The Tale Of A BSV Culture Shock: The Fairway Brief

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Oct 12

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Written by Arthur van Pelt

ABOUT EDITS to this article: as more material may become available after the publication of this article, it could have edits and updates every now and then. In that sense, this article can be considered a work in progress, and become a reference piece for years to come.

nChain Statement on departure of Christen Ager-Hanssen

The Fairway Brief

Correspondence & Disclosures

1. Documentation & Chronology: The allegations center around agreements and transactions dated 17th July, collectively referred to as the “17 July Transaction.” These agreements appear to be between various entities, most notably nChain Group and Indigo, but also involve HEH Holding and other related parties.
2. Alleged Shadow Directors: The ongoing involvement and influence of Calvin and Calvin’s Family Office in the affairs of nChain Group are highlighted, suggesting they function as ‘Shadow Directors’ of the organization.
3. Questionable Corporate Governance: Various allegations are raised against Calvin’s Family Office representatives, especially Marco Bianchi, for failing in their fiduciary responsibilities as directors. These include turning a blind eye to conflicts of interest, not acting in the best interests of nChain Group, and engaging in potentially fraudulent transactions.
4. The 17 July Transaction: This transaction consists of three separate agreements which, when read together, allegedly reveal a sinister objective — to undervalue and potentially extract nChain Group’s IP assets, severely undermining the group’s value and survival.
5. Board Manipulation: The article suggests that the board’s approval of the 17 July Transaction was possibly achieved through deception and manipulation. The implication is that Calvin Ayre and Marco Bianchi might have deceived other board members or that the entire board was compromised.
6. Credit Facility Agreement: An unexpected CHF 100m credit facility from Indigo to HEH Holding is highlighted. The secrecy surrounding this agreement and the lack of involvement of key nChain Group executives in its formulation are major points of contention.
7. Licence Agreement: The terms of the License Agreement are of particular concern. The agreement allegedly contains covenants and guarantees that would allow Indigo to acquire nChain’s intellectual property under certain conditions. The drafting and approval process of this agreement, especially the deviations from the original draft, raise questions about intent and corporate governance.
8. Implicated Parties: Multiple individuals and entities are implicated in the purported misconduct, including Calvin Ayre, Marco Bianchi, Stefan Matthews, and Robert Alizon. There are suggestions of intentional obfuscation, backdating of documents, and other unethical practices.
9. Summary & Implications: The article paints a picture of a deliberate conspiracy to undermine nChain Group’s value and transfer its core intellectual property assets to Indigo at a significant undervalue. If these allegations are accurate, they could have severe legal, financial, and reputational repercussions for the involved parties.

Service Agreement Overview

1. Procedural Bypass: The manner in which the agreement has been presented to the Board — without prior discussions or negotiations with the Group’s senior management — is unconventional, possibly bypassing the typical checks and balances expected in corporate decision-making.
2. Operational Changes: Notably, the Service Agreement dictates that all heads of departments within the nChain Group will now be accountable to their counterparts at Calvin’s Family Office. Such a directive alters established protocols, upsetting the corporate hierarchy, and can introduce confusion in reporting lines.
3. Governance and Compliance Concerns: The arrangement seems to starkly breach standard corporate governance protocols. A company allowing its top-level executives to be overseen by an external entity, especially a family office of a minority shareholder, can create multiple conflicts of interest. Such an arrangement risks undermining the authority of the CEO and Board, potentially diminishing managerial efficiency. There’s a valid concern that Calvin’s Family Office may be viewed as shadow directors, which further complicates matters from a governance perspective.
4. Interference and Conflicts: The added layer of management, as depicted by Calvin’s Family Office’s involvement, seems intrusive. There are allegations of unauthorized interference, from setting up reporting structures to direct interactions with the nChain Group’s management team. Furthermore, the stipulations of the agreement could compel members of the management team to disclose sensitive information to external parties, causing apprehension within the team.
5. Transparency and Ethical Concerns: The opaque manner in which the agreement was drafted and presented raises doubts about the intentions behind it. The fact that nChain’s management was sidelined during the agreement’s conception hints at possible malfeasance. Concerns are compounded by the Board Resolution’s alleged failure to address potential conflicts of interest.
6. Ulterior Motives: There’s an insinuation that the agreement serves an underlying motive — by making the nChain Group’s Management subordinate to Calvin’s Family Office, it could potentially facilitate strategic moves to disadvantage the nChain Group. Specifically, there’s a suggestion that this setup may be exploited to intentionally breach certain terms in the Licence Agreement, enabling an undervalued acquisition of nChain Group’s intellectual property.
7. Validity and Legal Implications: Given the above, the current form of the Services Agreement is heavily contested and deemed unacceptable. Any future collaboration or assistance should be established through transparent, fair, and arm’s length negotiations, ensuring all stakeholders’ interests are represented.
8. Compelled Agreement: The personal note of compliance, despite reservations, emphasizes the undue pressure or circumstances under which decisions are being made, indicating potential breaches of fiduciary duties.
9. Alleged Conspiracy: There are serious allegations of a conspiracy involving Calvin Ayre and Marco Bianchi, facilitated by Calvin’s Family Office, targeting HEH Holding for the exclusive advantage of Indigo/Calvin Ayre.

1. The most efficient course would be for the Court to direct now that TTL give security for costs up to the CMC in a specified sum. This would address the new risks faced by the Enyo Defendants without any disruption to the existing procedural timetable. Whatever the Court’s ultimate decision on quantum of longer-term security is when that issue is determined at the CMC, that sum will be significantly larger than the sum required to secure the Enyo Defendants’ position during the CMC preparation phase.
2. Alternatively, the Court could make an interim order for security for costs up to the CMC, with both parties being at liberty to argue at the CMC that the amount of the security for costs be varied (in either direction) when the main application for security for costs is determined.
3. Finally, the Court could set directions for the separate determination of the security for costs application on an urgent basis. This would require additional hearing time to be found in the near future, but given that the main issue between the parties is only as to the quantum of security, it would not need to be a long hearing.”