons with information rights and other relevant persons in connection with the receipt of communications from COBRA may be provided to Alto during the Offer Period as required under Section 4 of Appendix 4 of the Code.

BDO LLP, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Alto, as financial adviser in relation to the Offer, and is not acting for or advising any other person and accordingly will not be responsible to any other person other than Alto for providing the protections afforded to the clients of BDO LLP or for providing advice in relation to the contents of this Announcement or any offer or arrangement referred to herein or in the Offer Document and Form of Acceptance. Neither BDO LLP nor any of its affiliates owns or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of BDO LLP in connection with this Announcement, any statement contained herein or otherwise.

Fairfax I.S. PLC is acting exclusively for COBRA and no one else in connection with the possible Acquisition and will not be responsible to anyone other than COBRA for providing the protections afforded to customers of Fairfax I.S. PLC or for providing advice in relation to the Offer or any other matter referred to herein.

Disclosure requirements of the Code

Under Rule 8.3(a) of the City Code, any person who is interested in 1 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 (UK time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (UK 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 1 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 (UK 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 of 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).

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 www.thetakeoverpanel.org.uk, 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)20 7638 0129.

Overseas jurisdictions

The Offer is not being made directly or indirectly, and securities of COBRA will not be accepted for purchase from or on behalf of any COBRA Shareholder, in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities or other laws or regulations of such jurisdiction or would require any registration, approval or filing with any regulatory authority not expressly contemplated by the terms of this Announcement.

The availability of the Offer in, and the release, publication or distribution of this Announcement in or into, jurisdictions other than the United Kingdom may be restricted by law. Therefore persons into whose possession this announcement comes who are not resident in the United Kingdom should inform themselves about, and observe, any applicable restrictions. COBRA Shareholders who are in any doubt regarding such matters should consult an appropriate independent adviser in the relevant jurisdiction without delay. Any failure to comply with such restrictions may constitute a violation of the securities laws of any such jurisdiction.

In particular the Offer will not be made, directly or indirectly, in or into, or by the use of the mails or any means of instrumentality (including, without limitation, telephonically or electronically) of interstate or foreign commerce of, or any facilities of a national securities exchange of any Restricted Jurisdiction. Accordingly, except as required by applicable law, copies of this announcement are not being, and may not be, mailed or otherwise forwarded, distributed or sent in, into or from any Restricted Jurisdiction. Persons receiving this announcement (including without limitation nominees, trustees or custodians) must not forward, distribute or send it into any Restricted Jurisdiction.

This Announcement has been prepared for the purposes of complying with English law and the 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 Offer Shares have not been, and will not be, listed on any stock exchange or registered under the US Securities Act or under the securities laws of any jurisdiction of the United States; the relevant clearances have not been, nor will they be, obtained from the securities commission of any province or territory of Canada; no prospectus in relation to the Offer Shares has been, or will be, lodged with, or registered by, the Australian Securities and Investments Commission; and no steps have been, or will be, taken to enable the Offer Shares to be offered in compliance with the applicable securities laws of any state, province, territory or jurisdiction of the United States, Canada, Australia or Japan or any other country or jurisdiction outside the United Kingdom. Accordingly, the Offer Shares are not being, nor (unless an exemption under relevant securities laws is applicable) can they be, offered, sold, resold or delivered, directly or indirectly, in or into or from the United States, Canada, Australia or Japan or any other jurisdiction if to do so would constitute a violation of the relevant laws of, or require registration of them in, such jurisdiction or to, or for the account or benefit of, any US person or any resident, citizen or national of Canada, Australia or Japan.

Forward Looking Statements

This Announcement contains certain forward-looking statements with respect to (amongst other things) the financial condition, results of operations and business of the COBRA and certain plans and objectives of the directors of Alto. These forward-looking statements, without limitation, 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", "targets", "expect", "estimate", "intend", "plan", "goal", "believe", "will", "may", "should", "would", "could" or other words of similar meaning. These statements are based on assumptions and assessments made by the directors of Alto and COBRA in light of their experience and their perception of historical trends, current conditions, expected future developments and other factors they believe appropriate. 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, which are not guarantees of future performance.

Should one or more of these risks or uncertainties materialise, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this Announcement. COBRA and Alto assume no obligation to update or correct the information contained in this Announcement, whether as a result of new information, future events or otherwise, except to the extent legally required.

The statements contained in this Announcement are made as at the date of this Announcement, unless some other time is specified in relation to them, and service of this Announcement shall not give rise to any implication that there has been no change in the facts set out in this Announcement since such date. Nothing contained in this Announcement shall be deemed to be a forecast, projection or estimate of the future financial performance of COBRA except where expressly stated.

Rule 2.10 Disclosure

In accordance with Rule 2.10 of the Code, Alto confirms that on 29 June 2012 it had 47,500 A ordinary shares of GBP1 each in issue, all with equal voting rights.

In accordance with Rule 2.10 of the Code, COBRA confirms that on 29 June 2012 it had 36,374,276 ordinary shares of 25 pence each in issue and admitted to trading on AIM with ISIN GB00B1XN6X77.

Publication on websites

A copy of this Announcement and the Offer Document, is and will be available free of charge, subject to certain restrictions relating to persons resident in Restricted Jurisdictions, for inspection on Alto's website at http://www.altoinsurancegroup.com/offer and COBRA's

website at www.cobraholdings.co.uk/offer.html by no later than 12 noon on 2 July 2012 in the case of this Announcement and in the case of the Offer Document by 12 noon on the Business Day following its publication and will remain so during the course of the Offer.

For the avoidance of doubt, the content of the websites referred to above is not incorporated into and does not form part of this Announcement.

29 JUNE 2012

RECOMMENDED CASH offer by

ALTO INTERMEDIARY GROUP LIMITED

FOR

COBRA Holdings PLC

1. Introduction

Alto is a newly incorporated company in England and Wales, formed by Stephen Burrows (the current chief executive officer of COBRA) for the specific purpose of making the Offer. Alto has not traded since incorporation nor has it entered into any obligations other than in connection with the Offer and financing the Offer. The current shareholders of Alto are Stephen Burrows and Dominic Wainford who are joint offerors in accordance with the Code and David Stanley is a proposed shareholder. All three of them are directors of Alto.

2. The Offer

Alto is offering to acquire, subject to the conditions set out below and in Appendix I to this Announcement, and to the full terms and conditions to be set out in the Offer Document and accompanying Form of Acceptance, the entire issued and to be issued share capital of COBRA, on the following basis:

   for each COBRA Share                                                  20 pence in cash

The Offer, if it were to be satisfied entirely by the Cash Consideration, values the entire issued share capital of COBRA at approximately GBP7.3 million.

The Offer Price represents a discount of approximately 17 per cent. to the Closing Price of 24 pence per COBRA Share on 2 April 2012 (being the last Business Day prior to the commencement of the Offer Period) and is equal to the Closing Price of 20 pence per COBRA Share on 28 June 2012 (being the last Business Day prior to the publication of this Announcement).

The Offer is conditional upon amongst other things, (i) the Independent Shareholders passing Resolution 1 to approve the Arrangements at the General Meeting, and (ii) valid acceptances being received in respect of not less than 90 per cent. (or such lower percentage as Alto may, subject to the Code decide) of the COBRA Shares to which the Offer relates. Full details of the conditions to which the Offer is subject are set out in Appendix I to this Announcement.

The Offer extends to any COBRA Shares which are unconditionally allotted or issued fully paid (or credited as fully paid) pursuant to the exercise of options granted under the COBRA Share Option Schemes while the Offer remains open for acceptance (or such earlier date as Alto may, subject to the Code, decide).

The COBRA Shares will be acquired by Alto, pursuant to the Offer, fully paid and free from all liens, equities, charges, encumbrances, rights of pre-emption and any other interest of any nature whatsoever and together with all rights now or hereafter attaching thereto, including voting rights and the right to receive and retain in full all dividends and other distributions (if any) declared, made or paid on or after 3 April 2012 (being the date on which a possible offer was announced).

