Magic Investments SA v Ralph Thierry Broadbent & Anor

Remote hand-down: This judgment was handed down remotely at 14:30 on 25 July 2025 by circulation to the parties or their representatives by email and by release to the National Archives MR JUSTICE MARCUS SMITH: A. THE COMPANY AND ITS FOUNDER SHAREHOLDERS

1. The Second Respondent, The Greater Good Fresh Brewing Co Limited (the Company ), was incorporated on 6 April 2010 as a start-up business selling an innovative home-brewing kit. The Company was founded by the First Respondent (Mr Broadbent) and by a Mr Dixon. Both were major shareholders in the Company.

2. Mr Broadbent and Mr Dixon had made loans to the Company in the amount of £1,251,603 (Mr Broadbent) and £633,601 (Mr Dixon) (the Founder Loans ). There may have been other shareholder loans to the Company in addition to the Founder Loans, but nothing turns on this.

3. On 5 September 2018, a shareholder’s agreement was reached between the then shareholders in the Company, which I shall refer to as the Existing Shareholders Agreement . B. THE SUBSCRIPTION BY THE PETITIONER (MAGIC)

4. The Petitioner, Magic Investments SA ( Magic ), subscribed in 2021 for 103 shares in the Company at a total price of £996,131.54 or £9,671.18 per share. This implied a value in the Company of around £45 million.

5. The terms on which Magic subscribed were contained in the following documents: i) The Subscription Agreement. A subscription agreement dated 26 March 2021 (the Subscription Agreement ). The parties to the Subscription Agreement were the Company and Magic. Under the title “AMENDED ARTICLES & SHAREHOLDERS AGREEMENT”, the Subscription Agreement provided as follows: 4.1 GOOD FAITH 4.1.1 The COMPANY and MAGIC have agreed to enter into this SUBSCRIPTION AGREEMENT on the basis that the PARTIES shall, in good faith, use all reasonable endeavours to amplify and/or amend the CORPORATE DOCUMENTS. 4.1.2 It is noted that, as far as the parties are able to procure the same, the CORPORATE DOCUMENTS shall be amended to bring them into line with transactions of a similar nature where independent investors subscribe for shares in start-up companies. 4.1.3 The PARTIES agree that a high degree of good faith and co-operation must exist between them in seeking to so amend the CORPORATE DOCUMENTS. 4.1.4 Notwithstanding this paragraph 4.1, this SUBSCRIPTION AGREEMENT shall be binding upon the PARTIES and shall be of full force and effect until such time as the CORPORATE DOCUMENTS are amended and duly signed by all parties to them. 4.1.5 Any New Shareholders Agreements shall be substantially in the form of the EXISTING SHAREHOLDERS AGREEMENT, but shall, subject to the other shareholders of the Company agreeing to the same, in addition provide for, inter alia, the following – … The Existing Shareholders Agreement is that described in paragraph 3 above. The additional provision to be made in regard to the proposed new shareholders agreements is described further below. ii) The Deed. A deed executed by Magic on 25 March 2021 (the Deed ), referring to the Existing Shareholders Agreement and declaring that Magic (referred to as the “New Shareholders”) “will be bound by and will observe and perform every provision of the [Existing Shareholders Agreement] which is capable of applying to them and which has not, at the date of this Deed been performed, as if the New Shareholders had been named in it as parties to the [Existing Shareholders Agreement] in the capacity as a Shareholder”. iii) The Nomination Agreement. A letter from the Company dated 25 March 2021, which provided that Magic would be entitled to nominate someone to the board of the Company (the Nomination Agreement ). C. THE AMENDMENT OF THE CORPORATE DOCUMENTS

6. In late autumn 2021: i) The Company and each member of the Company, including Magic, entered into a mutual Deed of Release (the Deed of Release ), by which the Existing Shareholders Agreement was terminated with prospective effect. The Existing Shareholders Agreement was not replaced by any other shareholders agreement. ii) The Deed of Release provided as follows:

3. The Company is proposing to adopt new articles of association that will incorporate many of the provisions set out in the [Existing Shareholders Agreement] and it has been proposed by the Board that the [Existing Shareholders Agreement] be terminated with immediate effect. You are being sent this letter in your capacity as a shareholder of the Company, and this letter constitutes formal notification of the intention by the Company and the Founders to terminate the Agreement. Similar letters are being sent to each Shareholder to request their consent to terminate the Agreement (such letters and this letter each being a Termination Letter ).

