Khashoggi Holding Company & Ors v Maurizio Molinari

Mr Justice Henshaw: (A) INTRODUCTION 4 (B) PARTIES AND RELATED ENTITIES 4 (C) WITNESSES 4 (D) THE ISSUES 5 (E) FACTS 5 (1) OakHill financing of Meta 5 (2) The ARIA 6 (3) Articles of Association 7 (4) Share charge 7 (5) Attempts to sell Meta 8 (6) The Share Purchase Agreement (SPA) 11 (7) Post SPA events 16 (F) PRINCIPLES 38 (1) Repudiatory breach 38 (2) Frustration 47 (3) Assessment of damages claims 48 (4) Deceit 49 (G) ALLEGED REPUDIATORY BREACH BY DEFENDANT 52 (H) COUNTERCLAIMS 59 (1) Repudiatory breach of SPA by Claimant 59 (a) The claim advanced and witness evidence in support 59 (b) Outcome (counterfactual) for the Defendants under the SPA 66 (c) Outcome for the Defendants under the IKOPUS transaction 71 (d) Analysis 75 (2) Deceit prior to conclusion of SPA 77 (a) Intention to purchase the shares 77 (b) Deposit representation 83 (3) Breach of SPA: refusal to make Initial Payment 85 (4) Breach of SPA warranties 86 (5) Deceit after conclusion of SPA 86 (a) Availability of funds/intention to complete SPA 86 (b) Batt Company Representations 90 (I) CONCLUSIONS 93 (A) INTRODUCTION

1. The Claimant (“ Khashoggi Holdings ”) seeks a declaration that it validly terminated a Share Purchase Agreement (“ SPA ”) dated 8 December 2020 on the ground of repudiatory breach by the Defendants. The Defendants contend that they were not in repudiatory breach, and counterclaim for damages for (a) wrongful termination of the SPA by Khashoggi Holdings, (b) deceit and (c) breaches by Khashoggi Holdings of the SPA.

2. The case culminated in a five-day trial. Only two witnesses of fact were called, and no experts, with the result that the trial consisted mainly of oral opening and closing submissions, supplementing the parties’ opening skeleton arguments and shorter closing notes.

3. For the reasons set out in this judgment, I have concluded that both the claim and the counterclaims fail. (B) PARTIES AND RELATED ENTITIES

4. Khashoggi Holdings is a substantial company registered in Saudi Arabia. Its chairman is Mr Motashem Khashoggi, who is the Additional Defendant to the Counterclaim.

5. Metaenergia UK Limited (“ Meta ”) is a company registered in England & Wales. At the time relevant to this dispute, late 2020/early 2021, Meta had a number of wholly owned Italian subsidiaries who were engaged in the production of electricity from conventional (gas) and renewable sources. These included Metaenergia Produzione S.r.l (“ MEP ”) and Metaenergia Esco SRL (“ MEE ”).

6. Meta was formerly wholly owned by the Fifth Defendant, Finnat Fiduciaria SPA (“ Finnat ”), holding 10,000 ordinary shares. Finnat is a trust company, the beneficiaries of which were the Molinari brothers, namely the First Defendant Maurizio Molinari and the Second Defendant Michele Molinari, their company Stemic Financial Limited (the Fourth Defendant), and Mr Alessandro Privitera (the Third Defendant). (C) WITNESSES

7. Khashoggi Holdings called as a witness Mr Jonathan Berman, a partner with its solicitors Mishcon de Reya, who specialises in mergers and acquisitions. He gave evidence about his involvement in the matter in March and April 2021. He was a straightforward witness.

8. The Defendants called Alessandro Privitera, the Third Defendant. Mr Privitera is qualified as an Italian lawyer, and a shareholder in Meta. He acquired his shares from his father, a Notary Public in Rome who was one of the founders of the Meta group. Mr Privitera in general gave his evidence in a straightforward manner, save for the curious portion of his oral evidence referred to in § 177 below where he at first asked whether he was obliged to answer but then said he did not remember. (D) THE ISSUES

9. The principal issues are these:- i) Whether Khashoggi Holdings was entitled, by its solicitors’ letter dated 7 April 2021, to treat the SPA as having come to an end due to repudiatory breach by the Defendants, specifically arising from OakHill having not provided its consent to a transfer of shares to Mr Maurizio Molinari in December 2020, to the SPA itself and to the transfers of shares for which the SPA provided. ii) If not, whether the Defendants are entitled to damages on the basis of Khashoggi Holdings having repudiated or renounced the SPA. iii) Whether the Defendants are otherwise entitled to damages for breach of the SPA by Khashoggi Holdings. iv) Whether Khashoggi Holdings and/or Mr Khashoggi are liable in deceit for various representations alleged to have been made before and after the conclusion of the SPA. (E) FACTS (1) OakHill financing of Meta

10. In November 2019, Meta’s subsidiary, MEP, made a successful bid in the Italian electricity capacity auctions for 2022 and 2023. That involved a commitment to build and operate nine open-cycle gas turbine power plants.

11. In order to participate in the auctions, Meta required funding. It had obtained this financing from Oak Hill Advisors (“ OakHill ”), an American alternative investment firm, in October 2019. OakHill provided the funding via a Luxembourg special purpose vehicle, EN-IT Meta Sarl (“ En-It ”), which subscribed for bonds in Meta redeemable on 31 December 2020, originally in the amount of US$ 30 million.

12. The OakHill bonds were constituted by a trust deed, with Lucid Trustee Services Limited (“ Lucid ”) as trustee and security agent for En-It as bondholder. An investment agreement was entered into, and Meta agreed to issue 1,112 A Ordinary shares to En-It. As a result, Meta’s shareholders were now En-It holding 1,112 A Ordinary shares and Finnat holding 10,000 B Ordinary shares.

13. In April 2020, OakHill provided further financing by way of additional bonds in the amount of €16.4 million, also redeemable on 31 December 2020. On 14 April 2020 Meta sent En-It an Additional Bonds Notice, which recorded the arrangements agreed between Meta and En-It in this connection, and further agreements were entered into on 14 April 2020:- i) an Amended and Restated Investment Agreement (“ ARIA ”); and ii) a Share Charge between Finnat and Lucid. (2) The ARIA

14. The ARIA was entered into between En-It, Meta, Finnat, and the beneficiaries (the Molinaris, Stemic and Mr Privitera).

15. Clause 3 of the ARIA provided for the adoption by Meta of new Articles of Association, the text of which was set out at Schedule A. The new Articles were adopted by special resolution on 13 April 2020 and filed at Companies House on 7 May 2020.

16. Clause 5 provided for certain Investor Reserved Matters, namely matters which could not be effected without En-It’s prior written consent, including further amendment of the Articles (Schedule B § 3) and the issuance of any further shares in Meta or any other changes to its share structure (Schedule B § 1).

17. Clause 6.1 provided that Finnat shall not transfer its shareholding in Meta without En-It’s prior written consent, and that Meta shall not register a transfer of such shares without En-It’s prior written consent. “ Transfer ” was widely defined and included any agreement to sell or transfer. This prohibition on transfer was repeated at clause 6.10.1, and augmented at clause 6.10.2 by providing that any such shares purported to be transferred shall cease to confer on the holder thereof any rights in respect of them until the breach has been remedied. Further, clause 12.1 gave En-It an option to purchase Finnat’s shares at a discount if Finnat breached the obligations in clause 6 and such breach was not remedied within a 30-day ‘Remedy Period’.

18. Clause 9 (“ Distributions ”) provided for priority payment to En-It, as the A shareholder, in respect of the Gross Proceeds (as defined) of an Exit or a Partial Exit (as defined). Exit meant a share sale of all or substantially all the shares (both A Ordinary and B Ordinary) in Meta to a third party purchaser, an asset sale of all or substantially all of Meta’s assets, or an IPO. Partial Exit meant a sale of some of the shares in Meta or some of its assets.

19. By clause 10, it was acknowledged that arrangements had been made to effect an Exit. It was also agreed that there must be an “ Investor Exit ” by 30 October 2020 (or such a later date as may be agreed): the “ Exit Date ”. (The terms and conditions of the bonds provided for a maturity date of 31 December 2020.)

20. An “ Investor Exit ” meant the sale by En-It of all of its shares to a third party; However, clause 10 also provided that, if an Exit was to be achieved by way of disposal of less than Meta’s entire issued share capital, then En-It would have the right to dispose of its A Ordinary shares in priority to Finnat. It was acknowledged and agreed in clause 10.2 that achieving an Investor Exit by the Exit Date was of paramount importance.

21. The definition of “ Gross Proceeds ” provided for their calculation by reference to whether there was an Exit or a Partial Exit. Calculating the amount in respect of an Exit was relatively straightforward, but calculating the amount in respect of a Partial Exit required the amount that would have been obtained on a sale of the whole rather than of part to be taken into account.

22. If an Exit was not achieved by the Exit Date of 30 October 2020 (or such later date as might be agreed), clause 11 gave En-It a put option to require Finnat to acquire its shares at a calculated price.

23. The ARIA thus provided for an additional return to En-It over and above repayment of the bonds plus interest. This was known colloquially by the parties as the “ equity kicker ”. The effect of clause 9 of the ARIA was that the equity kicker would have been at least €50,000,000.

24. Clause 24 of the ARIA provided that any variation of it would not be valid unless in writing and signed by or on behalf of each party. (3) Articles of Association

25. The new Articles reproduced, at Article 35, the provisions of the ARIA as to Distributions from the Gross Proceeds of an Exit or Partial Exit. In addition, Article 40 broadly reflected the ARIA prohibition on the transfer of shares in Meta without En-It’s prior written consent. Article 40.1 stated:- “No B Ordinary Shares shall be transferred without the prior written consent of the holders of the A Ordinary Shares… Any transfer of Shares made otherwise than in accordance with these articles is null and void and shall not be recognised by the Company. If there has been a transfer of Shares in breach of this article 40.1, the Company shall refuse to register the proposed transfer, and the relevant Shares purported to be transferred shall cease to confer on the holder thereof any rights in relation to them until such time as the breach of this article 40.1 has been remedied.” (4) Share charge

26. The Share Charge was entered into between Finnat and Lucid. By clause 2.1, Finnat agreed to discharge the Secured Obligations (as defined), including the obligation to redeem the OakHill bonds. In clause 3.1, Finnat charged its shares in Meta (as defined by reference to Schedule 1, namely its 10,000 B Ordinary shares) as continuing security for the payment of the Secured Obligations (as defined).

27. By clause 6, Finnat represented and warranted that it was the legal owner of the Shares, which were not subject to any options to purchase or similar rights.

28. By clause 7, Finnat gave undertakings including that it would not sell, transfer or otherwise dispose of all or any of the Shares without prior written consent. Those restrictions applied for the duration of the security, and provided for a remedy period:- “ Duration of Undertakings 7.1 The Chargor undertakes to the Security Agent in the terms of this Clause 7 for the duration of the Security Period. 7.2 General Undertakings (a) Negative Pledge and Disposal Restrictions It will not: (i) create or agree to create or permit to subsist or arise any Security over all or any part of the Charged Property except for the creation of Security or other transactions pem1itted under the Finance Documents or in respect of which the consent of the Bondholders has been obtained in accordance with the Finance Documents; or (ii) sell, transfer, lease out, lend or otherwise dispose of all or any part of the Charged Property or agree or attempt to do the same, except as permitted by the Finance Documents or with the prior written consent of the Security Agent. 7.4 Power to Remedy If the Chargor fails to comply with any covenant set out in Clause 7.2 (General Undertakings) to 7.3 (Shares) (inclusive), and that failure is not remedied within 10 days of the earlier of the Security Agent giving notice to the Chargor or the Chargor becoming aware of the failure to comply, it will allow (and irrevocable authorises) the Security Agent or any Receiver to take any action on its behalf which the Security Agent or the Receiver deems necessary or desirable to ensure that those covenants are complied with. The Chargor shall reimburse to the Security Agent and/or any Receiver, on demand, all amounts expended by the Security Agent or any Receiver in remedying such failure together with interest at the rate set out in Condition 10.4 (Default Interest) of the Conditions from the elate of payment by the Security Agent or Receiver (as the case may be) until the date of reimbursement.” (5) Attempts to sell Meta

29. In the spring of 2020, the Defendants decided to sell part of Meta’s share capital, and instructed Barclays Bank to arrange an auction. Barclays received a number of bids, including one from MET Holding AG, but the Defendants did not in the end take them up.

30. On 24 July 2020, at a meeting attended by, amongst others, Mr Khashoggi, the Mr Maurizio Molinari and Grande Stevens International (solicitors for the Defendants), Mr Khashoggi set out his interest in the proposed transaction.

31. On 3 September 2020, Khashoggi Holdings sent Meta a “ Manifestation of Interest ” signed by Mr Khashoggi. On 27 September 2020, at a meeting attended by, amongst others, Mr Khashoggi, Mr Maurizio Molinari and Grande Stevens, Mr Khashoggi confirmed that Khashoggi Holdings was interested in the transaction and stated his strong will to support Meta by providing an amount into escrow to secure the exclusivity in the customary way. The Defendants accepted in principle an offer from Khashoggi Holdings to purchase 75% of Meta’s shares from the Defendants.

32. On 25 October 2020, Khashoggi Holdings and Meta entered into an “ Exclusivity Agreement ”. By clause 3 of that agreement, Khashoggi Holdings agreed to pay (i) €20 million to Deutsche Bank, to be held in escrow (termed the “ Down Payment Amount ”) and (ii) €10 million to Meta by way of deposit, making at total of €30 million.

33. On 28 October 2020, Mr Khashoggi stated to Mr Briamonte of Grande Stevens that he wanted to conclude the SPA quickly so that he could make a downpayment of the amounts that were required by Meta for the energy project.

34. On 30 October 2020, the Defendants’ lawyer, Mr Briamonte, sent Khashoggi Holdings a first draft of the SPA. This was followed by an email of 11 November 2020 in which he set out the shape of the proposed deal, indicating that it would require the moneys due to OakHill to be paid off from an initial payment to be made by Khashoggi Holdings.

35. In the ensuing emails, the commercial terms were negotiated by Mr Briamonte, for the Defendants, and Mr Jaques Degouve de Nuncques and Dr. Cinzia Chiari for Khashoggi Holdings. Mr Nuncques is a longtime friend of the Khashoggi family and had worked with Mr Khashoggi on previous energy deals. Dr Chiari is an Italian lawyer. As part of the negotiating process, Mr Khashoggi, Mr Nuncques and Dr Chiari were given access to the Data Room referred to in the SPA (see below).

36. On or around 3 November 2020, the Defendants agreed to waive the requirement under the Exclusivity Agreement for Khashoggi Holdings to pay the “ Down Payment Amount ” (€30 million) into an escrow account, but not the €10 million deposit that had to be paid to Meta.

37. On 23 November 2020, Mr Khashoggi stated in a WhatsApp message to Mr Maurizio Molinari that the deposit would be paid, and requested a SEPA CID number. On 24 November 2020, Mr Khashoggi enquired as to the status of the SEPA CID number and stated that he would like to make the transfer for the Deposit that day. Mr Khashoggi and Mr Maurizio Molinari exchanged messages regarding the process for the SEPA Transfer. Mr Khashoggi provided details to Mr Maurizio Molinari to request the SEPA Transfer. On 25 November 2020, Mr Khashoggi requested that Mr Maurizio Molinari send a direct debit request for the Deposit in the amount of €10 million. Mr Khashoggi also requested that Meta’s bank send a copy of the invoice for the Deposit. On 26 November 2020, Mr Maurizio Molinari proposed that the Deposit was paid using an MT 103 Target Bank Transfer, which would credit the payment instantly and would not leave the funds ‘in limbo’.

38. On 30 November 2020, Mr Khashoggi again requested the SEPA CID from Meta’s bank and also asked for 24 hours’ notice before making the Deposit transfer. The same day, Mr Maurizio Molinari emailed Mr Khashoggi, explaining the proposed use of purchase money then under negotiation. He indicated that €55.5 million was to be applied to “OHA interest and Bond repayment” , and also that part of the €60m ‘goodwill’ element of the purchase price “will be used to pay the equity kicker due to OHA and redeem the 1,142 Class A shares, which currently as you can see from the shareholders agreement the payment is standing at Euro 50m. We are currently negotiating a reduction and I will keep you posted on the outcome in due course .” The same day, Mr Khashoggi reiterated to Mr Maurizio Molinari his “even stronger desire to join your family in the development of METAEnergia”.

39. On 1 December 2020, Mr Maurizio Molinari confirmed that Finnat Bank could proceed with the SEPA Transfer. On 2 December 2020, Mr Khashoggi provided details of the account for payment of the Deposit by SEPA Transfer and requested that Meta’s bank sent the request to transfer the Deposit.

40. Also on 2 December 2020, Mr Briamonte said in an email to Mr Musa Soenmez and Mr Varant Mahdessian, both of OakHill:- “b. Form of consent to Share Transfer: we need to make a simple document can you instruct Sam to draft it or do you want us to draft it (keeping blank the Equity kicker component that we will fill in hopefully tomorrow)”

41. On 3 December 2020, Mr Maurizio Molinari confirmed that Meta’s bank had input the instructions and that it should have been received by Khashoggi Holdings’ bank. Mr Khashoggi stated that Khashoggi Holdings’ bank could not see the instructions. On 4 December 2020, Finnat requested the SEPA Transfer of the € 10 million deposit in accordance with the payment arrangements discussed.

42. Also on 4 December 2020, Finnat transferred 5,498 B Ordinary shares in Meta to Mr Maurizio Molinari (the “ MM Shares ”), leaving Finnat with 4,502. The MM Shares were transferred into Mr Molinari’s name on Meta’s register of shareholders. This transfer appears to have followed an exchange of emails that day. Mr Briamonte asked Mr Soenmez, who was Co-Head of OakHill Advisers Europe and a partner in OakHill Advisers:- “Musa one minor but I need it. Can you confirm I can have the MM shares put in his own name instead of finnat (legally this is no transfer but I'd like to copy you in the communication to Finnat CEO). This is the only way we get pledge easy for the deferred kicker”. The term “ deferred kicker ” seems to indicate that there had been discussion between Meta and En-It about the timing of payment in respect of the equity kicker. Mr Soenmez replied: “Re the shares it should be ok. I spoke to Sam and he will speak to you on Monday [7 December] once KH deal is clear.” (6) The Share Purchase Agreement (SPA)

43. On 8 December 2020 KHC entered into the SPA with Mr Maurizio Molinari, Finnat and the beneficiaries, for the acquisition of 75% of their shares in Meta.

44. The preamble to the SPA stated that Mr Maurizio Molinari was the legal and beneficial owner of 4,123 B Ordinary Shares (defined as the “ MM Sale Shares ”) being sold as part of the subject matter of the SPA, the remaining 3,377 to make up the 75% being sold by Finnat (and defined as the “ Finnat Sale Shares ”): together defined as the “ Sale Shares ”. The shareholdings were also set out in Schedule 2 Part 1, and the Sellers were defined as:- “Finnat (as legal owner of the Finnat Sale Shares), Maurizio Molinari (as legal and beneficial owner of the MM Sale Shares) and the Beneficial Owners other than Maurizio Molinari (as beneficial owners of the Finnat Sale Shares)”

45. The bonds issued to En-It were defined as the “ OakHill Bond ”, and the sum of €55.5m as the “ OakHill Redemption Amount ”, being the amount payable by Meta to redeem the bonds in full.

46. The definition of “ Purchase Price ” (amounting to €178.55 million) was made up of two components: i) the “ Conditional Deferred Purchase Price Payment ” of €88.55 million payable in due course, on conditions to be agreed within 90 days of the date of the agreement; and ii) the “ Aggregate Initial Purchase Price Payment ” of €90m, itself made up of two components: a) the “ Initial Purchase Price Payment ” of €60 million “ payable by the Buyer as initial payment for the purchase of the Sale Shares ”, and b) the “ Equity Top-Up ” of €30 million.

47. The definition of “ Initial Payment ” (amounting to €215.2 million) was made up of four components:- i) the Initial Purchase Price Payment of €60 million (as above); ii) the Equity Top-Up of €30 million (as above); iii) the “ Equity Component ” of €69.7 million; and iv) the “ OakHill Redemption Amount ” of € 55,500,000 “ payable by the Company in relation to the redemption in full of the OakHill Bond ”.

48. The SPA also included these definitions:- “ Claim : a claim under this agreement (including, for breach of any of the Warranties and/or any indemnity claim” “ Completion : completion of the sale and purchase of the Sale Shares in accordance with this agreement.” “ Completion Date : the date of this agreement, or such other date as may be agreed in writing between the parties” “ Data Room : the documents and information contained in the online date room made available to the Buyer” (File C of the Trial Bundle contains an index of all those documents that were in this room). “New Articles of Association : the new Articles of Association to be adopted by the Company as soon as reasonably practicable following the Completion Date, in a form to be agreed between the parties.” “ OakHill Exit Fee : the exit fee payable by the Company to EN-IT Meta S.a r.l. in relation to the cancellation of the 1,112 A ordinary shares of €1.00 each in the Company held by EN-IT Meta S.a r.l. as part of the OakHill Bond.” “ OakHill Security : the outstanding security charges granted by the Company (further details of which are set out in part 1 of Schedule 2) and the Subsidiaries (further details of which are set out in Part 2 of Schedule 2) in connection with the OakHill Bond.”

49. Clause 1.11 stated that “Unless expressly provided otherwise in this agreement, a reference to writing or written includes email” .

50. Clauses 2.1, 3 and 5 stated as follows:- “Clause 2. SALE AND PURCHASE 2.1 On the terms of this agreement, the Sellers shall sell and the Buyer shall buy (or the Buyer shall procure that a subsidiary controlled by the Buyer shall buy), with effect from Completion, the Sale Shares with full title guarantee and together with all rights that attach (or may in the future attach) to the Sale Shares including, in particular, the right to receive all dividends and distributions declared, made or paid on or after the Completion Date.” “Clause 3. PURCHASE PRICE … 3.2 On the date of this agreement, the Buyer shall pay the Initial Payment to the Sellers and/or the Company, as applicable, in accordance with this clause 3.” … 3.6 The Sellers and the Buyer hereby acknowledge and agree that: 3.6.1 the OakHill Redemption Amount and the OakHill Exit Fee shall be paid by the Sellers and/or the Company from the Initial Payment payable by the Buyer in relation to the purchase of the Sale Shares in accordance with this agreement; 3.6.2 following the payment of the OakHill Redemption Amount pursuant to clause 3.6.1, the Sellers shall procure that the necessary steps are taken by the Company and the Subsidiaries so as to release all of the OakHill Security; and 3.6.3 following the payment of the OakHill Exit Fee pursuant to clause 3.6.1, the Sellers shall procure that the 1,112 A ordinary shares of €1.00 each in the Company held by EN-IT Meta S.a r.l. are cancelled.” “Clause 5. COMPLETION “5.1 Completion shall take place on the Completion Date at the offices of the Sellers' Solicitors (or at any other place agreed in writing by the parties). 5.2 At Completion: 5.2.1 the Sellers shall: (a) deliver (or cause to be delivered) to the Buyer the documents and evidence set out in paragraph 1 of Schedule 3; (b) procure that a board meeting of the Company is held at which the matters set out in paragraph 2 of Schedule 3 are carried out; and (c) procure that resolutions of the Sole Director of each of the Subsidiaries are passed so as to carry out the matters set out in paragraph 3 of Schedule 3; 5.2.2 the Buyer shall pay the Initial Payment in accordance with clause 3 and deliver to the Sellers: ….” 5.3 The performance by the Buyer of its obligations under clause 5.2 shall be a condition precedent to the performance by the Sellers of their obligations under clause 5.2 to the intent that, if the Buyer shall fail or shall be unable to perform any of its obligations under clause 5.2, the Sellers shall at their option (and without prejudice to any other remedies or rights which they may have against the Buyer in respect of such non-performance): 5.3.1 cease to be liable to perform their obligations under clause 5.2; and/or 5.3.2 be entitled to terminate this agreement by notice in writing to the Buyer.”

51. Clause 6.9 provided that the plant at the Cassino 2 site, and Meta’s subsidiary MEE, would not form part of the transaction, and that the Purchase Price did not therefore take account of their value.