The Share Alternative

As an alternative to some or all of the Cash Consideration to which they would otherwise be entitled under the Offer, accepting COBRA Shareholders (other than all Overseas Shareholders) will be able to elect to receive Offer Shares to be issued by Alto on the following basis:

   For each COBRA Share                                           One Offer Share

The Offer Shares will be issued credited as fully paid and will be issued by Alto in certificated form. The rights of the Offer Shares are governed by the Articles. No application has been or will be made for the Offer Shares to be admitted to listing or trading on any stock exchange. Alto has no other shares admitted to listing or trading on any stock exchange.

The issue of the Offer Shares is conditional upon the Offer being declared unconditional in all respects. After taking into account the Irrevocable Undertakings received, electing for the Cash Consideration, the maximum number of Offer Shares that can be issued pursuant to the Offer will be 18,513,780. The total number of Offer Shares issued in connection with the Offer will be detailed in the next audited financial statements of Alto. Further details of the possible resultant shareholding structure of Alto are set out at paragraph 4 below and will be set out in the Offer Document. Further information on the Offer Shares is set out in paragraph 13 below.

BDO has provided an independent estimate of the value of an Offer Share. BDO has advised that, if on the Latest Practicable Date the Offer had become, or had been declared, unconditional in all respects and assuming, amongst other things, that only those COBRA Shareholders who have signed Irrevocable Undertakings electing to receive the Share Alternative will be issued Offer Shares, it estimates that the value of an Offer Share would be approximately 15 pence. The further assumptions will be set out in BDO's letter, a copy of which will be included in the Offer Document,

Alto will despatch the Offer Document and Form of Acceptance to COBRA Shareholders and, for information only, to COBRA Optionholders and the holder of the Convertible Notes and publish it on its website (www. altoinsurancegroup.com/offer) and the COBRA website (www.cobraholdings.co.uk/offer.html) as soon as practicable and in any event within 28 days of this Announcement.

The availability of the Offer to persons not resident in the United Kingdom may be affected by the laws of the Relevant Jurisdictions. Persons who are not resident in the United Kingdom should inform themselves about and observe any applicable legal or regulatory requirements.

The Offer is being made in accordance with the requirements of the Code and is subject to the terms and conditions to be set out in the Offer Document and the Form of Acceptance.

3. The recommendation

The Independent Directors of COBRA, who have been so advised by Fairfax, consider the terms of the Offer to be fair and reasonable in respect of the Cash Consideration.

The Independent Directors have agreed to recommend unanimously that COBRA Shareholders accept the Offer in respect of the Cash Consideration.

Those Independent Directors who have an interest in COBRA Shares have irrevocably undertaken to accept the Offer in respect of their entire holdings of 4,128,992 COBRA Shares representing, in aggregate, approximately 11.35 per cent. of the existing issued share capital of COBRA.

The Independent Directors note BDO's valuation of an Offer Share, which is less than the value of the Cash Consideration.

The Independent Directors, having been so advised by Fairfax, are of the opinion that, having regard to BDO's valuation of an Offer Share (which is less than the value of the Cash Consideration) and having considered the factors set out in the bullet points below, the Share Alternative is less attractive than the Cash Consideration. The Independent Directors do not recommend that COBRA Shareholders accept the Share Alternative. Further information regarding the Offer Shares which will form the Share Alternative is set out at paragraph 13 below.

In providing advice to the Independent Directors, Fairfax has taken into account the Independent Directors' commercial assessment of the Offer.

However, notwithstanding their recommendation set out above, the Independent Directors recognise that some COBRA Shareholders (especially those who are in management positions within the COBRA Group) may wish to retain an interest in COBRA. In these circumstances the COBRA Shareholders will need to decide whether to accept the Share Alternative or whether to do nothing and remain as a minority shareholder in COBRA. Any COBRA Shareholder considering accepting the Share Alternative is advised to consult with his or her or its own independent financial adviser, authorised under FSMA, before electing to accept the Share Alternative.

Any COBRA Shareholder considering accepting the Share Alternative is advised to consider carefully, inter alia, the following factors:

   --      The Offer Shares do not hold any voting rights;

-- No application is being made for the Offer Shares to be quoted or traded on any stock exchange and they will not be transferable. Accordingly it will not be possible to sell them;

-- Alto is taking on additional debt to finance the Cash Consideration payable under the Offer. The increase in borrowings increases the gearing of the Enlarged Group. While increased gearing can result in enhanced returns to shareholders if profitability improves beyond the cost of the debt, the gearing increase also magnifies losses if performance is poor; and

-- Alto is not required to have a governance regime (including independent directors, audit and remuneration committees etc.) of the type adopted by COBRA as a company trading on AIM.

Stephen Burrows, Dominic Wainford and David Stanley are directors of COBRA and Stephen Burrows and Dominic Wainford are shareholders in Alto. It is also proposed that David Stanley will become a shareholder in Alto, further details regarding this are set out at paragraph 10 below. As such they have not taken any part in the discussions or decisions relating to the recommendation to COBRA Shareholders to accept the Offer in respect of the Cash Consideration. The Independent Directors have considered the terms of the Offer on behalf of COBRA Shareholders.

Fairfax has advised the Independent Directors that the terms of the Arrangements with David Stanley are fair and reasonable in so far as the Independent Shareholders are concerned.

The Independent Directors also unanimously recommend that the Independent Shareholders vote in favour of Resolution 1 to approve the Arrangements, as those Independent Directors who hold an interest in voting rights in COBRA have irrevocably undertaken to do in respect of 4,128,992 COBRA Shares representing, in aggregate, approximately 11.35 per cent. of the existing issued share capital of COBRA.

4. Information on Alto

Alto is a newly incorporated company in England and Wales, formed by Stephen Burrows for the specific purpose of making the Offer. Alto has not traded since incorporation nor has it entered into any obligations other than in connection with the Offer and financing the Offer. The current shareholders of Alto are Stephen Burrows and Dominic Wainford who are joint offerors in accordance with the Code and David Stanley is a proposed shareholder. All three of them are directors of Alto.

If all COBRA Shareholders accept the Cash Consideration (except for those COBRA Shareholders who have given Irrevocable Undertakings to elect for the Share Alternative) the business of Alto, including its assets and profits, would not differ materially from that of COBRA, after the Offer becomes, or is declared, unconditional in all respects, save for the increase in debt and associated interest expense required to satisfy the Cash Consideration to the extent that it is required and the Share Alternative is not taken up.

Immediately after the Offer becomes or is declared unconditional in all respects and assuming that Resolution 1 is passed, the shareholders of Alto will be Stephen Burrows, Dominic Wainford, David Stanley and Wainford Holdings Limited in respect of the Preference Shares, together with any other COBRA Shareholders who accept the Share Alternative.

On the assumption that no COBRA Shareholders (other than those who have provided Irrevocable Undertakings to do so) validly elect for the Share Alternative and assuming that Resolution 1 is passed) on or shortly after the Offer becoming or being declared unconditional in all respects, the capital structure of Alto will be increased and is expected to comprise:

50,000 A Shares

15,228,745 B Shares (being the Offer Shares)

7,000,000 Preference Shares

On the basis that the B Shares and Preference Shares have no voting rights, the persons owning or controlling 5 per cent. or more of the voting rights of Alto will be:

   Steve Burrows                           69.5 per cent. 
   Dominic Wainford                      25.5 per cent. 
   David Stanley                            5 per cent. (assuming that Resolution 1 is passed)

Any COBRA Shareholder (including those persons who have provided Irrevocable Undertakings to do so) validly electing the Share Alternative will receive B Shares.

Summary details of the directors of Alto are set out below:

Stephen Burrows (aged 51) entered the insurance industry at the age of 17, working initially for Sun Alliance, before moving on to Berry Birch and Noble Plc at the age of 23. Stephen was appointed director at the age of 25. In December 1988, Stephen formed Burrows, Keith & Associates Limited, with certain of his colleagues. Burrows, Keith & Associates Limited then became the BKG group of companies and ultimately part of the COBRA Group in 2006.

Stephen has focused over his insurance career on marketing and new business within the general commercial insurance industry. For the past 10 years Stephen has carried out the role of chief executive officer of COBRA. He continues to sit on the board of all the companies within the COBRA Group, together with the acquisition, marketing and compliance committees of COBRA Resource Management and the Nomination Committee.