4. By countersigning this letter as a deed you consent to the termination of the Agreement and confirm that all provisions of the Agreement including any which are expressly stated in the Agreement as surviving its termination, or which might otherwise have done so by implication, are terminated on and from the date that the last Shareholder signs their Termination Letter (the Effective Date ). iii) As envisaged by the Deed of Release, and with the approval of all its shareholders, including Magic, the Company adopted new articles of association (the New Articles of Association ). D. THE CONVERSION OF FOUNDER LOANS INTO EQUITY

7. In 2022, Mr Broadbent referred to an approach by Brewdog to acquire a major stake in the Company at a valuation of at least £56 million. In June 2022, the Company wrote to shareholders offering up to £6 million in shares at 104p per share (one offer share per existing share) with a stipulation that shareholders who had made loans to the Company (such as the Founder Loans) could convert at the issue price, to satisfy an equivalent subscription entitlement. Magic protested the offering, referring to the Subscription Agreement as containing provisions precluding this, and seeking an undertaking that the transaction would not be implemented. This protest was disregarded, the subscription offer was declared unconditional, and Mr Broadbent as a result converted £1,115,440 of his Founder Loans to acquire 1.11 million offer shares. E. THE PETITION

8. By a petition under section 994 of the Companies Act 2006 dated 5 December 2022 (the Petition ), Magic sought relief for unfair prejudice in the conduct of the affairs of the Company. As Magic’s written submissions on this appeal make clear, the allegation of unfairly prejudicial conduct was made on three bases: i) That in breach of the Nomination Agreement, the Company had failed and refused to permit Magic to nominate an individual to act as a director of the Company. Before me, this was referred to as the Board Seat Allegation , and I adopt this label. ii) That in breach of the Subscription Agreement, the Company had failed to use reasonable endeavours in good faith to amend the Existing Shareholders Agreement in line with the requirements of clause 4.1.5 of the Subscription Agreement (which provision is set out in part at paragraph 5(i) above). The provisions that the Subscription Agreement stipulated for the new shareholders agreements were as follows: A. Change of Class of Shares All classes of shares should possibly be consolidated into one class of shares enjoying the same rights and privileges. B. Repayment / Discharge of Loan We refer to the Founder Loans set out in Annexure 1. • The Founder Loans shall be treated as follows ◦ Loans 1, 2 and 3 are unsecured, rank pari passu to ordinary shares in the Company and have an annual interest rate of 8.5%. These loans are repayable in accordance with their terms and shall be fully repaid by 20 June 2022 or on the closing of a Qualified Transaction (whichever is the earlier). ◦ Loan 4 is secured by a first ranking charge over the assets of the Company. It has an annual interest rate of 7% and is repayable (as to principal and accrued interest) on 30 September 2021. ◦ Loans 5 and 6 are interest free, unsecured, rank pari passu to ordinary shares in the Company and are only repayable in the event of a Qualified Transaction. • All distributions shall be in accordance with each Shareholder’s pro rata percentage holdings of the total number of the issued and outstanding shares in the Company. • As long as shareholders loans 5 and 6 are outstanding, the distribution to all shareholders will be in accordance with each Shareholder’s pro rata percentage holdings, and shareholders loans 5 and 6 shall not be repaid prior to a Qualified Transaction. The Founder Loans referred to in paragraph 2 above fell under the classification “loans 5 and 6”. A “Qualified Transaction” is a defined term in the Subscription Agreement, but it is not necessary to set this out. I shall refer to the allegation that these proposed terms were wrongfully not implemented into any new shareholders agreement (indeed, there was no new shareholders agreement at all, as I have described in Section C above) as the Failure to Amend Allegation . iii) That there had been unfairly prejudicial conduct in the issue of new capital by way of share offering to existing shareholders, which included the conversion of the Founder Loans into equity. The matters complained of are those described in Section D above, and I shall refer to this allegation as the Dilution Allegation . The Dilution Allegation has two aspects, one which is linked to the Failure to Amend Allegation and the other which stands independently of it. F. THE APPLICATION FOR REVERSE SUMMARY JUDGMENT