52. Clauses 8, in relation to the Sellers’ warranties, stated:- “Clause 8 SELLERS' WARRANTIES 8.1 The Buyer and the Sellers acknowledge that the Buyer has agreed to acquire the Sale Shares in the Company and the parties have accordingly entered into this agreement on the basis of the Warranties 8.1.1 Subject to clause 8.5 and clause 10: 8.1.2 Finnat warrants to the Buyer that, save as disclosed in the Data Room, each of the Warranties in paragraphs 1 and 2 of Schedule 4 is true on the date of this agreement; and 8.1.3 each of the Beneficial Owners severally warrants to the Buyer that, save as disclosed in the Data Room, each Warranty is true on the date of this agreement. 8.2 Save as provided in clause 8.5, each of the Warranties is separate and is not limited by reference to any other Warranty. 8.3 The Warranties shall not in any respect be extinguished or affected by Completion. … 8.7 The Buyer acknowledges and agrees that the Warranties are the only warranties of any kind given by, or on behalf of, any of the Sellers on which the Buyer has relied in entering into this agreement.”

53. The warranties in Schedule 4 included that:- i) Mr Maurizio Molinari is the sole legal and beneficial owner of the MM Sale Shares; ii) Finnat is the sole legal owner of the Finnat Sale Shares; iii) each seller has all requisite power and authority to enter into, deliver and perform the SPA, and the Transaction Documents pursuant to or connected with the SPA (including therefore the share transfers); and iv) there is no Encumbrance (as defined, including charges and option) affecting the Sale Shares. An “ Encumbrance ” was defined as “any interest or equity of any person (including any right to acquire, option or right of pre-emption) or any mortgage, charge, pledge, lien, assignment, hypothecation, security interest, title retention or any other security agreement or arrangement” .

54. Schedule 5 included the following limitation on claims under the Sellers’ warranties:- “11. BUYER'S KNOWLEDGE 11.1 The Buyer shall not be entitled to make a Claim if and to the extent that the facts, matters, events or circumstances giving rise to the Claim are: 11.1.1 disclosed in the Data Room; or 11.1.2 otherwise within the actual, constructive or imputed knowledge of the Buyer, its agents or advisers on or before the date of this agreement, whether as a result of the Buyer's due diligence investigations or otherwise. 11.2 For the purposes of paragraph 11.1, the Buyer shall be deemed to have knowledge of the contents of and facts ascertainable from the Disclosure Letter.” No disclosure letter was, in the event, finalised.

55. In addition, clause 14 stated:- “14. CLAIMS CAPABLE OF REMEDY The Sellers shall not be liable in respect of any Claim to the extent that the facts or circumstances giving rise to such Claim are capable of remedy and are remedied by or at the expense of the Sellers within 90 days of the date on which notice of such Claim is given pursuant to this schedule.”

56. The Buyer’s warranties were provided for in clause 9:- “9. BUYER'S WARRANTIES 9.1.1.1 "The Buyer warrants to the Sellers that:… 9.1.4 it has the financial ability, and is in possession of the readily available funds required to pay: (a) the Purchase Price in accordance with this agreement; and (b) the Equity Component in relation to the Capacity Financing; 9.1.5 having been given an opportunity to carry out an investigation into the business and affairs of the Company and the Subsidiaries, the Buyer: (a) has been provided by the Sellers and/or the Sellers' advisers with all the documentation and information requested by the Buyer and/or the Buyer's advisers; (b) is satisfied with the results and findings of the due diligence investigations carried out by the Buyer and its advisers; and (c) is not aware of any fact, matter or circumstance which is inconsistent with any of the Warranties or otherwise gives rise to any liability on the part of any of the Sellers under any other provision of this agreement; …” (7) Post SPA events

57. On 8 December 2020, the day on which the SPA was executed, a transfer of € 10 million, presumably in respect of the deposit, briefly appeared in Meta’s bank account. However, on 10 December 2020 Mr Maurizio Molinari informed Mr Khashoggi that the transfer had “ bounced back as unpaid ”, to which Mr Khashoggi replied that his bank told him it had been sent and that it must have “ returned automatically ”, adding that “we are preparing all 3 wire transfers and will confirm them with you and your banks before execution” .

58. Later the same day, Mr Khashoggi emailed Mr Maurizio Molinari regarding the Deposit stating “according to the bank, they requested to retrieve the funds as there was no confirmation and documentation errors and not lack of funds. As the funds have been sent initially according to them and they didn’t received [sic] the confirmation within the time allowed” ; and:- “we at [Khashoggi Holdings] will prepare the three wires as per the SPA and execute them accordingly. Our finance department has already started after we signed the SPA yesterday. As we agreed, we may introduce a couple of our bankers to contact your bank as well. Since the funds may come from more than one account. I know the time is sensitive, but we do need a few days to organize please.”

59. In an email to Mr Nuncques the same day (10 December 2020), Mr Khashoggi said that “the Clarigon transfer was cancelled as the directors of that SPV had legal concerns and returned the funds today” . Clarigon Electronics appears to have been a SPV linked to Khashoggi Holdings and to have been the entity whose account was to be debited according to the transfer notification. Nonetheless, the documents indicate that, again on the same day:- i) Mr Briamonte of GSI prepared a Word document (“ Payment Executive Summary 10 12.docx” ) which set out a schedule of payments totalling €215,200,000 to be made between 10 December 2020 and 14 December 2020. ii) Mr Khashoggi directed Mr Hasan Ashour of the Claimant to: “Kindly prepare the required wire transfers according to the signed SPA. Please confirm them form with Mr. Jacque and Ms. Cinzia to double check and confirm. Then send them to me for execution.” iii) Dr Chiari sent the document “ Payment Executive Summary 10 12.docx ” to Mr Ashour.

60. On 11 December 2020, Dr Chiari informed Mr Briamonte that “I can reassure you that the payment issue has been dealt with the utmost importance to fulfill [sic] contractual obligations”.

61. On 16 December, Mr Khashoggi sent an email to Finnat, copying Mr Maurizio Molinari and Mr Briamonte, stating:- “In terms of the disbursement of the amounts we agreed to in the SPA with my dear partner Mr. Molinari; we have informed our banks through our treasury, they are actively working on putting the schedule which we will share with you and both Mr. Molinari & Mr. Briamonte to confirm and review in order to take the necessary steps to send and receive the funds as per the schedule and details provided. We hope to share that information with you very soon, which we will forward to you immediately.” On the same day Mr Khashoggi told Mr Nuncques that:- “I've been busy with the banks to make available the funds in euros, it's a mess! The Euro is very expensive and we don't have enough euros. It will kill us to convert now. We need to delay the payment and request at least a month, but I want to propose that once I have a clear commitment from the banks on schedule and pricing.”

62. Mr Briamonte suggested using a currency rate swap to cover the ‘currency disfavour’, to which Mr Khashoggi replied “Thank you Mr. Briamonte for your kind advice. yes, this is common and considered as one of the options. It has been our family principal never to use debt nor expose our self, therefore, we are careful. I'm to receive all options today and will revert back to you Mr. Molinari.”

63. On 18 December 2020, Dr Chiari forwarded to Mr Briamonte an email from Mr Khashoggi to Finnat Bank stating “I’m trying to have all the funds come from one bank and one account to ease the KYC and elemenate [sic] any issues”. It appears that Mr Khashoggi had decided to use his own funds to make the payment, and the documents indicate that as of 18 December he was taking steps to open an account with Credit Suisse on an expedited basis.

64. Mr Hassan Ashour, an employee of Khashoggi Holdings, emailed Mr Briamonte on 20 December 2020 saying:- “I would like also to update you regarding the funding required for the agreed financial closing, we have been actively engaging with our banks, both local and international, we did witness delays from some bank due to timing and availability issues. However, we believe that we are close to finalization. The large Euro amounts required for the transaction did cause us a challenge, as we were surprised to learn the lack of its deposit due to negative interests on the Euro. So, we were offered tranches instead of the full amount. We are aware of the request from the third parties and hope to comfort them through you or us directly if you wish.’ On the same day, Mr Briamonte offered to vary the payment schedule, with €135,200,000 to be provide on 21 December 2020 and the balance on a date to be discussed in a conference call.

65. Also on 20 December 2020, Mr Norris of Ropes & Gray (formerly of Kirkland & Ellis), solicitors to OakHill, sent an email to Mr Briamonte attaching what he described as a:- “strawman outline of how we’re thinking about the exit. It aligns with what we discussed and hopefully you'll agree, it should be a pretty simple process ‐ albeit on a tight timeframe. We specifically designed it in a way that will not require much structuring to implement. We can draft a relatively simple buy back document with the payment left outstanding. It is, however, dependent on Meta UK having distributable reserve and confirmation from Khashoggi and MEAG that the arrangement is not prohibited.” MEAG was a financing company.

66. The following day, 21 December, Mr Norris asked for “any news on the deal? If deferred consideration is likely, we need to chat through as soon as you can.” Later that day, Vincenzo Lanni of Grande Stevens replied indicating that his firm had carried out an initial review of OakHill’s draft proposal relating to the OakHill equity exit mechanics, and setting out Grande Stevens’s initial comments. He continued:- “1. Option B/Deferred Consideration: As far as I understand, it appears more likely that we would have to go down the Option B route, whereby a large part of the OakHill equity kicker is paid in the future. Assuming that to be the case, you still appear to be envisaging a share buyback where most of the consideration in relation to such buyback is deferred. My understanding is that, in order to comply with the relevant statutory buyback process, the consideration payable by the company in respect of the share buyback must be paid in full at the time of the share buyback and such consideration cannot be deferred, paid in instalments or left outstanding as a loan (otherwise the share buyback risks being void). As such, we would like to understand exactly how you foresee this working so as to comply with the relevant statutory requirements? In addition, the deferred consideration is also likely to raise further issues in respect of the requirement for MetaUK to have sufficient distributable reserves when making all the various payments (see my comments in paragraph 2 below).

2. Distributable Reserves: I understand from Michele that the auditors of MetaUK are already considering the MetaUk distributable reserves position and the existence of sufficient distributable reserves is obviously key as to whether this proposal is actually doable (both for MetaUk as well as for OakHill). As you will appreciate, the directors of MetaUK would require some comfort from the company's auditors as to the level of distributable reserves available (and this would require the preparation of some interim accounts or at least some form of proforma balance sheet). In addition, given that the current proposal is based on the majority of the consideration being deferred, depending on exactly how you envisage this working (as referred to above), MetaUK would need to have distributable reserves not only now when it pays the initial Euro 15, 000, 000 but also when any of the deferred consideration is paid in the future (and it's obviously difficult for the directors of MetaUk to authorise future payments now based on the distributable reserves position at today's date when they clearly cannot possibly know what the distributable reserves position will be in one or two years' time when the other deferred payments are actually made).

3. MEAG/KHC: As you know, the MetaEnergia group is currently in the process of finalising the new MEAG financing arrangements. The shareholders of MetaUK have also recently entered into a share purchase agreement in relation to the sale of 75% of Meta UK to Khashoggi. As such, as you very correctly point out, the OakHill exit proposal would require the approval of both MEAG and KHC. Whilst we accept that, if the full amount of the equity kicker is not being paid immediately, in order to protect the outstanding deferred consideration, OakHill will require appropriate security and comfort, in our view, the wide‐ranging covenants, undertakings and restrictions currently envisaged over MetaUK (which will also impact on the Italian subsidiaries) go way too far and will not be acceptable to MEAG/KHC. Your draft proposal in this respect is drafted very much from a lender financing perspective whereas I understand from Michele that the commercial discussions have been more focused on a partnering arrangement going forwards (given that the OakHill bond will, in any event, have been repaid and that MetaUK will also be subject to the new MEAG financing and security arrangements). Clearly, there are further more detailed issues in your proposal that will also need to be discussed and resolved (e.g. the precise amount, timing and structuring of the deferred consideration, the level of protection and control required by OakHill over MetaUK, the precise security to be granted etc.) but the above issues are, in our view, the key initial overarching issues to be resolved so as to determine whether the proposal is actually workable.”

67. The same day, 21 December 2020, Mr Khashoggi sent an email to Mr Briamonte saying “we came into this deal very late in the game and we were not ready to close due to many factors which I don’t want to go through now”, “[w]e are a dollar based company, even our Saudi currency is tied to the dollar. We do have euros in our treasury, but not enough for this deal obviously. Moreover, our company and banks were not aware of this deal till when we signed the SPA. So they are asking for many questions and requirements which we are providing” and “I am still committed to Mr. Maurizio both personally and professionally. If it is best for Khashoggi holding to withdraw for now, I will do it. If that's what you and Mr. Molinari want. If you still want us to work together and close this deal, we all need to work as a team, I can help with Meag if you like while you and Maurizio can handle the less headaches.” Mr Briamonte replied indicating that the Defendants would not want even to consider Khashoggi Holdings withdrawing at this stage, which would be a “disaster beyond imagination” .

68. On 22 December 2020, Mr Khashoggi invited Husni Gama of Credit Suisse to coordinate with Mr Briamonte, and noted that the funds would be disbursed from the Claimant’s account with Credit Suisse. Dr Chiari sent Mr Gama certain Client Information Sheets prepared by Finnat relating to each recipient of the payments, and offered to assist with any further documentation. Mr Gama stated that Credit Suisse was “working diligently to conclude the necessary documents in order to facilitate the respective payments of this transaction to Finnat Bank.” Mr Briamonte had several calls with Mr Gama, and emailed Mr Khashoggi to say: “ We understand green flag on KYC and other issues has been already granted, and that hopefully tomorrow or on the 24th CS shall be in position to strike funds under your instruction sir.”

69. On 24 December 2020, Mr Briamonte emailed Mr Khashoggi asking him to indicate the source of funds for completion and to transfer the funds. Mr Khashoggi responded to Mr Briamonte to state that he would “ do my part as well ”.

70. On 29 December 2020, Mr Khashoggi attended a conference call between, amongst others, Mr Maurizio Molinari, Grande Stevens and Meta’s suppliers and stakeholders for the Project at which (according to an email the following day from Mr Briamonte) Mr Khashoggi stated that it was a matter of hours until the payment was to be successfully completed.

71. Also on 29 December 2020 OakHill’s solicitors, Ropes & Gray, circulated “the undated and compiled bond redemption documentation, which is strictly held to all parties order” . These documents provided for redemption of the bonds for €55,500,000, and release of the share charge and various other security rights. However, they did not address the other elements which also needed to be agreed, as set out above, i.e. in relation to the OakHill equity kicker.

72. The OakHill bonds fell due on 31 December 2020. On that date, Mr Hassan Ashour of Khashoggi Holdings emailed Mr Briamonte stating “ By way of update, I would like to inform you that we have completed the requirements needed and requested by Credit Suisse for the KHC account. They are currently on holiday, however, they confirmed to us that by Jan 5th 2021, they will confirm officially to receive the funds”.

73. On or around 5 January 2021, Mr Khashoggi and Khashoggi Holdings confirmed that funds had been received for payment of the Initial Payment at the Claimant’s account at Credit Suisse. Mr Briamonte stated that Dr Chiari (copied) had “ visual confirmation ” of the funds.

74. On 7 January 2021, Dr Chiari emailed, amongst others, the Project suppliers and MEAG copying, amongst others, Mr Maurizio Molinari and Mr Khashoggi, stating that “Our leader Mr. Motasem Khashoggi is in copy to this e-mail and he's authorised me to disclose as follows. We shall transmit to Mr. Briamonte the "proof of funds" letter in order to allow him to share it with you and set all the next technical and legal steps” and “We are able to directly guarantee any due payment of Metaenergia and so we will do in the event the days needed to complete the above payment process may cause un-comfort to any of the stakeholders or interests bearer”.

75. On 11 January 2021, Mr Khashoggi sent to Mr Briamonte, through his agent, an extract of a document purportedly from Deutsche Securities (part of Deutsche Bank Group) which was stated to show proof of availability of circa €2,167,500,000 (two billion, one hundred and sixty-seven thousand, five hundred Euros) in funds made available by Khashoggi Holdings to complete the purchase of the Sale Shares.

76. Also on 11 January 2021, Dr Chiari and Mr Briamonte corresponded regarding a revised date for Completion of the sale and purchase of the Sale Shares. Dr Chiari stated that “ Mr. Motasem prefer to fix the date at the 28/29 th of January ”.

77. On 13 January 2021, Mr Briamonte suggested a revised date of 28 January 2021 for the Initial Payment, for which Mr Khashoggi thanked him.

78. On 27 January 2021, Mr Briamonte said in an email to Mr Khashoggi that Dr Chiari had confirmed by phone that the funds would reach Meta’s account at Finnat that day. Mr Khashoggi stated that that instructions had been provided to wire the first tranche of €125 million, and that no further delays were anticipated.

79. On 2 February 2021, Mr Briamonte informed Mr Khashoggi that Credit Suisse needed prior notification of the entity that would transfer the funds, and from which bank. However, Mr Gama of Credit Suisse informed Mr Khashoggi that final due diligence was incomplete, and that “we kindly request a few more days for final clarification and we will update you accordingly. Until such point, we would not be able to accept incoming funds into the respective accounts.” Dr Chiari forwarded this message to Mr Briamonte. Mr Briamonte suggested using an alternative intermediary to Credit Suisse.

80. On 5 February 2021, Mr Khashoggi stated that he had received a call from Mr Husni Gama at Credit Suisse advising that all compliance checks had been completed for transfer of the Initial Payment, other than one item which could easily be resolved. Mr Briamonte proposed a further revised payment date of 8 February 2021.

81. In early February 2021, Mr. Khashoggi told the Sellers that his bank, Deutsche Bank, had advised him to make payment through an intermediary known as Batt Company (“ Batt ”), to whom he said Deutsche Bank had introduced him. On or about 10 February 2021, Meta entered into a “ Partnership Agreement on Investment and Financial Co-operation” with Batt, and a day or two later paid it €300,000 to discharge its fees for the transfer of the Initial Payment from Khashoggi Holdings.

82. On 10 February 2021, Mr Khashoggi emailed Mr Maurizio Molinari stating that “I received a request yesterday from the escrow asking for our TRN, then I confirmed back to them that Khashoggi Holding dose [sic] not have a TRN because it is a saudi company. So everything is done. By God’s Blessings we will finish today and payments get to you this week”.

83. On or around 24 February 2021, Mr Khashoggi confirmed to Mr Briamonte that Batt Company had resolved the difficulties and hurdles preventing the transfer of funds from Deutsche Bank to Credit Suisse.

84. On 24 February 2021, Mr Khashoggi emailed Credit Suisse, copying Mr Briamonte, stating that “In terms of update; the paying agent hired by [Deutsche Bank] delayed the payments to me for reasons related to them. I’m pleased to learn today that this issue is now resolved and we should expect the transfers immediately. In that regards; I would like you to refer to Mr. Briamonte or myself regarding the transfers due to Metaenergia”.

85. On 25 February 2021, Mr Khashoggi stated to Mr Briamonte that he had requested that Batt Company transfer “at least 600m as a first trenche [sic]”.

86. On 26 February 2021, Mr Briamonte told Mr Khashoggi that Arkady (of Batt) had confirmed the ‘detachment’ of the funds and that fund would be visible to Credit Suisse that day or the next.

87. On 27 February 2021, Mr Khashoggi emailed Credit Suisse, copying Mr Briamonte, stating that “I had been informed by the paying agent [(i.e. Batt Company)] that the first transfer has been processed, I requested a swift confirmation to share with you, I’ve yet to receive it”.

88. On Sunday 28 February 2021, Mr Briamonte raised concerns about Batt Company with Mr Khashoggi. Mr Khashoggi replied saying that Mr Batt had told him that the full amount would be transferred in the coming week, and added “Please don’t scare me! Tell me if there is something wrong”. On 1 March 2021, Mr Briamonte (having been asked to do so by Mr Khashoggi) began to escalate correspondence with Batt Company.

89. On 2 March 2021, Mr Briamonte reported that he did not trust Batt Company, and invited Mr Khashoggi to move to a “ Plan B ”, to provide Meta with €130m as soon as practicable while reassuring OakHill, MEAG, and suppliers. Mr Khashoggi agreed. On the same, Mr Briamonte sent an email to OakHill reporting that Mr Khashoggi had confirmed receipt of the funds on Khashoggi Holdings’ account.

90. On 3 March 2021, Mr Briamonte and Mr Khashoggi liaised with Credit Suisse about the envisaged Batt transfer.

91. On 5 March 2021, Mr Briamonte (after further investigation) advised Mr Khashoggi and the First Defendant to “ disintermediate ” Batt, and pay the sums directly from Mr Khashoggi’s personal account at Deutsche Bank. Mr Khashoggi agreed. Mr Briamonte then asked him to arrange a payment of €125,200,000 on Monday 8 March 2001. Mr Khashoggi told Mr Maurizio Molinari that “I have strong ties with DB, as far as I am concerned they are the responsible party, I don’t know or care of this Batt co. I will put all my pressure on them to make good and directly send the money to Metaenergia and the balance either to [the Claimant’s account at Credit Suisse] or keep it for now at [Deutsche Bank]”.

92. On 8 and 9 March 2021, Mr Khashoggi told Mr Maurizio Molinari in WhatsApp messages that he had contacted Deutsche Bank and instructed them to transfer €125 million urgently to Meta.

93. On 9 March 2021, Mr Khashoggi sent Mr Maurizio Molinari a photograph of a “ Summary of Income Report ” from Deutsche Securities to the First Defendant which appeared to show a “ Money Account ” with a value of about US$ 6.5 billion.

94. Khashoggi Holdings instructed Mishcon de Reya on or about 9 March 2021. The solicitor involved initially was Mr Mike Stubbs, a dispute resolution partner in the firm’s insolvency team.

95. On 10 March 2021, Mr Khashoggi told Mr Maurizio Molinari that he had been asked for a power of attorney by Deutsche Bank, which he was arranging and sending back and that he had been “ promised the swift for the transfer tomorrow”.

96. On 12 March, Mr Khashoggi emailed Mr Briamonte saying:- “Regarding the transfer from [Deutsche Bank]; I sent them the transfer request of €125.2m a few days back. I requested that the amount be directly transferred to the various accounts with Finnat. The be [sic] been supplying them with everything they requested and all seems in order. I was confirmed that they would share with me the confirmation yesterday, I’m still waiting. As soon as I receive it, I will share it with you and Maurizio whom I have been updating in real time the past few days”. and:- “They are still insisting that the amounts are to go through a third party. The firm they had suggested is http://www.avenzainvestment.com/”. Mr Briamonte looked into Avenza and did not consider them suitable.

97. Also on 12 March 2021, Mr Khashoggi told Mr Maurizio Molinari that the SWIFT payment for the first tranche of the Initial Payment would be made that evening. Mr Khashoggi provided to Mr Maurizio Molinari a copy of a cash transfer form which he said had been sent by his contact at Deutsche Bank. The form purported to show that an instant transfer of €1 billion had been made from Mr Khashoggi’s personal account at Deutsche Bank to Khashoggi Holdings’ account at Credit Suisse. Subsequently, in an email sent to Mr Khashoggi on 22 March 2021, Dr Chiari said:- “It seems that the funds in the attached sheet that you sent to him and to Mr. Molinari, do not exist and that the account of CS in the name of KH is devoid of funds. I honestly ran out of every resource. My dear Motasem, who gave you this paper apparently issued by the bank? it seems to be false the banks have checked the layout and said that this sheet contains invented information and above all it does not exist in the communications between the banks, which as you know are ALL TRACKED, there is no record about that attached's founds, they say.”

98. On 15 March 2021, Mr Khashoggi messaged Mr Maurizio Molinari stating that Credit Suisse had received the SWIFT payment from Deutsche Bank, but that there was a small issue with the value date that the banks were communicating to correct it. On 16 March 2021, Mr Khashoggi messaged Mr Maurizio Molinari to say that Credit Suisse would provide the confirmation for the transfer to Mr Maurizio Molinari, that the value date of the transfer was 23 March 2021, that the SWIFT transfer had not been cancelled, and that Credit Suisse had extended a temporary line of credit to pay Meta the required amounts.

99. It seems that on or around 17 March 2021, Mr Briamonte received documents purporting to show a transfer of €100 million from Batt’s account at Commerzbank to Khashoggi Holdings’ account at Credit Suisse on 16 March 2021. However, Credit Suisse stated on 18 March that no transfer had been received and the documents were fake.