Dominic Wainford (aged 44) founded Wainford Holdings Limited in 1997 which he continues to run as an investment company. Dominic joined the board of COBRA in January 2009 on the back of a significant investment in COBRA by Wainford Holdings Limited. Dominic joined The Tilt Estate Company Limited in 1985, becoming its owner and managing director prior to its sale in 2007. From 2001 to 2008 he was a director of Willowone Limited, a building company employing a range of contractors to carry out building renovations, extensions and maintenance to properties within The Tilt Estate portfolio.

David Stanley (aged 42) joined the COBRA Group in September 2008 and sits on the board of all the companies within the COBRA Group. A graduate of Leeds University and Strathclyde Business School, David was CFO at Kuju plc leading its flotation on AIM in 2002. On leaving Kuju David acted as a consultant to various companies trading on AIM and has been involved in acquisitions, group integrations and re-organisations, IPOs and re-financings. Previously David spent five years working for Thus Plc where he was part of the team which oversaw Thus' flotation on the London Stock Exchange in 1999.

As described in paragraph 9 of this Announcement, subject to the Offer being declared unconditional in all respects, Alto will issue 7,000,000 Preference Shares to Wainford Holdings Limited in exchange for the outstanding Convertible Notes.

Further information on Alto will be contained in the Offer Document.

5. Information on COBRA and current trading and prospects

COBRA is the holding company of a UK-based retail and wholesale insurance broking group, having at its core a nationwide retail insurance network. It provides services including marketing, access to market, compliance assistance and brand awareness to in excess of 100 independent insurance brokers. In addition, it offers retail insurance via its general broking arms, wholesale Lloyd's facilities using its own Lloyd's broker, underwriting capacity from major UK insurers via its underwriting agency and financial advice via its own independent financial services company. Following an extended period of acquisitive growth, COBRA commenced a disposal programme in 2011 to reduce its borrowings.

The most recent audited accounts were prepared for the year ended 31 March 2011. These showed revenues of GBP23,037,549 (2010: GBP22,679,194), earnings before interest, tax depreciation and amortization (EBITDA) of GBP2,415,524 (2010:GBP3,178,571), loss before tax of GBP1,744,406 (2010: profit 391,987) and net assets of GBP9,580,749 (2010: GBP11,379,945). The loss before tax is stated after providing GBP1,496,000 for impairment of goodwill, which was a non cash adjustment. COBRA's interim results for the six months to 30 September 2011 showed revenues of GBP11,990,000, profit before tax of GBP397,000 and net assets of GBP9,883,000.

In late 2011, COBRA disposed of COBRA Corporate Solutions Limited and the broking operations of COBRA Insurance Brokers Limited in Caterham and Alton. These sales resulted in the receipt of initial cash consideration of approximately GBP6 million which reduced the COBRA Group's borrowings, strengthening its financial position. Deferred consideration arising from the disposals, the amount of which will depend on trading performance, is expected to result in further cash receipts of around GBP2.7 million in total in December 2012 and December 2013. At 31 March 2012, excluding client monies, the COBRA Group held cash balances of approximately GBP2.2 million (2011: GBP0.8 million) and had borrowings of approximately GBP12.3 million (2011: GBP15.0 million).

The disposals in 2011 represented approximately 30 per cent. of the aggregated EBITDA of the operating components of the COBRA Group, on an annualised basis, prior to the allocation of holding company and overhead costs. Although COBRA had started taking steps to reduce COBRA's overhead costs to reflect the smaller size of its operating base, certain of these overhead reduction measures were put on hold when discussions with possible bidders for COBRA commenced, so as to enable any eventual purchaser the opportunity to decide where savings should be implemented. As a result the results for the COBRA Group to 31 March 2012 will reflect a disproportionally high level of such overhead compared to the aggregated EBITDA of the remaining operating components of the Group, the impact of which will be material.

The trading performance of COBRA's operating subsidiaries towards the end of the financial year ended 31 March 2012 was below expectations, but the new financial year started with better results in April 2012 which were broadly in line with (but slightly under) budget.

In the event that the Offer is withdrawn or lapses the Independent Directors believe that the COBRA Group would need to implement significant cost savings (which would include the cancellation of the COBRA Shares admission to AIM) similar to those contemplated by Alto and would need to negotiate additional funding and/or new terms with its existing debt providers in order to have sufficient working capital after servicing its debt.

6. Background to and reasons for recommending the Offer

COBRA discussed the sale of certain subsidiaries in 2011 with potential purchasers, one of whom proposed making an indicative offer for the COBRA Group as a whole in early 2012. This approach was considered by the COBRA Board and its financial adviser Fairfax and led to other potential offerors being approached. When initial indicative offers were received, the COBRA Board was disappointed with their value and Stephen Burrows sought the COBRA Board's consent to seek funding for his own offer for the issued share capital of COBRA. After receiving the COBRA Board's approval, Stephen Burrows formed Alto and has now received financial backing to finance the Offer.

On 3 April 2012, COBRA announced that it was co-operating with two potential offerors being Alto and also Towergate. As already announced Towergate withdrew from such negotiations on 18 May 2012. Towergate's indicative offer was below that of Alto's.

The Independent Directors are Peter Robinson (Chairman), John Lincoln (Executive Director), David Harris and Stephen Bullock (both Non Executive Directors).

In addition to Stephen Burrows who is not regarded as independent due to his interests in Alto, the Code provides that any executive directors of the Target who are to continue in employment following a management buy-out (as in the case here) are not generally deemed to be Independent Directors. Accordingly David Stanley (Chief Financial Officer), who will continue in the same role with the Enlarged Group and will, subject to Independent Shareholder approval, make an investment in A Shares, is not an Independent Director.

Dominic Wainford is the controlling shareholder of Wainford Holdings Limited which has entered into an arrangement to exchange the Convertible Notes for Preference Shares. In view of his personal interest in that transaction, Dominic Wainford, who has also subscribed for A Shares, is not an Independent Director.

The Independent Directors have considered the Offer and the effect of the Acquisition on the employees and business of the COBRA Group. Having taken advice from Fairfax, they have agreed to recommend acceptance of the Offer in respect of the Cash Consideration because it is higher than any of the indicative offers received from several interested parties all of which have now fallen away and is, in their opinion, fair and reasonable in the context of the COBRA Group's financial position and performance.

The Independent Directors believe that the excessive overheads of the COBRA Group can be more effectively reduced if it is no longer required to operate as a listed company and if the Offer was to lapse, the COBRA Board intend to proceed with the cancellation of trading of COBRA Shares' on AIM as described in paragraph 12 of this Announcement. This would lead to COBRA Shareholders holding unquoted shares which could prove very difficult to sell. The Independent Directors consider that the Offer presents a good opportunity for COBRA Shareholders to realise their investment in COBRA for the Cash Consideration.

Alto has indicated that it intends to immediately implement an operational review of the COBRA Group which is expected to lead to a management restructure and certain overhead cuts which will include the resignation of the non-executive directors. Otherwise, it is intended that the COBRA Group will continue to operate in much the same way as it does at present. Alto also intends that negotiations for the sale of COBRA Financial Services will continue and expects that sale to be completed if satisfactory terms can be agreed with a buyer. Further details are set out in paragraph 8 below.

The Independent Directors, who note BDO's valuation of an Offer Share, which is less than the value of the Cash Consideration, also had regard to the factors set out in paragraph 3 above when reaching their decision not to recommend COBRA Shareholders to accept the Share Alternative. Alto is, in effect, a management buy-out vehicle and the Independent Directors recognise that members of the management team wish to invest in it and have irrevocably undertaken to do so.

7. Irrevocable undertakings

Alto has received the following Irrevocable Undertakings to accept the Offer:

-- Stephen Burrows, Dominic Wainford and David Stanley, are interested in 8,717,582, 2,507,624 and 500 COBRA Shares respectively and have irrevocably undertaken to accept or procure the acceptance of the Offer in respect of their entire shareholdings representing in aggregate 11,225,706 COBRA Shares, being approximately 30.86 per cent. of the existing issued share capital of COBRA.