9. Shortly before the trial of the Petition was due to commence on 15 May 2024, Deputy ICC Judge Agnello, KC heard Mr Broadbent’s application for “reverse summary judgment” in regard to the Petition. The application had been made on 20 December 2023 and was heard on 12 April 2024. The Judge gave judgment on 19 April 2024, giving summary judgment in favour of Mr Broadbent and against Magic in regard to each of the allegations set out above (the Judgment , [2024] EWHC 887 (Ch) ).

10. The Judge set out the approach to applications for reverse summary judgment at Judgment/[4]-[6] and no complaint is made of her statement of the relevant principles by either party, although it was Magic’s case that the Judge had erred in the application of those principles. It is, therefore, not necessary for me to re-state the approach the Judge should have taken.

11. Although Magic complained that the timing of Mr Broadbent’s application meant that – once it had succeeded before the Judge – the date for the trial of the Petition was inevitably lost, no criticism was (or could be) made of the Judge in determining Mr Broadbent’s application. As the Judge noted (at Judgment/[7]): Whilst this application has ended up being heard only a month before the trial is due to start, this in itself, in my judgment, has no bearing upon the matters which I am required to determine. Both Mr Head [counsel appearing for Magic before the Judge, but not before me] acting on behalf of the petitioner and Mr Dougherty acting on behalf of the first respondent agreed that this was the case. Accordingly, I will not set out the details of the issue of the application and procedural steps.

12. The Judge was right in this: Mr Broadbent’s application, having been listed before the Judge, had to be determined by her. Whilst it is unfortunate that there was not a sufficient gap between the trial date for the hearing of the Petition and the Judge’s Judgment to enable an appeal to be heard and determined, that counsel of perfection does not in any way affect the correctness of the Judge’s decision to hear and determine Mr Broadbent’s application.

13. The Judge rejected all of the grounds in the Petition on the following grounds: i) As regards the Board Seat Allegation, the Judge held that: a) The Nomination Agreement was just that – an entitlement to nominate someone to the board of the Company: Judgment/[22]. The Judge distinguished between an entitlement to nominate and an entitlement actually to be appointed, and concluded that Magic only had the former “right” (and had only pleaded a case on this basis): Judgment/[23], [24]. One point made against the Judge’s decision was that this rendered the Nomination Agreement effectively meaningless, because it conferred on Magic nothing that it could not in any event do as a shareholder. In short, Magic’s point was that “nomination” had to be read as a right to appoint. b) Furthermore, any entitlement to appoint would have to be contained either in a shareholders agreement or in the articles of association: Judgment/[23]. c) The Judge rejected an argument that there was a right only to nominate once (Judgment/[25]), but also found that there had only been one (successful) attempt to nominate (Judgment/[43]). d) The Judge also considered the relationship between Magic’s pre-existing rights and the changes brought about by the Deed of Release and the New Articles of Association, but did not reach any relevant determination on this point. e) The Judge also considered that there was no prejudice to Magic, because any and all directors owe the same duties and obligations to the Company as well as to shareholders as a whole (Judgment/[40]). As a result, even if the point succeeded, the Petition would not serve to provide the Magic with any remedy (Judgment/[44]-[45]) ii) As regards the Failure to Amend Allegation, the Judge concluded that the obligations under clause 4.1 of the Subscription Agreement were “good faith” obligations, and did not consider a failure by the Company to achieve amendments to the corporate documents to constitute unfair prejudice (Judgment/[49], [53]). iii) As regards the Dilution Allegation, the Judge held: a) There was no restriction on the conversion of debt to equity, even if the Corporate Documents had been re-framed as envisaged by the Subscription Agreement. Properly construed, these provisions were restricted to the repayment of loans, not their conversion to shares (Judgment/[52], [53], [58]). b) The Judge again touched upon the suggestion that the Subscription Agreement could not have survived the Deed of Release and the New Articles of Association (Judgment/[59]), but the Judge appears not to have based her decision on this point (Judgment/[62]-[63]).

