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Artilium and TriStar Africa v. Artilium Group and others

Artilium Africa, LLC and TriStar Africa Telecom, LLC v. Artilium Group Limited, Green Globe Services, LLC and Pareteum Corporation, ICDR Case No. 01-19-0003-1680
Nature of the proceedings:
International
Type of case:
Commercial Arbitration
Economic sector:
Information and communication
Telecommunications
Date of introduction:
4 Oct 2019
Status of the case:
Concluded
Claimant’s country of origin:
United States
Respondent's country of origin:
United Kingdom
,
United States
Institution:
AAA-ICDR (International Centre for Dispute Resolution)
Rules of arbitration:
Seat of arbitration:
Washington D.C.
Applicable law:
Virginia (United States)

Documents of the case

profile picture Carolyn B. Lamm Sole arbitrator
Picture of partner

This document was contributed under the IBA x Jus Mundi Exclusive Partnership for Commercial Arbitration.

Contributor(s):

  • logo organization

    Jus Mundi

AAA-ICDR has not contributed to this publication.

Lawyers, other representatives, expert(s), tribunal’s secretary

Final Award

I. Introduction

1.
This Final Award resolves all claims between the parties.

II. Procedure

2.
On 4 October 2019, Tristar Africa Telecom, LLC submitted a Notice of Arbitration against Artilium, plc & Green Global Services, LLC, received by the American Arbitration Association (AAA) on January 7, 2019 and assigned to its International Centre for Dispute Resolution (ICDR) for administration.
3.
On 2 September 2020 the undersigned was appointed by the ICDR as the Sole Arbitrator.
4.
On 29 June 2020, Respondents 1 and 2 submitted their Answer.
5.
On 4 January 2021, Claimants informed the ICDR via correspondence that the Judge in the Delaware Litigation stayed the court proceedings and ordered that Pareteum Corporation be joined as a respondent to the arbitration.
6.
On 8 January 2021, Respondents requested that Claimants provide a revised Demand for Arbitration containing allegations against all Respondents and also informed the ICDR that Respondent 1, Artilium PLC changed its name to Artilium Group Limited.
7.
On 11 January 2021, Claimants informed the ICDR that no written opinion was issued concerning the Stay Order relating to the Delaware lawsuit and requested an extension of time until 19 January 2021 to file a revised claim.
8.
On 21 January 2021, Claimants submitted their Amended Demand Document.
9.
On 25 January 2021, Respondents requested an extension of time to respond to the Amended Demand.
10.
On the same date, McGuireWoods entered a notice of appearance on behalf of Respondents.
11.
On 17 February 2021, the Sole Arbitrator, the Tribunal Secretary, the ICDR and the parties participated in the Preliminary Hearing.
12.
On 19 February 2021, the Sole Arbitrator issued Procedural Order No. 1 and its accompanying Annex A, the Procedural Timetable, granting the parties until 26 February 2021 to provide any comments or an agreed alternative to Annex A.
13.
On 23 February 2021, Claimants submitted their Amended Demand Document with Exhibits.
14.
On 26 February 2021, the Sole Arbitrator acknowledged receipt of Claimants' Amended Demand and accompanying exhibits and took notice of Mr. Robert Toland's appearance as counsel for Claimants.
15.
On the same date, the parties submitted a joint proposal for the Procedural Timetable.
16.
On 1 March 2021, the Sole Arbitrator acknowledged receipt of the joint proposal for the Procedural Timetable, confirmed the hearing dates, and requested that both parties confirm their understanding that they are waiving the time limit set forth in Article 15.2.3 of the Operating Agreement if the arbitration proceeded according to the parties' Agreed Procedural Timetable.
17.
On the same date, Claimants confirmed they agreed to waive the terms of Article 15.2.3 of the Operating Agreement if the arbitration proceeded according to the parties' Agreed Procedural Timetable.
18.
On 2 March 2021, Respondents confirmed they agreed to waive the terms of Article 15.2.3 of the Operating Agreement if the arbitration proceeded according to the parties' Agreed Procedural Timetable.
19.
On 2 March 2021, the Sole Arbitrator circulated the Agreed Procedural Timetable to the parties, Annex A to Procedural Order No. 1.
20.
On 5 March 2021, Respondents submitted their Answer to the Amended Demand.
21.
On 9 March 2021, the Sole Arbitrator sent the parties a sample Redfern Schedule for use in document production and reminded the parties that all exhibits and legal authorities should be numbered as set forth in paragraph 11 of Procedural Order No. 1.
22.
On 10 March 2021, the parties submitted their respective document requests.
23.
On 17 March 2021, Claimants submitted their Objections to Respondents' Document Requests.
24.
On the same date, Respondents submitted their Objections to Claimants' Document Requests.
25.
On 19 March 2021, Claimants submitted their Reply to Response to Claimant's Document Request.
26.
On the same date, Respondents submitted their Replies to Claimants' Objections to Document Requests.
27.
On 20 March 2021, the Sole Arbitrator invited Claimants to confirm that they would produce certain documents.
28.
On 22 March 2021, Claimants provided the requested confirmation.
29.
On 24 March 2021, Respondents requested confirmation that documents would be treated confidentially.
30.
On 25 March 2021, the Sole Arbitrator and Claimants confirmed and agreed with the confidentiality undertaking.
31.
On 25 March 2021, Respondents requested the ICDR's confirmation that documents would be treated confidentially.
32.
On 26 March 2021, the ICDR confirmed that documents would be treated confidentially.
33.
On 26 March 2021, the parties submitted their respective document productions and corresponding privilege logs.
34.
On 27 March 2021 the Sole Arbitrator issued decisions on the document production requests.
35.
On 3 April 2021, Respondents produced additional documents further to the Sole Arbitrator's decision.
36.
On 7 April 2021, Claimants submitted a Stipulation For Extension Of Time To Submit Claimants' Memorial. This Stipulation also extended the time limit for Respondents to submit their Counter-Memorial.
37.
On the same date, the Sole Arbitrator signed the Stipulation For Extension Of Time To Submit Claimants' Memorial.
38.
On 12 April 2021, Claimants submitted their Memorial, the Declarations of Paul Delkaso and Mark Westerfield, and the referenced exhibits.
39.
On 15 April 2021, the Sole Arbitrator ordered Claimants to submit all legal authorities referred to in their Memorial by 19 April 2021 and requested that Respondents confirm by 16 April 2021 whether they maintain any counterclaim in the arbitration.
40.