100. On 22 March 2021, Mr Khashoggi emailed Mr Briamonte to say: “Today the value date of the wire from [Deutsche Bank] to [Credit Suisse] is due. As agreed, I’ll make sure the first wire for €50m is completed without any delay nor issues, once you confirm receipt; I’ll send the remaining immediately ”. However, no funds were received. Credit Suisse on 23 March 2021 indicated that it would not participate in the transaction. Mr Stubbs of Mishcon de Reya in an email the same day from to Mr Briamonte said:- “I am working to understand what caused the interruption at Credit Suisse. Question why was CS in position not Deutsche if you know the answer now I don't want to disturb MK this late Lets speak on the immediate issues tomorrow”

101. On 23 March 2021, Mr Khashoggi introduced Mr Briamonte to Mr Stubbs of Mishcon de Reya, asking them to “ work together on finding a quick solution that will protect the integrity of the project and the families involved” . On 25 March 2021 there was a conference call between Mishcon de Reya and Mr Briamonte.

102. On 27 March 2021, Mr Briamonte and Mishcon de Reya discussed a route forward, where there would be money paid into an escrow account, and further money loaned to Meta to repay the pressing creditors, and the SPA varied to defer completion until the summer. This was welcomed and developed by Mr Briamonte (although an agreement was not concluded).

103. In an email to Mr Stubbs of Mishcon de Reya and Mr Khashoggi on 29 March 2021, Mr Soenmez of OakHill said he assumed that “between Mishcon and Ropes and Gray we can resolve any outstanding questions and documentation so that we can proceed to funding of the overdue amounts asap” .

104. Dr Chiari resigned from her role as adviser to Mr Khashoggi on 30 March 2021.

105. On the same day, Mr Soenmez of OakHill sent an email to Mr Khashoggi, copied to Mishcon de Reya and Grande Stevens, saying:- “Dear Motasem, Dear Mike, I am very sorry to chase and insist. The lack of response and action from KHC and Mishcon over the last days makes me believe that the urgency of the situation has not been sufficiently appreciated. I would therefore strongly suggest that we have an all party call today where KHC/ Mishcon provide us with a detailed action plan which allows us to understand where we stand and how the overdue payments will be actioned during the course of this week. I do reiterate that we have been extremely patient over the last 3-4 months but are no longer in a position to extend the timetable any further. I am available today between 1 pm and 5 pm UK time. Please let me know when would be a good time to speak.” Mr Soenmez also wrote to Mr Stubbs, copying all parties:- “Dear Mike, many thanks for the prompt response and many thanks for working through the complexities of the transaction. Can I please request that we start communicating openly what the issues are. While you have only joined the transaction recently, I think the rest of us are now well beyond the phase where we have to dance around issues. If KHC has a willingness to close the transaction, we should all get on a call and discuss any issues which you may have come across and discuss how these may be resolved. Sorry to repeat myself but we do not have time to allow for a lengthy re-underwrite of the situation by Mishcon. Can I please therefore suggest that we have an all party call this afternoon.”

106. There was a conference call between Mishcon de Reya and Ropes & Gray on 30 March 2021, of which no notes were disclosed. In the evening, Mr Norris of Ropes & Gray asked Mr Stubbs whether Khashoggi Holdings had paid money over to Finnat, as he was hearing that something like €50 million had been paid already.

107. There was an ‘in person’ meeting on 1 April 2021, which was attended by Mr Soenmez of OakHill, Mr Norris of Ropes & Gray (acting for OakHill), Mr Stubbs of Mishcon de Reya and Mr Stubbs’ colleagues, Mr Jonathan Berman and Ms Jessica Wicker (the author of the attendance note). The note included the following paragraphs:- “• Initially Musa was openly hostile towards Khashoggi Holdings (KH) citing KH's failure to complete the deal as a reason why. He provided a short history of the transactions from Oakhill's perspective - he noted that KH and the Molinaris appeared to have a good relationship and one that looked as though it would engender a good working relationship. He added that KH appeared on the scene in September/October and was the highest of three bidders in the transaction. Musa noted that KH had advice from Jacques and that it was this that at one point looked like it may torpedo the deal as Jacques attempted to renegotiate the deal at a late stage. He said that KH had failed to provide the funds to complete the transaction on 28/29 January causing huge problems for Oakhill and MEAG. • Musa made clear that should he come out of this meeting with the belief that KH was not genuinely interested in completing the transaction, as a lender they would look to step in and take control of the deal opting for another bidder with more credibility, of which there are several • MS explained that MdR have only just been instructed and have not had the opportunity to review and consider all of the documents. What we do know and can share is that KH entered into this transaction without the appropriate level of legal advice - Jacques is not a lawyer. We would have expected months of negotiations, due diligence and advice - this did not happen. MS and JB also noted that the SPA is the most peculiar document with clauses such as the drag and tag potentially causing serious loss to KH. JB noted that whilst there may have been other bidders, they may have sanctioned the deal based on the documents in the data room. It should be noted that the SPA in the data room and the one signed by KH are very different. • MS explained that he has been Motasem's lawyer in the UK for 12 years and is convinced that he wants to do the deal and we need to see if that is possible. ... • Musa emphasised the timing was key for Oakhill and that they could not allow this process to go for longer than necessary. The only way in which Musa considered the deal could be rescued is by MdR and Briamonte renegotiating the SPA and if KH was to step into Oakhill's shoes as the secured lender - the latter would allow KH to make payments with security which they will not be able to do in any other circumstances. • This was discussed in detail and it was agreed that in terms of what happens next, the documentary side of things, so long as there was no renegotiation of value, could be fairly straight forward with Briamonte, particularly if MdR do the drafting. However, it is the CPs that cause some concern particularly the regulatory and tax approvals needed. There is some concern about how long the Golden Power will take to obtain and also the fact that the business will be wholly owned by a Saudi Arabian business. These are unknowns and MdR will need to seek the view of Italian counsel - MdR said that this would determine whether the deal was doable. Ropes & Gray said that they have looked into this and could suggest their counsel as a first step. • MS said that the next consideration is the value of the security should KH step into KH's shoes. MS asked this question of Oakhill repeatedly and initially they could not be drawn. Eventually, Oakhill explained that consider the value to be around E140m - E57m of debt, E30m Casino 2 and the E70m as equity kicker. Musa could not be drawn on the issue of the fire sale value despite many attempts by MS.”

108. Mr Berman in his witness statement explained that Mr Stubbs had brought him into the matter because it had an M&A element. Mr Berman felt there were “lots of red flags” in the SPA, which he considered did not appear to be a bona fide , sensible agreement. It involved Khashoggi Holdings buying a majority stake yet not gaining control of the business, lacked the types of protection that a purchaser would normally expect, and included some provisions he regarded as extraordinary. When he started looking at the SPA, he realised that “the payment obstacles were the least of our client’s issues” . Mr Berman participated in the telecon with Mr Briamonte on 25 March 2021. He had been reminded that there was a call on 30 March and then a meeting and second call on 1 April 2021. Mr Berman could not recall whether he took part in the 30 March 2021 call, but did recall speaking and meeting with Mr Norris on one or possibly both of those days. Mr Berman said this in his witness statement:- “25. Sam Norris was acting for OakHill, and I recall him expressing his relief to us about Mishcon's involvement and stating words to the effect, "thank god I have real lawyers to deal with". Sam was a straightforward, very nice, professional lawyer. He was cooperative and, like us, I think his instructions were to see how he could facilitate the deal getting done. We were very open with him too and I did not sense that there was any game playing.

26. Sam was very open and honest about what OakHill needed. He stated that OakHill needed to be paid, but they did not know how much. As I recall, the issue was that two projects were being carved out under the SPA and as such, not reflected in the sale price. OakHill were getting repaid their loan and being paid for the sale of their shares in Meta, but they were also expecting to agree what they would be paid in respect of the two projects that had been carved out under the SPA. They knew how much debt there was, but there remained the question of what they were to be paid in respect of their shareholding to include their interest in the excluded projects. He explained that this was still needed to be negotiated, and until that point was negotiated, consent would not be given by OakHill.

27. Whilst on the call with Sam Norris (whether this was the first or second call) Sam raised for the first time that OakHill had not given its consent to the SPA, for the reasons outlined in the above paragraph. He explained something like, "we are yet to have those discussions". I replied with something to the effect of, "what are you saying, that you didn’t give consent ?". Sam said words to the effect of, "yes exactly, that is the critical point". I remember this as it was a seminal moment. It was a big, big moment.

28. It had not occurred to me ask whether OakHill had provided its consent as it seemed such an obvious point to me that consent was needed prior to entering in the SPA (and therefore would have been provided). The point was raised by Sam, not by me or Mike. Sam wanted us to understand and appreciate the importance of the point he was making. It was raised and put on a plate for us by him.

29. I thought at the time that there must have been a benefit to OakHill in bringing the lack of OakHill's consent to our attention and making us aware that OakHill had not yet agreed aspects of the deal, and therefore us realising that without OakHill's consent, any transfer of shares under the SPA was void.

30. Sam knew that KHC still wanted to do the deal, and we were making that clear to him on the telephone call.

31. In the days following the call with Sam Norris, I can recall that there remained concerted efforts to get the deal done including multiple discussions with Mr Briamonte and further calls with Sam Norris, sometimes with his client contact, Musa Soenmez. As far as I can recall, the point about consent did not come up again. As well as reviewing the SPA and financing documents, I was in conversations with banks (including Citi bank) about setting up an escrow account for KHC in order to allow payments to be made under the SPA. ”

109. In his oral evidence, Mr Berman said he did not believe there were any notes of this conversation with Mr Norris. He said the discussion regarding OakHill consent had been about consent to the SPA, and that there had been no reference to consent to share transfers between Finnat and Mr Maurizio Molinari. Mr Berman said he thought the matter had not been discussed at the meeting on 1 April, so his conversation with Mr Norris must have been after that. He did not recall whether Mr Stubbs was on the call too, or how he communicated the outcome of call afterwards. Mr Berman did not know on what basis Mishcon de Reya’s letter of 7 April 2021 stated that enquiries had been made of “ OakHill and its lawyers” (my emphasis).

110. On the evening of 5 April 2021, Mr Berman sent Mr Briamonte “our list of principal issues” . The list bears the date 3 April 2021, but Mr Berman did not remember whether that was the date on which the list had been started. There is no direct reference in the list to a need to obtain consent from OakHill to the SPA, but point 7 of the list, relating to the Sellers’ Warranties in the SPA, set out Khashoggi Holdings’ position (“ KHC position ”) as follows:- “Sale Shares to be sold with full title guarantee and free from encumbrances - i.e. the Oakhill security over both the Sale Shares and the target group is to be released simultaneously with completion. The Sale Shares must include those held by Oakhill (i.e. the 1,112 A ordinary shares). [The concern is, what comfort is there that Oakhill will agree to the cancellation of its shares unless and until the entirety of its Exit proceeds have been paid? From our discussions it appears that these discussions have not been finalised]” (emphasis in original) Mr Berman did not recall why the list did not ask for a copy of OakHill’s consent to the SPA. He agreed that provided a deal could be done in relation to the OakHill equity kicker, the problem would have been solved. Mr Berman accepted that OakHill had sent a series of emails indicating that they wished to get the deal done, but felt that Mr Norris, as a lawyer, probably for professional reasons, still wanted to ensure that Mishcon de Reya understood the problem, as Khashoggi Holdings would otherwise be paying € 200 million for shares to which they would not be entitled.

111. On the morning of 7 April 2021, Mr Stubbs of Mishcon de Reya emailed OakHill and Ropes & Gray saying:- “The money is coming from Jeddah and was actioned this morning On previous history I expect 24 48 hours Meanwhile we have just written formally to Michele and others Which we hope will actually make this move forward. Jonathan and I would be happy to have a call with you this evening if that suits.”

112. Later the same morning, Mr Soenmez of OakHill emailed Mishcon de Reya and Grande Stevens, saying:- “Following up on last Thursday's meeting and the conference call on Sunday morning with Maurizio Molinari, we would highly appreciate a detailed update on where you and your client stand. We understand from Michele Briamonte that there is some progress being made on the SPA as well as the mechanism for payments from the buyer to Meta UK. As you are aware, OHA's loan has matured on 31 Dec 2020. As highlighted during our meeting, given the repeated delays and substantial loss of credibility of the buyer over the last few months, we are not in a position to prolong the discussions any further without seeing proof in the very short term of a significant portion of the purchase price being transferred to Meta UK such that Meta UK is able to make the necessary payments to OHA as well as key suppliers. To enable us to make tangible progress asap, we would urge KH and Mishcon to provide us with a detailed timetable for the relevant payments over the next few days including amounts and timing. Subject to seeing proof of certain payments and a detailed schedule and timetable which gives us clear and unambiguous visibility, we are happy to meet with Mishcon and Michele Briamonte in London on Thursday or Friday to fine-tune any outstanding items with the aim of bringing the transaction to closure in the very short term.”

113. Also on 7 April 2021, however, Mishcon de Reya wrote to the Defendants purporting to terminate the SPA for repudiatory breach by the Defendants. The letter included the following passages:- “As you know we act on behalf KHC and have been assisting in the commercial dialogue concerning MetaEnergia UK Limited (" Meta "). However, we have also formally considered the Share Purchase Agreement (“ SPA ”) dated 8 December 2020 providing for the acquisition by KHC of 7,500 B Ordinary shares in Meta, of which 3,377 B Ordinary shares constituted the Finnat Sale Shares (as defined), Finnat Fiduciaria SpA (“ Finnat ”) Finnat being party to the SPA as a seller. Recital G to the SPA refers to 1,1 12 A Ordinary shares held by EN-IT Meta Sari (“En-lt”) “as part of the OakHill Bond”. We have contacted OakHill and its lawyers, and have been provided with documentation and information which has not previously been made available to, and was not previously known by, our client. The OakHill Suite of Documents We refer to two documents which were executed on 14 April 2020. First, a Share Charge between Finnat and Lucid Trustee Services Limited whereby Finnat’s 10,000 B Ordinary shares in Meta were charged. Can you explain how Mr Molinari came to be (as provided for by the SPA) a B Ordinary shareholder in Meta? Did he enter into a deed of adherence in respect of the OakHill obligations? Second, an Amended and Restated Investment Agreement (“ARIA”) which provides at clause 6.1 that Finnat shall not transfer its shares in Meta without the prior written consent of En-lt; nor shall Meta register such a transfer without En-lt’s prior written consent. This latter provision is cemented by clause 3 of the ARIA which provides for the adoption by Meta of new Articles of Association, which were duly adopted. The Articles Article 40. 1 provides as follows: … This provision applies to any B Ordinary shares, but in any event applies to the Finnat Sale Shares. Prior Written Consent Having made enquiry of OakHill and its lawyers, it appears that En-lt’s prior written consent has not been sought or obtained in respect of either: (i) the transfer of the Finnat Sale Shares (pursuant to clause 6. 1 of the ARIA); or (ii) the transfer of the B Ordinary shares the subject of the SPA (including the Finnat Sale Shares) pursuant to Article 40.1. Not only was Finnat therefore not at liberty to transfer the Finnat Sale Shares; any transfer of B Ordinary shares is null and void and shall not be recognised by Meta. The SPA Clause 2. 1 of the SPA provides for the purchase of the 7.500 B Ordinary shares (including the Finnat Sale Shares) “with full title guarantee”. Apart from this phrase meaning what it says in plain language, it is used to import various implied covenants regarding the seller’s title to shares being sold as set out at sections 2 and 3 of the Law of Property (Miscellaneous Provisions) Act 1994 including: (i) that the seller has the right to dispose of his shares; and (ii) that the disposal of the shares is made free from known encumbrance. For the reasons set out above, there has been a breach of the full title guarantee provision, and breaches of the implied covenants: a. at least the Finnat Sale Shares are subject to the encumbrance of the Share Charge; b. there was no right to dispose of (at least) the Finnat Sale Shares without En-lt’s prior written consent (which was not obtained); and c. any transfer of the 7,500 B Ordinary shares the subject of the SPA (including at least the Finnat Sale Shares) is null and void (absent En-lt’s prior written consent, which has not been obtained). Warranties Clause 8 of the SPA provides for warranties in respect of the 7,500 B Ordinary shares the subject of the SPA, save as disclosed in the Data Room. Paragraph 2.6 of Schedule 4 warrants the absence of Encumbrance (as defined) except as disclosed in the Disclosure Letter (in the absence of which the Data Room applies). First, this warranty has no bearing on the full title guarantee provision in clause 2.1, which is unconditional; nor does it undermine the implied covenants. Second, and in any event, the disclosure in the Data Room was wholly insufficient in respect of the encumbrance of the Share Charge. For example, the Data Room did not contain the OakHill suite of documents. Third, and in any event, the warranty provisions can have no relevance to the prohibitions in the ARIA and the Articles concerning the absence of En-lt’s prior written consent. Fundamental Breach The three matters set out in sub-paragraphs (a) to (c) above (and their consequences, as explained in this letter) constitute, individually or collectively, fundamental and repudiatory breach of the SPA, which repudiation KHC accepts, and the SPA is accordingly terminated. Alternatively, the SPA has been frustrated, and likewise terminated. We are separately sending a copy of this letter to the parties listed at clause 17.3.1 to 17.3.5 of the SPA by way of notice. WITHOUT PREJUDICE SAVE AS TO CONTRACT The Way Ahead Notwithstanding the necessarily formal nature of this letter, we are instructed that our client still wishes to engage with you very constructively to explore whether a satisfactory commercial outcome for all parties can nevertheless be reached and as soon as possible; and we firmly believe that it should indeed be possible , It will require a wholly constructive approach and very diligent and hard work on all sides. It will be helpful to know that fully adequate resource is in place for this exercise. We will provide direct contact details for each senior member of our team. This is obviously dependent on the matters which constituted the fundamental and repudiatory breach of the SPA (or which led to its frustration) being resolved and overcome. We suggest the following modus operandi for discussions going forward (and we recognise the urgency of the situation). First, our respective clients agree to a moratorium on any legal proceedings between them - arising out of the SPA or otherwise. We suggest mutual covenants not to sue, terminable on 14 days prior written notice. This will hopefully provide a period of time during which the clients can concentrate on without prejudice discussions and on reaching a commercial solution which is acceptable to everyone. Second, on entering into a suitable arrangement reflecting the above, KHC would pay into this firm’s client account an initial sum of €200m. We appreciate that a commercial solution would require a greater sum than this, and KHC is willing to engage to that appropriate extent financially; but KHC hopes that this proposed payment to its solicitors’ client account would serve as a substantial gesture of commitment and goodwill. Third, we will follow up shortly with a note of our more detailed proposals for the most efficient and expeditious transaction of these matters. These proposals as to the way ahead are necessarily without prejudice to KHC’s legal position (in respect of which all its rights are reserved), and subject to contract; but it is hoped that they may form the basis for urgent discussions going forward to resolve the situation to everyone’s commercial advantage.”

114. After the letter was sent, Mr Stubbs emailed Mr Soenmez the same afternoon saying:- “The money is coming from Jeddah and was actioned this morning On previous history I expect 24 48 hours Meanwhile we have just written formally to Michele and others Which we hope will actually make this move forward. Jonathan and I would be happy to have a call with you this evening if that suits.”

115. Grande Stevens replied on 8 April 2021, responding in particular to the purported notice of termination as follows:- “In your letter of 7 April 2021, addressed to the Sellers, you purport to terminate the SPA for what you allege to be fundamental and repudiatory beaches of the SPA. However, your purported termination of the SPA is based on a number of false premises. In particular, contrary to the various allegations set out in your letter in relation to the transfer of shares from Finnat Fiduciaria SpA ("Finnat") to Mr Maurizio Molinari ("Mr Molinari"):

1. EN-IT Meta Sarl ("EN-IT") did, in fact, provide written consent to the transfer of shares from Finnat to Mr Molinari;

2. Mr Molinari was already a party to the Amended and Restated Investment Agreement ("ARIA"), in his capacity as the beneficial owner of the shares held by Finnat on his behalf, and, as such, was already bound by the provisions of the ARIA. On that basis, there was no need for Mr Molinari to enter into a further deed of adherence to the ARIA; and

3. On the basis of the above, the registration of the transfer of the shares from Finnat to Mr Molinari was duly recognised by the Company and is in no way null and void as you claim. Furthermore, contrary to the allegations made in your letter in relation to the proposed transfer of the Sale Shares from the Sellers to the Buyer under the SPA:

4. The Sellers have, at all times throughout the sale process, kept EN-IT appraised of developments and EN-IT is fully aware of the SPA and the proposed transfer of the Sale Shares by the Sellers to the Buyer;

5. It was agreed with EN-IT that all of the security held by them (or for their benefit) would be released on completion of the SPA, subject to repayment of the Oakhill Redemption Amount. Indeed, all of the relevant redemption documents and the related deed of release were agreed and signed in December 2020 and were being held in escrow by EN-IT's lawyers pending completion of the SPA. The deed of release agreed with EN-IT releases, inter alia, the Sale Shares from any encumbrance created for the benefit of EN-IT under the share charge referred to in your letter;

6. As acknowledged and agreed by your client under the SPA, the OakHill Redemption Amount was to be paid by the Sellers and the Company from the Initial Payment payable by the Buyer under the SPA. Unfortunately, completion of the SPA has not yet taken place, and payment of the OakHill Redemption Amount could not be made, due solely to your client's breach of the SPA, namely the Buyer's failure to make the Initial Payment;

7. Subject to your client complying with its obligations under the SPA and, in particular, in relation to the payment of the Initial Payment, the OakHill Bond will be redeemed in full and the Sale Shares will be transferred to the Buyer with full title guarantee and free from encumbrances; and

8. On the basis of the above, your alleged breaches by the Sellers of the full title guarantee provision and the implied covenants are completely misplaced. On the basis of all of the above, there has been no fundamental or repudiatory breach of the SPA on the part of any of the Sellers and your purported termination of the SPA is invalid. Clearly, such invalid attempt to terminate the SPA is simply intended to cover up your own client's breach of the SPA, namely the Buyer's failure to make the Initial Payment.” As to the way forward, Grande Stevens indicated that they were instructed to engage constructively, but that:- “Our clients' agreement to engage in further commercial discussions and to enter into the proposed moratorium is, however, also subject to (i) you providing confirmation (and written evidence) that the Initial Payment of Euro 215,200,000 has actually been received in your firm's client account and (ii) funds being provided by the Buyer to the Company and the Subsidiaries so that the now long overdue and urgent payments that are required to be made by the Company and the Subsidiaries in order to safeguard the Project are actually made within this current week as per your email confirmation.”

116. On 9 April 2021, Mr Berman sent a message to Mr Stubbs recording that:- “I just got off a call with Samuel Norris of Ropes Gray. He didn't want to get embroiled in the dispute/correspondence between Grande Stevens and Mishcon; he said he wanted us all to focus on getting the deal done and for Briamonte to be on a plane to see us next week. That the correspondence is ridiculous; we should all simply be working to get a deal done rather than looking to litigation. I asked about the deed of release, per the GS letter he said that a deed of release had been signed but that was only part of the package and that the deal didn't work without the other elements that had yet to be dealt with. […] He wanted to again impress on us that Oakhill expects to see commitment; he didn't mention money and I didn't ask. I explained that our standing instructions were to get the deal done and we would be sending across, later in the day, our road map of how we are expecting to get there. He was happy with that.”

117. Mr Briamonte on 11 April 2021 asked Mr Stubbs to confirm whether the envisaged payment referred to in Mishcon de Reya’s letter of 7 April had been received by Mishcon de Reya. In fact, no such payment was ever made, and no such confirmation was provided.

118. In an email of 12 April 2021 to Mr Nuncques, Mr Stubbs said:- “PS In the meantime Musa has just called me again to say he is encouraging MB to agree our moratorium and to visit London to meet face to face later this week but to know there is real money in MdR client account would make all the difference I repeated I would not discuss that until the threat is lifted. I also reminded Musa that distrust goes both ways My view of the drag position in the old SPA is fraudulent in my book ie I don't believe that MB is that negligent Musa fairly pointed out that it’s something very easily remedied ie just take it out I said I understand that but he should look at it this way If I had just put a car bomb under his vehicle I could easily remedy that by taking it out but he might want to go somewhat further in satisfying himself as to my change of spots before taking a drive through the Italian countryside.”

119. Mishcon de Reya wrote to Grande Stevens again on 14 April 2021, maintaining that the SPA had been terminated but proposing engagement with a view to finding a commercial solution.

120. The Defendants on 15 April 2021 wrote to Khashoggi Holdings stating, so far as material:- “4. Under the Agreement, you agreed, in particular, among other obligations, to make the Initial Payment in the amount of Euro 215,200,000 on the Completion Date (namely, 8 December 2020).