14. Because it is relevant to what came to be referred to as “Ground 4A”, the Judge considered whether (in light of her conclusions), Magic should be given time to amend the Petition, so as to “rescue” it. The Judge accepted that in cases of strike-out, the party being struck out was in an appropriate case permitted to amend their case. In this case, the Judge did not take that course for the reasons given in Judgment/[83]. The Judge noted that, during the hearing, she had repeatedly invited Magic to consider amending, and that those offers had not been taken up. She also noted that there were no draft amendments before the court. She declined to adjourn to allow any amendments to be proposed (Judgment/[83]).

15. An order consequential to the Judgment was made on the same day. There was a further order, dealing with the question of costs dated 26 May 2024. G. MATTERS SUBSEQUENT TO THE JUDGMENT AND THE GROUNDS OF APPEAL

16. By an order dated 15 May 2024, Trower J stayed execution of parts of the Judge’s second order, pending an application for permission to appeal; and by a further order dated 18 October 2024 (there were two other orders giving extensions of time dated 21 June 2024 (Richard Smith J) and 16 July 2024 (Miles J)), Trower J gave permission to appeal on all of the Grounds of Appeal. The grounds of appeal contend (in very brief summary: I do not propose to set them out in detail): i) That the Judge erred in relation the construction of the Nomination Agreement, which (properly construed) provided for a right to appoint. ii) The Judge’s analysis of the failure to amend the Existing Shareholders Agreement as not being capable of constituting unfair prejudice was flawed. iii) That the Judge’s analysis of the conversion of the Founder Loans as not constituting “repayment” was wrong.

17. Accordingly, Magic contended that the striking out of the Board Seat Allegation, the Failure to Amend Allegation and the Dilution Allegation was wrong. Additionally: i) Magic articulated a further ground of appeal – Ground 4A – which Mr Broadbent does not oppose being heard, although it is contended that permission to appeal should not actually be given. Ground 4A provides: The Deputy ICC Judge erred in striking out the Petition without allowing the Petitioner the opportunity to plead an oral agreement that the deed of termination and the resolution passed for the adoption of new articles of association did not affect the Petitioner’s rights under the nomination agreement and the subscription agreement. I propose to consider the substance of Ground 4A alongside the other grounds of appeal which appear in Magic’s Grounds of Appeal. ii) Mr Broadbent has filed a Respondent’s Notice contending that the Judge’s first order should be upheld on grounds other than those set out in the Judgment.

18. The appeal was argued before me on 7 May 2025, and I reserved my judgment. H. AN UNDECIDED POINT?

19. It is convenient to begin with Mr Broadbent’s contention that the Judge’s first order, granting reverse summary judgment, can be upheld on grounds other than those stated in the Judgment. The Respondent’s Notice contends that the effect of the Deed of Release and the New Articles of Association meant: i) That the requirements of clause 4.1.4 of the Subscription Agreement were satisfied (such that the Subscription Agreement ceased to have any on-going effect between Magic and the Company); alternatively ii) That any on-going contractual obligation on the part of the Company in respect of the Subscription Agreement and the Nomination Agreement ceased in respect of any alleged breach occurring after 1 November 2021.

20. The Respondent’s Notice proceeds on the basis that this point was not decided by the Judge, but that it supports the conclusion reached by the Judge. By contrast, Magic considered that this point had been decided by the Judge against Magic. Paragraph 4 of the Grounds of Appeal pleads: If the Deputy ICC Judge held that the subscription and nomination agreements were superseded by the deed of termination of shareholders’ agreement, she erred in so holding. On their true construction, and having regard to the factual matrix surrounding the execution of the deed of termination, including the written and oral discussions between the parties as to the Petitioner’s rights under the nomination agreement and the effect of the deed of termination upon the Petitioner’s rights under the nomination agreement and the subscription agreement, the deed of termination did not affect those rights, or at least that this issue of construction was not fit to be determined on a reverse summary judgment application shortly before trial. Further and in the alternative, the Petitioner had a realistic prospect of establishing at trial that it was agreed orally between the Petitioner and the company, that it and the resolution passed for the adoption of new articles of association did not affect the Petitioner’s rights under the nomination agreement and the subscription agreement.