-- As part of their Irrevocable Undertakings Dominic Wainford and David Stanley have further undertaken to elect for the Share Alternative in respect of their entire holdings in COBRA Shares. As part of his Irrevocable Undertaking, Stephen Burrows has undertaken to elect for the Share Alternative in respect of 1,967,582 COBRA Shares and the Cash Consideration in respect of 6,750,000 COBRA Shares which will result in the payment to him of GBP1.35 million. As part of the funding arrangements being made available to Alto, Mr Burrows is required to pay off existing personal loans and in order to do this he is required to receive the Cash Consideration for some of his COBRA Shares as opposed to electing for the Share Alternative in full. Stephen Burrows has given a personal guarantee of GBP750,000 as part of the funding arrangements which will at the sole discretion of Macquarie Bank Limited and subject to ongoing compliance with the Facility Letter, only be released when capital repayments totalling GBP1.35 million have been made by Alto.

-- Those Independent Directors who have an interest in COBRA Shares have irrevocably undertaken to accept the Offer in respect of their entire holdings of 4,128,992COBRA Shares, representing approximately 11.35 per cent. of the existing issued share capital of COBRA.

-- In addition other COBRA Shareholders have given Irrevocable Undertakings to accept the Offer in respect of 17,734,543 COBRA Shares representing approximately 48.76 per cent. of the existing issued share capital of COBRA.

All of the above Irrevocable Undertakings will cease to be binding only in the event that the Offer is withdrawn or lapses or if the Offer Document is not published within 28 days of the date of this Announcement. Otherwise they will remain binding in all circumstances save for the undertakings signed by John Lincoln (a COBRA Director) and Mark Zandler which fall away in the event of an offer from a third party which is at a price of 10 per cent. or more in excess of the Offer Price.

Accordingly Alto has received, in aggregate, Irrevocable Undertakings to accept the Offer in respect of 33,089,241 COBRA Shares, representing approximately 90.97 per cent. of the existing issued share capital of COBRA. Of these Irrevocable Undertakings, Alto has received undertakings to elect for the Cash Consideration in respect of a total of 17,860,496 COBRA Shares, representing 49.10 per cent. of the existing issued share capital of COBRA and undertakings to elect for the Share Alternative in respect of a total of 15,228,745 COBRA Shares, representing 41.87 per cent. of the existing issued share capital of COBRA.

The above Irrevocable Undertakings given by the COBRA Shareholders except for those given by Stephen Burrows, Dominic Wainford and David Stanley (who, under the provisions of the Code, are not entitled to vote on Resolution 1) also undertake to vote in favour of Resolution 1, representing 86.94 per cent. of the votes capable of being cast.

Full details of the Irrevocable Undertakings are set out in Appendix III at the end of this Announcement and will be set out in the Offer Document.

8. Management, Employees and locations

Upon the Offer becoming or being declared unconditional in all respects, the directors of Alto intend to immediately implement an operational review of the COBRA Group which is expected to lead to a management restructure and certain overhead cuts which will include the resignation of the non-executive directors. Otherwise, it is intended by Alto that COBRA will continue to operate in much the same way as the COBRA Group does at present. Alto also intends that negotiations for the sale of COBRA Financial Services will continue and expects that sale to be completed if satisfactory terms can be agreed with a buyer.

Alto has indicated that the skills, knowledge and expertise of COBRA's employee workforce are valued by Alto and the Independent Directors have been given assurances that the employment rights of all COBRA employees will be safeguarded. Alto has no current intention to change the strategic direction, or the location of COBRA's operations, to redeploy any of COBRA's fixed assets or to effect a material change in any conditions of employment.

Save for the Arrangements set out in paragraph 10 below, no favourable conditions have been proposed by Alto and no management incentivisation arrangements have been proposed or discussed by Alto or any persons acting in concert with Alto or with any member of COBRA's management.

   9.    Convertible Notes

COBRA has outstanding Convertible Notes to the value of GBP7 million, with a conversion price of 50 pence per COBRA Share. Subject to the Offer being declared unconditional in all respects COBRA and Wainford Holdings Limited (the holder of the Convertible Notes) have, as part of the funding arrangements being made available to Alto, agreed to exchange the Convertible Notes for Preference Shares. It has been agreed that 7,000,000 Preference Shares equal to a total of GBP7 million will be issued to Wainford Holdings Limited.

The Preference Shares will, for the first 3 years only, receive a fixed dividend of 12.5 per cent per annum, however they have no security, and will have no voting rights. This dividend will be split so that a fixed dividend of 12.4 per cent. per annum will be calculated on a daily basis and be satisfied annually by the issue of additional Preference Shares and 0.1 per cent. per annum will be calculated on a daily basis and be satisfied quarterly by the payment of cash. After three years the fixed dividend payable on the Preference Shares will be 0.1 per cent. per annum and will be calculated on a daily basis and be satisfied quarterly by the payment of cash.

No specified redemption date has been set, although subject to agreement of its debt funder, Alto can choose to repay part of the balance and the Preference Shares can also be redeemed on the sale of Alto. Full details of the restrictions on the Preference Shares are set out in the Articles.

The Independent Directors, having received advice from Fairfax, consider the proposal made in relation to the Convertible Notes to be fair and reasonable so far as both the COBRA Shareholders and Wainford Holdings Limited are concerned. In providing advice in relation to such proposal, Fairfax has relied on the commercial assessments of the Independent Directors and has taken into account the fact that Dominic Wainford is a director and shareholder in Alto (and has agreed to be treated as a joint offeror for the purposes of the Code).

Further details regarding the Convertible Notes and the Preference Shares will be set out in the Offer Document.

10. Arrangements with Alto

Stephen Burrows and Dominic Wainford who are both Alto Shareholders are joint offerors in accordance with the Code.

Alto has invited David Stanley the current Chief Financial Officer of COBRA to continue his current role with the Enlarged Group and David Stanley will invest in Alto to receive 5 per cent. of the A Shares, subject to Independent Shareholders' approval. Stephen Burrows and Dominic Wainford believe that David Stanley has excellent knowledge of the COBRA Group's structure both in his operational and financial capacity and is viewed as a major asset going forward.

Fairfax considers the terms of the Arrangements between Alto and David Stanley described in this paragraph 10 to be fair and reasonable so far as the COBRA Shareholders are concerned.

Under Rule 16 of the Code, except with the consent of the Panel, an offeror or persons acting in concert with it may not make any arrangements with shareholders and may not deal or enter into arrangements to deal in shares of the offeree company, or enter into arrangements which involve acceptance of an offer, either during an offer period or when one is reasonably in contemplation, if there are favourable conditions attached which are not being extended to all shareholders.

In accordance with Rule 16.2 of the Code, as David Stanley is a director and shareholder in COBRA, and as a result of the arrangements described in this paragraph 10, he will become a shareholder in Alto on a basis that is not being made available to the other COBRA Shareholders, such Arrangements must be approved at a General Meeting before they are able to take effect. The Arrangements are therefore subject to Resolution 1 being approved at a General Meeting, as required by Rule 16.2 of the Code. Accordingly the notice of the General Meeting convening the General Meeting will be set out in the Offer Document at which Resolution 1,to approve the Arrangements pursuant to the Code, will be proposed. In accordance with the requirements of the Code, only the Independent Shareholders will be permitted to vote on Resolution 1, which will be taken on a poll.

The Offer will be conditional, inter alia, upon the passing of Resolution 1, however Alto reserves the right to waive this condition.

In the event that Resolution 1 is not passed David Stanley will not be entitled to subscribe for any A Shares until the expiry of 6 months following completion of the Offer.

   11.       COBRA Share Option Schemes

The Offer will extend to any COBRA Shares which are unconditionally allotted or issued fully paid (or credited as fully paid) pursuant to the exercise of options granted under the COBRA Share Option Schemes or otherwise while the Offer remains open for acceptance (or such earlier date as Alto may, subject to the Code, decide).

12. Compulsory acquisition and cancellation of COBRA Shares trading on AIM

If the Offer becomes or is declared unconditional in all respects and sufficient acceptances are received and/or sufficient COBRA Shares are otherwise acquired, Alto intends to apply the provisions of sections 974 to 991 (inclusive) of the Act to acquire compulsorily any outstanding COBRA Shares to which the Offer relates and which have not been acquired or agreed to be acquired pursuant to the Offer or otherwise.