5. In breach of your obligations under the Agreement, and notwithstanding repeated reassurances from you that the Initial Payment was being organised, you have failed to make the Initial Payment. 6 This breach has deprived us of substantially all the benefit of the Agreement. You are therefore in repudiatory breach of contract.

7. We note your purported termination of the Agreement contained in the letter of Mishcon de Reya dated 7 April 2021. For the reasons set out in the response letter sent by Grande Stevens International to Mishcon de Reya on 8 April 2021, your purported termination of the Agreement was invalid.

8. By this letter, we are exercising our rights to terminate the Agreement under clause 5.3 and at common law on grounds of your repudiatory breach, which repudiation is accepted by the Sellers, and the Agreement is accordingly terminated.”

121. On 28 April 2021, IKOPUS S.à r.l. (“ IKOPUS ”) offered to purchase Meta’s shares (including its interest in the Cassino 2 plant mentioned earlier). In due course, that transaction came to fruition on 21 June 2021, when the Defendants sold 80% of the shares in Meta to IKOPUS. (F) PRINCIPLES (1) Repudiatory breach

122. A breach of contract is a repudiatory breach, and gives the innocent party the right to terminate the contract (that is, to treat itself as discharged from performing any remaining primary obligations) when, relevantly: i) the wrongdoer has breached a condition; ii) the wrongdoer has breached an innominate term in a sufficiently serious way; or iii) it is impossible for one party to perform its obligations under the contract. See Chitty on Contracts, 35th edition, at paragraph 28-011.

123. A term is a condition when “ the nature of the contract or the subject matter or the circumstances of the case lead to the conclusion that the parties must, by necessary implication, have intended that the innocent party would be discharged from further performance of its obligations in the event that the term was not fully and precisely complied with” . Chitty, 28-017. The House of Lords in Bunge Corpn. v Tradex Export SA [1981] 1 WLR 711 , 725 approved the statement of Bowen LJ in Bentsen v Taylor, Sons & Co. [1893] 2 QB 274 , 281 that:- “There is no way of deciding that question except by looking at the contract in the light of the surrounding circumstances, and then making up one's mind whether the intention of the parties, as gathered from the instrument itself, will best be carried out by treating the promise as a warranty sounding only in damages, or as a condition precedent by the failure to perform which the other party is relieved of his liability.”

124. In the case of an innominate term, the test is, “Does the occurrence of the event deprive the party who has further undertakings to perform of substantially the whole benefit which it was the intention of the parties as expressed in the contract that he should obtain as the consideration for performing those undertakings?” (Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd [1962] 2 Q.B. 26 , p66). This requires a consideration of “ all the relevant circumstances” ( Valilas v Januzaj [2014] EWCA Civ 436 at [60]).

125. The third way in which a breach can give the innocent party a right to terminate is where the wrongdoer has “ disabled himself from performing his contractual obligations in some essential respect”: Chitty § 28-052. There is an overlap between impossibility and anticipatory breach of contract, which arises:- “… when, before the time for performance, a party to the contract either renounces the contract or disables itself from performing its obligations under the contract.” (Chitty § 28-007) “Anticipatory breach of contract may be constituted by impossibility …” (Chitty § 28-076) Thus the law does not always require the innocent party to await actual breach. As to the relationship between the two principles, Chitty explains:- “In most cases where the impossibility created by one party has manifested itself by conduct, the innocent party will rely upon renunciation by conduct rather than impossibility, because renunciation is so much easier to establish. Renunciation is to be preferred because the innocent party need only show that the conduct of the party in default was such as to lead a reasonable man to believe that he did not intend, or was not able, to perform his promise; whereas if the innocent party relies upon impossibility he must show that the contract was in fact impossible of performance due to the other party’s default. Nevertheless the innocent party would be well advised to rely on both grounds for treating the contract as at an end, because: (1) renunciation may not, for some reason, be open to him; and (2) if he has misinterpreted the conduct of the other party and so terminated the contract for an inadequate reason he may still fall back on impossibility if it should subsequently appear that the other party was in fact incapable of performing his promise” (Chitty § 28-053, footnotes omitted)

126. The parties relied on several cases on the topic of impossibility or other forms of anticipatory breach, which I summarise below.

127. In Omnium D’Enterprises v Sutherland [1919] 1 KB 618 , the Court of Appeal held that the defendant shipowner had repudiated a charterparty by selling the relevant vessel and thereby putting it out of the defendant’s power to perform the charterparty. Bankes LJ said:- “The learned judge had to decide whether the sale of the steamer out and out was a repudiation by the defendant of the contract, and he held that it was. I agree with him. The defendant put it out of his power to perform his part of the contract, inasmuch as from the moment he sold the steamer he no longer had the power as of right to hand her over to the plaintiffs on completion of the period of requisition. [The defendant] now says that he feels sure that he will be able to get possession of her at the proper time. That however is very different from being able to say that the steamer is his and when the time comes he will give the plaintiffs possession of her. It is substituting a chance for a certainty.” (p.621)

128. Despite some of the phraseology of that reasoning, it is clearly not the law that a contract can be terminated on the ground that the counterparty has disabled itself from performing merely on the basis that the counterparty’s ability to perform is or has become uncertain or dependent on the actions of a third party who is not already contractually bound to act in a particular way. The test, set out in the caselaw up to and including House of Lords level, is one of impossibility. As Devlin J and Popplewell J later explained and illustrated in Universal Cargo Carriers Corporation v Citati and Geden (as to which see below), there are many examples of contracts whose performance depends on the actions of third parties or is uncertain for other reasons. The basis of the anticipatory breach doctrine, in both its forms, is that the innocent party need not wait for the inevitable actually to happen. The existence or creation of a situation of mere uncertainty is insufficient. It may therefore be that Omnium is better regarded as a case of repudiation by renunciation rather than impossibility.

129. In Universal Cargo Carriers Corporation v Citati [1957] 2 QB 401 shipowners had purported to cancel a charterparty, three days before the end of the agreed lay days, on the ground that the charterer had failed to nominate a shipper or berth or to provide a cargo. Devlin J, on an appeal from arbitrators, referred to Lord Porter’s statement in Heyman v Darwins Ltd [1942] AC 356 , 397 that:- “The three sets of circumstances giving rise to a discharge of contract are tabulated by Anson as: (1) renunciation by a party of his liabilities under it; (2) impossibility created by his own act; and (3) total or partial failure of performance. In the case of the first two, the renunciation may occur or impossibility be created either before or at the time for performance. In the case of the third, it can occur only at the time or during the course of performance." As to (1) and (2), Devlin J said:- “Of the two modes, renunciation has since the decision in Hochster v De La Tour established itself as the favourite. The disadvantage of the other is that the party who elects to treat impossibility as an anticipatory breach may be running a serious risk. Suppose, for example, that a man promises to marry a woman on a future date, or to execute a lease, or to deliver goods; and that before the day arrives he marries another, or executes the lease in favour of another, or delivers the goods to a third party. The aggrieved party may sue at once. ‘One reason alleged in support of such an action’, Campbell CJ observed in Hochster v De la Tour , ‘is, that the defendant has, before the day, rendered it impossible for him to perform the contract at the day: but this does not necessarily follow; for, prior to the day fixed for doing the act, the first wife may have died, a surrender of the lease executed might be obtained, and the defendant might have repurchased the goods so as to be in a situation to sell and deliver them to the plaintiff’. But if the plaintiff treats the defendant’s conduct as amounting to renunciation and justifies his rescission on that ground, the defendant could not avail himself of this defence. … The two forms of anticipatory breach [viz. unwillingness and inability to perform] have a common characteristic that is essential to the concept, namely, that the injured party is allowed to anticipate an inevitable breach. If a man renounces his right to perform and is held to his renunciation, the breach will be legally inevitable; if a man puts it out of his power to perform, the breach will be inevitable in fact - or practically inevitable, for the law never requires absolute certainty and does not take account of bare possibilities. So anticipatory breach means simply that a party is in breach from the moment that his actual breach becomes inevitable. Since the reason for the rule is that a party is allowed to anticipate an inevitable event and is not obliged to wait till it happens, it must follow that the breach which he anticipates is of just the same character as the breach which would actually have occurred if he had waited. … Anticipatory breach … covers all breaches that are bound to happen.” (p.438)

130. After rejecting the owners’ case on renunciation, Devlin J went on to consider whether the charterer was in fact able to perform, i.e. impossibility. He referred to British & Beningtons Ltd. v. N. W. Cachar Tea Co. Ltd . [1923] AC 48 , where Lord Sumner stated that, even absent a renunciation, a buyer could treat a contract as having come to an end “if … the sellers had become wholly and finally disabled from performing essential terms of the contract altogether” (p.71). Applying that test, Devlin J said at pp446-447:- “In my judgment, therefore, if the owner can establish that in the words of Lord Sumner the charterer had on July 18 "become wholly and finally disabled" from finding a cargo and loading it before delay frustrated the venture, he is entitled to succeed. Lord Sumner's words expressly refer to the time of breach as the date at which the inability must exist. But that does not mean, in my opinion, that the facts to be looked at in determining inability are only those which existed on July 18; the determination is to be made in the light of all the events - whether occurring before or after the critical date - put in evidence at the trial. ” Devlin J added at p.450 that an anticipatory breach must be proven in fact and not in supposition.

131. The Court of Appeal in Chilean Nitrate Sales Corporation v Marine Transportation Co Ltd and Pansuiza Compania de Navegacion SA (The “Hermosa”) [1982] 1 Lloyd’s Rep 570 (CA), a renunciation case, said at p.572rhc:- “We use the term “renunciatory” to indicate conduct which, whether or not it amounts to an actual breach of contract, foreshadows a breach which would have this potentially dissolutive character. An alternative term, sometimes used, is “anticipatory” since the effect is to allow the injured party to anticipate a breach and act upon it before it occurs. What he is permitted to anticipate is either impossibility of future performance created by the prior conduct of the party treated as a defaulter or a future failure to perform foreshadowed by a prior declaration, by words or conduct, of an intention not to perform in the future. In the case of future impossibility, the law does not require the injured party to await the inevitable. In the case of notice of a future refusal to perform, the law allows the injured party to take the other party at his word and, so doing, to treat the future breach of contract as inevitable.”

132. In Afovos Shipping v Pagnan [1983] 1 WLR 195 , Lord Diplock said, obiter , that “where a party to a contract, whether by failure to take timeous action or by any other default, has put it out of his power to perform a particular primary obligation, the right of the other party to elect to treat this as a repudiation of the contract by conduct depends upon whether the resulting non-performance would amount to a fundamental breach” (p.203H).

133. In Alfred C. Toepfer International GmbH v Itex Itagrani Export SA [1993] 1 Lloyd’s Rep. 360 , sub-buyers had agreed to purchase one full cargo of 22,000 tonnes, and had nominated a vessel to load the cargo, which nomination was passed on to the head sellers. The sub-buyers had also nominated the same vessel to carry another cargo of 6100 tonnes. Draught restrictions meant that the same vessel could not carry both cargoes. Arbitrators held the sub-buyers not to be in repudiatory breach. Saville J, after rejecting the seller’s case on renunciation, dealt with inability to perform as follows:- “As to liability to perform, the sellers first advanced the proposition that where one party makes a contract, but has or undertakes inconsistent obligations under another engagement with third party, he is to be treated in law as being unable to perform the contract. In my judgment this proposition does not represent English law. What must be established (apart from the other requirements of repudiation) is quite simple: namely that on the balance of probabilities the party in question cannot perform his obligations. The fact that that party has entered into inconsistent obligations does not in itself necessarily establish such inability, unless those obligations are of such nature or have such an effect that it can truly be said that the party in question has put it out of his power to perform his obligations. The case of Omnium v Sutherland , [1919] 1 K.B 618 is not an authority in favour of the sellers’ proposition. In that case a shipowner had sold the vessel and had thus indeed on the face of it put it out of his power to perform the charter that he had made. It was argued that this was not so, since the ex-owners might be able o get the new owners to agree to let them have the vessel back to perform the charter: but the Court of Appeal considered that this chance was not sufficient to displace the conclusion that in truth the owners simply did not have the means of performing their bargain, as they no longer had the right to the vessel they had agreed to charter. In the present case, however, the mere fact that the sub-buyers had contracted to load other goods on the vessel did not, in itself, establish that the buyers could not perform – at most that established that the buyers might not be able to perform. Unlike the case cited, it could not be said that the buyers had on the face of it or otherwise put it out of their power to perform. In the case cited there was only a chance that the owners might be able to perform – in the present case there was only a chance that the buyers would be unable to perform. At this stage in the argument the sellers advanced another proposition – namely that if a party to a contract vests the power to perform in another party) in case by using the sub-buyers’ nomination as their nomination) an unwillingness in the third party to perform amounts in law to an inability of the contracting party to perform. I do not see why this should be so. The question remains exactly the same – in circumstances and on the balance of probabilities is the party in question unable to perform? The mere fact that a third party is demonstrating an unwillingness to do something which the contracting party needs him to do to perform the contracting party’s obligations means at best that the contracting party may not be able to perform, not that on the balance of probabilities he cannot perform.” (p362)

134. Finally, in Geden Operations Ltd v Dry Bulk Handy Holdings Inc (The M/V “Bulk Uruguay”) [2014] 2 Lloyd’s Rep 66 , charterers wished to be able to transit the Gulf of Aden from time to time, an area with known piracy risks. On its true construction, the charterparty permitted charterers to do so without disponent owners’ consent, whereas head owners’ consent was required under the head charter. The disponent owners, following specific and limited consent from head owners, allowed charterers to transit the Gulf of Aden on her maiden voyage, but said that for future voyages their position would be dictated by the position taken by head owners. Popplewell J upheld arbitrators’ conclusion that that was not an anticipatory breach of the charterparty by disponent owners. Charterers argued that “Where one party puts it out of his power to perform his obligations, his self-created incapacity automatically evinces an intention not to be bound. A classic illustration of this principle is where one party makes his future performance solely dependent on the actions of an independent third party over whom he has no actual or legal power to compel performance” ([14]) Popplewell J rejected that argument for reasons which I consider worth setting out in some detail given their pertinence to the present case. After quoting at some length from Devlin J’s decision in Universal Cargo Carriers Corporation v Citati , Popplewell J continued as follows:- “17. Three points emerge which are important. First, the rationale for treating both renunciation and self-induced impossibility as entitling the innocent party to treat the contract as at an end prior to the time for performance is the inevitability of non-performance. Since the reason for the rule is that a party is allowed to anticipate an inevitable event and is not obliged to wait until it happens, anticipatory breaches are treated in the same way as actual breaches because they are bound to happen. In the case of self-induced impossibility, this means actual inevitability. In the case of renunciation, it means legal inevitability, in the sense that the innocent party is entitled to treat as inevitably going to happen that which the contract breaker clearly conveys by words or conduct that he intends will happen.

18. Secondly, self-induced impossibility is narrowly confined to those cases where breach is rendered inevitable. Save for possibilities which are so remote that in practice they can be ignored, what is required is inevitability. It is not sufficient if something is done which makes future performance unlikely, even very unlikely, still less that it renders performance uncertain. That is why renunciation is often a more favoured basis for invoking the doctrine of anticipatory breach.

19. Thirdly, the lease and marriage cases which Devlin J had in mind are best explained as examples of renunciation, not self-induced impossibility. The position is explained by the learned authors of Smith’s Leading Cases, 13th Edition, 1929, at pages 38 to 41, the last part of which was cited with approval by Devlin J in Citati at page 441: “In Short v Stone, 8 QB 358, it was held that if a man promises to marry a woman on a future day, and before that day marries another woman, he is instantly liable to an action; in Ford v Tiley, 6 B & C 325, and Lovelock v Franklyn, 8 QB 871, it was held that if a man contracts to grant a lease on and from a future day for a certain term, and before that day he grants a lease to another for the same term, he may be immediately sued; in Bowdell v Parsons, 10 East 359, it was held that if a man contracts to sell and deliver specific goods on a future day, and before that day he sells and delivers to another, he is immediately liable to the first purchaser. In each of the above cases it was not necessarily impossible for the defendant to perform the contract; for, prior to the day fixed, the first wife may have died, a surrender to the lease might have been obtained, and the defendant might have repurchased the goods; and in each case it seems better to say that the act of the defendant was tantamount to a refusal to perform his side of the contract which the plaintiff was entitled to accept as a breach in accordance with the principles above discussed; see Hochster v De la Tour, 2 E & B, at p 688, per Lord Campbell; Synge v Synge [1894] 1 QB 466 ; McIntyre v Belcher, 14 C B (N S) 654; Ogdens Ltd v Nelson [1905] AC 109 . … A party is deemed to have incapacitated himself from performing his side of the contract, not only when he deliberately puts it out of his power to perform the contract, but also when by his own act or default circumstances arise which render him unable to perform his side of the contract or some essential part thereof.”

20. Applying these principles I can see no warrant for what I see as the central plank in Mr Kimmins QC’s argument, which is that there is some principle of law whereby a party who has made his performance dependent on a discretion to be exercised by a third party is ipso facto deemed to be evincing an intention not to perform. Mr Kimmins QC confirmed that he was relying on renunciation, not self-created impossibility. The tribunal has found that the owners’ stance was not to be understood as being that they would be unable or unwilling to perform if and when charterers gave a voyage order requiring GOA transit. That was the majority’s finding of fact. Why, one asks, should the contrary be deemed as a matter of law? There is no authority to support such deeming, and it is contrary to established principle.

21. Where conduct renders future performance uncertain, the self-induced impossibility ground for putting an end to the contract does not arise. The innocent party must bring himself within the doctrine of renunciation. Conduct which renders future performance uncertain may in the circumstances of a particular case be such that a reasonable man would conclude that it evinced an intention not to perform when the time comes. This is the explanation for the lease and marriage cases. Whether the conduct evinces such an intention is a question of fact in each case. Much will depend upon the degree of uncertainty, the nature of the contingency, in whom the contingency is vested, and a host of other circumstances peculiar to each case. Words or conduct which give rise to the uncertainty of future performance, the contingency of which rests upon conduct of a third party, will not necessarily evince an intention not to be bound. If, for example, a person has a contractual obligation to be at a place at 09.00 on a particular day, and says that he only intends to fulfil his obligation if the early train is running as usual, he is making clear that his future performance is dependent upon a contingency which is in the hands of another. But he is not ipso facto evincing an intention not to perform his obligation, and the rationale for the anticipatory breach rule does not require some legal deeming that he is. On the contrary, it requires the other contracting party to wait to see whether there is a breach when the time for performance arises, a breach which before that time is not inevitable.

22. The principle is no different where the uncertainty arises out of a discretion which falls to be exercised by a third party from that which arises from any contingency, whether it be within or outside the immediate control of the contracting party. Contractual performance is commonly subject to a host of uncertainties and contingencies. When the time for performance arises there may be a breach which arises from an unwillingness or inability to perform driven by factors which rest on decisions of third parties, such as that of a seller’s supplier up the chain, or other independent contingencies, such as an absence of goods available in the market to a seller who has assumed that contractual risk. A party may lawfully assume an absolute obligation which he hopes to fulfil when the time for performance arrives. He is not in anticipatory breach by reason merely of there being an uncertainty whether his hopes will be fulfilled. A party who contracts to sell specific goods which he is negotiating to purchase is not in anticipatory breach because he has not yet concluded the negotiations with the supplier and secured the means of supply. He is no more in anticipatory breach if he has concluded his supply contract but it provides for performance by the supplier which is subject to contingencies. If the supply is subject to the supplier’s consent, which may or may not be forthcoming, that is but one example of where future performance is uncertain and depends upon a contingency outside the control of the contracting party. Similarly, a lessee who subleases a property from a future date in the hope and expectation that he will in the meantime obtain the landlord’s consent is not ipso facto in anticipatory breach the moment he enters into the sub-lease, notwithstanding that his ability to perform depends upon the consent of the landlord.” (2) Frustration

135. Although, as noted below, Khashoggi Holdings does not plead frustration (properly or at all), I include the following for completeness. The law was summarised by Bingham LJ in The Super Servant Two [1990] 1 Lloyd's Rep. 1 p8 in this way:- “The classical statement of the modern law is that of Lord Radcliffe in Davis Contractors Ltd. v. Fareham Urban District Council [1956] A.C. 696 at 729: “… frustration occurs whenever the law recognises that without default of either party a contractual obligation has become incapable of being performed because the circumstances in which performance is called for would render it a thing radically different from that which was undertaken by the contract. Non haec in foedera veni. It was not this that I promised to do.” As Lord Reid observed in the same case (at page 721): “… there is no need to consider what the parties thought or how they or reasonable men in their shoes would have dealt with the new situation if they had foreseen it. The question is whether the contract which they did make is, on its true construction, wide enough to apply to the new situation: if it is not, then it is at an end.” Certain propositions, established by the highest authority, are not open to question:

1. The doctrine of frustration was evolved to mitigate the rigour of the common law's insistence on literal performance of absolute promises …. The object of the doctrine was to give effect to the demands of justice, to achieve a just and reasonable result, to do what is reasonable and fair, as an expedient to escape from injustice where such would result from enforcement of a contract in its literal terms after a significant change in circumstances…

2. Since the effect of frustration is to kill the contract and discharge the parties from further liability under it, the doctrine is not to be lightly invoked, must be kept within very narrow limits and ought not to be extended...

3. Frustration brings the contract to an end forthwith, without more and automatically...

4. The essence of frustration is that it should not be due to the act or election of the party seeking to rely on it...

5. A frustrating event must take place without blame or fault on the side of the party seeking to rely on it …” (citations omitted) (3) Assessment of damages claims

136. On the topic of evidence of loss, the Defendants cite the so-called Armory principle, restated by Leggatt J in Yam Seng Pte Ltd v International Trade Corp Ltd [2013] EWHC 111 (QB):- “…On the one hand, the general rule that the burden lies on the claimant to prove its case applies to proof of loss just as it does to the other elements of the claimant's cause of action. But on the other hand, the attempt to estimate what benefit the claimant has lost as a result of the defendant's breach of contract or other wrong can sometimes involve considerable uncertainty; and courts will do the best they can not to allow difficulty of estimation to deprive the claimant of a remedy, particularly where that difficulty is itself the result of the defendant's wrongdoing. As Vaughan Williams LJ said in Chaplin v Hicks [1911] 2 KB 786 at 792: “the fact that damages cannot be assessed with certainty does not relieve the wrong-doer of the necessity of paying damages for his breach of contract.” Accordingly the court will attempt so far as it reasonably can to assess the claimant's loss even where precise calculation is impossible. The court is aided in this task by what may be called the principle of reasonable assumptions – namely, that it is fair to resolve uncertainties about what would have happened but for the defendant's wrongdoing by making reasonable assumptions which err if anything on the side of generosity to the claimant where it is the defendant's wrongdoing which has created those uncertainties.”

137. The Armory principle was later summarised and explained by Leggatt J in the later case Marathon Asset Management v Seddon [2017] EWHC 300 (Comm):- “163. The third argument advanced by Marathon was an argument based on uncertainty. The point was made that, when files containing confidential information are unlawfully copied, it may be extremely difficult or practically impossible to identify what subsequent use has been made of the information and what, if any, detriment to the claimant or benefit to the defendant has resulted. In these circumstances, it was argued, it is a just solution to require the defendant to pay a sum which represents the value of the information, assessed at the time when the breach of duty occurred on the assumption that the information would thereafter be exploited to whatever extent the defendant chose to do so – without requiring the claimant to prove what use was actually made of the information and what financial consequences actually ensued.

164. There are legal principles which may assist a claimant who has difficulty in proving loss. One such principle is that difficulty of estimation should not be allowed to deprive the claimant of a remedy, particularly where that difficulty is itself a result of the defendant's wrongdoing. Accordingly, the court will attempt as best it can to quantify the claimant's loss even where precise calculation is impossible. The court may do so by making reasonable assumptions about what the claimant's financial position would have been if the defendant had complied with its obligation to the claimant. A second principle is that, where the defendant has destroyed or wrongfully prevented or impeded the claimant from adducing relevant evidence, the court will make presumptions in favour of the claimant. The classic illustration of this principle is the old case of Armory v Delamirie (1722) 1 Strange 505; 93 ER 664, where a chimney sweeper's boy found a jewel and took it to the defendant's shop to find out what it was. The defendant did not return the jewel but only the empty socket, and was held liable to pay damages to the boy. Experts gave evidence about the value of the jewel which the socket could have accommodated. According to the case report: 'The Chief Justice directed the jury, that unless the defendant did produce the jewel, and show it not to be of the finest water, they should presume the strongest against him, and make the value of the best jewels the measure of their damages: which they accordingly did.'

