CL-2022-000367 - [2025] EWHC 2877 (Comm)

Mr Smith and Mr Bonnier were introduced by Mr Sargent in mid-2020. Mr Sargent – who Mr Smith has known for around 30 years – was, at that time, an executive director of AAA. He told Mr Smith that AAA was involved with Aaqua, a new company set up by Mr Bonnier, and that it was worth meeting Mr Bonnier given that he also had an interest in Audioboom, one of CVS’s investments.

In September 2020, Mr Smith and Mr Bonnier met in France (the “September 2020 Meeting”). Mr Bonnier told Mr Smith that he thought that Audioboom, in which he knew CVS had a significant minority stake, was undervalued, and that he was looking to build his stake in the company.

Mr Smith and Mr Bonnier also discussed Mr Bonnier’s vision for Aaqua. This was of interest to CVS.

On or around 14 October 2020, Mr Bonnier and Ms Islam-Bonnier – acting via their close associate and nominee, Peter Antonioni, the owner of 192 Pte Ltd (“192 Pte”) (an investment vehicle based in Singapore), subscribed for £3.15 million of shares in Audioboom. Mr Smith describes this as boosting Mr Bonnier’s credibility in his eyes, in addition to their introduction by a trusted mutual acquaintance.

On 1 November 2020 Mr Bonnier sent an email to Mr Smith, attaching a document titled “Aaqua Primer November 2020” (the “November 2020 Primer”). This included, on page 14, a table headed “Partner Ecosystem” and displayed as a pyramid – the top layer of which showed Apple and LVMH as “Founding” partners and described them as “Partners in Purpose”. This is reproduced below.

On 31 December 2020 Mr Bonnier sent an email to Mr Smith, summarising the proposed capital structure of Aaqua and the proposed transaction between Aaqua and CVS (the “31 December 2020 Email”).

At that stage, the proposed transaction was that CVS would sell 1.5 million of its shares in Audioboom to Aaqua for €5.5 million (the “Audioboom Shares”), and it would subscribe to acquire 15,000 Block shares in Aaqua, at a price of for €6 million. The €6 million subscription price was largely to be offset by the sale of the Audioboom Shares to Aaqua, with the balance of €500,000 to be paid in cash by CVS. Simultaneously, Aaqua would continue to pursue its “Dante plan”, by which an entity referred to by the code name “Aristotle plc” would acquire 9.9 per cent of Aaqua, by a share exchange at a 1:7 ratio, in early January 2021, followed by a further 20 per cent in late January 2021.

Mr Bonnier further stated in the 31 December 2020 Email that:

“There are various conditions precedent that were agreed between AAQUA and our tactical partners and we are on track to deliver / satisfy these in early Q2 ’21. That would result in the tactical partners equity subscriptions to go unconditional and thus complete shortly afterwards. In total the amount to be raised in that tactical round is €960mn at PPS€1,920.”

Mr Smith replied to the 31 December 2020 Email on 2 January 2021. He made various comments on the body of the 31 December 2020 Email and said that it would be necessary for Mr Candy and Mr Bonnier to have at least one face-to-face meeting to discuss the proposed transaction. He stated that Mr Candy’s “key focus will be on the TP Round and what is the likelihood of it happening at the indicated valuation”, because the tactical partner funding round “gives the trajectory external verification.” Mr Smith noted that Mr Candy would not necessarily see a right or obligation to invest in a Series “C” round as a benefit, but this might be impacted by the “verification of the likelihood and valuation of the TP round”.

Mr Bonnier replied to Mr Smith’s email of 2 January 2021 on the same day (the “2 January 2021 Email”) stating: “Not sure I get the point. Being granted a free Option where the Option holder has the right (not the obligation) to exercise for a 60 day period after the most valuable company in the world has just invested £500m+ at double the Option price point? If that ever in my life was offered to me, I would literally bite the persons’ hand off”. The parties agree that the reference to “the most valuable company in the world”meant Apple.