The COBRA Board intends to announce today that it has notified the London Stock Exchange pursuant to Rule 41 of the AIM Rules for Companies of the AIM Cancellation.

The AIM Cancellation is subject to COBRA Shareholders' approval at a General Meeting unless Alto declares the Offer unconditional in all respects with over 75 per cent. acceptances.

The Offer Document will contain a notice of the General Meeting which will include Resolution 2 to approve the AIM Cancellation.

If the Offer is declared unconditional in all respects with 75 per cent. or more acceptances, the AIM Cancellation will be effective 5 clear business days after that occurs but not before 30 July 2012. If the Offer is withdrawn or lapses, but Resolution 2 is passed, the cancellation will be effective 5 business days after the passing of Resolution 2 but not before 30 July 2012.

Delisting would significantly reduce the liquidity and marketability of any COBRA Shares which are not acquired by Alto.

It is also intended that, following the Offer becoming or being declared unconditional in all respects, COBRA will be re-registered as a private company.

13. Information on the Offer Shares

The Offer Shares will be non-transferable redeemable B Shares of 20 pence each in Alto with no voting rights. With regards to income the holders of the B Shares will be entitled to receive dividends at the discretion of the Alto Board.

With regards to a sale or liquidation of Alto the holders of the B Shares will, following the redemption of the Preference Shares but in priority to the holders of the A Shares, be entitled to receive a redemption sum equivalent to up to 20 pence per B Share subject to the proceeds available. Thereafter any further proceeds shall be distributed to the holders of the A Shares until such time as the holders of the A Shares have received four times the aggregate amount received by the holders of the B Shares. Thereafter any surplus proceeds shall be distributed between the holders of the A Shares and the holders of the B Shares on the basis of 80 per cent. of the funds being split between the holders of the A Shares and 20 per cent. being split between the holders of the B Shares (as a further redemption sum per B share).

The B Shares will not be transferable. Full details of the B Shares are set out in the Articles.

Any COBRA Shareholder (including those persons who have provided Irrevocable Undertakings to do so) validly electing the Share Alternative will receive B Shares.

14. Financing of the Offer in respect of the Cash Consideration

BDO LLP is satisfied that the necessary resources are available to Alto sufficient to satisfy full acceptance of the Offer.

The Offer will be funded by a debt facility from Macquarie Bank Limited.

The Offer, if it were to be satisfied entirely by the Cash Consideration, values the entire issued share capital of COBRA at approximately GBP7.3 million.

As noted in paragraph 7 of this Announcement, a number of COBRA Shareholders have given Irrevocable Undertakings to elect for the Share Alternative. Taking this into account, the maximum cash payable by Alto under the terms of the Offer would be approximately GBP4.23 million.

Further information on the financing of the Offer will be set out in the Offer Document.

15. Shareholdings of persons acting in concert with Alto

Alto confirms that on 4 April 2012 it disclosed the information required under Rule 8.1(a). Further to this disclosure, as at 29 June 2012, Alto had in issue 47,500 A Shares. Dominic Wainford is now deemed to be acting in concert with Alto. The holdings of A Shares and the percentages of the Alto issued share capital by those persons deemed to be acting in concert with Alto are:

                                                            A Shares                         Percentage of issued

share capital of Alto

   Stephen Burrows                                 34,750                            73.16 
   Dominic Wainford                               12,750                            26.84

Alto confirms that where not all relevant details have been disclosed a further disclosure will be made in accordance with Rule 8.1(a) and Note 2 (a)(i) on Rule 8 as soon as possible.

16. Shareholdings of persons acting in concert with COBRA

The following directors of COBRA who are deemed to be acting in concert with COBRA have no holdings of Alto Shares. Their holdings of COBRA Shares and the percentages of COBRA's issued share capital are:

                                                  COBRA Shares                 Percentage of issued

share capital of COBRA

   Peter Robinson                                        25,773                       0.07 
   Stephen Bullock                                         nil                               nil 
   David Harris                                            40,000                         0.11 
   John Lincoln                                       4,063,219                       11.17

Fairfax, which is acting in concert with COBRA, has Exempt Principal Trader status.

17. Other

17.1 Alto has received consent from the FSA to become the controlling shareholder of COBRA's regulated subsidiaries.

17.2 In 2009 Stephen Burrows and Wainford Holdings Limited (with the permission of the COBRA board) set up a company, Burrford Limited ("Burrford") to provide loans to COBRA network members, these loans were provided during the course of 2009 and 2010. It has been agreed between Alto and Macquarie Bank Limited that following completion of the Offer part of the funds drawn down in accordance with the Facility Letter will be utilised to acquire the benefit of all the loans owned by Burrford with a value of approximately GBP1,276,663 for the sum of GBP1,250,000. It is the view of the directors of Alto that these purchases will benefit the Enlarged Group because it will no longer have to pay to Burrford the ongoing commission associated with the loans which have been acquired. This should save the Enlarged Group approximately GBP400,000 in commission each year.

17.3 On 27 February 2012 Alto and COBRA entered into a non-disclosure agreement in a customary form in relation to a potential offer by Alto for COBRA enabling Alto to receive certain information on COBRA.

18. Documents on display

Copies of the documents referred to below will be available for inspection at the offices of asb Law, Innovis House, 108 High Street, Crawley, West Sussex, RH10 1AS, during normal business hours on any weekdays (Saturdays, Sundays and public holidays excepted) and online at Alto's website www.altoinsurancegroup.comoffer and COBRA's website www.cobraholdings.co.ukoffer.html by no later than 12 noon on 2 July 2012 and remain available while the Offer remains open for acceptance:

   1.   the Facility Letter and associated banking documents; 
   2.   the non-disclosure agreement described in paragraph 17 above; and 
   3.   the Irrevocable Undertakings.

19. General

The Offer Document, containing the full terms of the Offer, will be posted to COBRA Shareholders as soon as possible, but in any event, within 28 days of today's date. The conditions to the Offer are set out in Appendix I to this Announcement and, together with certain further terms of the Offer, will also be set out in full in the Offer Document and, in the case of certificated COBRA Shares, in the Form of Acceptance. In deciding whether to accept the Offer, COBRA Shareholders should rely on the information contained in, and follow the procedures described in, the Offer Document and, if applicable, the Form of Acceptance.

The availability of the Offer to COBRA Shareholders not resident in or citizens of the United Kingdom may be affected by the laws of the Relevant Jurisdictions in which they are citizens or in which they are resident. Such persons should inform themselves about and observe any applicable legal or regulatory requirements of any such Relevant Jurisdiction.

In particular, the Offer is not being made, directly or indirectly, in, into or from or by the use of the mails of or any means or instrumentality (including, without limitation, by means of facsimile transmission, telex, telephone, internet or other forms of electronic communication) of interstate or foreign commerce of, or by any facility of a national, state or other securities exchange of, any Restricted Jurisdiction, or in any other jurisdiction if to do so would constitute a violation of the relevant laws of such jurisdiction and the Offer, when made, will not be capable of acceptance by any such use, means, instrumentality or facility from or within any Restricted Jurisdiction where to do so would constitute a breach of any relevant securities laws of that Restricted Jurisdiction. Accordingly, copies of this Announcement are not being, and must not be, mailed or otherwise distributed or sent in or into or from any Restricted Jurisdiction or any such other jurisdiction. Doing so may render invalid any purported acceptance of the Offer. Alto will retain the right to permit the Offer to be accepted and any sale of any securities pursuant to the Offer to be completed if, in its sole discretion, it is satisfied that the transaction in question can be undertaken in compliance with applicable law and regulation.

Any persons who are subject to the laws of any jurisdiction other than the United Kingdom should inform themselves about, and observe any applicable legal or regulatory requirements. Further information in relation to overseas COBRA Shareholders will be set out in the Offer Document.

COBRA Shareholders who accept the Offer may only rely on the Offer Document and, where appropriate, the related Form of Acceptance for all the terms and the condition of the Offer. In deciding whether or not to accept the Offer in relation to their COBRA Shares, COBRA Shareholders should rely only on the information contained, and procedures described, in the Offer Document and the accompanying Form of Acceptance. COBRA Shareholders are strongly advised to read the Offer Document being posted to them shortly, and in any event within 28 days of this Announcement, which contains important information with respect to the Offer.

