J.P. Morgan International Finance Limited (Appellant) v WEREALIZE.COM Limited (Respondent)

Case summary

Case ID

UKSC/2025/0053

Parties

Appellant(s)

J.P. Morgan international Finance Limited

Respondent(s)

WEREALIZE.COM LIMITED

Issue

What is the correct interpretation of the word “exercise” or “exercised” in a shareholders’ agreement in determining whether the appellant is entitled to exercise multiple or only one call notice to acquire shares

Facts

This dispute is concerned with share call options provided for in a Shareholders’ Agreement dated 24 January 2022, as amended on 17 August 2022 (the “SHA”). The SHA was entered into between the Appellant (“JPM”), and the Respondent (“WRL”), to govern their relationship as shareholders in a Greek fintech company, Viva Wallet Holdings Software Development SA (“Viva”). Schedule 1 to the SHA grants call options to both parties to buy the other’s shares in – and thereby to take full control of – Viva at a price to be determined by an expert valuation process. The question in dispute is whether the valuation methodology set out in paragraph 3 of Schedule 1 required the valuation experts to disregard the effect of certain US banking regulations (known as “Regulation K”) which applied to Viva by virtue of JPM being an “Edge Act corporation” under the US Edge Act of 1919. Regulation K restricts Viva’s activities both inside and outside the United States. WRL contends that Regulation K does not apply to Viva and, in any event, the valuation methodology required the valuation experts to ignore the impact of Regulation K on Viva’s business. Both parties issued proceedings against the other party. Both parties had proceeded on the basis that JPM could send an exercise notice in any and all of the four option exercise periods with WRL having an effective veto over such a notice in the first three option exercise periods if the JPM call option price is below EUR 5 billion. The day before trial, however, WRL then amended its defence to argue that JPM could send an exercise notice only once, and that a call option was “exercised” simply by sending an exercise notice, even if the JPM call option price was below EUR 5 billion and WRL therefore could (and did) reject the call option. The High Court rejected WRL’s “one shot construction” defence but the Court of Appeal allowed WRL’s appeal. JPM now appeals to the Supreme Court.

Date of issue

27 March 2025

Case origin

PTA

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