The 31 December 2020 Email had attached a document entitled “AAQUA High-level Cap Table Jan ’21.xlsx” (“the January 2021 Capital Table”). The January 2021 Capital Table included an entry headed “Series B Round” which showed an investment from CVS and others, an entry headed “Series C Round” which showed a €200 million investment from as yet unidentified investors, followed by an entry headed “AAQUA Tactical Partner Round”, which showed an investment with an “Issue Price” of €1,920 per share, with Apple acquiring 300,000 shares for a total consideration of €576,000,000 and LVMH acquiring 100,000 shares for a total consideration of €192,000,000.

On 8 February 2021, Mr Bonnier emailed Mr Smith, attaching a further capital table (“the February 2021 Capital Table”) amongst other documents. The February 2021 Capital Table was in identical terms to the January 2021 Capital Table as regards the Series B, Series C and AAQUA Tactical Partner rounds. The email also attached a further Primer entitled “AAQUA Primer February 2021” (the “February 2021 Primer”).

Mr Smith responded on the same day to say that:

“The one thing we will want access to is the Aaqua “data room” (or equivalent); in particular the Apple and LVMH documentation.”

On 9 February 2021 (the “9 February 2021 Email”), Mr Bonnier emailed Mr Smith to say that he was happy to share the individual draft tactical funding revenue contribution agreements with Apple and LVMH, that the individual tactical partner playbook programs were not yet ready and they expected these to be finalised in early April for Apple and early May for LVMH.

On 10 February 2021, Mr Smith confirmed to Mr Bonnier by email that CVS was ready to proceed with the transaction subject only to final due diligence. CVS asked, and Mr Bonnier agreed, to remove the €500,000 cash investment component of the proposed deal.

On 14 February 2021 (the “14 February 2021 Email”), Mr Bonnier emailed Mr Smith attaching a document entitled “Draft Tactical Partner Framework Agreement” (“the Draft Framework Agreement”), which was expressed as being an agreement between Aaqua and “Apple Inc”. Mr Bonnier described the Draft Framework Agreement as follows:

“includes the latest three way inputs and will continue to iterate over the next several weeks until we definitively conclude.”

In the 14 February 2021 Email, Mr Bonnier offered for CVS to discuss the Conviction Passion Partnership Structure with Joel Hogarth of Eliot and Luther Advisry Ltd (“Eliot and Luther”, the Aaqua Group’s external general counsel). Mr Smith did not take up the offer.

The Draft Framework Agreement did not contain any definitive commitment by Apple to invest. No draft of any agreement with LVMH was provided at any time. The Draft Framework Agreement featured Aaqua and Apple’s logos at the top of each page; was stated to be between Aaqua and “Apple Inc”; and set out, in Section C, the purported “Key Terms of the Tactical Partnership”, including:

On 14 February 2021, Mr Smith shared the Draft Framework Arrangement with an internal analyst (Mr William Benattar) and Mr Philip Lamb of BDB Pitmans, copying in Mr Candy amongst others. The email requested that Mr Lamb “please have a scan from a legal perspective and see if there are any red flags” and for Mr Benattar to “please review from a commercial perspective and summarise the key terms for Nick and me.”

On 14 February 2021, Mr Benattar replied providing comments on the Draft Framework Agreement. Amongst his comments, Mr Benattar said:

“this document is still a ‘work in progress… in my view, the ‘valuable’ details are missing (e.g. collaboration framework, governance and the specifics of the content to produce). A lot, almost too much is still open for deliberation. Additional, my initial impression is that it feels ‘light’ for a contract with Apple, not sure whether Apple has any input in this, can we check?”

Mr Benattar also said:

“Also worth noting that, at this stage, Apple’s ability to invest in AAQUA is an option rather than something set in stone. Even if the 250m euro round equity round closes, we have little to no visibility as to how likely or interested they are to exercise it.”

Mr Smith later replied on the 14 February 2021:

“Any chance we could do a call at 08.00am tomorrow? I am back-to-back after that and I would really like the three of us to understand what this “contract” means.”

On the 15 February 2021, CVS and Aaqua entered into the Three Agreements.