On 16 April 2021, Respondents confirmed they are not maintaining a counterclaim in the arbitration.
41.
On 19 April 2021, Respondents submitted correspondence requesting "leave to submit a motion seeking the dismissal of Green Globe and Pareteum from the Arbitration prior to the ultimate hearing scheduled for the week of June 21, 2021."
42.
On 19 April 2021, Claimants submitted an Amended Claim Memorial with accompanying exhibits and legal authorities.
43.
On 19 April 2021, the Sole Arbitrator granted Claimants until 22 April 2021 to provide any comments they may have with respect to Respondents' correspondence requesting leave to submit a motion seeking the dismissal of Green Globe and Pareteum.
44.
On 22 April 2021, Claimants submitted correspondence in response to Respondents' Motion to Dismiss and accompanying exhibits.
45.
On 23 April 2021, Respondents submitted further correspondence concerning the document production and Claimants' 22 April 2021 correspondence.
46.
On 23 April 2021, the Sole Arbitrator informed the parties no decisions on adverse inferences would be taken at this time and informed the parties that no further submissions on the potential dismissal of Respondents 2 and 3 were necessary at this time. Adverse inferences are addressed in this Award.
47.
On 23 April 2021, the Sole Arbitrator issued Procedural Order No. 2 declining to dismiss Respondents 2 and 3 in a preliminary phase but providing the parties were invited to support their respective positions on Respondents 2 and 3 in the remaining submissions in the arbitration.
48.
On 3 May 2021, Respondents submitted their Counter-Memorial and Witness Statements.
49.
On 7 May 2021, Claimants submitted their Reply to Counter-Memorial and Declaration of Paul Westerfield.
50.
On 14 May 2021, Respondents submitted their Rejoinder and Supplemental Witness Statements.
51.
On 17 May 2021, Respondents requested clarification of the Statement of Issues and Desired Outcome.
52.
On 18 May 2021, Respondents submitted correspondence concerning typographical errors in their Counter-Memorial submission.
53.
On 18 May 2021, the Sole Arbitrator requested the parties agree on a format and tentative schedule for the Hearing by 21 May 2021 and addressed Respondents' request for clarification of the Statement of Issues and Desired Outcome.
54.
On 21 May 2021, Respondents submitted correspondence concerning the format and schedule of the hearing.
55.
On 21 May 2021, the Sole Arbitrator requested Claimants' comments on Respondents' proposal by 24 May 2021.
56.
On 24 May 2021, Claimants informed the Sole Arbitrator of their agreement with Respondents' hearing proposal.
57.
On 24 May 2021, the Sole Arbitrator requested that Claimants notify of any witnesses they will call for cross-examination, to the extent possible.
58.
On 25 May 2021, Claimants submitted correspondence indicating that they would call Respondents' three witnesses for cross-examination.
59.
On 25 May 2021, Respondents submitted correspondence requesting that Aaron Jaroff be included on all correspondence.
60.
On 27 May 2021 the Sole Arbitrator issued Procedural Order No. 3 setting forth the hearing procedure as agreed by the Parties.
61.
On 4 June 2021, the parties simultaneously submitted their respective Statement of Issues and Desired Outcome.
62.
On 15 June 2021, the Sole Arbitrator, the Parties, and the Tribunal Secretary participated in the Pre-Hearing Conference.
63.
On 16 June 2021, Claimants submitted their correspondence on damages.
64.
On 18 June 2021, Respondents submitted their correspondence on damages.
65.
On 18 June 2021, the Sole Arbitrator granted Claimants until 20 June 2021 to respond to Respondents' request for cancellation of the Hearing.
66.
On 20 June 2021, Claimants submitted their reply to Respondents' request for cancellation.
67.
On 20 June 2021, the Sole Arbitrator indicated via email that the Hearing would proceed on 22 June 2021 and that a reasoned procedural order would follow on 21 June 2021.
68.
On 21 June 2021, Respondents submitted correspondence requesting the exclusion of the Supplemental Declaration of Paul Delkaso.
69.
On 21 June 2021, the Sole Arbitrator issued Procedural Order No. 4 addressing the Parties' pre-hearing procedural requests.
70.
On 22 and 23 June 2021, the hearing on the merits was held in Washington, DC.
71.
The Parties agreed at the conclusion of the hearing that TSG Reporting would deliver the hearing transcript within 10 business days of the hearing.
72.
The Parties further agreed that they would submit a corrected transcript to the Sole Arbitrator within 3 days of receipt of the transcript from TSG Reporting.
73.
On 28 June 2021, the Sole Arbitrator issued Procedural Order No. 5 regarding the hearing transcript, post-hearing submissions, and a procedural timetable.
74.
On 20 July 2021, the Sole Arbitrator issued an updated procedural timetable reflecting the dates of final submissions.
75.
On 21 July 2021, Claimants informed the Sole Arbitrator of a further extension of the dates established in the procedural timetable for the remainder of the proceeding.
76.
On 21 July 2021, the Sole Arbitrator confirmed the revised dates for the remainder of the proceeding.
77.
On 30 July 2021, Claimants submitted Mr. Delkaso's Second Supplemental Declaration and Exhibits.
78.
On 23 August 2021, the Parties submitted Post-Hearing Briefs.
79.
On 13 September 2021, the Parties submitted Rebuttal Post-Hearing Briefs.
80.
On 16 September 2021, the Sole Arbitrator requested that the parties confirm in writing their respective positions on (a) the type of reasoned award requested; and (b) whether the Sole Arbitrator must select either Respondents' proposed Award or that of Claimants.
81.
On 17 September 2021, the Sole Arbitrator issued a revised p. 4 of the Agreed Procedural Timetable, updating the submission date for the remaining submissions, as agreed by the Parties.
82.
On 22 September 2021, Claimants requested clarification of whether the parties' costs submissions would be shared with the other side or only with the Sole Arbitrator.
83.
On 26 September 2021, the Sole Arbitrator clarified that costs submissions would be shared with the other side and the Sole Arbitrator and invited the parties to redact any narrative entries as or if necessary.
84.
On 1 October 2021, both parties submitted their responses to the Sole Arbitrator's request for further briefing on a reasoned award and the form of the Final Award.
85.
On 8 October 2021, the Parties submitted their respective submissions on costs.
86.
On 10 December 2021, the Sole Arbitrator closed the proceedings.
87.
On the same date, the ICDR informed the parties that the Final Award was due no later than 8 February 2022, in accordance with Article 30 of the applicable International Arbitration Rules.