165. These principles can help a claimant to overcome evidential difficulties in proving damages. There is a limit, however, to how far they can be taken. They may assist in resolving uncertainties where evidence is not reasonably available but they do not enable the court to conjure facts out of the air and they have little role to play where evidence could reasonably have been obtained, 3 or has in fact been adduced. 4 They may give the claimant a fair wind, but not a free ride. 5 ” [Fns.] 3 See e.g. Capita Alternative Fund Services (Guernsey) Ltd v Drivers Jonas [2012] EWCA Civ 1417 , paras 80, 122-3. 4 See e.g. Force India Formula One Team Ltd v Aerolab Srl [2013] EWCA Civ 780 ; [2013] RPC 36 , paras 92-93. 5 See Adam Kramer, The Law of Contract Damages (2014) at 470-1 . (4) Deceit

138. A claim in deceit based upon an allegedly fraudulent misrepresentation requires a claimant to show that a defendant (i) has made (or is otherwise responsible for) a materially false representation, (ii) knowing it to be untrue, or being reckless as to whether it is true, (iii) with the intention that the claimant should act in reliance on it. Where these matters are proven then, in so far as the claimant does so and suffers loss, the defendant is liable for that loss: Zurich Insurance Co v Hayward [2017] AC 142 at [18].

139. A statement of future intention will be a misrepresentation if the intention was not honestly held or the maker of the statement knew of facts that would make it impossible to fulfil the intention: see Inter Export LLC v Townley [2018] EWCA Civ 2068 at [34] and Chitty on Contracts §§ 10-17 to 10-18. Where such a misrepresentation is made, it can be inferred is that it was made fraudulently or recklessly, as the representor can be assumed to have known his or her own mind ( Abbar v Saudi Economic & Development Co [2013] EWHC 1411 (Ch) at [197]).

140. The burden of proving that there is a sufficient statement for the purposes of a claim in deceit lies on the claimant: Kyle Bay Ltd t/a Astons Nightclub v Underwriters Subscribing Under Policy No 019057/08/01 [2007] 1 CLC 164 at [32]. It is not for the representor to show why a statement should not be an actionable misrepresentation and, where there is room for an exercise of judgment, a misrepresentation should not be too easily found: in SK Shipping Europe Ltd v Capital VLCC 3 Corp [2022] EWCA Civ 231 ; [2022] l CLC 552 at [38]. As Carnwath LJ put it in Jafari-Fini v Skillglass Ltd [2007] EWCA Civ 261 at [40]: ... in civil proceedings, the “presumption of innocence” is not so much a legal rule, as a common sense guide to the assessment of evidence. It is relevant not only where the cause of action requires proof of dishonesty, but, wherever the court is faced with a choice between two rival explanations of any particular incident, one innocent and the other not, unless it is dealing with known fraudsters, the court should start from a strong presumption that the innocent explanation is more likely to be correct.

141. Further, see Cassa di Risparmio della Repubblica di San Marino SpA v Barclays Bank Ltd [2011] 1 CLC 701, per Hamblen J at [229]:- Where a serious allegation (such as deceit) is in issue, this does not mean the standard of proof is higher. However, the inherent probability or improbability of an event is itself a matter to be taken into account when weighing the probabilities and deciding whether, on balance, the event occurred. The more improbable the event, the stronger must be the evidence that it did occur before, on the balance of probability, its occurrence will be established – The Kriti Palm, supra, para 259, quoting Lord Nicholls in re H (Minors) [1996] AC 563 , 586.

142. See further Calver J’s judgment in ED&F Man Capital Markets Ltd v Come Harvest Holdings Ltd [2022] EWHC 229 (Comm) at 70: “ The cogency of the evidence relied on must be commensurate with the seriousness of the allegation ”, and at [71]: "i) It is not open to the Court to infer dishonesty from facts which are consistent with honesty or negligence, there must be some fact which tilts the balance and justifies an inference of dishonesty, and this fact must be both pleaded and proved: Three Rivers District Council v Bank of England [2001] UKHL 16 ; [2003] 2 A.C. 1 , §§55-56 per Lord Hope and §§184-186 per Lord Millett. ii) The requirement for a claimant in proving fraud is that the primary facts proved give rise to an inference of dishonesty or fraud which is more probable than one of innocence or negligence: JSC Bank of Moscow v Kekhman [2015] EWHC 3073 (Comm) at §20 per Bryan J; Surkis & Ors v Poroshenko & Anr [2021] EWHC 2512 (Comm) at §169(iv) per Calver J."

143. In Bank St Petersburg PJSC v Arkhangelsky at para [46], Sir Geoffrey Vos C cited with approval para [1438] of [2020] 4 WLR 55 Fiona Trust & Holding Corp v Privalov [2010] EWHC 3199 (Comm):- “[it] is well established that ‘cogent evidence is required to justify a finding of fraud or other discreditable conduct’: per Moore-Bick LJ in Jafari-Fini v Skillglass Ltd [2007] EWCA Civ 261 at [73]. This principle reflects the court's conventional perception that it is generally not likely that people will engage in such conduct: ‘where a claimant seeks to prove a case of dishonesty, its inherent improbability means that, even on the civil burden of proof, the evidence needed to prove it must be all the stronger’, per Rix LJ in Markel International Insurance Company Ltd v Higgins [2009] EWCA Civ 790 at [50]. The question remains one of the balance of probability, although typically, as Ungoed-Thomas J put it in In re Dellow's Will Trusts [1964] 1 WLR 451 , 455 (cited by Lord Nicholls in In re H [1996] AC 563 , 586H), ‘The more serious the allegation the more cogent the evidence required to overcome the unlikelihood of what is alleged and thus to prove it’. Associated with the seriousness of the allegation is the seriousness of the consequences, or potential consequences, of the proof of the allegation because of the improbability that a person will risk such consequences: see R (N) v Mental Health Review Tribunal (Northern Region) [2005] EWCA Civ 1605 ; [2006] QB 468 , para 62, cited in In re D (Secretary of State for Northern Ireland intervening), [2008] UKHL 33 ; [2008] 1 WLR 1499 , para 27, per Lord Carswell.” In paragraph [117] of Arkhangelsky , Males LJ said “In general it is legitimate and conventional, and a fair starting point, that fraud and dishonesty are inherently improbable, such that cogent evidence is required for their proof. But that is because, other things being equal, people do not usually act dishonestly, and it can be no more than a starting point. Ultimately, the only question is whether it has been proved that the occurrence of the fact in issue, in this case dishonesty in the realisation of the assets, was more probable than not.”

144. See further G.I. Globinvestment Ltd & Ors v XY ERS UK Limited & Ors [2025] EWHC 740 (Comm) paragraph 969ff for a very recent judicial summary of the law on deceit, including the following:-

994. A representee must show that he in fact understood the statement in the sense (so far as material) which the court ascribes to it, and that, having that understanding, he relied on it: Raiffeisen Zentralbank Osterreich v Royal Bank of Scotland [2010] EWHC 1392 (Comm) at para [87] . This requirement is of particular significance in the case of implied representations.

995. In BV Nederlandse Industrie Van Eiprodukten v Rembrandt Enterprises [2019] EWCA Civ 596 at para [43] ("BV Nederlandse") , the court held that, in a case of deceit: "there is an evidential presumption of fact (not law) that a representee will have been induced by a fraudulent misrepresentation intended to cause him to enter the contract and that the inference will be "very difficult to rebut" to use the words of Lord Clarke."

996. While the onus of proof is on the representee to prove inducement, he has the benefit of that evidential presumption, and he only needs to show that the misrepresentation was "actively present in his mind" when he made the decision to enter into the transaction (BV Nederlandse at para [45]). The phrase "actively present in his mind" is taken from the judgment of Bowen LJ in Edgington v Fitzmaurice (1885) 29 Ch D 459 , 483 where he explained the principle as follows: "But such misstatement was material if it was actively present to his mind when he decided to advance his money. The real question is, what was the state of the Plaintiff's mind, and if his mind was disturbed by the misstatement of the Defendants, and such disturbance was in part the cause of what he did, the mere fact of his also making a mistake himself could make no difference".

997. It is sufficient for the misrepresentation to be an inducing cause of the claimant entering into the transaction on the terms that he did. It is not necessary for it to be the sole cause (Hayward v Zurich [2016] UKSC 48 at para [33] ("Hayward"). (G) ALLEGED REPUDIATORY BREACH BY DEFENDANT

145. Khashoggi Holdings’ pleaded case is, first, that:- “16. By use of the words “full title guarantee”, and by sections 1 -3 Law of Property (Miscellaneous Provisions) Act 1994 , it was an express term of the SPA that: 16.1. Ds had the right to dispose of the Sale Shares as they purported to do; and 16.2. Ds were disposing of the Sale Shares free from all charges and incumbrances, and all other rights exercisable by third parties (other than any charges, incumbrances or rights which Ds did not know about and could not reasonably be expected to know about).”

146. Khashoggi Holdings also relies on the warranty in Schedule 4 § 1.1 that, except as disclosed in the Data Room, the Defendants had all requisite power and authority to enter into, deliver and perform the SPA; and the warranty in § 2.6 that there was no Encumbrance affecting the Sale Shares. The Data Room did not contain the ARIA or the Share Charge, though the new Articles and the transfer of shares from Finnat to Mr Maurizio Molinari (and its registration by Meta) were available at Companies House.

147. Khashoggi Holdings then alleges repudiatory breach/impossibility of performance as follows:- “20. En-It had not given its prior written consent to Ds to enter into the SPA, or any agreement to sell shares to C. Further, En-It had not given its prior written consent to D5 to transfer 5,498 B Ordinary Shares to D1. Therefore: 20.1. By clause 7.2 of the Share Charge, and by clause 6.1 of the ARIA, D5 was obliged not to transfer, or to agree to transfer, its shares to C. 20.2. By Article 40.1 of the New Articles, no B Ordinary Shares were able to be transferred to C. 20.3. By Article 40.1 of the New Articles, the transfer to D1 was null and void, and any transfer to C made in accordance with the SPA would have been null and void and could not have been recognised by Meta. 20.4. By clause 6.1 and 6.10.1 of the ARIA, and by Article 40.1 of the New Articles, Meta was obliged not to register any transfer of shares to D1 or any transfer of the Sale Shares to C. 20.5. By clause 6.10.2 of the ARIA, and by Article 40.1 of the New Articles, any shares transferred under the SPA would have conferred no rights on C, and the purported prior transfer to D1 likewise conferred no rights. 20.6. By clause 12.1 of the ARIA, En-It has an option (subject to notification and a 30 day remedy period) to acquire all of D5’s shares at 70% of their Called Market Value as defined. 20.7. By clause 3.1 of the Share Charge, the Sale Shares remained charged in favour of the Security Agent.

21. As a result of the matters set out in paragraphs 20.1 to 20.7 above, Ds were in breach of the SPA: PARTICULARS OF BREACH 21.1. In repudiatory breach of the express term of the SPA set out in paragraph 16.1 above, Ds did not have the right to dispose of the Sale Shares as they purported to do, including (without limitation) because Article 40.1 of Meta’s New Articles provided that a transfer of Ds’ shares would be “null and void” and would not be recognised by Meta, and such shares would be disenfranchised. 21.2. In repudiatory breach of the express term of the SPA set out in paragraph 16.2 above, Ds were not disposing of the Sale Shares free from all charges and incumbrances, and all other rights exercisable by third parties (other than any charges, incumbrances or rights which they did not know about and could not reasonably be expected to know about). 21.3. In repudiatory breach of the express term of the SPA set out in paragraph 17 above [warranty § 1.1], Ds did not have all requisite power and authority to enter into, deliver and perform the SPA, and this matter was not disclosed in the Data Room as defined. 21.4. In repudiatory breach of the express term of the SPA set out in paragraph 18 above [warranty § 2.6], there were Encumbrances (as defined) affecting the Sale Shares. The restrictions on sales, and the rights of En-It, set out in paragraphs 9-11 above [clauses 2.1, 3.1 and 7.2 of the Share Charge, clauses 3, 6.1, 6.10 and 12.1 of the ARIA and Article 40.1] affected the Sale Shares because the prior written consent of En-It or the Security Agent had not been obtained, as set out above. This matter was not disclosed in the Data Room as defined. 21.5. Further and in any event, by failing to obtain the prior written consent of En-It and the Security Agent for Ds to enter into or perform the SPA (or any agreement to sell shares to C), Ds (by their own act or default) made it impossible for themselves to perform their obligations under clause 2.1 of the SPA and/or were in repudiatory breach thereof. Paragraphs 20.1 to 20.7 are repeated. 21.6. Further, by failing to obtain the prior written consent of En-It and the Security Agent for D5 to transfer 5,498 B Ordinary Shares to D1, Ds (by their own act or default) made it impossible for themselves to perform their obligations in respect of D1’s shares under clause 2.1 of the SPA and/or were in repudiatory breach thereof. Paragraphs 20.1 to 20.7 are repeated.

22. Each of the matters set out in paragraph 21 above, individually or combined, entitled C to treat itself as discharged from its obligations under the SPA, because: 22.1. Each of the terms pleaded in paragraphs 16.1, 16.2, 17 and 18 above was a condition. The nature of the contract and/or its subject matter and/or all the circumstances of the case lead to the conclusion that the parties must, by necessary implication, have intended that C would be discharged from further performance of its obligations in the event that such terms was not fully and precisely complied with. A purchaser committing over €300,000,000 could not reasonably be obliged to complete the purchase of shares which the sellers did not have the power to sell, or which were subject to encumbrances. 22.2. Alternatively, each of the terms pleaded in paragraphs 16.1, 16.2, 17 and 18 above was an innominate term. The breaches of those terms as set out above went to the root of the SPA, and deprived C of the whole or substantially the whole benefit of the SPA.”

148. Khashoggi Holdings pleads that Mishcon de Reya’s letter of 7 April 2021 gave notice that the matters pleaded constituted fundamental and repudiatory breaches “and frustration by breach” , though its Particulars of Claim do not in fact include an allegation that the SPA was frustrated.

149. Khashoggi Holdings submits that the “ insuperable impediment ” was the OakHill Exit Fee, the amount of which was unknown. At completion, it would be possible to discharge the OakHill Redemption Amount because it was known. If that had been En-It’s only interest, such could have been satisfied in the usual way at completion and En-It presumably would not have stood in the way of the deal: it would likely have provided any necessary consents (although such were not referred to in the SPA). However, there remained the OakHill Exit Fee which was likewise to be met from the proceeds of sale of the Sale Shares (clause 3.6 of the SPA). The trouble was that this (being unknown) could not be satisfied at completion, and would therefore have to be satisfied some time subsequently, if and when known. That meant that En-It would not give its prior written consent at completion – with the result that the Finnat Sale Shares could not be sold and would be disenfranchised, and subject to the Call Option, and any transfer of them would be null and void and they could not be registered in the name of the Buyer. Mr Norris confirmed that En-It had not given its consent, and there was still no indication as to if and when consent might be given, even four months after the date of the SPA when Mishcon wrote its letter of 7 April 2021. Equally, no consent had been given by OakHill to the transfer of the MM Shares.

150. As to its entitlement to treat the SPA as having been brought to an end, Khashoggi Holdings submits as follows:- i) The terms implied by the words “ full title guarantee ” are conditions. This is because the words are positioned immediately next to the subject matter of the contract, in clause 2.1, in the most important operative clause of the SPA. The parties evidently intended the “ full title guarantee ” to be of foundational importance to the purchased shares. Nothing else would suffice. No other form of performance was possible. The sale and successful transfer of unencumbered shares was fundamental. ii) The warranties in Schedule 4 §§ 1.1 and 2.6 were also conditions. Khashoggi Holdings was committing over €300,000,000 to the purchase of the Sale Shares. It could not reasonably be taken to have agreed to the purchase of shares which the Sellers did not have the power to sell, and which could not be transferred, or which were subject to encumbrances. iii) Alternatively, the provisions mentioned above were innominate terms, which were breached in a sufficiently serious way to entitle KHC to terminate the contract. They were so significant that they deprived KHC of substantially the whole benefit of the SPA. KHC agreed to purchase shares, but they remained subject to very significant encumbrances and third party rights. Unless and until the En-It (OakHill) bond was redeemed and its security released, the shares were subject to the Share Charge and other security rights. Unless and until En-It was paid enough money to satisfy the equity kicker, or agreed to alternative security, the B Ordinary shares purchased by KHC would be subject to En-It’s rights under Article 40.1, rendering transfer impossible. En-It had not agreed to the release of this security, and the Defendants had not obtained En-It’s prior written consent to the transaction, or to the prior transfer by it of shares which then constituted the MM Sale Shares. KHC should never have been in a position of such risk. iv) By way of further alternative, the Defendants’ failure to obtain En-It’s prior written consent made it impossible for themselves to sell the shares unencumbered. v) Finally, En-It’s failure to provide its written consent to the SPA was a change in circumstance rendering the SPA radically different: the Defendants were no longer able to perform it in the way the parties had intended. They were unable to transfer the shares, and if they purported to do so, such shares would be encumbered, disenfranchised and could not be registered. KHC never intended to buy such shares. The SPA was therefore frustrated.

151. I am unable to accept those submissions. The fundamental problem with Khashoggi Holdings’ case on this issue is that the language of the SPA, reflecting the commercial imperative, was for the buyer to obtain full title to the shares on completion . SPA clause 2.1 said so in clear terms:- “the Sellers shall sell and the Buyer shall buy …, with effect from Completion , the Sale Shares with full title guarantee” (my emphasis)

152. It is true that the SPA defined the Completion Date as “the date of this agreement, or such other date as may be agreed in writing between the parties” . However, in assessing alleged breach, what matters is when completion in fact occurred or was intended to occur. It is clear from the chronology summarised above that the parties actually envisaged completion occurring some time after the date of the SPA. Moreover, by the written communications mentioned in §§ 76, 110 and 111 above, as well as the numerous communications from Khashoggi Holdings about payment referred to in §§ 58, 61, 64, 67, 68, 72, 80-87, 91-93 and 95-100 above, all of which clearly envisaged completion on a future date, the parties implicitly agreed in writing that completion was to occur at some future date. Completion would involve the various steps set out in clause 5.2 of the SPA taking place: a stage which had not yet been reached by the time of Khashoggi Holdings’ purported termination of the agreement. Accordingly, although the Initial Payment was in principle due on the date of execution of the SPA, that was not the date of Completion.

153. Accordingly, I do not consider that SPA clause 2.1 made it a condition of the contract that OakHill’s consent to the transfer of either the Finnat Shares or the MM Shares be provided at any date prior to actual completion. Indeed, it is notable that Mishcon de Reya’s list of principal issues circulated on 5 April 2021 clearly recognised that it was on or by a future date, “simultaneously with completion” , that the OakHill security would need to be released (see § 110 above). The concern was a prospective one, as reflected in the second paragraph of that entry, noting that the discussions with OakHill about payment of its “ Exit proceeds ” had not yet been finalised.

154. I also reject the suggestion that the warranties in Schedule 4 §§ 1.1 and 2.6 were, in fact, conditions. First, they were expressed to be warranties, a term which in general legal usage stands in contrast to conditions (and it is be expected that that applied to all the warranties, which are collectively given effect by clause 8 of the SPA). Secondly, on the assumption that these warranties related to the position as the time of signature of the SPA, the nature of the contract, its subject-matter and the circumstances do not lead to the conclusion that the parties must have intended that the buyer be discharged if the warranties were not complied with. As SPA clause 2.1 indicates, it was full title at completion that mattered. Provided that could be delivered, there was no reason to release the buyer from its obligations. In that sense, the SPA was no different from a commonplace property transaction, where good title to the land conveyed cannot, and does not need to be, given at the date of the contract but only on completion, typically because there is a chain or contracts (or, perhaps, a tenancy or other incumbrance that needs to be removed before completion can occur).

155. A further objection to any such warranty claim is that the facts or circumstances giving rise to the claim were capable of remedy, and Khashoggi Holdings failed to give 90 days’ notice to remedy them as required by SPA Schedule 5 § 14. Khashoggi Holdings submits that its claim for a declaration that the SPA has been terminated is not a ‘Claim’ as defined in the SPA, i.e. “ a claim under this agreement (including, for breach of any of the Warranties and/or any Indemnity Claim). ” However, insofar as Khashoggi Holdings founds its claim on a breach of warranty, it is a ‘Claim’ as so defined. Khashoggi Holdings also submits that the failure to give prior written consent was, by its nature and its consequences, irremediable once the SPA had been entered into, and the risk to which KHC was exposed (with the purchase shares disenfranchised and encumbered) was so great as to be incapable of remedy. I disagree. Any breach of warranties 1.1 and 2.6 could be remedied by obtaining OakHill’s consent (and any necessary re-transfers of the MM Shares) before completion. Khashoggi Holdings was not exposed to any risk of completing a purchase of disenfranchised and encumbered shares, because it had no obligation to do so. In these circumstances, I find it unnecessary to decide whether or not the exchange of emails quoted in § 42 amounted to written consent by OakHill, though the exchange gives every reason to believe that OakHill would have had no problem with it at all.

156. Equally, on the footing that the provisions relied on were innominate terms, they were either not breached, or were not breached in a sufficiently serious way to entitle Khashoggi Holdings to terminate the contract. It was open to the Defendants to procure OakHill’s agreement to the transaction by the time of completion, and the sale could then proceed. There were active discussions going on in that regard, and a series of emails and meetings, before and after the date of the SPA, making abundantly clear that OakHill wished the sale to proceed: see §§ 40, 42, 65, 66, 103, 105 and 112 above. (Equally, there was never any reason to believe OakHill would exercise its call option, and indeed it never did so, even after Khashoggi Holdings’ purported termination of the SPA.) No doubt the process was taking some time, but Khashoggi Holdings did not at any stage serve anything resembling a notice making time of the essence, possibly because (as the narrative set out earlier makes clear) Khashoggi Holdings was having trouble raising the currency required to buy the shares. Mr Khashoggi was never ‘at risk’ in the way it now suggests, because it would have been entitled to decline to complete until full and unencumbered title to all the Sale Shares could be provided. (The fact that the Defendants were in fact pressing for the Initial Payment is beside the point: it is the contractual position that matters.)

157. For essentially the same reasons, the Defendants had not disabled themselves from performing the SPA, and performance had not become impossible. There was every reason to believe that OakHill’s consents could be obtained (as, indeed, presumably happened in due course when the Defendant sold the shares instead to IKOPUS).

158. Khashoggi Holdings points out that Mr Berman was told that OakHill was yet to have discussions to resolve what it was owed, which were the necessary precursor to its consent being forthcoming. Grande Stevens’ response to the Mishcon de Reya termination letter was not to engage with the problems which were apparent but to assert (wrongly) that they did not exist. This was shortly followed by Grande Stevens’ own termination letter. Khashoggi Holdings says impossibility was thus inevitable.

159. However, the fact that the transaction ground to a halt after Khashoggi Holdings had purported to terminate it tells one nothing about whether or not the Defendants had, in point of fact, disabled themselves from performing it. (As already noted, the Defendants were in fact able to square OakHill’s position when, a few weeks later, they sold the shares to IKOPUS instead.) As at the date of Mishcon de Reya’s letter of 7 April 2021, it remained perfectly possible for the SPA to be performed. The third party on whom ability to perform it depend, OakHill, had made abundantly clear that it wanted the transaction to proceed. The situation was in line with examples considered by Popplewell J in Geden at § 22. Failure to perform was not inevitable: far from it. Khashoggi Holdings’ impossibility contention is in my view wholly without merit.

160. Finally, even had a case of frustration been pleaded, I would have rejected it. There was no change of circumstances making performance of the SPA radically different from that which the parties had reasonable envisaged. The Defendants remained obliged to provide good title on completion, that was something which remained possible, and Khashoggi Holdings remained liable to complete the transaction provided it obtained good title to the shares.

161. For all these reasons, I reject Khashoggi Holdings’ case that it was entitled to bring the contract to an end on 7 April 2021, as it purported to do, on the ground of repudiatory breach by the Defendants. (H) COUNTERCLAIMS (1) Repudiatory breach of SPA by Claimant (a) The claim advanced and witness evidence in support

162. The Defendants plead that Mishcon de Reya’s letter of 7 April 2021 amounted to a renunciation by the Claimant of the SPA “(and hence a repudiatory breach)” (Defence § 66.4), and that by Grande Stevens’ letter of 15 April 2021 the Defendants “notified the Claimant that they were exercising their rights to terminate the SPA under Clause 5.3 and at common law by acceptance of the Claimant’s repudiatory breach” (Defence § 66.5).