Fairfax and BDO LLP have given their respective written consents to the release of this Announcement containing references to their names in the form and context in which they appear.

Fairfax I.S. PLC, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for COBRA and no one else in connection with the Offer and will not be responsible to anyone other than COBRA for providing the protections afforded to customers of Fairfax or for providing advice in relation to the Offer or any other matter referred to herein. The principal place of business of Fairfax is 46 Berkeley Square, London W1J 5AT.

The directors of Alto accept responsibility for the information contained in this document, save for the information for which the COBRA Directors accept responsibility in accordance with the following paragraph. Save as aforesaid, to the best of the knowledge and belief of the directors of Alto (who have taken all reasonable care to ensure that such is the case) the information contained in this document for which they are responsible is in accordance with the facts and does not omit anything likely to affect the import of such information.

The directors of COBRA, accept responsibility for the information contained in this document relating to COBRA, themselves and their immediate families, related trusts and connected persons. To the best of the knowledge and belief of the directors of COBRA (who have taken all reasonable care to ensure that such is the case) the information contained in this document for which they are responsible is in accordance with the facts and does not omit anything likely to affect the import of such information.

Forward looking statements

Overseas jurisdictions

The attention of COBRA Shareholders is drawn to the fact that under the Code there are certain UK dealing disclosure requirements in respect of relevant securities during an offer period. An Offer Period was deemed to have commenced at 13.54 on 3 April 2012 when a possible offer for COBRA was announced.

This Announcement has been prepared for the purposes of complying with English Law and the 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.

Disclosure requirements of the Code

Under Rule 8.3(a) of the Code, any person who is interested in 1 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 10(th) business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10(th) 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 Code, any person who is, or becomes, interested in 1 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.

Alto is a paper offeror for the purposes of the above disclosure requirements.

This Announcement does not constitute, or form part of, an offer or invitation to purchase any securities.

APPENDIX I

Conditions of the Offer

The Offer is subject to the following conditions:

(i) valid acceptances being received (and not, where permitted, withdrawn) by not later than 1.00 p.m. on the first closing date of the Offer (or such later time(s) and/or date(s) as Alto may, subject to the rules of the Code, decide) in respect of not less than 90 per cent. (or such lesser percentage as Alto may decide) in nominal value of the COBRA Shares to which the Offer relates, provided that, unless agreed by the Panel, this condition will not be satisfied unless Alto has acquired or agreed to acquire (pursuant to the Offer or otherwise), directly or indirectly, COBRA Shares carrying, in aggregate, over 50 per cent. of the voting rights then normally exercisable at general meetings of COBRA on such basis as may be required by the Panel (including for this purpose, to the extent (if any) required by the Panel, any voting rights attaching to any shares which are unconditionally allotted or issued before the 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 (a) the expression "COBRA Shares to which the Offer relates" shall be construed as those shares in COBRA unconditionally allotted or issued on or before the date on which the Offer is made and ordinary shares in COBRA unconditionally allotted or issued after that date but before the time at which the Offer ceases to be open for acceptance but excluding any shares that are held in treasury on or after the date of the Offer; (b) shares which have been unconditionally allotted shall be deemed to carry the voting rights which they will carry on issue; and (c) valid acceptances shall be deemed to have been received in respect of COBRA Shares which are treated as having been acquired or contracted to be acquired by Alto by virtue of acceptances of the Offer;

(ii) the passing by the Independent Shareholders at the General Meeting (or at any adjournment thereof) of Resolution 1 to approve the arrangements between Alto and David Stanley or such other resolutions as may be required by the Panel to approve the Arrangements;

(iii) no government or governmental, quasi-governmental, supranational, statutory or regulatory body, or any court, institution, investigative body, association, trade agency or professional or environmental body or (without prejudice to the generality of the foregoing) any other person or body in any jurisdiction (each, a "Relevant Authority") having decided to take, instituted, implemented or threatened any action, proceedings, suit, investigation or enquiry or enacted, made or proposed any statute, regulation or order or otherwise taken any other step or done anything, and there not being outstanding any statute, legislation or order, that would or might reasonably be expected to (in any case to an extent which is material in the context of the COBRA Group or Alto, as the case may be):

(a) directly or indirectly restrict, restrain, prohibit, delay, impose additional conditions or obligations with respect to or otherwise interfere with the implementation of the Offer or the acquisition of any COBRA Shares by Alto or any matters arising therefrom or require amendment to the terms of the Offer;

(b) result in a limit or delay in the ability of Alto, or render Alto unable, to acquire some or all of the COBRA Shares;

(c) require, prevent, delay or affect the divestiture by Alto or any member of the COBRA Group of all or any portion of their respective businesses, assets or property or of any COBRA Shares or other securities in COBRA or impose any limitation on the ability of either of them to conduct their respective businesses or own their respective assets or properties or any part thereof;

(d) impose any limitation on the ability of Alto to acquire or hold or exercise effectively, directly or indirectly, all rights of all or any of the COBRA Shares (whether acquired pursuant to the Offer or otherwise) or to exercise voting or management control over any member of the COBRA Group;

(e) make the Offer or its implementation or the proposed acquisition of COBRA or of any COBRA Shares or any other shares or securities in, or control of, COBRA, illegal, void or unenforceable in or under the laws of any jurisdiction;

(f) otherwise adversely affect any or all of the businesses, assets, prospects or profits of Alto or the COBRA Group or the exercise of rights of shares in COBRA;

and all applicable waiting periods during which such Relevant Authority could institute, implement or threaten any such action, proceedings, suit, investigation, enquiry or reference or otherwise intervene having expired, lapsed or been terminated;

(iv) all authorisations, orders, grants, consents, clearances, licences, permissions and approvals ("Authorisations"), in any applicable jurisdiction, reasonably considered necessary or appropriate by Alto for or in respect of the Acquisition, the proposed acquisition of any shares or securities in, or control of, COBRA by Alto or the carrying on of the business of any member of the COBRA Group or Alto, being obtained in terms reasonably satisfactory to Alto from all appropriate Relevant Authorities or (without prejudice to the generality of the foregoing) from any persons or bodies with whom any member of the COBRA Group or Alto has entered into contractual arrangements (in each case where the absence of such Authorisation would have a material adverse effect on Alto) and such authorisations, orders, grants, consents, clearances, licences, permissions and approvals remaining in full force and effect and there being no intimation of any intention to revoke or not to renew the same and all necessary filings having been made, all appropriate waiting and other time periods (including extensions thereto) under any applicable legislation and regulations in any jurisdiction having expired, lapsed or been terminated and all necessary statutory or regulatory obligations in any jurisdiction in respect of the Offer or the proposed acquisition of any COBRA Shares or any matters arising therefrom having been complied with;

(v) since 30 September 2011 (being COBRA's last interim results date) and save as announced publicly via a Regulatory Information Service or otherwise fairly disclosed in writing to Alto by or on behalf of COBRA prior to 28 June 2012 (being the Latest Practicable Date), no member of the COBRA Group having:

(a) issued or agreed to issue or authorised or proposed the issue of additional shares of any class or issued or authorised or proposed the issue of or granted securities convertible into or rights, warrants or options to subscribe for or acquire such shares or convertible securities or redeemed, purchased or reduced or announced any intention to do so or made any other change to any part of its share capital;

(b) recommended, declared, paid or made or proposed to recommend, declare, pay or make any dividend, bonus or other distribution;

   (c)        authorised or proposed or announced any change in its share or loan capital;

(d) issued or authorised or proposed the issue of any debentures or (other than by operation of any rate of interest applying to such indebtedness or liability) incurred or increased any indebtedness or liability (actual or contingent) which in any case is material in the context of the COBRA Group;

(e) disposed of or transferred, mortgaged or encumbered any asset or any right, title or interest in any asset or entered into or varied any contract, commitment or arrangement (whether in respect of capital expenditure or otherwise) which is of a long term or unusual nature or which involves or could involve an obligation of a nature or magnitude which is material or is otherwise than in the ordinary course of business or could reasonably be regarded as materially restricting the business of the COBRA Group or Alto or authorised, proposed or announced any intention to do so;

(f) entered into, or varied the terms of, any contract or agreement with any of the directors;