III. Arbitration Agreement

88.
The agreement to arbitrate is set forth at Article 15 of the Operating Agreement and provides as follows:

15.1. Meeting of Principals. Any dispute, demand, claim or controversy between the Members arising out of or relating to the business or the operation of the Company, or any contract or subcontract between Company and any Member or between any Members, upon written request by any Member, the Members shall convene a meeting of principals representing each Member, physically present at the meeting, to consult and negotiate with each other and, recognizing their mutual interests, attempt to reach a solution satisfactory to both Parties. For business entities, this meeting shall be attended by at least one principal representing each Member who shall be authorized and have full authority on behalf of the Member to resolve the dispute fully.

15.1.1 This meeting shall be conducted in the English language.

15.1.2 This meeting shall be held within 2 weeks of any request by either Party, absent exceptional circumstances. If the other Party fails or refuses to meet, or if the Parties cannot agree on the date of the meeting, then the Party requesting the meeting of principals may proceed to mandatory arbitration, as set forth in the following section, as if the meeting of principals had taken place.

15.1.3 This meeting shall be held in a mutually agreeable and convenient location. If the Parties cannot agree on the location, the location shall be at the offices of the Member first calling for the meeting.

15.1.4 Any agreement resulting from such meeting shall be formalized in writing and signed by, and on behalf of, each Party.

15.2. Mandatory Arbitration under ICDR Rules. If the meeting of principals does not result in a formal agreement which completely resolves all issues between the Members, then within thirty (30) days of .the meeting (or within thirty (30) days after any agreed upon date or deadline established during the meeting), any unresolved controversy or claim between the Parties shall be settled by mandatory arbitration administered by the International Center for Dispute Resolution (ICDR) in accordance with its International Arbitration Rules.

15.2.1 There shall be one (1) arbitrator appointed through the ICDR procedures.

15.2.2 The arbitration shall be conducted in the English language.

15.2.3 It is the intent of the Parties that, absent extraordinary circumstances, the arbitration proceedings shall be concluded within two (2) months from the date the arbitrator is appointed. The arbitrator may extend this time limit in the interests of justice, particularly if one Party is found to have delayed the proceeding to the detriment of the other Party. Failure to adhere to this time limit shall not constitute a basis for challenging the arbitration decision and award.

