Kingston Bridge Holdings

10 November 2022

Dear Mark, John, Yioryos, Paul,

Thank you again for last week's meeting. We feel it moved things along and we're grateful that you remain open to further discussion. You indicated that it would be helpful for you to have a written proposal of some kind. This letter therefore represents an initial outline of the context of our interest and the strategic, operational and financial parameters of our proposal, which we would hope could be further refined and finalised during a more intensive diligence phase to be undertaken over the next 2-3 months.

Context

As fans we are extremely grateful for the stewardship, financial support and too often thankless hard work and that the current board of directors have given to Kingstonian over the last decade and more. The club has been through extremely challenging times – entirely of others’ making – and the fact that it still exists today in an operationally and financially viable state is to your immense credit.

We are also very aware that the club continues to face extreme challenges in the medium and long term – driven by an ‘unvirtuous cycle’ that we all recognise of declining attendances, declining revenues, declining community impact, and declining performances:

• With the club having been absent from Kingston town for a number of years, we no longer have a natural ‘catchment area’ for new fans. As longstanding fans lose interest or ability to attend matches and are not replaced, this has led to a steady and ongoing decline of our supporter base and supporter engagement. As a result, average attendances this season are firmly in the bottom half of the Isthmian league, having been at or above median levels for most of the later years at Kingsmeadow.
• Commercial revenue potential is clearly under strain – as evidenced by the lack of 3rd party match sponsorship over recent months.
• The impact the club makes in Kingston is now negligible, with much of its community football having disaffiliated over the last 12-24 months and no obvious ‘hub’ for community events.
• Having cut the budget this season due to a combination of these attendances and a (perfectly reasonable) unwillingness from directors to continue to subsidise the same level of losses via large loans, the team is performing below previous standards.

If this situation continues for more years, we believe that the future of Kingstonian as a vibrant non-league club is at risk. The two assets that the club has – a loyal fanbase and the money it received as payoff for leaving Kingsmeadow early – are being depleted every season, and when they get below a certain level the club that we all fell in love with decades ago will cease to exist in the same way for any next generation to enjoy.

It is for this reason that we have come forward now to offer financial and operational support to the board to speed up the processes that are already ongoing to secure the long-term future of the club. From our conversation, it feels like we are highly aligned on what this looks like:

• Playing in Kingston at a ground that is at least partially owned by the club
• Sustaining a men’s team at Step 2-4
• Regular attendances of 400+
• Re-establish women’s boys’ and girls’ teams infrastructure

It is as clear to us as it is to everybody that in this context the ground issue is existential for the club, and it is only through its resolution that the long-term future of the club can be secured.

Outline Proposal

Kingston Bridge Holdings is a company that will be established with the sole intent of acquiring a stake in Kingstonian FC Ltd with a view to contributing to the strategic direction and practical operations of the club via representation on the board. Its members are longstanding Kingstonian fans with a range of skills and resources that will be useful in accelerating the progress of the club over coming years. They are:

• Alastair Akers
• Neil Baker
• Rupert Cane
• Michael Cox
• Jamie Cutteridge
• Gary Ekins
• Ali Kazemi
• Taimour Lay
• James Maw
• Simon Murray
• Henry Stannard
• Ollie Steel
• Jon Tolley

To be clear, and to mitigate any concerns over accountability and clear lines of communication, the company would act as a single corporate body with whom Kingstonian FC Ltd deals and would nominate directors from amongst its members to fill its allotted board seats. Over the medium-term, membership of the company is liable to change as individual members’ financial and family circumstances change or to incorporate new members who are able to commit time, money or expertise to the club. Our intention is very much to add to the good work the board is already doing, not to replace any individual directors unless that is the will of the board today.

In return for its shareholding, Kingston Bridge Holdings will be able to offer support to the current board in the following ways:

• Expert support and network to augment current strategic initiatives – in particular around the ground search, commercial partnerships, and digital marketing
• Day-to-day operational support around club administration
• Substantial guaranteed directors’ loans for a period of 3-5 years to supplement the budget, drawn from the personal wealth of individual members

Whilst a precise offer in terms of shareholding/number of board seats etc is clearly impossible to make at this stage, we want to make clear our proposal is subject to full agreement from the board to three critical strategic principles:

1. A commitment to end the groundshare with Tooting at the earliest possible date – ie. to start immediately examining options for the end of the 2022-23 season – and to move to a ground more conveniently located near Kingston where attendances and commercial viability can be better sustained.
2. A commitment to a financial pathway that will see the club no longer using what is left of the lump-sum payment received in 2017 to subsidise the annual operating budget in time for the start of the 2025-26 season at the latest.
3. Achieving high conviction/’heads of terms’ agreement with one of the three immediately available options (Kingsmeadow Athletics Track, Kingston University, Corinthian Casuals) for a permanent home before the end of the 2022-23 season. For the avoidance of doubt, it is our position that there is a strong business case for a ground at Kingsmeadow Athletics.

Diligence and Next Steps

Should you continue to be interested in our proposal for further support, we would be very keen to proceed with a short diligence phase of work.

As part of this phase we would be grateful to receive certain information that will allow us to refine an attractive offer to present back to you. That information will of course be considered on a confidential basis with a commitment not to disclose in any form to any other individuals beyond the members of Kingston Bridge Holdings Ltd Listed in this letter. In the same way we expect the membership of this group and the nature of our discussions to remain confidential until an outcome is secured. We would happy to draft and commit to either a corporate or personal mutual NonDisclosure Agreement, and are happy to supply a template if you do not already have one.

The information that is most critical for us is as follows. We are – of course – happy to discuss what could be made available most conveniently and adjust accordingly.

1. Operational Accounts (ideally on a cash basis, or with reconciling cash figures to P&L) for each of the last 5 seasons (2017-18, 2018-19, 2019-20, 2020-21, 2021-22) and budget for the current season, splitting out key costs and revenue items.
   • Costs
     • Playing staff wages & bonus
     • Coaching staff wages & bonus
     • Other wages
     • Home Matchday expenses
     • Travel expenses
     • Rent
     • Kit
     • Transfer Fees Out
   • Revenue
     • Season Tickets
     • Matchday Ticket Sales
     • Bar Takings (share of)
     • Season Sponsorship & Commercial
     • Matchday Sponsorship & Commercial
     • Prize Money
     • Transfer Fees In
     • Government COVID Support
   • Cash Support
     • New Directors loans made
     • Directors loans repaid
     • Drawdown from lump sum
2. Confirmation of the amount of money remaining from the Lump Sum received on leaving Kingsmeadow relative to the amount originally received.
3. Copies of the most recent communications with potential new ground partners (including Kingston Council).
4. A copy of the current Tooting groundshare contract, in addition to those from Corinthian Casuals and Leatherhead.
5. Outline terms of historic directors’ loans still outstanding.

In addition to this information we would request a third meeting with all active current directors around two weeks after the information requested is made available to us, at which a number of us will attend to ask clarifying questions, discuss the current day-to-day operations and administration of the club, and respond to any questions or concerns you have about us. Following receipt of the information we will confirm a firm offer to you within five weeks.

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Mark, John, Yioryos, Paul: we are extremely grateful for the time you have already taken to meet with us and discuss your vision for our great club. We are 100% aligned with your end-goal and are keen to accelerate Kingstonian’s journey back to success. We would be grateful for confirmation from you that you are happy to proceed on these terms within a week of the receiving this letter.

Yours,

Taimour Lay

On behalf of Kingston Bridge Holdings Ltd.