21. Construing the Judgment, I conclude that the Judge did not deal with this point and that this is not why Magic lost the application. That is clear from Judgment/[62]-[63]. Since Magic lost for reasons other than this (as I have described), and since this point was not decided, Mr Broadbent is therefore right to raise it in his Respondent’s Notice. I. GROUND 4A

22. Ground 4A seeks to challenge what was a case management decision by the Judge not to allow the Magic a “second bite of the cherry”. The Judge gave her reasons for this at Judgment/[83]. She was within the broad ambit of her judicial discretion in reaching this conclusion, and set out her reasons clearly. I have no basis for setting that decision aside as being one that the Judge had no right to make, and accordingly I refuse permission to appeal on this ground. Had permission to appeal been granted along with the other grounds of appeal, I would have dismissed the appeal. J. THE ARGUMENT THAT THE SUBSCRIPTION AGREEMENT AND THE NOMINATION AGREEMENT WERE SUPERSEDED (1) The relevant provisions

23. The opening words clause 4.1 of the Subscription Agreement were set out at paragraph 5(i) above. Clause 4.1.5 is an “agreement to agree” that stipulates (emphasis added): Any New Shareholders Agreement shall, subject to the other shareholders of the Company agreeing to the same , in addition provide for, inter alia, the following –

24. The provisions that were to be included in a new shareholders agreement have already been set out at paragraph 8(ii) above. (2) Magic’s argument and analysis

25. Magic’s contention was that these “promises” in the Subscription Agreement remained in force and, to the extent that Mr Broadbent had disregarded them, that disregard constituted unfair prejudice for the purposes of section 994 .

26. I do not regard this contention as arguable, for two closely related reasons. First, even disregarding the existence of the Deed of Release and the New Articles of Association, the substantive provisions of clause 4.1.5 under headings “A” and “B” are not promises. Secondly, even if they were capable of amounting to promises, they were overtaken and superseded. These points are closely linked, but it is helpful to try to keep them disentangled. (3) An agreement to agree

27. The substantive provisions of clause 4.1.5 under headings “A” and “B” are (as I have said) not promises. At most, this is an “agreement to agree”, in circumstances where the agreement of not merely the Company and Magic was requisite, but also that of other interested persons, notably the other shareholders in the Company. It is arguable that the Company was obliged to act in good faith to conclude a “New Shareholders Agreement” along these lines, but there was no guarantee that such an outcome would obtain. Clause 4.1.5 expressly refers to “the other shareholders of the Company agreeing to the same”. At the very most, the Company was undertaking to try to obtain an agreement along these lines. Any unfair prejudice case would have to be on the basis that the Company had failed to do what it had promised in clause 4.1.1, namely “in good faith, use all reasonable endeavours to amplify and/or amend the CORPORATE DOCUMENTS”.

28. Obviously an allegation of bad faith would have to be clearly made out and pleaded. It is not enough to assert that a desired end was not achieved. Furthermore, one of the points made by Mr Broadbent is that the Petition makes allegations only against Mr Broadbent, and not the Company. This is significant, because Mr Broadbent was not a majority shareholder and could not dictate the terms of any “New Shareholders Agreement”. In short, Magic faces very significant difficulties even at this first stage of the analysis.

29. But that is not the end of the point. (4) Performance of the agreement to agree

30. The Deed of Release and the New Articles of Association represent exactly the performance of the aspirations articulated in the Subscription Agreement. The aim, as articulated in the Subscription Agreement, was to bring the Corporate Documents into line with transactions of a similar nature. That is clearly what the New Articles of Association were seeking to achieve, as the Deed of Release expressly states. More to the point, Magic (in stipulating to the Deed of Release) participated in and endorsed this process.