15.2.4 The arbitration shall be held in a mutually agreeable location or, if the Members cannot agree, then at a location determined by the designated arbitrator.

15.2.5 The designated arbitrator shall have discretion to determine the scope and reasonableness of any requested exchange of documents and materials in accordance with the ICDR procedures.

15.2.6 Upon a timetable to be established by the arbitrator, the Members shall submit to the arbitrator a statement setting forth the issues in the dispute and the outcome which that Member desires the Arbitrator to reach. After hearing sufficient evidence to permit a decision, to the extent practicable, the Arbitrator shall make his or her decision in the matter by selecting from the position submitted by one of the Members.

15.2.7 To the extent necessary for the full resolution of the dispute, the Arbitrator may make such other or ancillary rulings as required to effect the final decision.

15.2.8 In deciding the dispute and selecting from the positions submitted by the Members, the Arbitrator shall be governed by his or her determination as to: the terms of this Operating Agreement or the then applicable Operating Agreement; the best interest of the Company; the profitability of the company; the impact on the Company's business operations and purpose; fairness to the Members involved in the dispute; and, the original intentions of the Members in entering into this business as Members of the Company.

15.3. Enforcement of Dispute Resolution Provision. If any Member pursues an action, whether in a court of law or equity, without first proceeding with these dispute resolution procedures, that Member shall be liable for all expenses and attorneys' fees incurred by the other Party to enforce the dispute resolution procedures of this Operating Agreement and this Operating Agreement may be invoked to remove the matter from the legal proceeding so that these dispute resolution procedures may be followed.

15.4. Exclusive Remedies. The dispute resolution remedies set forth herein are exclusive and the Parties hereby waive their rights under any applicable law to proceed with an action in a court of law or equity.

IV. Governing Law

89.
Article 20.2 of the Operating Agreement provides that "[t]his Operating Agreement and the interpretation hereof, and the rights and liabilities of the Member shall be governed exclusively by this Operating Agreement's terms and by the laws of the Commonwealth of Virginia without reference to its choice of law provisions."1
90.
The parties likewise confirmed their choice of Virginia law in their submissions throughout the course of the arbitration.2
91.
Such agreement to Virginia law was likewise reflected in Procedural Order No. 1.3

V. Overview of the Dispute

92.
This overview provides background on the merits of the dispute and relies on the parties' account of the facts in their written submissions and at the hearing.
93.
In early 2016 Paul Delkaso, the President and CEO of Tristar Group LLC, Tritente Global Energy Group, and Tristar Property Management LLC, represented by his counsel Craig Westerfield, commenced negotiations with Bart Weijermars, CEO of Artilium PLC (now Artilium Group Limited) ("Artilium"), represented by a business development specialist Alain Andries and legal counsel for Artilium Jan Cant,4 to enter into an agreement for the provision of mobile and telecom services throughout Africa. As a result of these negotiations, they entered into a series of business plans and an Operating Agreement, which includes the Arbitration Agreement in this dispute.5
94.
Specifically, on 10 March 2016, Artilium Africa, LLC ("AA" or "Artilium Africa") was formed in Virginia as a limited liability company to provide mobile data, cloud, and telecom services throughout Africa.6 At the same time, Mr. Westerfield formed Tristar Africa Telecom, LLC ("TAT" or "Tristar") to act as the member of Artilium Africa on behalf of Mr. Delkaso, and Artilium formed Green Globe Services.7 TAT held a 50% ownership in AA, while Artilium and Green Globe together held the remaining 50% (35% and 15% respectively).8
95.
On 11 March 2016, Messrs. Westerfield and Delkaso traveled to Brugge, Belgium to finalize and sign the Operating Agreement dated 12 March 2016,9 which Mr. Westerfield had drafted.10 As part of the Operating Agreement, Artilium entered into a joint venture with Green Globe Services and Tristar Africa Telecom, a wholly owned subsidiary of Tritente, to form and operate Artilium Africa. This new joint venture was announced in a series of press releases.11
96.
On 12 March 2016, TAT, Artilium and Green Globe also signed a Syndicate Agreement. This Agreement was drafted by Mr. Cant and its preamble announced that "[t]he Parties aim to prospect on potential customers and the setup of Artilium 'Portfolio Services'" (including "the hardware, software, or related IT services which Artilium PLC and third party suppliers currently market or which may be marketed during the term of this Agreement". This means Artilium PLC had a duty to supply to AA hardware, software or related IT services directly or indirectly through third parties "within the territory of Africa."12 This Agreement clearly stated that in case of conflict between the Operating Agreement and the Syndicate Agreement, the Operating Agreement would prevail.13
97.
Neither Agreement however explicitly provided for and/or confirmed the pricing, cost, or who would pay for the services and/or hardware. The overall financing for the joint venture and for the contracts to be entered following the Memoranda of Understanding ("MOUs") was not explicitly provided in either of the two agreements. The parties argued over whether it was a "reseller" model that later transformed into a "revenue sharing" model but neither agreement changed and neither agreement provided explicitly for either model. The Parties argued whether each Member of the JV had to make capital contributions but the Operating Agreement in section 5.4 provided "no Member shall be required to make any capital contribution unless approved by all Managers and all Members". Thus no one Member could demand capital contributions without the consent of a ll. 14 Claimants contend in their Post Hearing Brief that the financing (to establish the system) is clear15 but that does not resolve what constitutes a reasonable cost to the customer and the level of investment required to develop the systems. Respondents agree that in the beginning the JV followed a "reseller model" but then shifted to a "revenue sharing model" without any change to the Agreements.16
98.
In March 2016, the Members prepared a business plan for the joint venture.17
99.
In April 2016, Artilium signed a Partnership Agreement with GET Wireless, a Tunisian systems integrator.18
100.
Between May 2016 and 2017, Artilium Africa was in discussions with a number of potential customers for the provision of services in Africa, attempting to prepare and execute MOUs in various countries.
101.
Specifically, the following MOUs or preliminary agreements were pursued:

Countries Involved Exhibit Document Title Agreement Status
Tunisia, Algeria, Morocco, Libya, Mauritania R-4 International Partnership Agreement between AA and GET Wireless Executed on 28 April 2016
Gambia R-5 MOU (non-binding) between AA and the Ministry of Information and Communication Infrastructure for Gambia, and Alpha Data Solutions Co., Ltd. Executed on 30 June 2016
Gambia R-6 / R- 28 Preliminary Proposal on Micro Data Center services, Infrastructure-as-a-Service (IaaS) and Cloud services on the 'Gener8' solution by AA for Partnership with the Ministry of Information and Communication Infrastructure of The Gambia Executed only by AA on 14 July 2016
Uganda, Rwanda, Tanzania R-29 AA formal proposal to Uganda Telecom Executed only by AA in September 2016
Uganda, Rwanda, Tanzania R-7 MOU between Hamilton Telecom and AA Executed on 12 October 2016
Uganda, Rwanda, Tanzania R-8 Framework Agreement between AA and Hamilton Telecom Executed on 21 November 2016; bank guaranty was never executed
Ethiopia, Kenya, Tanzania, Uganda, Sudan, South Sudan, Djibouti, Somalia R-10 MOU between AA and Ethio Telecom Unexecuted
Tunisia Not produced

102.
As reflected in the above table, between June 2016 and 2017, Paul Delkaso signed MOUs and other agreements with several African nations to develop the telecommunications and cloud-based hardware and software services contemplated in the Operating Agreement, although no formal sales agreements resulted.19
103.
Specifically, with respect to the negotiations with Hamilton Telecom, a meeting between AA and Hamilton Telecom took place at Artilium's offices in November 201620 and Artilium Africa executed a contract ("the Framework Agreement") with Hamilton Telecom to provide telecom services in Uganda.21 The agreement required further discussions on the exact services to be provided and the pricing. Moreover, the Framework Agreement entered into between Artilium Africa and Hamilton Telecom required Hamilton Telecom to produce a €4 million bank guarantee, which it never did. 22
104.
In May 2017 Respondent lost the GiG.tech deal and therefore the ability to readily supply the necessary hardware to fulfil a deal as originally contemplated.23 According to Claimants, the "AA enterprise imploded" at the time of the Hamilton Telecom deal in August 2017. Mr. Westerfield testified at the hearing that the Hamilton deal "stalled" in March 2017 and "started again" in August 2017 when "Alain sent a specific, written proposal to Hamilton, and Hamilton accepted that specific proposal."24 The proposal included expenses of €294,000, that Respondents allegedly insisted on splitting with Tristar Africa Telecom.25 Tristar Africa Telecom did not agree to split the expenses amount, given that such expenses were the responsibility of Respondents pursuant to the Syndicate Agreement, according to Claimants and their witness, Mr. Westerfield.26
105.
At around the same time of the Framework Agreement, the parties began to have disagreements over their respective obligations under the Operating and Syndicate Agreements, in particular over their obligations to provide capital.
106.
In November 2016, the parties met in Belgium and Artilium allegedly began insisting on restructuring the terms of the Operating Agreement through side deals.27
107.
From that moment on, there were a series of meetings and exchanges concerning the payment of additional capital contributions during the period from January-October 2017.28
108.
For example, on 3 February 2017, Messrs. Delkaso, Andries, and Weijermars participated in a telephone meeting.29 According to Mr. Delkaso, Mr. Andries pushed to set up a separate operating company for Artilium Africa and insisted on a €1-2 million contribution, with an initial payment to be made in March.30
109.
Later that month, on 23 February 2017, Mr. Delkaso and Mr. Andries attended a board meeting in which Artilium requested that TAT provide 1 million in working capital to Artilium Africa and TAT did not agree. The Minutes indicate that Mr. Delkaso agreed to provide this funding, although this is disputed by Claimants.31
110.
For approximately the next six months, the parties continued discussing whether additional funding in the form of a capital contribution would be made. In March and April 2017, Mr. Andries and Mr. Delkaso exchanged a series of messages concerning a capital contribution:

a. On 28 March 2017, Mr. Andries was still pushing for TAT to make a contribution.32

b. On 20 April 2017, Mr. Delkaso responded to Andries' proposal and said TAT would not make a direct capital contribution.33

c. On 23 April 2017, Mr. Delkaso set forth objections to the minutes of the 10 April 2017 meeting, indicating that TAT did not agree to the proposed investment of capital.34

d. On 24 April 2017, Mr. Andries responded indicating that he needed "clear statements and clear engagements of both partners regarding the financing and operational set up before we proceed and enter into final negotiations with any potential local partner."35

e. On 25 April 2017, Mr. Delkaso responded indicating that no capital contribution was required.36

111.
At the same time, Mr. Delkaso stated that Artilium Africa had failed to enter any final agreements and had no cash flow.37 The deals with Hamilton Telecom and Belcash never closed although TAT represented that the Hamilton Telecom and Belcash deals were ready,38 and GigTech decided that it would no longer use Artilium as its exclusive distributor in Africa after 1 May 2017. 39
112.
From July-October 2017, the discussions concerning capital contributions continued40 and Mr. Delkaso continued to attend sales meetings in African countries.41
113.
On 9 and 11 August 2017, Mr. Delkaso and Mr. Andries separately emailed Mr. John Kamya of Hamilton Telecom concerning the purported status of the project as well as the obligation to make a US$ 4 million "capex investment" in Artilium Africa.42 Subsequently, Mr. Westerfield called for a retraction of Mr. Andries' email and his resignation as a Board Member of Artilium Africa. No subsequent agreement was signed for these services.43
114.
Beginning in the summer of 2017, Pareteum approached Artilium about the possibility of working together,44 including in Africa. On 14 October 2017, Mr. Weijemars sent an email to TAT proposing to terminate AA because TAT would not provide any capital contributions.45 Two days later, Pareteum and Artilium entered into a Strategic Alliance Agreement and a share exchange agreement46 for the pursuit of joint commercial opportunities and Pareteum's eventual acquisition of Artilium.47 Artilium Africa was not notified of the Strategic Alliance, before or after its signature. Indeed, Mr. Andries testified that he was unaware of any agreement between Pareteum and Artilium until the end of March 2018 when Mr. Weijermars called him to inform him his contract was ending. 48
115.
Following entry into the Strategic Alliance Agreement, Pareteum subsequently announced that the geographic regions of Asia and Africa were strategic next steps it would pursue with Artilium.49 Mr. Andries testified at the hearing that Artilium PLC was a "direct competitor" of Pareteum, stating that "I mean, as I testified, I was working for Elephant Talk, Pareteum in the future. I was working there already in 2009; and at that moment, Pareteum was already active from APAC to Middle East, Africa, to Latin America, to Mexico to Americas itself."50
116.
Beginning in the fall of 2017, the Artilium Africa JV became inactive and following Pareteum's acquisition of Artilium though a merger in the fall of 2018, Artilium subsequently abandoned the JV.51 The JV had been inactive since the fall of 2017. 52 Pareteum had previously announced in June 2018 that it would acquire Artilium, with an expected closing date of September 2018.53 No notice was provided to Artilium Africa of this acquisition or any termination of the JV.
117.
According to Respondents, while Artilium and Pareteum worked together to develop business throughout the world, it did not develop any business in Africa, indeed, during and following the merger, Artilium has not generated any revenue through business conducted in Africa.54
118.
Following Artilium's merger with Pareteum and subsequent abandonment of the JV, the present dispute arose. From January 2019 to the present, the parties attempted to resolve their dispute through mediation, litigation, and this arbitration. Between 21-23 January 2019, the principals met in New York City to mediate the dispute.
119.
The attempt was unsuccessful.55 On 1 October 2019, Tristar Africa Telecom, LLC initiated this arbitration against Artilium Group Ltd and Green Globe Services, LLC.56 Nine days later, on 10 October 2019, Artilium Africa, LLC and Tristar Africa Telecom, LLC sued Pareteum Corporation in U.S. District Court in Delaware alleging tortious interference with current and prospective contractual relationships of Artilium Africa, LLC and Tristar Africa Telecom, LLC. This lawsuit was stayed and Artilium Africa, LLC and Pareteum Corp. were ordered to join the arbitration.57

