Heads of Terms — Glenn Flegg & Co

1Introduction

We have spent the past weeks getting to know Glenn Flegg & Co — the business, the team and the book — and we have been genuinely impressed. What Glenn, Simone and Nick have built over 35 years is a well-run, well-regarded local agency with an exceptional, diversified lettings book and a team that clearly knows its patch. We would be proud to carry it forward, and this offer is made in that spirit.

2The offer

3How we have valued the business

We have used the same sum-of-parts framework the market applies to lettings businesses of this kind:

• Fully-managed recurring income (£374,126) at 1.7×–2.0×;
• Rent-collection / let-only recurring income (£66,633) at 1.5×–1.7×;
• All other lettings income — set-up and admin fees, let-only fees, ancillary income — at 1.0×, with renewal-fee income (abolished by the Renters' Rights Act from May 2026) at nil;
• Sales income valued separately — the pipeline paid across as received, as above.

£900,000 sits at the centre of that framework. Two further considerations inform our position relative to the guide: the renewal-fee income that the law has now removed (the sellers' own FY-Mar-26 projection already reflects this), and the as-yet-unproven effect of the loss of the high-street office from 1 July — the brand's street presence has been part of how this business wins and keeps instructions for 35 years, and the impact of its absence is something neither side can yet evidence.

4Retention mechanics

• The holdback is measured against 100% of recurring fee income at completion, eroding at £9,000 per percentage point of lost recurring income from the first point below 100%, exhausted at 90% retention.
• Agreed carve-outs (we anticipate these rather than negotiate them later):
  • A landlord who leaves but sells the property through us — no retention penalty (the sales commission is ours);
  • No-fault departures — death, repossession, a landlord moving back in or genuinely selling outside us — do not count against retention;
  • New managed instructions won during the period count toward retention.
• The purpose is simple: what we are protecting against is the loss of landlords who could and should have been kept, or whose departure was known and not disclosed.

5Assumptions

This offer assumes, and we expect the figures to confirm:

• Management accounts to end-May 2026 showing revenue and profitability consistent with the information provided to date;
• The recurring book (properties, landlords and fee rates) substantially as described in the sale information;
• The continuing health of the business through to completion, including through the office move.

6What we will verify in diligence

We will keep diligence focused and quick. We expect to verify:

• The number of managed and rent-collection properties and active landlords against the system records;
• That each property has a valid, signed tenancy agreement on file;
• That each property meets the statutory compliance standards — current gas safety certificate, EICR, EPC, deposit protected with prescribed information served, and licensing where applicable;
• Terms-of-business coverage across the book (which versions, signed by whom);
• Client money and deposit reconciliation;
• Employment particulars for the transferring team;
• The financial records (Xero) supporting the reported revenue and the lettings/sales split.

7Structure

The purchase will be an asset and goodwill purchase into an acquisition company we have established for this purpose. We reserve the right to nominate a different company within our group as transferee of particular assets prior to closing. The team transfers under TUPE; we will run a direct consultation process in parallel with legals so that the timetable holds.

8About Grafton Capital

Grafton Capital is the family investment company of Ed Barroll Brown, an experienced investor and company builder based locally in Windsor. Grafton builds and backs operating businesses for the long term; this acquisition is the foundation of a committed, well-capitalised programme in residential lettings. We are funded, local, and able to move quickly — there is no financing condition to this offer.

9Our plans for the business

Our plan is continuity and investment: we will keep the Glenn Flegg name, retain the team, and invest in marketing the business locally — building on the brand's 35-year reputation rather than replacing it. Landlords and tenants should notice better service, not a different agency.

10Handover and team

• We ask for the customary handover: two weeks in the office and three months available on call, included in the price. Anything beyond that can be arranged separately on consultancy terms.
• We intend to agree retention arrangements for key staff at completion, and we place particular value on the existing operational team.

11Process and timetable

• We are ready to move to exchange within 3–4 weeks of agreed heads of terms, with a deliberately short conditions list (§5–§6).
• As a team we have done a great deal of work on this opportunity alongside others we are progressing; this offer is open for acceptance for [5 working days — Friday of the week sent].