<p><strong>From:</strong> John Soden &lt;soden.j@gmail.com&gt;<br />
<strong>Date:</strong> 28 August 2020 at 17:40:07 BST<br />
<strong>To:</strong> James McCulloch &lt;james@harcourtinns.co.uk&gt;, Rachel Rossiter &lt;rachel@harcourtinns.co.uk&gt;, Henry Harris &lt;henry@harcourtinns.co.uk&gt;<br />
<strong>Cc:</strong> Shane Gallwey &lt;shane.gallwey@guinnessfunds.com&gt;, Nick Curtis &lt;n.curtis123@btinternet.com&gt;, John Soden &lt;john.soden@moorgateindustries.com&gt;<br />
<strong>Subject:</strong> <strong>EGMs and other</strong></p>

<p>﻿</p>

<p><br />
&nbsp;</p>

<p>Dear James,</p>

<p>I have been surprised and concerned by two developments in the last 24 hours.</p>

<p>&nbsp;</p>

<p>First, I have received an unsolicited approach from Andrew Endean regarding his debt (which I assume is the &pound;171k) stating that he is about to initiate recovery proceedings against the Harcourt and that you apparently referred him to me to resolve the situation. That is an extraordinary thing to do given that you and Henry have still not appointed our suggested shareholder nominees as directors and stepped down. As existing directors you all remain responsible and exposed for all aspects of the company. Given the current inability of the company to pay its debts as they fall due and this pending legal action the company appears to be potentially insolvent in the absence of action to resolve its problems. You cannot remain in place but opt not to act and ignore your responsibilities to the company or shareholders.</p>

<p>&nbsp;</p>

<p>Second, whilst waiting for you to respond on the points raised in our meeting on your/Mike Smith&rsquo;s proposals we have heard that you have asked Fleurets to undertake a sale and leaseback transaction for four of the pubs including the KPH without discussing it with shareholders. Of particular concern is that the &nbsp;prospectus refers to;</p>

<p>- a pub Group - again risking the EIS status of the pubs and providing support to HMRC&rsquo;s attack on the EIS status of which you have informed us</p>

<p>- &nbsp;the guide price being significantly below vacant possession value and site assembly cost and the rental being significantly below market rental</p>

<p>Not only is this prejudicial to shareholder value and their EIS claims but it also seems to completely cut across your/ Mike Smith&rsquo;s proposal and raises significant doubts as to whether that proposal is genuine or credible. Please provide Mike Smith&rsquo;s contact details so that we can seek clarification direct from him.</p>

<p>&nbsp;</p>

<p>All of this highlights the fact that your actions and refusal to step down from each of the pubs in favour of new directors or call the EGMs is causing serious potential damage to shareholder interests for which we will hold you accountable. This cannot continue and we would urge you to meet with us early next week to negotiate the basis on which you withdraw and your management agreements are terminated.</p>

<p>&nbsp;</p>

<p>&nbsp;</p>

<p>Sent from my iPad</p>

<p><br />
&nbsp;</p>

<p>On 26 Aug 2020, at 18:00, James McCulloch &lt;james@harcourtinns.co.uk&gt; wrote:</p>

<p>﻿</p>

<p>Dear John,</p>

<p>Pls note that I am considering this and not ignoring your email.&nbsp;</p>

<p>I will be in touch shortly with a proposal on how to move forwards.</p>

<p>Regards,</p>

<p>James&nbsp;</p>

<p>&nbsp;</p>

<p>Get <a href="https://aka.ms/o0ukef">Outlook for iOS</a></p>

<p>&nbsp;</p>

<p><strong>From:</strong> John Soden &lt;soden.j@gmail.com&gt;<br />
<strong>Sent:</strong> Monday, August 24, 2020 10:06:26 AM<br />
<strong>To:</strong> James McCulloch &lt;james@harcourtinns.co.uk&gt;<br />
<strong>Cc:</strong> Nicholas Curtis &lt;n.curtis123@btinternet.com&gt;; Rachel Rossiter &lt;rachel@harcourtinns.co.uk&gt;; Henry Harris &lt;henry@harcourtinns.co.uk&gt;<br />
<strong>Subject:</strong> EGMs</p>

<p>&nbsp;</p>

<p>James,</p>

<p>Please can you update on your plans on standing down as a director and appointing new shareholder directors? As you know the clock is ticking on the EGMs but given the position of the pubs, shortage of liquidity and critical issues around solvency as well as &nbsp;the need to resolve your conflict with the offer that has been made there is little sense in waiting and having to go through a procedure that is, in any event, a foregone conclusion. We need to discuss this as a matter of urgency such that shareholder interests are no further Unnecessarily compromised.</p>

<p>We should sit down and hammer this out this week. Please confirm your availability for a meeting to resolve this.</p>

<p>Sent from my iPad</p>

<p><br />
&nbsp;</p>

<p>On 24 Aug 2020, at 09:05, John Soden &lt;soden.j@gmail.com&gt; wrote:</p>

<p>﻿James,</p>

<p>thanks for these. We also need the same information for the other three pubs as a matter of urgency. Will these be available today.</p>

<p>We also await the fee information for each pub. Please pass them on as they become available rather than waiting for the last to be available.&nbsp;</p>

<p>You have said you are meeting with Philip Hare today so can we please have an update on EIS tomorrow.</p>

<p>&nbsp;</p>

<p>Sent from my iPad</p>

<p><br />
&nbsp;</p>

<p>On 21 Aug 2020, at 15:29, James McCulloch &lt;james@harcourtinns.co.uk&gt; wrote:</p>

<p>﻿</p>

<p>Dear John/Nick,</p>

<p>&nbsp;</p>

<p>See attached asset / liabilities analysis for the Coach, Crown and Three Cranes based on the offer put forward by Mike Smith.</p>

<p>&nbsp;</p>

<p>Rachel has assumed reopening all three pubs in September in the analysis although in reality it probably isn&rsquo;t a good idea to reopen the Three Cranes.</p>

<p>&nbsp;</p>

<p>Still waiting on the breakdown of fees and I have also spoken to Philip Hare to understand the dynamics of a sale, inside or outside EIS, and loss relief including a future profit share.</p>

<p>&nbsp;</p>

<p>Regards,</p>

<p>&nbsp;</p>

<p>James McCulloch</p>

<p>Managing Director</p>

<p>Harcourt Inns</p>

<p>Tel: 07904910301</p>

<p><a href="mailto:james@harcourtinns.co.uk">Email: james@harcourtinns.co.uk</a></p>

<p>Post: 139 Ladbroke Grove, Notting Hill, London W10 6HJ</p>

<p>&nbsp;</p>

<p>&nbsp;</p>