31. The fact is that the Company and all of the shareholders, including Magic, acceded to this course, which did not involve any new shareholders agreement at all. It is not arguable that Mr Broadbent or the Company breached any obligation contained in the Subscription Agreement. Indeed, the Petition might properly be described as an attempt to revisit and reopen agreements that Magic entered into of its own volition. (5) Implications

32. It follows that I accept the point made in the Respondent’s Notice, and consider this to be a complete answer to the Failure to Amend Allegation and to the Dilution Allegation to the extent that this allegation is related to the Failure to Amend Allegation. I consider these points not to be arguable in light of (i) the terms of the Subscription Agreement, (ii) the execution of the Deed of Release by all shareholders, including Magic and (iii) the entry into force of the New Articles of Association. I therefore dismiss these two grounds of appeal, leaving for further consideration: i) What I shall term the Pure Dilution Allegation . This allegation of unfair prejudice contends that altogether independently of the Failure to Amend Allegation, Magic was unfairly prejudiced because (i) the offering of additional shares was at an “undervalue”, (ii) in circumstances where the holders of Founder Loans were advantaged by being able to convert those loans into equity, such that (iii) Magic’s shareholding was improperly (and to Magic’s prejudice) diluted. ii) The Board Seat Allegation. The right to nominate arises out of the Nomination Agreement. The Nomination Agreement is not a “Corporate Document” within the meaning of the Subscription Agreement, and it is well-arguable that the Nomination Agreement (such as it is) survives the Deed of Release and the New Articles of Association.

33. It is necessary to consider these points further. K. THE PURE DILUTION ALLEGATION

34. Although the Company contended that the petition was against Mr Broadbent, and not the Company, and that Mr Broadbent (as a minority shareholder) could not act to prejudice Magic in the way pleaded in the Petition, it seems to me that it would be an error to decide this point of appeal on an arid technical ground which (even if correct) can easily be corrected for.

35. I am also going to proceed on the basis that the offering of additional share was at an “undervalue” in the sense that had there been an offering of shares to persons other than existing shareholders, the offer price would have been higher . The use of the term “undervalue” is, in such a case, something of a tendentious one. What the Company was doing was seeking additional funding from existing shareholders on terms advantageous to those existing shareholders.

36. Apart from the question of the Founder Loans, to which I shall return, the fact that the favourable terms for the acquisition of new shares were offered to all shareholders is fatal to Magic’s argument. Magic had exactly the same rights to participate as all the other shareholders, and simply declined to avail itself of the opportunity. It cannot be the case that Magic’s failure to take up the offer is of any weight at all: were material weight to be attached to a failure to take up an offer that could have been accepted on non-discriminatory terms, then that would give every individual shareholder an effective veto. That proposition only has to be stated to be rejected, and I do so reject it.

37. The question is whether the conversion of the Founder Loans from debt to equity makes a difference to this analysis. I fail to see how it can. There is no suggestion that the holders of the Founder Loans were paying any less for the new shares than any other shareholder, and the Company’s balance sheet was being improved by this transaction in exactly the same way as by the injunction of new money by an existing shareholder. It is not arguable to say: i) That Magic was prejudiced quoad any other existing shareholder. ii) That Magic and the other existing shareholders were prejudiced quoad the holders of the Founder Loans.

38. I dismiss the appeal in regard to the Pure Dilution Allegation. L. THE NOMINATION AGREEMENT AND THE BOARD SEAT ALLEGATION

39. The Nomination Agreement is an informal document. It is on the Company’s headed paper, “signed” by Mr Broadbent (his name is typed: there is no signature), and addressed “To whom it may concern”. It provides: I write in respect of the investment of £1,199,226.32 by [Magic] in [the Company].

1. [Magic] will be issued with 124 shares. There will be no more than 4,653 shares in issue at the time of the transaction, giving a post-closing percentage company ownership of 2.66%.

2. [Magic] will be entitled to nominate someone to the board.