VI. Contractual Framework

120.
The dispute between the parties arises under the Operating Agreement of Artilium Africa that was "made and adopted effective" 12 March 2016 and entered into by Artilium PLC, Green Globe Services, LLC and Tristar Africa Telecom.58 On the same date, as explained above, Artilium and Green Globe also entered into the Syndicate Agreement, which is a related contract that the Parties relied on in their written submissions.59
121.
Pursuant to the Operating Agreement, Artilium Africa was organized as a limited liability company under Virginia law60 and the Agreement governs, pursuant to its Article 1.3 "the business and affairs of the Company and the rights, obligations and liabilities of the Members to the extent permitted by the applicable law."61 The subsequent articles go into further detail concerning Artilium Africa and the responsibilities of its Managers. For purposes of this arbitration, Articles 2.5, 4.8, 4.15 and 5.4 have particular importance.
122.
Article 2.5 of the Operating Agreement sets forth the "business purpose" of Artilium Africa, stating that "[t]he business purpose of the Company and the duty of the Members to the Company, is limited to those products and services described by Artilium, PLC as within its 'Portfolio of Services' in any country in Africa. For purposes of this Operating Agreement, 'Portfolio of Services' refers to the hardware, software, or related IT services which Artilium, PLC and third-party suppliers currently market, or which may be marketed during the term of this Agreement, to its customers or potential customers. …"62
123.
Article 4 of the Operating Agreement addresses the duties and responsibilities of the Board of Managers. Specifically, Article 4.8 establishes a duty of loyalty to the Company, providing that:

The Members agree that any business opportunity or activity encompassed by the business of the company, as referenced herein to be conducted in any country in Africa by an Initial Member shall be conducted exclusively through Artilium Africa, unless the other Member or Members agree(s) to the contrary. Except for this limitation, the Members and Managers may engage in and/or possess an interest in other business ventures of any nature and description, independently or with others, including but not limited to the ownership, financing, operation, management and development of businesses which are similar in nature to the Business; and neither the Company nor any of the Members shall have any right by virtue of this Agreement to enter into any such independent venture or to share in any income or profits derived therefrom. Neither the Member, Manager nor any Affiliate thereof shall be obligated to present any particular investment opportunity to the Company or other Members if such opportunity is of a character that, if presented to the Company, could be taken by the Company, and the Member and/or Manager shall have the right to take for his or its own account or to recommend to others any such particular investment opportunity.

124.
Article 4.15 addresses the reimbursement of expenses of managers, providing that:

Managers shall be entitled to reimbursement of reasonable expenses incurred in connection with the performance of their activities on behalf of the Company or in furtherance or their duties as Managers. Compensation of the Manager for his or her services in such capacity beyond the reimbursement expenses shall be subject to approval by the Members pursuant to this Operating Agreement.

125.
Finally, Article 5 of the Operating Agreement refers to capital contributions. Pursuant to Article 5.1, "initial capital contributions" were limited to "services by Members." Additional capital contributions are addressed at Article 5.4, which provides that "[n]o member shall be required to make any capital contribution in addition to the Member's initial capital contribution unless approved by all Managers and Members."63
126.
The Syndicate Agreement was entered into between Tristar, Artilium, and Green Globe. The Parties rely on several provisions of the Syndicate Agreement in their submissions, including Articles 1, 2 and 5.
127.
Article 1.6 of the Syndicate Agreement provides that:

[T]he pre-finance costs for the establishment of the company will be borne by each party according to the following principles:

- cash out of pocket expenses for setting up the respective companies and needed authorisations, licences (ex. VAS license), eventual marketing costs will be borne by Tristar

- costs for research and presales proposals will born by Artilium64

128.
Article 2 sets forth the parts of the contract, workshares, with 2.1.1 specifying the responsibilities of each party:

Artilium is a provider of Information and Communication Technology Services ("ICT Services") and enabler for mobile virtual network operations ("Enabler Services") and will especially take care of:

• Data Center managed services

• Cloud services

• Communication services for MNO's, MVNO's, IoT and business

• General telecommunications services

Tristar is specialized in the marketing and sales in Africa and will render essentially the following basic services:

• Business development

• Marketing services

• Local content services

• In country general services.

129.
Articles 5.2 and 5.3 of the Syndicate Agreement address exclusivity and loyalty. Article 5.2 on exclusivity provides in relevant part that "[t]he syndicate members are obliged to act only within the scope of this contract for the length of the term of this contract and to neither directly nor indirectly act via joined enterprises or collective…".65
130.
Article 5.3 explains that the "parties are obliged to mutual loyalty. During the contract implementation the syndicate members may not alienate staff members of the respectively other syndicate member."66
131.
The Operating Agreement is silent on quantum but provides the dispute resolution remedies are exclusive.67 The Syndicate Agreement, in Section 6.3.1.2 provides that "[e]ach syndicate member is liable to the other syndicate members for damages [it] caused culpably- (i.e. here with intention and with every kind of negligence)." If a syndicate member is "slight[ly] negligen[t]" then liability will be limited to "one hundred thousand" euros damage "per damage event." If the syndicate member is "grossly negligent" then the liability is "unlimited." Liability for loss of profit is excluded.
132.
These provisions of the Operating and Syndicate Agreements will be analyzed in greater detail in the relevant sections below.