163. Although their Counterclaim is not pleaded with the highest level of precision in this regard, the Defendants go on to repeat their Defence, hence including the above pleas, as part of their Counterclaim (Counterclaim § 69) and then to claim damages for Khashoggi Holdings’ “breaches of the SPA” (Counterclaim §§ 89-91 and 122).

164. The Claimant in its Reply took issue with Defence §§ 66.4 and 66.5 only to the extent of denying them for the reasons pleaded elsewhere (i.e., on the basis that Khashoggi Holdings was entitled to treat the SPA as having come to an end due to repudiatory breach by the Defendants). At trial, counsel for the Claimant did not seek to dispute the allegation that if Mishcon de Reya’s letter did amount to a renunciation, then the Defendants were entitled to, and did, accept it at common law by Grande Stevens’ letter of 8 April 2021; nor that, in that event, the Defendants could claim damages for any resulting loss.

165. In my view, Mishcon de Reya’s letter of 7 April 2021 plainly amounted to a renunciation of the SPA by Khashoggi Holdings. It purported to terminate the SPA on the ground of breach by the Defendants and/or frustration, neither of which have been established, and then proposed a renegotiation to find “a satisfactory commercial outcome”, also described as “a commercial solution which is acceptable to everyone” , which would require “a wholly constructive approach and hard work on all sides”. It indicated that such an outcome would include, but was not said to be limited to, resolution of the matter which the letter had amounted to breach or which had led to its frustration. It is plain from the letter that Khashoggi Holdings was not merely pressing the Defendants to perform the SPA: it was purporting to terminate the SPA and proposing discussions leading to a different deal. It evinced a clear intention on Khashoggi Holdings’ part not to perform the SPA.

166. On that basis, the Defendants are in principle entitled to recover damages for any proven loss flowing from the Claimant’s renunciation of the SPA.

167. It should be noted that, although the Counterclaim seemingly advances counterclaims on behalf of the Defendants and Meta (as Additional Counterclaimant compendiously), the breach of contract claims can be advanced only by the Defendants. Meta was not a party to the SPA and has no claim for breach of it (repudiatory or otherwise).

168. The Defendants seek damages for breach of contract by reference to the difference between the position they would have been in had the SPA been performed, and the position they were in as a result of their attempts to mitigate the loss, resulting in the IKOPUS transaction summarised below (Counterclaim § 122).

169. The Defendants plead that, following the termination of the SPA, they urgently needed alternative financing in order to redeem the OakHill bonds, complete the Capacity Financing, fund the project, comply with Meta’s obligations in respect of the capacity auctions and benefit from the ‘guaranteed’ payments under the capacity auctions. In order to mitigate their losses, they entered into negotiations with a prospective new buyer, IKOPUS S.à r.l., for the sale of a majority shareholding in Meta and/or MEP. IKOPUS was a Luxembourg limited company and a wholly-owned subsidiary of the IKAV group, an international asset management business which invested in energy infrastructure assets.

170. On 21 June 2021, following several further weeks of negotiations, the Defendants entered into an investment agreement (the “ IKOPUS Investment Agreement ”) with IKOPUS, pursuant to which IKOPUS agreed to purchase 80% of the issued share capital of MEP (the “ IKOPUS Acquisition ”).

171. As part of the IKOPUS Acquisition, pursuant to the IKOPUS Investment Agreement:- i) Meta and the Defendants agreed to sell 80% of the issued share capital of MEP to IKOPUS, for a consideration of €9,846,073.20 (paid to Meta, which the Defendants retained under this transaction); ii) MEP (as borrower) entered into a Shareholders Loan Agreement with IKOPUS (as lender) to borrow up to circa €200,000,000 (the “ Shareholder Loan Facility ”). MEP would, in turn, advance to Meta a portion of the funds received in connection with such Shareholder Loan Facility; iii) Meta partially redeemed the OakHill bonds in the sum of €44,523,750. IKOPUS agreed to purchase the remaining portion of the bonds for a total deferred consideration of €15,000,000; and iv) IKOPUS agreed to pay a total of €18,000,000 to En-It to purchase the A ordinary shares in Meta.

172. Simultaneously with the IKOPUS Acquisition, MEP entered into the Capacity Financing with MEAG in the amount of circa €300,000,000 in order to enable MEP to fund the development of the Awarded Capacity Sites (i.e. the energy production sites owned by Meta subsidiaries who had been awarded capacity payments in a Capacity Auction). Following the completion of the IKOPUS Acquisition and the Capacity Financing with MEAG, the Defendants and Meta say they have endeavoured successfully to complete the Project in accordance with its obligations pursuant to the capacity auctions.

173. The Defendants’ Particulars of Loss, in their Counterclaim, start with this introductory paragraph: “The present attempts of the Defendants and Meta to ascertain and quantify all their respective losses remain provisional. They have sought to quantify their losses below and they reserve the right to add to and/or amend their losses in due course (including on the basis of expert evidence).” No expert evidence has in fact been served.

174. The Counterclaim particularises the alleged breach of contract losses as follows:- “122. But for the Claimant’s breaches of the SPA: 122.1 The Defendants would not have lost the difference in value between the Sale Shares under the SPA and the proportion of MEP sold under the IKOPUS Acquisition. The Defendants’ loss is presently estimated at €168,000,000. 122.2 The Defendants would not have lost the difference between the value of the 25% of the issued share capital in Meta, which was to be retained pursuant to the SPA, and the 20% of the issued share capital of its operating subsidiary MEP which was to be retained pursuant to the IKOPUS Acquisition. The Defendants’ loss is presently estimated at €57,000,000. 122.3 The Cassino plant owned by MEP was excluded from the SPA. The Defendants had previously received an offer solely for the acquisition of the Cassino plant for a consideration of €50,000,000. Following the breach of the SPA by the Claimant, the Defendants had no other choice but to include the Cassino plant as part of the IKOPUS Acquisition at a value which is significantly lower than the consideration offered by other potential buyers. The Defendants’ losses are presently estimated at €25,000,000. 122.4 Meta would not have incurred additional interest in respect of the late redemption of the Bond, or incurred additional costs and penalties pursuant to the supply contracts entered into for delivery of the Project. As a result, the Defendants would not have suffered a loss of profit and/or diminution in value. The Defendants’ losses in this regard are presently estimated at €3,260,712 and €12,500,000, respectively. 122.5 The Project would not have suffered delays, but rather would have been completed on time, with the result that MEP would have been to supply electricity as it was required to do. As a result, the Defendants would not have lost the profits that they would have earned. The Defendants’ losses in this regard are presently estimated at €4,600,000. 122.6 The Defendants would not have incurred wasted costs corresponding with the Claimant and Mr Khashoggi regarding payment of the Initial Payment and Completion of the sale and purchase of the Sale Shares, or in negotiating the Investment Agreement and ancillary documentation with IKOPUS and other project partners. The Defendants are currently quantifying such wasted costs, which will be set out in due course. 122.7 Accordingly, under this head, the Defendants’ total loss is estimated at circa €270,700,000.”

175. The Claimant in its Defence to Counterclaim, in addition to denying liability, denies that the IKOPUS transaction amounted to reasonable mitigation of loss, saying: “94.1. Even if (which is not admitted) it is possible to compare the SPA with the IKOPUS Acquisition, the reduction in price relied on by the Defendants is patently unreasonable. According to the D&CC, the MEAG Capacity Financing was successfully completed, the En-It Bond was part-redeemed and part-purchased, and the Project successfully completed (with, according to subparagraph 120.2.3-4, only about €20m of loss attributable to delays). The sale of 80% of MEP for €10,000,000 is clearly and obviously unreasonable, and was objectively unreasonable when it was agreed. 94.2. Moreover, as the Defendants and Meta well knew, the Claimant was willing and able to negotiate, in an attempt to find a solution that would enable the Claimant to purchase the Sale Shares. Paragraph 78.28-78.30 above are repeated. The Defendants’ decision not to negotiate with the Claimant was an unreasonable failure to mitigate and an independent cause of the loss alleged in the Counterclaim.” A number of other defences are also advanced.

176. As noted above, no valuation or other expert evidence has been served in support of the Counterclaim. The only witness evidence comes from Mr Privitera. I set it out in full below:- “63. In the weeks that followed, Metaenergia urgently sought new strategic investors. The pressures of the project were immense and Metaenergia was in default of the OHA Bond which was due to be paid on 31 December 2020. This resulted in negotiations with IKOPUS S.a.r.l., culminating in an Investment Agreement signed on 21 June 2021.

64. Under that agreement, IKOPUS purchased 80% of MEP for approximately €10,000,000.00, with a 49% stake transferred immediately and the remaining 31% after Golden Power clearance. The Golden Power rule applies to certain sectors deemed strategic and of national interest. Under this regime, the Italian Government has the authority to block the sale of companies. Before proceeding with the sale, we were required to notify the Government, and the transaction had to be formally approved. Approval for the transaction was received and the transaction proceeded.

65. IKOPUS granted MEP a shareholder loan facility of €200,000,000.00, part of which was up streamed to Metaenergia and Metaenergia repaid part of the OHA bond (approximately €44,500,000.00) and IKOPUS acquired the balance for €15,000,000.00.

66. IKOPUS also acquired the A ordinary shares from OHA for €18,000,000.00.

67. Simultaneously, MEP was able to close the approximately €300,000,000.00 Capacity Financing with MEAG, finally securing the funding needed to proceed with the Awarded Capacity Sites.

68. It should be noted that this amount did not reflect the real market value of MEP at the time. On the contrary, it represented a deeply discounted figure that we were forced to accept due to our desperate need for liquidity. This included the sale of the Cassino Plant which we would have retained under the SPA. A direct consequence of KHC’s non-performance and the collapse of the previous transaction.

69. This transaction with IKOPUS also demonstrated how the sale of Metaenergia could and should have been completed under normal conditions, without obstruction. The structure of the deal was that IKOPUS paid the relevant amounts (regardless of the OHA charge), and the funds received from IKOPUS were then used by Metaenergia to partially repay the OHA Bond. Thereby allowing for the release of the charge. In other words, IKOPUS proceeded with the payment despite the existing charge in favour of OHA, which was subsequently discharged following OHA’s receipt of payment. It serves as further evidence that the alleged breaches invoked by KHC were wholly unfounded and clearly pretextual.

70. The losses we suffered were substantial. We had offers of €243,000,000.00 from MET Holding AG prior to the SPA. This includes a purchase price of €60,000,000.00 for the Cassino 2 Plant. The IKOPUS Agreement sets out the sums we received. It is clear the amounts were significantly less than the highest bid prior to entering the SPA.

71. Under the terms of the SPA, we were due to receive the initial payment of €215,200,000.00 and an additional conditional payment of €88,550,000.00. In total we should have received €303,750,000.00. Again, what we received under the IKOPUS agreement was considerably less. We also had the loss of the Cassino 2 Plant and had to sell an additional 5% of the shareholding. Based on the valuations calculated by reference to the 75% in the SPA, at the time of signing the SPA, the 5% would be valued at €20,250,000.00.

72. As the OHA Bond was overdue for payment, we had to pay interest for the overdue period and until it was redeemed. The project suffered delays and as result we suffered a loss of income from the Capacity Auctions and additional costs. And penalties regarding supply contracts. The total losses suffered are now set out in our Counterclaim.

73. This had a devasting impact on us both professionally and personally. All of which could have been avoided had KHC and Mr Khashoggi complied with the SPA and made the initial payment as they assured they would.

74. 1 would therefore respectfully request that the court dismiss the claim and award the damages that we are seeking in our counterclaim.”

177. In cross-examination, Mr Privitera said he did not recall how much he would have expected to receive under the SPA, though he said calculations were done at the time. He accepted that there were quite a few deductions to be made from the 75% sale price of which he stood to receive 20%. He was asked what he expected to receive personally from the IKOPUS transaction, resulting in the following evidence:- “7 Q. What is it that you have or expect to receive from the 8 Ikopus transaction as a shareholder? Personal benefit. 9 A. Yes, I would say the main one was money. 10 Q. Yes, and how much, do you know? Have you received any 11 money? 12 A. Yes I did. 13 Q. How much, for your share, for the benefit of your 14 shares? 15 A. Do I have to answer this? 16 Q. Well, yes, please. 17 A. Okay, for sure. 18 Q. Well, I don't suppose you have to, no. 19 A. Okay, I don't actually remember 100 per cent, but it was 20 the fair value of my shares, I guess. 21 Q. All right. 22 The -- 23 MR JUSTICE HENSHAW: I think counsel is trying to ask you 24 whether you remember how much, how many euros you 25 received for your share? 1 A. I don't actually remember precisely that.” (Day 3/112-113) If Mr Privitera did not remember how much money he received, it is curious that he began this sequence of answers by asking whether he had to answer. (b) Outcome (counterfactual) for the Defendants under the SPA

178. The SPA provided for the sale of 80% of Meta. The main elements of the consideration were:- i) the Initial Purchase Price Payment of €60 million, which (reading the definition of Initial Payment along with § 3.6 of the SPA) seems to have been intended to cover (at least) the OakHill Exit Fee and the transaction costs; ii) the Equity Top-Up of €30 million, to be paid to the Defendants to re-inject into Meta by way of a minority shareholders’ non interest bearing subordinate loan; iii) the Equity Component of €69.7 million, which was described as a ‘cash injection’ by Khashoggi Holdings into Meta; iv) the Debt Assumption element of €55.5 million, to be paid to OakHill direct in order to redeem the OakHill Bonds; and v) the Conditional Deferred Purchase Price of €88.5 million, payable on the “terms and conditions” to be contained in a further agreement to be made within 90 days of closing.

179. How much of the Initial Purchase Price Payment the Defendants would actually receive would depend on the amount required to settle the OakHill Exit Fee, which had not yet been negotiated by the time the SPA came to an end. In their written closings, the Defendants submitted that: “Under the SPA, the OHA Redemption Bond and Exit Fee, totalling €… [sic.] million would have been paid out of the Initial Payment: see clause 3.6 SPA B/015. By contrast under the IKOPUS contract, the payments for the release of these securities were made by IKOPUS to OHA [D5/805]. The figures payable to OHA under both deals therefore cancel each other out, with the result that under the IKOPUS deal, the Defendants only received some £10 million.”

180. It is true that the OakHill Bond redemption amount was a known payment whose source was identified in both transactions: under the SPA it was to be settled using the Debt Assumption element, and under the IKOPUS transaction the purchaser bought €15 million of the bonds and lent Meta (as part of a larger loan facility) the €44.5 million need to redeem the rest.

181. However, the OakHill Exit Fee cannot be analysed in the same way. Under the IKOPUS transaction, OakHill agreed to accept €18 million for its ‘A’ shares, and there is no evidence as to what, if any, further payment may have been made to settle the OakHill Exit Fee. Under the SPA, the evidence does not establish how much would have been required to settle the OakHill Exit Fee. It cannot simply be assumed that it would have been the same as under the IKOPUS transaction, which was a different transaction with differently structured consideration. On 30 November 2020, Mr Maurizio Molinari had said that it was “ standing at €50,000,000 ” but subject to negotiations; but at a meeting on 1 April 2021 the figure stated by Mr Soenmez for the Exit Fee was €70,000,000. A bargain struck at the latter figure would, of course, have absorbed the whole of the Initial Purchase Price Payment and more.

182. The Equity Top Up loan was needed to fund what was defined in the SPA as the “ Capex Shortfall ”: money still needed by Meta in order to carry out the project (see clause 4.2.3 and the definition of Equity Top-Up). There is no evidence as to how, whether, or when Meta would have been able to repay this loan; nor is there any expert analysis of the value to the Defendants of Meta’s obligation to repay this loan to them. The Defendants submitted that, in the absence of evidence that Meta would be unable to repay it, the face value of the loan could be equated to cash: the parties evidently regarded the acquisition as a good deal, so there was no reason to ‘mark it down’ as a bad debt. I am unable to accept that submission, which strikes me as excessively simplistic. The parties directed me to no evidence about Meta’s assets, other liabilities, trading records or trading prospects. The loan was subordinated and unsecured, and carried no interest. How much of it would be repaid, and when, would depend on Meta’s ability to repay it. In the circumstances, I do not consider that the value of the loan, in the hands of the Defendants as creditors, could on any sensible view be taken as its face value; and in the absence of any specific, considered evidence as to the value it would really have had under the SPA transaction, any attempt by the court to estimate a value would be pure guesswork. There is also the further uncertainty as to whether some of the €30 million would have been needed to settle the balance of the OakHill Exit Fee, if that turned out to be higher than the Initial Purchase Price Payment (see § 181 above).

183. The Equity Component would not go to the Defendants at all. It was to be paid to Meta direct, and was needed in connection with the Capacity Financing. SPA clause 4.2 envisaged that MEAG would lend Meta around €347 million following the SPA transaction, but only on the basis of a certain debt to equity ratio (clause 4.3), requiring Khashoggi Holdings to ‘inject’ money into Meta.

184. The Debt Assumption element also would not go to the Defendants, but would be paid direct to OakHill to redeem the OakHill Bonds.

185. The Conditional Deferred Purchase Price was provided for in SPA clause 6:- “Waterfall and Conditional Deferred Purchase Price Payment 6.1 In order to assure the Beneficial Owners the full value of the business of the Company and the Subsidiaries and the full benefit of the goodwill of the business of the Company and the Subsidiaries as at the date of this agreement, the Buyer hereby undertakes and covenants with the Beneficial Owners that it shall pay, or the Buyer shall procure that the Company shall pay by way of preferential dividend, the Conditional Deferred Purchase Price Payment to the Beneficial Owners on such terms and conditions as shall be agreed in good faith between the Buyer and the Sellers within 90 (ninety) days of the date of this agreement. 6.2 Without prejudice to the provisions of clause 6.1, in the event that the Buyer and the Sellers agree that the Conditional Deferred Purchase Price Payment shall be paid by the Company by way of preferential dividend, the parties hereby agree that: 6.2.1 such Conditional Deferred Purchase Price Payment shall be payable to the Beneficial Owners commencing from the First COD and shall be paid in full within five years of the First COD; and 6.2.2 in order to enable such Conditional Deferred Purchase Price Payment to be paid to the Beneficial Owners in full within five years of the First COD, the Buyer shall agree that the available revenues of the Company and the Subsidiaries shall be distributed between the parties irrespective of the respective shareholdings in the Company held by the Buyer and the Beneficial Owners (namely irrespective of the 75%/25% shareholdings) and the Buyer, to the extent necessary, agrees to waive its entitlement to its full dividend share so as to enable payment of the Conditional Deferred Purchase Price Payment to the Beneficial Owners in full.”

186. The Defendants submitted that these provisions left no doubt that the Conditional Deferred Purchase Price would be paid or as to its amount, but only the repayment dates and interest. Further, the buyer had an obligation to procure that the payment was made, so payment could be in doubt only if there were good evidence (which there was not) that Meta’s finances would not enable it to pay. The court should assume that the transaction was entered into by both sides in the expectation that the money would be paid.

187. I am unable to accept those submissions. Clause 6.1 indicated that the purpose of the Conditional Deferred Purchase Price was to ensure that the Defendants received “the full value of the business of the Company and the Subsidiaries and the full benefit of the goodwill of the business of the Company and the Subsidiaries as at the date of this agreement” ; and the payment – whether to be made by the Buyer or by way of preferential dividend – was expressly stated to be subject to “ terms and conditions ”, to be “ agreed in good faith ” between the parties. There would have been no certainty as to what terms and conditions would have been agreed. In particular, there would have been no reason to expect that the Buyer would have agreed (or, acting in good faith, would have been bound to agree) to undertake an unconditional obligation to pay the Conditional Deferred Purchase Price from its own funds. Indeed, that seems unlikely, and would have converted this element of the consideration from a “ Conditional ” deferred purchase price to a simple guaranteed deferred payment.

188. At best, therefore, the Defendants could reasonably argue that they would at least have ended up with the benefits provided for in clause 6.2, namely an agreement that the Conditional Deferred Purchase Price would be paid, within five years of the “First COD” (defined as 1 January 2022) i.e. by 1 January 2027, from “the available revenues of the Company and the Subsidiaries” . The latter expression naturally referred to revenues available to pay dividends, since the intended payment mechanism was preferential dividends, and as confirmed by the reference in clause 6.2.2 to the Buyer’s “dividend share” . As a result, the Conditional Deferred Purchase Price could be paid only if and to the extent that Meta and its subsidiaries had (lawfully) distributable profits available during the period 2022 to 2027 which could be used for that purpose.

189. There was, however, no evidence from any factual or expert witness about the extent to which such distributable profits would have been available, taking into account the group’s assets, liabilities and trading prospects. The Defendants in effect invite the court to infer, from the fact that the parties to the SPA presumably regarded Meta as a good investment, that it would have distributable profits of €88.55 million (or some specific lesser sum that could be the subject of a damages award) over the period 2022 to 2027. In my view, no such inference can properly be drawn, and the Defendants have failed to put forward any cogent evidence in support of this very substantial counterclaim. Submissions by counsel in closing, based on the parties’ apparent views about the group at the time of the SPA, are no substitute for the kind of evidence one would expect to see in order to support a counterclaim of this nature.

190. Clause 6.9 of the SPA provided as follows:- “ Cassino 2 and Metaenergia Esco S.r.l. - No Buyer Responsibility 6.9 The Sellers and the Buyer hereby mutually agree and expressly acknowledge that: 6.9.1 the Purchase Price payable by the Buyer in relation to purchase of the Sale Shares, and the other amounts payable by the Buyer under this agreement, have been calculated and agreed on the basis that they do not take account of the value of the Cassino 2 site and Metaenergia ESCo S.r.l., and as such, that the Cassino 2 site and Metaenergia ESCo Srl. shall be carved out of the Transaction perimeter; 6.9.2 furthermore in accordance with the specific provisions of the Capacity Financing, the Cassino 2 site located at the Cassino Premises and Metaenergia ESCo S.r.l. shall also fall outside of the transaction perimeter for the purposes of the Capacity Financing on the basis that the Cassino 2 site is a permitted disposal under the Capacity Financing and Metaenergia ESCo S.r.l falls outside of the Capacity Market projects; 6.9.3 the intention of the parties is to sell the Cassino 2 site and sell or carve out Metaenergia ESCo S.r.l following the date of this agreement and the Sellers and the Buyer shall take such actions as may reasonably be required to facilitate and effect respectively such sales and/or carve out; 6.9.4 the Beneficial Owners shall be entitled to the entire amount of the sale proceeds relating to the sale of the Cassino 2 site and/or the sale of Metaenergia ESCo S.r.l and the Buyer shall, and shall procure that the Company and the Subsidiaries shall, take such actions as may be required so as to ensure that the entire amount of the sale proceeds relating to the sale of the Cassino 2 site and/or the sale of Metaenergia ESCo S.r.l are received by the Beneficial Owners; 6.9.5 the Buyer shall not be responsible for and shall not assume any liabilities in respect of the Cassino 2 site and Metaenergia ESCo S.r.l..; and 6.9.6 the sale or carve out of the Cassino 2 site from the transaction perimeter shall not directly cause the Company and the Subsidiaries to have a negative net worth (namely, patrimonio netto negative).”

191. As noted above, the Defendants plead that “122.3 The Cassino plant owned by MEP was excluded from the SPA. The Defendants had previously received an offer solely for the acquisition of the Cassino plant for a consideration of €50,000,000. Following the breach of the SPA by the Claimant, the Defendants had no other choice but to include the Cassino plant as part of the IKOPUS Acquisition at a value which is significantly lower than the consideration offered by other potential buyers. The Defendants’ losses are presently estimated at €25,000,000.”

192. Mr Privitera’s evidence was that MET Holding AG’s offer of €243,000,000 included a purchase price of €60,000,000 for the Cassino 2 Plant. The ARIA deemed its “ Market Value ” to be €55 million for the purposes of the provisions of that agreement. In quoted § 122.3 above, the Defendants alleged that the plant was sold at an undervalue under the IKOPUS transaction. However, there was no valuation evidence in relation to the Cassino 2 plant, nor any real evidence of the value ascribed to it in the IKOPUS transaction. The fact that parties chose to treat it as having particular values for the purposes of particular agreements or offers is not a substitute for direct evidence of actual value. Moreover, the heading (“ No Buyer Responsibility ”) to SPA clause 6.9, the obligation to sell the plant and the reiteration in clause 6.9.5 that the Buyer shall not have any responsibility or liabilities in respect of the plant, may suggest that the Buyer saw it as something of a risky asset.