3. The company does not currently require an audit in terms of the laws of England and accordingly the Warranties contained in clause 3 of the Subscription Letter are true and correct.

4. When [the Company] begins to export to South Africa, it intends to enter into a License and Distribution Agreement with the RAM Group where the RAM Group will be appointed to import and distribute TGG Products into South Africa.

40. The label “Nomination Agreement” is somewhat misleading and is not how the instrument (I hesitate to call it a contract) describes itself. Three of the paragraphs set out above cannot be regarded as contractual promises at all . Clause 4 is (as was the case with the Subscription Agreement) aspirational and merely a statement of intention. Clause 1 is really a statement of what the Subscription Agreement will achieve, and cannot be construed as a self-standing promise. Clause 3 appears to be no more than a statement by the Company that the warranties in the Subscription Agreement are true. If anything, it is a somewhat self-serving attempt to head-off any breach of warranty allegation by Magic in the future. It is certainly not a promise.

41. I appreciate that none of these provisions are directly relevant for determination in this appeal. But instruments (again, I hesitate to use the term “contract”) must be read as a whole, and it does seem to me that clause 2 is coloured by the nature of the document as a whole, and the other provisions contained within it.

42. The Judge read clause 2 as conferring no more than a right to nominate. In short, the Judge correctly assessed the “rights” conferred by the Nomination Agreement as minimal, and as not amounting to a right to appoint. In this, I consider the Judge was correct. Indeed. it seems to me that the Judge was wrongly generous to Magic in construing this “promise” as anything more than a “one-off”. More specifically: i) The right to appoint a director is a significant right. True it is that all directors must act bona fide in the interests of the company and the shareholders as a whole. But that does not mean that having a director with a specific brief to have regard to specific interests is not a proper and valuable role in the protection of those interests, and that consequently a power to appoint matters. ii) It is because of the significance of such powers that a power to appoint is not generally bilaterally agreed between a company and one shareholder, without the involvement of the other shareholders. It seems to me that the Judge was right to consider that a right in a single shareholder to appoint a director would have to bind all shareholders, either by way of the articles of association or in a shareholders’ agreement. Otherwise there is a questionable preferring of one shareholder (here: Magic) over all the others. iii) This is strongly suggestive that the Judge’s reading of the Nomination Agreement is correct: that the Nomination Agreement simply recorded a right that Magic would have had in any event, namely to nominate a director whose name – I am prepared to accept – would receive serious consideration from the Company for the purposes of appointment. iv) This was exactly what happened. Magic nominated a Mr Christopher Meyer, and the Company showed every willingness to appoint him (and may even have done so) as director. It was Mr Meyer himself who (for reasons of his own) felt unable to continue to act, and he withdrew. v) Magic did not nominate anyone else: they say because it was clear that that nomination would be refused. This is an evidential matter on which I am not going to be drawn. I consider that the Nomination Agreement was at most a one-off ability to nominate with (possibly – and in the circumstances it does not matter) an obligation on the Company to consider that nomination but not guarantee the appointment.

43. It was Magic’s contention that the Nomination Agreement conferred an entitlement on Magic to appoint a director “in perpetuity”: see, for example, paragraph 32 of the witness statement of Mr Lazarus on behalf of Magic. It is clear that the Nomination Agreement is nowhere near sufficient to support so bold an assertion, and I reject it (i) for the reasons given by the Judge and (ii) for the additional reason that I consider the Nomination Agreement was considering at most a “one-off” nomination. In short, I do not consider the point to be arguable.

44. Additionally, it is very difficult to see how the right contended for by Magic could survive the re-arrangement put in place by the Deed of Discharge and the New Articles of Association. One would expect a specific right of appointment to be dealt with in the articles.

45. As part of this appeal, Magic contended that their case could be improved by amendments to the Petition pleading certain oral conversations which supported the contention of a right of appointment in perpetuity. For the reasons I have given, the Judge’s refusal to permit such a course is unimpeachable, and I therefore do not need to consider the evidence on this point, and do not do so. L. DISPOSITION

46. For all these reasons, the appeal (including in relation to Ground 4A) is dismissed.