(g) taken or proposed any corporate action or had any legal proceedings started or threatened against it for its winding-up, dissolution or reorganisation or for the appointment of a receiver, administrator, administrative receiver, trustee or similar officer of all or any of its assets and revenues or any analogous proceedings in any jurisdiction or appointed any analogous person in any jurisdiction which in any case is material in the context of the COBRA Group;

(h) waived or compromised any claim other than in the ordinary course of business which is material in the context of the COBRA Group;

(i) made any amendment to its memorandum or articles of association or other incorporation documents;

(j) been unable or admitted that it is unable to pay its debts or having stopped or suspended (or threatened to stop or suspend) payment of its debts generally or ceased or threatened to cease carrying on all or a substantial part of its business;

(k) implemented, effected, authorised or proposed or announced its intention to implement, effect, authorise or propose any merger, demerger, reconstruction, amalgamation, scheme, commitment, partnership or acquisition or disposal of assets or shares or loan capital (or equivalent thereof) in any undertaking or undertakings on any such case;

(l) entered into any contract, commitment or agreement or passed any resolutions with respect to any of the transactions, matters or events referred to in this condition (v);

(vi) since 30 September 2011 (being COBRA's last interim results date) and save as announced publicly via a Regulatory Information Service or otherwise fairly disclosed in writing to Alto by or on behalf of COBRA prior to 28 June 2012 (being the Latest Practicable Date):

(a) no litigation, arbitration, prosecution or other legal proceedings having been instituted, announced or threatened or become pending or remained outstanding by or against any member of the COBRA Group or to which any member of the COBRA Group is or may become a party (whether as plaintiff, defendant or otherwise) which in any case is material in the context of the COBRA Group;

(b) no contingent or other liability of any member of the COBRA Group having arisen or become apparent or increased which in any case is material in the context of COBRA Group;

(c) no adverse change or deterioration having occurred in the business, assets, financial or trading position, profits or prospects of any member of the COBRA Group which in any case is material in the context of the COBRA Group; and

(d) no investigation by any Relevant Authority having been threatened, announced, implemented or instituted or remaining outstanding which in any case is material in the context of the COBRA Group; and

   (vii)      Alto not having discovered that:

(a) any business, financial or other information concerning the COBRA Group publicly disclosed at any time by the COBRA Group, either contains a misrepresentation of fact or omits to state a fact necessary to make the information contained therein not misleading and which was not subsequently corrected before 28 June 2012 (being the Latest Practicable Date) by disclosure either publicly or otherwise to Alto to an extent which in any case is material in the context of the COBRA Group; or

(b) COBRA is subject to any liability, actual or contingent, which is not disclosed in the interim report and accounts of COBRA for the six months ended 31 September 2011 which is material in the context of the COBRA Group.

Alto reserves the right to waive all or any of conditions (ii) to (vii) (inclusive) above, in whole or in part. Conditions (ii) to (vii) above must be fulfilled or waived (where possible) within 21 days after the later of the first closing date of the Offer and the date on which condition (i) is fulfilled (or in each case such later date as the Panel may agree), failing which the Offer will lapse. Alto shall be under no obligation to waive or treat as satisfied any of conditions (ii) to (vii) (inclusive) by a date earlier than the latest date specified above for the satisfaction thereof notwithstanding that the other conditions of the Offer may at such earlier date have been waived or fulfilled and that there are at such earlier date no circumstances indicating that any of such conditions may not be capable of fulfilment.

If Alto is required by the Panel to make an offer for COBRA Shares under the provisions of Rule 9 of the Code, Alto may make such alterations to the conditions as are necessary to comply with the provisions of that Rule.

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

APPENDIX II

Sources of information and bases for calculations

In this Announcement, unless otherwise stated or the context otherwise requires, the following bases and sources have been used:

a) Unless otherwise stated, financial information relating to COBRA has been extracted or derived (without material adjustment) from the audited financial statements of COBRA for the years ended 31 March 2010 and 31 March 2011.

   b)   On the Latest Practicable Date COBRA had in issue 36,374,276 ordinary shares of 25 pence each.

c) On the Latest Practicable Date there were 1,630,000 outstanding options granted under the COBRA Share Options Scheme all with an exercise price of in excess of 20 pence and the Convertible Notes.

d) The value of the Offer, in respect of the Cash Consideration, of approximately GBP7.3 million is calculated on the basis of the existing issued share capital of COBRA as set out in (b) above multiplied by the Offer Price and the assumption that none of the outstanding options will be exercised as they are in excess of 20 pence.

e) The COBRA Group cash balances and borrowings at 31 March 2012, as set out in paragraph 5 of this Announcement of cash balances (excluding client money) of approximately GBP2.2 million and borrowings of approximately GBP12.3 million have been extracted from the COBRA unaudited management accounts for period ended 31 March 2012.

f) The prices of COBRA Shares on a particular date are derived from the Closing Price for that date.

APPENDIX III

Irrevocable undertakings

Set out below are the details of the Irrevocable Undertakings received by Alto to accept, or procure the acceptance of, the Offer from COBRA Shareholders in respect of 33,089,241 COBRA Shares representing approximately 90.97 per cent. of the existing issued share capital of COBRA.

 
                          Number of        Percentage                             Number of 
                         COBRA Shares      of existing              Number of    COBRA Shares 
 Shareholder              subject to       issued share          COBRA Shares     accepting 
                        the Irrevocable     capital of              accepting     the Share 
  Director                Undertaking         COBRA        Cash Consideration    Alternative 
 Peter Robinson                  25,773            0.07                25,773 
 David Harris                    40,000            0.11                40,000 
 John Lincoln                 4,063,219           11.17             4,063,219 
 Stephen Burrows              8,717,582           23.97             6,750,000       1,967,582 
 Dominic Wainford             2,507,624            6.89                             2,507,624 
 David Stanley                      500           0.001                                   500 
 
 Other Shareholders 
 Mark Zandler                 4,063,446           11.17             4,063,446 
 Michael Bowler               3,355,796            9.23                             3,355,796 
 Peter Bright                 2,388,676            6.57               500,000       1,888,676 
 Paul Bryant                  2,040,998            5.61             2,040,998 
 Lee Wallis                   1,629,087            4.48                             1,629,087 
 Andrew Graham                1,265,408            3.48                             1,265,408 
 Brian Fuller                 1,079,513            2.97                             1,079,513 
 Jeremy Hiscott               1,000,000            2.75                             1,000,000 
 Mark Peasey                    377,060            1.04               377,060 
 James Wrynne                   287,027            0.79                               287,027 
 Martin Hoult                   102,836            0.28                               102,836 
 Kevin McNeil                    85,696            0.24                                85,696 
 Howard Collins                  59,000            0.16                                59,000 
 
 
  Total                      33,089,241           90.97            17,860,496      15,228,745

These Irrevocable Undertakings will lapse if the Offer lapses or is withdrawn or if the Offer Document is not published within 28 days of the date of this Announcement. Otherwise they will remain binding in all circumstances save for the undertakings signed by John Lincoln (a COBRA Director) and Mark Zandler which fall away in the event of an offer from a third party which is at a price of 10 per cent. or more in excess of the Offer Price.