193. For the reasons set out in the foregoing paragraphs, the Defendants have in my view failed to establish what, if any, money they would have received on completion, or thereafter, pursuant to the SPA transaction. (c) Outcome for the Defendants under the IKOPUS transaction

194. As noted earlier, the main elements of the IKOPUS transaction were:- i) sale of 80% of the MEP to IKOPUS for around €10,000,000; ii) IKOPUS granting MEP a shareholders’ loan facility agreement of up to around €200,000,000, part of which MEP would advance to Meta; iii) Meta partially redeeming the OakHill Bonds for €44,523,750 and IKOPUS agreeing to purchase the remainder for a total deferred consideration of €15,000,000; and iv) IKOPUS buying the A ordinary shares in Meta for €18,000,000.

195. The core provisions of the Shareholders Loan Agreement between IKOPUS and MEP were these:- “3. THE FACILITY 3.1 Subject to the terms of this Agreement, the Lender makes available to the Borrower a term loan facility in a maximum principal amount of EUR 200,964,541.00.

4. UTILISATION 4.1 The Borrower hereby requests to borrow a Loan of EUR 71,378,604.72 under the Facility (“Initial Utilisation Request”), which shall be applied for the purposes, and paid out directly towards the various creditors of the Borrower, as indicated in the funds flow attached as Schedule 1 hereto. 4.2 The Borrower may utilise further amounts of the Facility by delivery to the Lender of a duly completed Utilisation Request. 4.3 Each Utilisation Request is irrevocable and will not be regarded as having been duly completed and delivered unless: 4.3.1 the proposed Utilisation Date is a Business Day within the Availability Period; 4.3.2 the currency and amount of the Utilisation Request complies with Clause 3.3; and 4.3.3 such Utilisation Request is delivered together with evidence (in form and substance satisfactory to the Lender) that such any Construction Costs are falling due and payable by no later than 30 days following the date of the Utilisation Request. 4.4 The currency specified in a Utilisation Request must be euro and the amount of the proposed Loan must be less than or equal to the Available Facility. 4.5 The Lender shall make each Loan available by the Utilisation Date.

5. REPAYMENT 5.1 On and from 30 November 2025 the Borrower shall repay the Loan by paying to the Lender on each Facility Repayment Date the Facility Repayment Amount, provided that, on 31 December 2037, the Borrower shall repay the full amount of the Loan that remains outstanding as at that date together with all other amounts due and payable under this Agreement. 5.2 The Borrower shall, by no later than the date falling seventy five (75) days after 30 September 2022 and the last day of each Financial Year thereafter, apply an amount equal to eighty per cent. (80%) per cent of Free Cashflow at such time in prepayment of the Loan. 5.3 The Borrower may not re-borrow any part of the Facility which is repaid or prepaid. 5.4 The Borrower may prepay the whole or any part of any Loan at any time.”

196. Schedule 1, referred to in clause 4.1 quoted above, was headed “Fund Flow – Initial Utilisation Request” , and listed five payments totalling € 71,378,604.72:- i) a payment to Meta of €44,523,750, in order to redeem most of the Oak Hill Bonds; ii) a payment to MEP itself of €4,600,927.92; iii) a payment of €2,200,000 to Snowstorm S.r.l, an entity which according to the IKOPUS Investment Agreement owned an asset, the Termoli Project, which MEP was to purchase; iv) a payment of €1,053,926.80 to Grande Stevens Studio Legale Associato, the Defendants’ Italian lawyers, presumably for transaction costs; and v) a payment of €19,000,000 to Metaenergia SpA (to which I return below).

197. Those payments were also listed in Schedule 5 to the IKOPUS Investment Agreement, which set out the “Payments at First Closing” that IKOPUS was required to make pursuant to clause 6.2.6 of that agreement. In addition, Schedule 5 required IKOPUS to make two further payments, namely:- vi) a payment of €9,846,073.20 to Meta, in return for 80% of the shares in MEP; and vii) a payment of €15,000,000 to En-It, in order to purchase the balance of the Oak Hill Bonds i.e. those that were not to be redeemed by Meta.

198. The payment of €19 million to Metaenergia SpA was thus provided for in both documents: the IKOPUS Investment Agreement and the Shareholder Loan Agreement. Mr Privitera did not refer to this payment in his summary of the IKOPUS Acquisition (quoted above). I was informed by counsel for the Defendants (on instructions) that Metaenergia SpA was the company which originally owned MEP; that it was understood to be owned by the Molinaris; and that the €19 million payment was believed to reflect a intercompany debt following transactions between Meta and Metaenergia SpA. This appeared to follow the Italian authorities having formed the view that assets had been transferred from Metaenergia SpA to Meta. Counsel explained that it had been possible to obtain very little information from his clients’ Italian lawyers, and that under Italian criminal law his team was not allowed to communicate with the Molinaris at all.

199. The suggestion that there was inter-company debt as between Meta and Metaenergia SpA gains some support from a “Final draft – Vendor Assistance Report” dated July 2020 prepared by Deloitte Financial Advisory S.r.l. of Milan, in connection with a different proposed transaction. This document referred to Meta having “payables towards Metaenergia S.p.A.” (p.8), “outstanding payables vs Metaenergia S.p.A. related to the acquisition of investments in [MEP] and [Metapower] (€m88)” (p.8) and negative working capital of €17.2 million “ relating to overdue trade payments due to Metaenergia S.p.A. ” (pp.14-17). At the same time, that document was heavily caveated, indicating in the covering letter that:- “As agreed with you, our work is intended to present a general overview of the income statement, balance sheet and cash flow of the Group, identifying the main adjustments to the Net Financial Position of the Target Group («Group»). … Our work and final report should not be considered an adequate substitute for a normal scope intended for engagements on which reliance is granted as part of the investment decision-making process. The scope of our work was limited to the procedures agreed with you. The limited procedures requested by you and performed by us do not constitute an audit of the consolidated financial statements of the Target as we did not perform all of the test procedures requested by generally accepted auditing standards. Consequently, if we had performed a full audit, other matters or adjustments might have emerged and they would have been brought to your attention.”

200. Counsel for the Claimant also referred to an undated letter written in 2025 by Gildo Ursini, an Italian advocate acting for Mr Maurizio Molinari, stating (among other things):- “I am representing Mr. Maurizio Molinari in his role as president of the Board of Directors, from May 18, 2009 to August 8, 2020, of the company Metaenergia Spa, declared bankrupt on April 14, 2023 by the Court of Rome. The charge provisionally raised against my client within the framework of the criminal proceeding in question is basically that of having committed - in conspiracy with others - facts of fraudulent bankruptcy.” It is evident that Metaenergia was not sold to IKOPUS, but remained under the control of the Defendants (or at least the Molinaris). It is unclear what became of the €19 million that was agreed to be paid (and presumably was paid) to Metaenergia upon the closing of the IKOPUS transaction.

201. I asked counsel during closings whether that €19 million payment may have constituted a further benefit to the Defendants resulting from the IKOPUS transaction. Counsel for the Defendants very frankly replied that he could not properly answer that question (Day 5/164/23). He went on to make submissions which appeared to include a suggestion that there was “probably a liability to Mr Molinari already” (Day 5/168/19). However, I was not taken to any evidence on those matters. In principle, and whether or not Meta owed money to Metaenergia or Metaenergia owed money to Mr Molinari, a payment by IKOPUS of €19 million to Metaenergia was capable of amounting to a benefit to the Defendants. The value of any such benefit would depend on (a) whether, to what extent and when the Defendants (or any of them) benefitted directly or indirectly from Metaenergia’s receipt of the money, and (b) what the prospects would have been, absent the IKOPUS transaction, of Metaenergia receiving payment of the €19 million said to be owed to it by Meta, when it would be likely to have been received, and what (if any) benefit the Defendants would have received, and when, under this counterfactual scenario. In the absence of evidence on any of those matters, the court cannot simply discount the receipt of a cash payment under the IKOPUS transaction of €19 million to a company linked to the Defendants or some of them.

202. Under the IKOPUS transaction, the Cassino 2 plant was included, at least provisionally. Clause 7.3.3 of the IKOPUS Acquisition Agreement provided:- “7.3 Sale of Cassino 2 Plant 7.3.1 The parties acknowledge that it is their joint interest and also a request of the Noteholders, that MEP sells Cassino 2 Plant as soon as reasonably possible after the First Closing, and in any event within the timelines provided in the Senior Financing documentation. 7.3.2 The parties agree to make their best efforts to assist MEP in the sales process, including by searching and identifying themselves potential investors. 7.3.3 In the event of failure to sell the Cassino 2 Plant within the timelines provided in the Senior Financing documentation, the Buyer is entitled to have the Cassino 2 Plant purchased at a purchase price of Euro 25 million and against a guaranteed rate of return of 5.5% per annum. ” Clause 7.3.3 thus entitled IKOPUS to put the Cassino 2 plant back to Meta at the price of €25 million if it remained unsold. There was no evidence about whether the plant had in fact been sold, and (if so) at what price, or whether the option under clause 7.3.3 had been exercised. The fact that IKOPUS negotiated that option for itself does not establish, or even (in my view) tend to show, that the plant was worth €25 million. It might indicate that IKOPUS considered that it had given value of at least that amount, as part of the overall transaction, for the Cassino 2 plant: but, of course, only on the proviso that it could recoup €25 million if the plant remained unsold. I do not consider that fact to show the plant as having any particular value.

203. Aside from the initial utilisation payments totalling approximately €71 million to be made on completion of the IKOPUS transaction, the availability of the balance of the €200 million (around €130 million) is bound to have been beneficial to the MEP group, in which the Defendants retained a 20% economic interest. Taken together with the payments of approximately €4.6 million to MEP and €2.2 million to Snowstorm, it was a significantly larger potential sum than the approximately €100 million (Equity Top Up and Equity Component) to be put into the operating companies under the SPA. (d) Analysis

204. In my view, the evidence adduced by the Defendants is inadequate to establish a quantifiable counterclaim.

205. At the general level, it is unusual and surprising for a party to attempt to establish a very significant counterclaim – here of the order of €168 million – without clear and focussed evidence, including expert evidence where appropriate (for example in relation to valuation of shares or businesses, or companies’ trading prospects). In the present case, there was not only no expert evidence but also precious little witness evidence. The greater part of the Defendants’ case on their Counterclaim was in effect based on submissions from counsel, at times in an almost improvised fashion, by reference to the transaction documents. In addition, there were the specific deficiencies that I summarise below.

206. First, the evidence fails to establish any particular value (or likely range of values) for the components of the consideration under the SPA that would or might have been received by the Defendants: see §§ 179-189 above; or the value of the Cassino 2 plant which they would have retained: §§ 190-192 above.

207. Secondly, the evidence does not establish the value to the Defendants of the IKOPUS transaction, including the benefit of the €200 loan facility and the €19 million to Metaenergia SpA (see §§ 198-201 and 203) above. The Defendants’ only witness of fact, Mr Privitera, was unable, or unwilling, to state how much he had in fact received as a result of the IKOPUS transaction.

208. Thirdly, the SPA and IKOPUS transactions are not directly comparable because they involved the sale of different assets. Under the SPA, the Defendants were to sell 75% of the shares in Meta. Under the IKOPUS transaction, they retained Meta and sold 80% of the shares in its subsidiary, MEP. If Meta had no other assets apart from MEP, it might have been possible to ‘look through’ Meta for the purpose of assessing damages. However, the Defendants did not take me to any evidence establishing that Meta had no other assets. At least in those circumstances, any comparison between the two transactions would have required evidence about the relative values of (a) the Defendants’ retained 25% shareholding in Meta under the SPA transaction, and (b) the Defendants’ retained 100% shareholding in Meta after that company had divested itself of 80% of MEP under the IKOPUS transaction. There was no such evidence.

209. Fourthly, the Defendants submitted that on any view they had, in economic terms, lost 5% of the value of MEP, because under the SPA they would have retained 25% of Meta (which owned MEP) whereas under the IKOPUS transaction they retained, through Meta, only 20% of MEP. They argued that the 5% difference represented a loss of €20,250,000 based on the following evidence from Mr Privitera:- “Under the terms of the SPA, we were due to receive the initial payment of €215,200,000.00 and an additional conditional payment of €88,550,000.00. In total we should have received €303,750,000.00. Again, what we received under the IKOPUS agreement was considerably less. We also had the loss of the Cassino 2 Plant and had to sell an additional 5% of the shareholding. Based on the valuations calculated by reference to the 75% in the SPA, at the time of signing the SPA, the 5% would be valued at €20,250,000.00.”

210. There are several difficulties with this evidence. i) It is premised on the value of the total consideration for the Defendants under the SPA transaction being €303,750,000. For the reasons given in §§ 178-189 above, I do not consider that assumption to be sustainable. ii) It ignores the fact that under the IKOPUS transaction, the Defendants retained 100% of the shares in Meta, which may have had other assets. iii) It ignores the differences between the SPA and IKOPUS transactions, such as the benefit of the full €200 million loan facility, that might well affect the relative value of the retained shareholdings under the two transactions. iv) More generally, it assumes that the difference in value between a 20% and a 25% minority shareholding in a private, unlisted company is 5% of the value of all the company’s shares. No such assumption can reliably be made. The valuation of minority shareholdings is a matter for expert valuation, or at least clear factual evidence based on real offers or other concrete evidence of value. In these circumstances, I do not consider the Defendants to have established any loss resulting from the 5% difference in retained shareholding between the two transactions.

211. Fifthly, the evidence does not establish the Defendants’ alleged loss by reason of the Cassino 2 plant having to be sold as part of the IKOPUS transaction: see §§ 190-192 and 202 above. The evidence does not establish a value for the plant as an asset, nor does it show what value the Defendants received for it in the context of the IKOPUS transaction viewed as a whole (and as compared to the SPA transaction).

212. Sixthly, there is no proper particularisation or evidence of the other heads of loss claimed, including additional interest on the OakHill bonds, costs or penalties, nor any lost profits due to delay in being able to supply electricity, all of which would in any event have been losses incurred by Meta and not directly by the Defendants. Nor is there any particularised, evidence or quantified claim for the alleged wasted costs of negotiating with Khashoggi Holdings.

213. Seventhly, it is more likely than not, on the evidence before the court, that the Defendants failed to mitigate their loss. The Defendants submit that the IKOPUS transaction was disadvantageous to them, but have provided no real explanation as to why they did not revert to the bids Barclays had procured a few months previously, including the MET bid. The Defendants’ case on their post-SPA deceit claim is that, but for the Claimant’s alleged misrepresentations, they could and would have reverted to the MET bid in mid March 2021. However, there is no real explanation of why they did not do so, or approach other entities who had bid, or re-run an action process, only a few weeks later, in mid April when the SPA came to an end. When I asked counsel for the Defendants about this during closings, he appeared to accept that there was an evidential deficit.

214. For completeness, had it been relevant, I would not have accepted the Claimant’s submission that the Defendants should have mitigated their loss by re-engaging with the Claimants in the way proposed in Mishcon de Reya’s letter of 7 April 2021. In circumstances where the Claimant had walked away from a signed transaction, the Defendants could not reasonably have been expected to do so.

215. In all these circumstances, and even giving the Defendants the benefit of a ‘fair wind’, I do not consider them to have established any quantifiable counterclaim for breach of contract. (2) Deceit prior to conclusion of SPA (a) Intention to purchase the shares

216. The Defendants allege that, by and through the communications made during the discussions and negotiations leading up to execution of the SPA, Khashoggi Holdings (through Mr Khashoggi) and Mr Khashoggi personally each made “the implied and continuing representation of fact to the Defendants that [Khashoggi Holdings] in fact possessed the intention to purchase the Sale Shares and complete the intended Transaction” . The Defendants allege that that representation became false prior to the signing of the SPA on 8 December 2020, because Khashoggi Holdings ceased to have the intention to purchase the shares and complete the intended transaction. They say they relied on these false representations when they decided not to pursue the offers received through the Barclays auction process and when they decided to enter into the SPA. In support of the allegation of falsity, the Defendants say:- “72.1.1 Had the Claimant in fact possessed the intention to complete the purchase of the Sale Shares, then the Claimant would have made the payments required under the SPA and would have completed the purchase of the Sale Shares, within the timescales contemplated by the SPA or in any event prior to 7 April 2021, when the Claimant purported to terminate the SPA. 72.1.2 Had the Claimant in fact possessed the intention to complete the intended Transaction at all times prior to execution of the SPA, then the Claimant would have done so, within the timescales contemplated by the SPA or in any event prior to 7 April 2021, when the Claimant purported to terminate the SPA. 72.1.3 As it is, the Claimant did not make any payment whatsoever at any stage (including the payment of the Deposit (as addressed further below) or even the payment of €300,000 to Batt Company), nor were any meaningful steps taken to effect completion of the purchase of the Sale Shares. 72.1.4 In fact, Mr Khashoggi took steps to revoke, cancel or reverse (or to cause or direct the revocation or cancellation or reversal of) the SEPA Transfer on or around the date of execution of the SPA (as set out below). 72.1.5 In such circumstances, it is to be inferred that, and the Defendants and Meta aver that, the Claimant did not in fact possess the intention to complete the intended Transaction at all times prior to execution of the SPA. ” (Counterclaim § 72.1)

217. The Defendants submit that Khashoggi Holdings/Mr. Khashoggi’s true intentions in relation to the purchase of the Sale Shares under the SPA are revealed by his emails to Mr. Nuncques of 4 and 16 December 2020. In the first of these emails he stated: “€215 m is a very far reached and dangerous commitment, if it wasn’t for the investors I told you about and their commitment, I wouldn’t have thought of considering such an amount!” In the second he stated: “…we need to delay payment and request at least a month…”. The Defendants say these email show that Khashoggi Holdings never intended to make the Initial Payment from its own funds, notwithstanding all of Mr Khashoggi’s messages to Mr Molinari and the terms of the SPA itself. They submit that if the picture presented by these emails was in fact wrong, then Mr Khashoggi has failed to correct it by giving evidence in this trial and the court is entitled to draw an inference from his absence (see Wisniewski v Central Manchester Health Authority [1998] EWCA Civ 598 , [1998] PIQR P324). Further, the Defendants say, as of March 2021 Khashoggi Holdings/Mr Khashoggi were still waiting for funds from his “ investors ” because in an email to Dr. Chiari of 23 March 2021 Mr Khashoggi stated, amongst other things:- “My dear Cinzia, in order to be realistic and contain the situation for now, we need to consider the following actions: KHC withdraws from the deal and agreed to a form of penalty Extend the closing till the 1 st of June when I am able to physically travel and finalize with all stakeholders …”

218. In my view, this counterclaim fails for a number of reasons, and falls well shortly of a distinctly proven allegation of deceit.

219. First , the communications relied on do not establish that any implied representations made as to intention to proceed with the transaction were false. Starting with the three emails highlighted in the Defendants’ submissions as mentioned above, the first of them formed part of a chain of emails to and from Mr Nuncques on 4 December 2020 which included Mr Nuncques sending Mr Khashoggi the latest draft of the SPA and highlighting the problem of the OakHill ‘A’ shares:- “3. OakHill A Shares: Once again, we have amended clause 3.6.3 of the SPA so as to try and address the concerns raised by JDG. We totally agree this is "a seller's issue' and its solution depends on the agreement we can reach with OHA as soon as we have closed ours. Then, the shares would either need to be purchased back by MetaUK (in order to cancel them) or the shares would need to redenominated and reclassified the way we decide together.” and a further email from Nr Nuncques in which he said:- “We are getting there, but I am surprised not to say upset, that GS could have even being thinking on putting the responsibility on us as well for OHA cancellation of their shares in META after repayment on their amount. GS is not protecting well KHC interests As a consequence assuming you have a deal with Mauricio, I will need time and possibly support to come to an acceptable documentation. Sorry about that quick but no rush Do you agree?” Mr Khashoggi replied:- “Jacques, I trust you 100% and will never go against your advice unless I have a good reason, which I could not find in this deal, so, I remain committed to your advice. I can not accept a deal that would jeopardize my family's interest. To put such an amount upfront "€215m" is a very far reached and dangerous commitment, if it wasn't for the investors I told you about and their commitment, I wouldn't have thought of considering such an amount! Jacques, I believe this is a very serious and important deal which unfortunately Molinari may had spoiled by the OAK Hill deal. I want nothing to do with it now nor in the future! So, please don't listen to any noise from anyone. You put the offer you feel you can accept for yourself and family before me my family and I will present it! I am free tomorrow anytime you like if you want to speak. ”

220. In my view these messages do not establish that Khashoggi Holdings or Mr Khashoggi had no intention of Mr Khashoggi proceeding with the transaction. Mr Khashoggi’s response seems to indicate that Khashoggi Holdings may have been planning to do so on behalf of investors, rather than for Mr Khashoggi and his family, but it was of course Khashoggi Holdings rather than Mr Khashoggi who proposed to purchase the shares. The chain also suggests some concerns about the OakHill element of the transaction, which would be understandable, but there is no suggestion that Mr Khashoggi or Khashoggi Holdings had lost any intention to proceed to enter into and complete the transaction.

221. The second of the three emails was eight days after the SPA. Mr Khashoggi said to Mr Nuncques:- “… I've been busy with the banks to make available the funds in euros, it's a mess! The Euro is very expensive and we don't have enough euros. It will kill us to convert now. We need to delay the payment and request at least a month, but I want to propose that once I have a clear commitment from the banks on schedule and pricing. If Citi or others act fast on the SBLC then I don't have currency problem, but the FX is not in our favor now Let me j ow when we can speak ” This message indicates difficulties in payment, after signature of the SPA, and a wish to achieve a delay. It does not indicate that at the time Mr Khashoggi entered into the SPA, or at any time before that, Khashoggi Holdings or Mr Khashoggi did not intend to proceed with the transaction. The fact that Khashoggi Holdings in the end did not pay does mean that it had never intended to do so: that would have made the whole exercise entirely pointless from its point of view.

222. The third email also post-dates the SPA. It supports the view that Khashoggi Holdings was entering into the transaction for the benefit of investors or ‘stakeholders’, but that is in no way inconsistent with Mr Khashoggi and Khashoggi Holdings intending to carry it through.

223. More generally, the Defendants in my view put forward no evidence that comes close to demonstrating that, before or at the date of signature of the SPA, Khashoggi Holdings or Mr Khashoggi had no intention to performing it. Indeed, the fact Khashoggi Holdings did execute the SPA tends to suggest the contrary. No plausible reason has been suggested why Khashoggi Holdings would have done so, thereby entering into a legally binding commitment to purchase the shares, if it or Mr Khashoggi had no intention of completing the transaction. To the contrary, Mr Berman’s evidence was that, both before and after the 7 April 2021 letter, his firm was under instructions from Khashoggi Holdings to get the deal done, and that our client was intending to do the deal” (Day 3/28).

224. Secondly , there is no reason to infer that Khashoggi Holdings or Mr Khashoggi intended that the Defendants should rely on any implied representation that they intended to purchase and pay for the shares. The Defendants would, rather, naturally be expected to rely only on Khashoggi Holdings’ signature of the SPA, if and when that were actually achieved.

225. Thirdly , the Defendants had put forward no evidence of reliance. Their only witness of fact was Mr Privitera, whose witness statement included the following passages:- “23. On or around April 2020, Metaenergia and its Shareholders decided to sell Metaenergia’s shares to finance the project. They launched an auction process for the sale of Metaenergia’s shares, with the support of Barclays Bank. Several serious bidders came forward, including Engie, MET Holding AG, and Glenmont Partners. All were highly reputable groups offering solid financial and operational guarantees.