Following the execution of the Three Agreements, Mr Bonnier continued to tell both Mr Smith and Mr Candy that the Apple/LVMH investments in Aaqua were close to finalisation. On 16 February 2021, Mr Bonnier told Mr Candy that he would be meeting with Apple in San Francisco on 19 February 2021. When asked by Mr Candy how that meeting went, Mr Bonnier replied on 20 February 2021:

“Hi Nick super well … Dealing with this now. Basically [Apple] want to accelerate first closing including 200k AAQUA shares at €1,920 and have the right to subscribe for a further 100k at 7,192 [sic] per AAQUA share which becomes a 30 day funding obligation if AAQUA raises a similar amount from a third party or AAQUA reaches for 30 days a total of 100m AAM and RAM (combined). It is the intention that we meet again for several days week commencing 8 March and there should be little reason why we can’t close 10-14 days thereafter ie before end of March. We have our MVS scheduled for 23 March and would be great having the public announcement the following day. As a result I will probably stay Stateside until closing, unless I can get to Singapore late next week without quarantine. Speak soon!”

After another purported meeting with Apple on 5 March 2021, Mr Candy and Mr Bonnier exchanged the following messages by WhatsApp:

On 11 March 2021 Mr Bonnier sent Mr Candy an email, stating that Aaqua was:

“head on dealing with the Apple transaction documentation such that it is in execution format for 2H week of 22 March”.

On 19 March 2021, pursuant to the Three Agreements, CVS transferred 1.5 million shares in Audioboom to Aaqua and CVS acquired 15,000 shares in Aaqua. At the Closing Date of 12 March 2021 (as stipulated in the Relationship Agreement) the deemed value of the Audioboom Shares was £6,450,000.

Several months later, in or around October 2021, CVS agreed to exchange its shares in Aaqua for shares in AAA. By an agreement dated 13 October 2021, CVS subscribed for 56,250,000 shares in AAA (the “AAA Subscription Agreement”) in return for CVS selling the 15,000 shares in Aaqua to AAA.

By summer 2022, CVS’s patience had run out. When Mr Smith pressed Mr Bonnier in respect of the Apple/LVMH situation by email on 10 June 2022, Mr Bonnier replied on 14 June 2022 to say he was:

“… simply no longer comfortable talking about founder partner relationships”.

Around the same time, CVS learned of the restructuring of the Aaqua Group, pursuant to which Aaquaverse was incorporated in Singapore and Aaqua’s business was transferred to it. Mr Candy identified this as the trigger for these proceedings.

On 20 June 2022, CVS’ solicitors, Grosvenor Law Ltd, sent a letter before action to Aaqua and Mr Bonnier, alleging that CVS had been induced to invest in Aaqua on the basis of misrepresentations and contending that CVS was entitled to rescind the Three Agreements and to seek the return of the 1.5million shares in Audioboom that had been sold by CVS to Aaqua under the Purchase Agreement. They also notified Aaqua and Mr Bonnier that they would be seeking an interim injunction to restrain Aaqua from any disposition of the Audioboom Shares, pending the resolution of CVS’s claim, and sought an undertaking that they would not dispose of the Audioboom Shares.

On 12 July 2022, Mr Hogarth of Eliot and Luther sent an email to Grosvenor Law (the “12 July 2022 Email”). The email stated that Aaqua would:

“prefer to find a commercial solution to settle this matter without litigation”.

Privilege over the without prejudice negotiations that followed was waived by the parties.

The 12 July 2022 Email also contained an offer to CVS pursuant to which Mirador Investments FZE, an investment company owned by Mr Diarmuid Clohessy, would purchase CVS’s 106.25 million shares in AAA for a cash price of £13.5 million, with a proposed settlement date of 15 August 2022 (the “Mirador Offer”).

On 12 July 2022, CVS made a counter-offer, stating that it would refrain from serving proceedings if, by 27 July 2022, Aaqua paid £15.9m in cash and transferred 500,000 shares in Audioboom to CVS, alongside paying CVS’s reasonable legal costs.