APPENDIX IV

Definitions

 
 The following definitions apply throughout this Announcement, 
  unless the context requires otherwise: 
  "A Shares"                  the A ordinary shares of GBP1 each in 
                               the share capital of Alto in issue at 
                               the date of this document 
 "Acquisition"                the proposed acquisition of COBRA by 
                               Alto pursuant to the Offer 
 "Act"                        the Companies Act 2006, as amended from 
                               time to time; 
 "acting in concert"          has the same meaning given by the Code 
 "AIM"                        AIM, being a market operated by London 
                               Stock Exchange 
 "AIM Cancellation"           the proposed cancellation of the COBRA 
                               Shares to trading on AIM 
 "Alto"                       Alto Intermediary Group Limited 
 "Alto Board"                 board of directors of Alto 
 "Alto Shares"                the A Shares, the Offer Shares and the 
                               Preference Shares 
 "Announcement"               this announcement 
 "Arrangements"               the arrangements between Alto and David 
                               Stanley further details of which are 
                               set out at paragraph 10 of the Announcement 
 "Articles"                   the articles of association of Alto 
 "BDO"                        BDO LLP, which is authorised and regulated 
                               in the UK by the Financial Services 
                               Authority to carry on investment business, 
                               the financial adviser to Alto in respect 
                               of the Offer 
 "Business Day"               a day on which banks are open for business 
                               in London (excluding Saturdays, Sundays 
                               and public holidays) 
 "Cash Consideration"         in accordance with the terms of the 
                               Offer the consideration of 20 pence 
                               per COBRA Share payable in cash 
 "certificated" or "in        not in uncertificated form 
  certificated form" 
 "City Code" or "Code"        the City Code on Takeovers and Mergers 
                               (as amended or interpreted from time 
                               to time by the Panel) 
 "Closing Price"              the closing middle market quotation 
                               of a COBRA share on the relevant date 
                               as derived from the AIM Appendix to 
                               the Daily Official List 
 "COBRA" or "Target"          COBRA Holdings plc 
 "COBRA Directors" or         the board of directors of COBRA 
  "COBRA Board" 
 "COBRA Financial Services"   COBRA Financial Services Limited 
 "COBRA Group"                COBRA and its subsidiary undertakings 
                               at the date of this Announcement 
 "COBRA Optionholders"        holders of options in the COBRA Share 
                               Option Schemes 
 "COBRA Shareholders"         the holders of COBRA Shares 
 "COBRA Shares"               the existing unconditionally allotted 
                               or issued and fully paid (or credited 
                               as fully paid) ordinary shares of 25 
                               pence each in the capital of COBRA and 
                               any further shares which are unconditionally 
                               allotted or issued fully paid or credited 
                               as fully paid before the date on which 
                               the Offer ceases to be open for acceptance 
                               (or such earlier date as Alto may, subject 
                               to the Code, decide) but excluding any 
                               such shares held or which become held 
                               in treasury 
 "COBRA Share Option          COBRA Holdings Plc Employee Share Option 
  Schemes"                     Scheme and the COBRA Holdings plc Enterprise 
                               Management Incentive Share Option Plan 
 "Convertible Notes"          the secured GBP7 million convertible 
                               redeemable loan notes with a conversion 
                               price of 50 pence per COBRA Share with 
                               interest at 12.5 per cent. per annum 
 "Daily Official List"        the daily official list of the London 
                               Stock Exchange 
 "Enlarged Group"             Alto and the COBRA Group following completion 
                               of the Acquisition 
 "Facility Letter"            the facility letter between (i) Macquarie 
                               Bank Limited; (ii) Alto and (iii) Stephen 
                               Burrows (as guarantor) dated 29 June 
                               2012, relating to the financing of the 
                               Offer 
 "Fairfax"                    Fairfax I.S. PLC, independent financial 
                               adviser under the Code and nominated 
                               adviser to COBRA 
 "First Closing Date"         the date which is 21 days after the 
                               day of posting of the Offer Document 
 "Form of Acceptance"         the form of acceptance, authority and 
                               election for use by holders of COBRA 
                               Shares in certificated form in connection 
                               with the Offer 
 "FSA"                        the Financial Services Authority; 
 "FSMA"                       the Financial Services and Markets Act 
                               2000; 
 "General Meeting"            the general meeting of COBRA (or any 
                               adjournment thereof), notice of which 
                               will be set out in the Offer Document, 
                               at which (i) pursuant to Rule 16 of 
                               the Code Resolution 1 will be proposed 
                               (which only the Independent Shareholders 
                               shall vote on) and (ii) Resolution 2 
                               will be proposed to vote in favour of 
                               the AIM Cancellation 
 "Independent Directors"      being Peter Robinson, David Harris, 
                               John Lincoln and Stephen Bullock 
 "Independent Shareholders"   the COBRA Shareholders excluding Stephen 
                               Burrows, Dominic Wainford and David 
                               Stanley 
 "Irrevocable Undertakings"   the irrevocable undertakings given by 
                               certain COBRA Shareholders as described 
                               in Appendix III of this Announcement 
 "Latest Practicable          28 June 2012, being the latest practicable 
  Date"                        date prior to the publication of this 
                               Announcement 
 "London Stock Exchange"      London Stock Exchange PLC 
 "Offer"                      the recommended cash offer with Share 
                               Alternative to be made by Alto to acquire 
                               the entire issued and to be issued share 
                               capital of COBRA on the terms and subject 
                               to the conditions to be set out in the 
                               Offer Document and the Form of Acceptance 
                               (including, where the context so requires, 
                               any subsequent waiver, revision, variation, 
                               extension or renewal thereof) and any 
                               election available in connection with 
                               it 
 "Offer Document"             the document to be sent to COBRA Shareholders 
                               containing the Offer 
 "Offer Period"               the period commencing 3 April 2012 until 
                               whichever of the following shall be 
                               the later (a) the First Closing Date 
                               and (b) the date on which the Offer 
                               lapses or is withdrawn and (c) the date 
                               on which the Offer becomes unconditional 
                               as to acceptances 
 "Offer Price"                20 pence per COBRA Share in respect 
                               of the Cash Consideration 
 "Offer Shares" or "B         the non-transferable redeemable B preferred 
  Shares"                      shares of 20 pence each in the capital 
                               of Alto 
 "Overseas Shareholders"      COBRA Shareholders (or nominees of or 
                               custodians or trustees for COBRA Shareholders) 
                               in, resident in or nationals or citizens 
                               of jurisdictions outside the United 
                               Kingdom 
 "Panel"                      the Panel on Takeovers and Mergers 
 "Preference Shares"          the preference shares of GBP1 each in 
                               Alto to be issued to Wainford Holdings 
                               Limited in exchange for the Convertible 
                               Notes 
 "Relevant Authorities"       government or governmental, quasi-governmental, 
                               supranational, statutory or regulatory 
                               body, or any court, institution, investigative 
                               body, association, trade agency or professional 
                               or environmental body or (without prejudice 
                               to the generality of the foregoing) 
                               any other person or body in any jurisdiction 
                               (each, a "Relevant Authority") 
 "Resolution 1"               the ordinary resolution to be proposed 
                               to the Independent Shareholders at the 
                               General Meeting (or any adjournment 
                               thereof) in accordance with the requirements 
                               of the Code to approve on a poll the 
                               terms of the Arrangements 
 "Resolution 2"               the ordinary resolution to effect the 
                               AIM Cancellation to be passed by not 
                               less than 75 per cent of members or 
                               proxies voting in favour at the General 
                               Meeting 
 "Restricted Jurisdiction"    the United States, Canada, Australia, 
                               the Republic of South Africa or Japan 
                               or any other country or jurisdiction 
                               if making the Offer in such jurisdiction 
                               would constitute a violation of the 
                               relevant laws of, or require registration 
                               of the Offer in, such jurisdiction 
 "Share Alternative"          the arrangements pursuant to which COBRA 
                               Shareholders (other than certain overseas 
                               shareholders) who validly accept the 
                               Offer may elect to receive Offer Shares 
                               instead of some or all of the Cash Consideration 
                               to which they would otherwise be entitled 
                               under the Offer 
 "Towergate"                  Towergate Partnershipco Limited (a member 
                               of the Towergate Insurance Company) 
 "uncertificated" or          recorded on the relevant register of 
  "in uncertificated           the share or security concerned as being 
  form"                        held in uncertificated form in CREST, 
                               and title to which, by virtue of the 
                               CREST Regulations, may be transferred 
                               by means of CREST 
 "United Kingdom" or          the United Kingdom of Great Britain 
  "UK"                         and Northern Ireland 
 "United States"              the United States of America, its territories 
                               and possessions, any states of the United 
                               States and the District of Columbia 
                               and all other areas subject to its jurisdiction 
                               of the United States of America 
 "US Securities Act"          the United States Securities Act 1933, 
                               as amended and the rules and regulations 
                               promulgated died under such Act 
 "GBP", "p", "pence"          the lawful currency for the time being 
  or "sterling"                in the UK

For the purposes of this Announcement, subsidiary undertaking" has the meaning given by section 1162 of the Act.

All times referred to are London time unless otherwise stated.

END

This information is provided by RNS

The company news service from the London Stock Exchange

END

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