24. However, despite the strength and reliability of those offers, the Shareholders decided to pursue a direct proposal from Khashoggi Holding Company (“KHC”), which they initially received in the summer of 2020. This was primarily because Mr. Motasem Almotazbellah Khashoggi (“Mr. Khashoggi”) presented himself in a friendly, reassuring, and collaborative manner from the outset, repeatedly expressing his intention to build a long-term and strategic partnership with us. His tone and approach were strikingly different from that of the institutional bidders and conveyed a personal commitment that inspired confidence. Presenting himself on a more personal level, not only as a speculator but someone who wanted to join the Metaenergia family. He also came from a family business and so was relatable to the Shareholders. …

27. In September 2020, KHC submitted an offer to acquire 75% of Metaenergia’s share capital at a valuation higher than those received through the Barclays process, the valuation and Mr. Maurizio Molinari’s seemingly good relationship with Mr. Khashoggi made this offer attractive. Mr. Khashoggi was very reassuring and positive about the project and projected himself as a good partner for this venture. As a result, the Shareholders chose to discontinue the Barclays Auction and proceed privately and only with KHC. …

29. From October to December 2020, the parties engaged in significant back and forth negotiating the terms of the share purchase agreement. Through a combination of emails, WhatsApp, and telephone communications involving the Shareholders’ legal advisors, Mr. Michele Briamonte (“Mr. Briamonte”) of Grande Stevens International LLP (“GSI”), Mr. Nuncques, Dr Chiari, and Mr. Maurizio Molinari, who dealt directly with Mr. Khashoggi. A Mr. Emad Khashoggi also remained involved throughout the negotiation phase, reviewing draft versions and coordinating legal points through KHC’s team. I was kept informed about the negotiations through our legal advisors and my father.” …

31. Mr. Khashoggi and Mr. Maurizio Molinari were in constant communication during the negotiations and when an issue arose, they would often message and speak with each other to resolve the matter. Mr. Khashoggi would also reassure Mr. Maurizio Molinari and continued to give assurances regarding the transaction.”

226. In his oral evidence, Mr Privitera said that, although in the written evidence quoted above he described Mr Khashoggi as very reassuring and positive, he never spoke to directly Mr Khashoggi. He was kept informed about the negotiations through the Defendants’ legal advisers and his father. There were very few references to Mr Privitera in the emails about the transaction, but he said he had access to and read many emails forward to his father by Grande Stevens and Mr Briamonte. Mr Privitera was inclined to accept that he was, really, ‘informed’ rather than ‘involved’ in the transaction.

227. In my view, the Defendants’ evidence is insufficient to establish, on the balance of probabilities, that they relied on any implied representation by Khashoggi Holdings or Mr Khashoggi as to their intentions regarding the transaction, or that they so relied by refraining from taking forward discussions with MET or any of the other bidders in the Barclays auction. It is also notable that the Defendants did not revert to any of those bidders in March or April 2021. Asked why that was, the Defendants’ counsel in closings acknowledged that the Defendants had an “evidential deficit” and that “our case, primary case, has to be on breach of contract” (Day 5/146/13-25; see also 147/2 – 149/4). There is also no evidence that there was a deal available from MET at the time of the alleged misrepresentations but which was no longer available following the purported termination of the SPA on 7 April 2021.

228. The conclusions I reach above make it unnecessary to consider questions of loss relating to this head of claim. I would simply observe that, on the evidence presented, I would have had great difficulty concluding that the Defendants would have received any net benefit from the MET deal (even if it had proceeded) after taking account of the need to cover the Capacity Financing, the Capex Shortfall, the OakHill bonds and the OakHill Exit Fee. (b) Deposit representation

229. The Defendants allege that, by various statements in the period leading up to the execution of the SPA on 8 December 2020, Khashoggi Holdings and Mr Khashoggi made implied representations of fact that: i) the Claimant and Mr Khashoggi in fact possessed the intention to make payment of the Deposit by the SEPA Transfer; ii) neither the Claimant nor Mr Khashoggi in fact possessed the intention to revoke, cancel or reverse the SEPA Transfer; and, iii) both the Claimant and Mr Khashoggi had not in fact revoked, cancelled or reversed the SEPA Transfer.

230. The Defendants say those representations were false. The SEPA Transfer was ordered on Mr Rodgers around 7 December 2020, and on or around 8 December the funds were briefly credited to Meta’s account at Finnat Bank. However, on or about 10 December the Defendants and Meta were told that the payment had disappeared from the account, and Meta never thereafter received the payment or any part of it. The Defendants invite the inferences that Khashoggi Holdings and/or Mr Khashoggi revoked, cancelled, and/or reversed the transfer, and that they never in fact possessed the intention to pay the deposit by the SEPA Transfer. The Defendants say they relied on the implied representations when they decided to enter into the SPA; and that, but for that representations, they would instead have negotiated a sale with an alternative bidder from the Barclays auction process or with IKOPUS, without delay.

231. The Defendants submit that the alleged representations can be implied from the following statements:- i) On 27 September 2020, at a meeting attended by, amongst others, Mr Khashoggi, the First Defendant and Grande Stevens International, Mr Khashoggi confirmed that Khashoggi Holdings was interested in the transaction and stated his strong will to support Meta by putting a sum into escrow to secure exclusivity in the customary way. ii) On 28 October 2020, Mr Khashoggi stated to Mr Briamonte that he wanted to conclude the SPA quickly so that he could make a downpayment of the amounts that were required by Meta for the project. iii) On or around 23 November 2020, Mr Khashoggi sent a WhatsApp message confirming that the deposit would be paid and requesting a SEPA CID number. iv) On 24 November 2020, Mr Khashoggi enquired as to the status of the SEPA CID number and stated that he would like to make the transfer for the Deposit that day. Mr Khashoggi and the First Defendant exchanged messages regarding the process for the SEPA Transfer. Mr Khashoggi provided details to Mr Molinari so that he could request the SEPA Transfer. v) On 25 November 2020, Mr Khashoggi requested that Mr Molinari send a direct debit request for the Deposit in the amount of €10 million and a copy of the invoice for the Deposit. vi) On 30 November 2020, Mr Khashoggi again requested the SEPA CID from Meta’s bank and also asked for 24 hours’ notice before making the Deposit transfer. vii) On 30 November 2020, Mr Khashoggi reiterated to Mr Molinari his ‘even stronger desire to join your family in the development of META Energia’. viii) On 2 December 2020, Mr Khashoggi provided details of the account for payment of the Deposit by SEPA Transfer and requested that Meta’s bank sent the request to transfer the Deposit.

232. The Defendants invite the inference of falsity from these matters:- i) The fact that no payments were in fact received by the Meta parties and that no proper explanation has ever been offered as to why payments were not made. ii) The fact that the SEPA Transfer was recalled for reasons which have not been properly explained. iii) Mr Khashoggi’s email to Mr Nuncques of 4 December 2020 quoted in §§ 217 and 219 above, which is said to show that his true intentions were that he was waiting for investment and this was a pre-condition to his intention/ ability to proceed with a transfer. iv) Mr Khashoggi’s email of 16 December 2020, quoted in §§ 217 and 221 above, from which the Defendants say it can be inferred that his actual intention was to delay payment due to reasons of securing investment.

233. In my view, this claim too is not made out.

234. First, I am not persuaded that the communications relied on contain a specific implied representation of the kind alleged, and certainly not one which Khashoggi Holdings or Mr Khashoggi can be taken to have intended should be relied on. At most, the communications might support an implied representation that they wished to proceed with the transaction (as to which see section (H)(2)(a) above). The emails relating to the transfer were of an administrative nature, and in my view did not contain any implied representation that the Defendants could reasonably have been expected to rely on. Realistically, it would be the entering into of the SPA and its actual performance on which the Defendants might be expected to place any reliance.

235. Secondly, I do not consider the evidence sufficient to establish that any representation was false, and knowingly so, as the time at which it was made. The evidence does not reveal why the SEPA Transfer was not made, or was made and then apparently withdrawn. Although that is a matter on which Mr Khashoggi might have chosen to give evidence, it is also one which the Defendants might reasonably have been expected to investigate, particularly in the context of a claim for deceit. Bearing in mind the fact that (as indicated below) there is no evidence of reliance by the Defendants on any such representation, with the result that this counterclaim has no prospect of success anyway, I am not willing to infer from Mr Khashoggi’s failure to give evidence that he must have instructed his bank to refrain from making (or to recall) the transfer, or that at the time of the communications cited by the Defendants he had no intention of making the payment. Moreover, some of the post-SPA communications referred to in §§ 59, 68 and 79 ff., at least if taken at face value, are consistent with Khashoggi Holdings and Mr Khashoggi wishing to make payments but encountering difficulties with various financial institutions in that regard.

236. Thirdly and in any event, there is no evidence of reliance by the Defendants on any implied representation of the kind alleged. The considerations set out in §§ 225-227 apply again here. Moreover, by 9 December 2020, the Defendants knew that the SEPA Transfer had not been made, yet there is no indication that they sought to treat the SPA as having been brought to an end for breach, or that they then entered into discussions with MET or IKOPUS. (3) Breach of SPA: refusal to make Initial Payment

237. The Defendants allege that Khashoggi Holdings failed to make the Initial Payment on the date of the SPA, or at all, in breach of the SPA. Khashoggi Holdings denies the allegation, on the basis that the various communications between the parties from 10 December 2020 to 27 March 2021 referred to earlier had the effect of varying the due date for the payment or estopping the Defendants from claiming damages for failure to pay on the original due date.

238. It is unnecessary to decide this point, because I have already concluded that the Defendants were entitled to, and did, accept Mishcon de Reya’s letter of 7 April 2021 as a renunciatory breach of the SPA entitling the Defendants, in principle, to claim damages. The damages claimed for the failure to make the Initial Payment are, in the Defendants’ Counterclaim, expressed to be the same as those claimed for the renunciation. Whether or not those losses those could be said to flow from failure to make the Initial Payment is a moot point, because I have concluded in section (H)(1) above that the alleged losses have not been established. (4) Breach of SPA warranties

239. The same considerations apply to the Defendants’ counterclaims for breach of warranty. They allege that Khashoggi Holdings breached the warranties it gave in the SPA that, at the time of the SPA, it had “the financial ability … to pay the Purchase Price in accordance with this agreement and the Equity Component in relation to the Capacity Financing” and (b) that, at the time of the SPA, it was “in possession of the readily available funds required to pay the Purchase Price in accordance with this agreement and the Equity Component in relation to the Capacity Financing” . The Defendants that, if those warranties had not been breached, then:- “the Claimant would have paid the Initial Payment on the date of the SPA as required. As a result: the Defendants and/or Meta would have paid the OakHill Redemption Amount and the OakHill Exit Fee, leading to the release of the OakHill Security and the cancellation of the 1,112 A ordinary shares of €1.00 each in the Company held by En-It, all as contemplated by Clause 3.6 of the SPA; the Defendants would have performed their obligations under clause 5.2.2; and Completion would have taken place.” (Counterclaim § 95)

240. The loss and damage alleged is, again, the same as that alleged in respect of Khashoggi Holdings’ renunciation of the SPA, which I have already concluded have not been established. This counterclaim too leads nowhere. (5) Deceit after conclusion of SPA (a) Availability of funds/intention to complete SPA

241. The Defendants allege that, by their various communications after 8 December 2020, Khashoggi Holdings and Mr Khashoggi made implied and continuing representations of fact that:- i) the Claimant in fact possessed, or in fact had available to it from Mr Khashoggi, the funds required to complete the purchase of the Sale Shares and comply with all the Claimant’s financial obligations under the SPA; ii) the Claimant and Mr Khashoggi both in fact possessed the intention that the Claimant should complete the purchase of the Sale Shares; iii) the Claimant and Mr Khashoggi had in fact taken and/or were in fact taking steps to make payment of the Initial Payment; and iv) actions of the financial institutions involved prevented the Claimant from making the Initial Payment.

242. As to falsity, the Defendants allege as follows:- “100.1 The Claimant did not in fact possess, and/or did not in fact have available to it from Mr Khashoggi, the funds required to complete the purchase of the Sale Shares and comply with all the Claimant’s financial obligations under the SPA. 100.1.1 Had the Claimant in fact possessed, or in fact had available to it from Mr Khashoggi, the funds required to complete the purchase of the Sale Shares and comply with all the Claimant’s financial obligations under the SPA, then the Claimant would have done so, within the timescales contemplated by the SPA or at any event prior to 7 April 2021 when the Claimant purported to terminate the SPA. 100.1.2 As it is, the Claimant did not make any payment whatsoever at any stage (including even the payment of €300,000 to Batt Company). 100.1.3 In such circumstances, and having regard to the communications and exchanges detailed in Appendix B hereto, it is to be inferred that, and the Defendants and Meta aver that, the Claimant did not in fact possess, and/or did not in fact have available to it from Mr Khashoggi, the funds required to complete the purchase of the Sale Shares and comply with all the Claimant’s financial obligations under the SPA. 100.2 Neither the Claimant nor Mr Khashoggi in fact possessed the intention that the Claimant should complete the purchase of the Sale Shares. 100.2.1 Had the Claimant and/or Mr Khashoggi in fact possessed the intention that the Claimant should complete the purchase of the Sale Shares, then the Claimant would have made the payments required under the SPA and would have completed the purchase of the Sale Shares, within the timescales contemplated by the SPA or at any event prior to 7 April 2021 when the Claimant purported to terminate the SPA. 100.2.2 As it is, the Claimant did not make any payment whatsoever at any stage, nor were any meaningful steps taken to effect completion of the purchase of the Sale Shares. 100.2.3 In such circumstances, it is to be inferred that, and the Defendants and Meta aver that, neither the Claimant nor Mr Khashoggi in fact possessed the intention that the Claimant should complete the purchase of the Sale Shares. 100.3 Neither the Claimant nor Mr Khashoggi had in fact taken and/or were in fact taking steps to make payment of the Initial Payment. 100.3.1 Had the Claimant and/or Mr Khashoggi in fact taken steps to make the Initial Payment, then the Claimant would have made the Initial Payment prior to 7 April 2021, when the Claimant purported to terminate the SPA. 100.3.2 As it is, the Claimant did not make any payment whatsoever at any stage, nor were any meaningful steps taken to effect completion of the purchase of the Sale Shares. 100.3.3 In such circumstances, it is to be inferred that, and the Defendants and Meta aver that, neither the Claimant nor Mr Khashoggi had in fact taken and/or were in fact taking steps to make payment of the Initial Payment. 100.4 It was not the actions of the financial institutions involved which prevented the Claimant from making the Initial Payment. 100.4.1 The Defendants and Meta rely in this connection on paragraphs 100.1 to 100.3 above. Since the Claimant did not in fact possess, and/or did not in fact have available to it from Mr Khashoggi, the funds required to complete the purchase of the Sale Shares and comply with all the Claimant’s financial obligations under the SPA, and since neither the Claimant nor Mr Khashoggi in fact possessed the intention that the Claimant should complete the purchase of the Sale Shares, and since neither the Claimant nor Mr Khashoggi had in fact taken and/or were in fact taking steps to make payment of the Initial Payment, it follows that it was not the actions of the financial institutions involved which prevented the Claimant from making the Initial Payment. 100.4.2 Furthermore, if it had simply been the actions of the financial institutions involved which prevented the Claimant from making the Initial Payment then the Claimant and/or Mr Khashoggi would have succeeded in ensuring that the Initial Payment was made at some point in the period from 8 December 2020 to 7 April 2021 when the Claimant purported to terminate the SPA. 100.4.3 As it is, the Initial Payment was not paid at any stage, whether in whole or in part. 100.4.4 In the circumstances, it is to be inferred that, and the Defendants and Meta aver that, it was not the actions of the financial institutions involved which prevented the Claimant from making the Initial Payment. ”

243. Adopting the summary set out in the Defendants’ written closing submissions, they say the falsity of the alleged representations can be inferred from the following facts:- i) that no payments were in fact received by the Meta Parties and no proper explanation has ever been offered as to why payments were not made; ii) that Khashoggi Holdings was in fact awaiting on its “investors” as revealed by Mr Khashoggi’s emails to Mr Nuncques of December 2020; iii) that Mr Stubbs has never revealed the outcome of the investigation that he said he was undertaking in his email to Mr Briamonte of 23 March 2021; and iv) the concerns raised by Dr Chiari about the payment document of 12 March 2021 as restated in her email of 30 March 2021.

244. The Defendants contend that Khashoggi Holdings and Mr Khashoggi made these representations knowing them to be false, and that the Defendants relied on them, saying that (as expressed in their written closings) “but for these misrepresentations, the Defendants would have rescinded/terminated the SPA in time to conclude a deal with MET”.

245. In my view, even assuming the implied representations alleged were made, the evidence does not establish that they were false, still less that Mr Khashoggi or (through him) Khashoggi Holdings knew they were false. i) Taken as a whole, the communications referred to in section (E)(7) above suggest that there were difficulties about making payments, such that it is not possible to infer from the fact of non-payment that Mr Khashoggi or Khashoggi Holdings lacked the means to pay the sums due under the SPA, albeit the exchange rates may have made this challenging. ii) The documents, and the fact of non-payment, do not support the view that Khashoggi Holdings and Mr Khashoggi had no intention to pay but were merely engaging in a façade, and it is unclear why they would have done so. iii) There is evidence that Khashoggi Holdings and Mr Khashoggi did take steps with a view to making payment, through their engagement with Credit Suisse, Deutsche Bank and Batt. iv) As noted above, there is evidence of problems arising from the approach taken by the financial institutions involved.

246. The evidence does not disclose what, if anything, Mr Stubbs did following his email of 23 March 2021 in order to ascertain why Credit Suisse withdrew, and Mr Stubbs was not called to give evidence. The Defendants suggest that Mr Stubbs was himself ‘duped’ by Mr Khashoggi’s promises of payment, as illustrated by his having told Mishcon de Reya that money was being remitted from Jeddah on 7 April 2021 which never arrived. However, I do not consider it legitimate to infer that Credit Suisse withdrew from the transaction on 23 March for a reason which would indicate that any of the alleged representations were untrue e.g. because Khashoggi Holdings were pretending to effect payments which they could not or did not intend to make.

247. Nor in my view could the court legitimately draw a relevant inference against Khashoggi Holdings or Mr Khashoggi from the (hearsay) statement of Dr Chiari that a fake transfer document had been produced. The Defendants submit that: i) Mr Khashoggi’s email of 23 March 2021 to Dr Chiari, quoted in § 217 above, shows that he could not complete the SPA until he received funds from investors, and ii) that delay “seems to have led him and KHC into making more desperate and more dishonest representations as to payment, culminating in his WhatsApp message to the 1st Defendant of 12 March 2021 … in which he attached a screen shot of a purported transfer of €1 billion being transferred from his personal account at Deutsche Bank to KHC’s account with Credit Suisse” , whereas in fact no such transfer had taken place.

248. However, the message to Dr Chiari referred to ‘finalising’ with all stakeholders, but did not say that Khashoggi Holdings or Mr Khashoggi needed them to provide funds before he could complete the transaction. Moreover, that view would seem hard to square with Mr Khashoggi’s engagement with financial institutions with a view to effecting payment during the period from December 2020 to March 2021. Whatever the explanation is for the strange episode of the purported €1 billion transfer, it is insufficient in my view to support a finding that Mr Khashoggi deceitfully misrepresented his intention to proceed with the transaction or his ability, ultimately, to pay for the shares.

249. In any event, as with the alleged pre-contractual misrepresentations, there is no evidence of reliance: see §§ 225-227 above. The counterclaim would fail if only for that reason alone. (b) Batt Company Representations

250. The Defendants allege that in early February 2021, Khashoggi Holdings (through Mr Khashoggi) and Mr Khashoggi personally represented “to the Defendants” (Counterclaim § 106) that:- i) Mr Khashoggi had been advised by Deutsche Bank to use Batt Company; and ii) he had been introduced by Deutsche Bank to Batt Company as an intermediary in relation to the transfer of funds from Mr Khashoggi’s personal bank account with Deutsche Bank to the Claimant’s bank account at Credit Suisse in order to make the Initial Payment.

251. These representations are said to have been made:- i) by a WhatsApp message in which Mr Khashoggi stated that he would check with his contact at Deutsche Bank; ii) by a WhatsApp message in which Batt Company was said to have been used by Deutsche Bank; iii) by an email from Mr Khashoggi dated 11 February 2021 stating that Deutsche Bank had sent the relevant funds to Batt Company; and iv) in an email of 5 March 2021, in which Mr Khashoggi stated that he considered that Deutsche Bank was responsible for Batt Company.

252. The Defendants allege that the falsity of those representations can be inferred from the absence of any documents to substantiate the above statements, and the improbability of Deutsche Bank having given such advice or made any such introduction, in circumstances where:- i) Batt Company was not a registered financial intermediary in Germany and was not able to perform paying agency services under German regulations; ii) no payment was made by Batt Company to the Defendants and no relevant transfer from Khashoggi Holdings/Mr Khashoggi appears to have been effected by or through Batt Company; and iii) Batt Company has not refunded the deposit which was paid on behalf of the Meta Parties.

253. The Defendants allege that they and Meta relied on the above representations in deciding that Meta should enter into a payment delegation letter with Batt Company for payment of a deposit of €300,000 to Batt Company, which it did on 11 February 2021, and that Meta should pay that deposit on behalf of Khashoggi Holdings, which Meta did on 12 February 2021.

254. I am not persuaded that the communications relied on contained (expressly or impliedly) the representations alleged. In the first message, on 5 February 2021, Mr Khashoggi said to Dr Chiari, a propos Batt, “I’ll contact my RM at Deutsche Bank tomorrow and ask him. I didn’t give it much thought honestly, as escrow agents are not that important usually. But better to be sure.” Dr Chiari replied that she had called the number corresponding to Batt, which “answers a nutritional supplement company owned by Viktor Batt ”. Mr Khashoggi responded, in the second message relied on, thanking Dr Chiari for the information and saying “I don’t know this man, Deutsche Bank used him and sent the funds to his escrow company. I hope he is not a bad person who will cause us trouble.”

255. In the email exchanges on 10 February 2021, Mr Briamonte told Mr Khashoggi that he had had long discussions with Arkady Pasdniakov of Batt, that “[w]e have arranged it all and we sent him all infos” and asking Mr Khashoggi to sign a Partnership Agreement with Batt, which was “needed to move on with the funds” . Mr Khashoggi replied: “Sure. Anything I can do to expedite. As long as it’s ok, please proceed and let me know if anything is needed.” Slightly later in the exchange, Mr Khashoggi said:- “I do not have any partners nor partnership agreements with Batt Company or anyone affiliated with it. I confirm they asked me for the TRN of Khashoggi Holding, which we don't have as a Saudi registered company. So they informed me that this is legally required since we don't have a tax registration number. But there is no partnership nor any relationship. Is my understanding correct? Deutsche Bank sent the funds to Batt company. Batt company holds the funds and pays it out to KH at Credit Suisse. Part of the held funds with Batt is directly transferred to Metaenergia. That is the deal and my understanding, anything else or contrary to that is not acceptable nor do I have any knowledge about.” Mr Briamonte responded:- “Ok Sir, very clear. I understand it is consistent with your recognition. They have called the agreement you have already signed as "partnership agreement" but, in effect, as you may see there is nothing more than "fiduciary service in money transfer" in the agreement. I am waiting their documents in order to move on with the payments and I'll forward them to you as soon as they send it over. I'll clearly take care that their role is correct and in line with your indication.” to which Mr Khashoggi replied:- “leave it in your capable hands dear Michele. I trust you 100%”

256. Finally, in the 5 March 2021, Mr Khashoggi was responding to a message from Mr Maurizio Molinari which began “I'm sorry for the uncomfortable situation which you are in with this Batt Company.” Mr Khashoggi replied:- “Thank you dear brother for your words and everything you and your team had done thus far. It’s truly a manifestation of a real partnership which we are blessed. I perfectly know and recognize the situation, I am sure we will resolve and over come it. I have strong ties with DB, as far as I am concerned they are the responsible party, I don’t know or care of this Batt co. I will put all my pressure on them to make good and directly send the money to Metaenergia and the balance either to CS or keep it for now at DB. I’ll keep you update”

257. None of those communications in my view contains a representation from Mr Khashoggi to the effect indicated in § 240 above.

258. In any case, there is no evidence that the Defendants relied on any representation of the kind alleged. Moreover, the representation is alleged to have been made to the Defendants, yet the loss was suffered by Meta (subject to any recovery by Meta from Batt, as to which there was also no evidence). There is no evidence as to how that loss affected the Defendants. This counterclaim cannot get off the ground. (I) CONCLUSIONS

259. For all the reasons set out above, both Khashoggi Holdings’ claim and the Defendants’ counterclaims fail and must be dismissed.

260. I take this opportunity to note with approval junior counsel’s significant role at trial, including the skilful presentation by Mr Laurie Scher for the Claimant of oral closing submissions on the issues relating to alleged losses.