VII. Parties' List of Issues and Statement of Desired Outcome

133.
Pursuant to Article 15.26 of the Operating Agreement, each Party was to submit a List of Issues and Statement of Desired Outcome.
134.
The parties submitted the following List of Issues and Statement of Desired Outcome to the Sole Arbitrator:

a. Claimants' List of Issues and Statement of Desired Outcome

Issues:

2. Was there a contractual relationship between: (a) Claimant Tristar and nominal Claimant Artilium Africa, LLC, and (b) Respondents Artilium PLC, n.k.a. Artilium Group Ltd., and Green Globe Services?

a. Yes.

3. Were the Contracts among the Parties ever modified in writing?

a. No.

4. Did Respondents Artilium PLC and Green Globe breach the terms and conditions of the Contracts?

a. Yes, by:

i. Failing to perform in accordance with the terms and conditions of the Contracts;

ii. Conditioning their performance on the posting of capital by Claimants; and

iii. Violating the terms of loyalty and exclusivity in the Contracts when they entered into the Strategic Alliance with Pareteum.

5. Did Respondent Pareteum Corporation tortiously interfere with the Contracts between Claimants and Respondents Artilium plc and Green Globe?

a. Yes, they tortiously interfered, resulting in Artilium and Green Globe breaching the Contracts with Claimants and abandoning the effort to enter into contracts between African nations and Tristar in order to provide the services it advertised it could provide.

6. Did Claimants suffer damages as a result of the breach of the Contracts and/or the tortious interference with the Contracts?

a. Yes, in an amount to be determined by the Arbitrator.

b. Respondents' List of Issues and Statement of Desired Outcome

1. Whether Claimants have shown that Respondents Artilium or Green Globe breached any requirement of the Operating Agreement?

a. No, because:

i. The Operating Agreement did not prohibit any Member from asking another Member to contribute financially;

ii. Even if the statements made to prospective customers by one of Artilium Africa's managers were false, Claimants cannot show attribution or that Artilium Africa's business was in any way harmed by these statements;

iii. There is no evidence that Artilium Africa conducted any business in Africa, with or without Pareteum;

iv. Claimants' argument that Artilium repudiated its obligations by not funding all of the start-up costs required for a business transaction contradicts the Operating Agreement, which provides that no Member is required to make any capital contributions; and

v. Claimants have failed to show any breach by Green Globe and have only repeated that it is a "responsible party."

2. Whether Respondent Pareteum tortiously interfered with the Operating Agreement or with Claimants' potential economic advantage, or conspired with Artilium to interfere with the Joint Venture.

a. No, because:

i. Pareteum cannot be found liable for causing or inducing Artilium to breach the Operating Agreement without a predicate finding that Artilium breached the Agreement (which it did not);

ii. Claimants have no evidence to demonstrate intentional interference by Pareteum with Artilium Africa's contractual rights or potential economic advantage; and

iii. The mere fact that Pareteum and Artilium entered into a Strategic Alliance in October 2017 does not lead to the conclusion that Pareteum therefore caused Artilium to breach the Operating Agreement.

3. Whether Claimants have shown any compensable damage

a. No, because:

i. Claimants failed to meet their burden of proof under Virginia law, including demonstrating that there is a causal connection between Respondents' alleged misconduct and the damages Claimants claim to have suffered, which is required to recover lost profits;

ii. Claimants must prove their damages with reasonable certainty and have not because they have failed to offer any calculation of damages, any method for calculating damages, or any factual foundation for calculating damages; and

iii. The evidence shows that any projection of purported profits is too speculative and uncertain.

4. Requested Relief

a. Award finding that Respondents are not liable and denying the relief requested by Claimants in their entirety;

b. Costs and fees in their favor.

135.
Following the hearing on the merits, the Sole Arbitrator requested that the parties in their Post-Hearing submissions "include a clear statement of the relief requested, indicating whether or how this has changed from the position stated in each Statement of Issues and Desired Outcome."68
136.
In their Post-Hearing Brief, Claimants reiterate that "Artilium and Green Global are liable because they breached the terms and conditions of the contract documents"; "Pareteum is liable because it tortiously interfered with the contract"; and "Claimants suffered damages as a result of the breach of the Contracts and the tortious interference." Claimants quantified such damages in the amount of US$ 49,732,164, and also requested attorney's fees and costs.69
137.
Additionally, Claimants contend that Paragraph 15.2.8 of the Operating Agreement "provides that the resolution of the claims in this case shall be governed by" the following "six factors": (a) "[t]he terms of this Operating Agreement or the then applicable Operating Agreement"; (b) "[t]he best interest of the Company"; (c) "[t]he profitability of the company"; (d) "[t]he impact on the Company's business oerations and purpose"; (e) "[f]airness to the Members involved in the dispute"; and (f) "[t]he original intentions of the Members in entering into this business as Members of the Company."70
138.
In their Post-Hearing Brief, Respondents confirmed that they sought the "same relief that they sought in their Statement of Issues and Desired Outcome," requesting that the "Sole Arbitrator enter an Award in their favor, deny the relief requested by Claimants in its entirety, and award Respondents' [sic] their costs and fees."71

VIII. Preliminary Matters

139.
As a preliminary matter, the Sole Arbitrator will address: (a) the parties' arguments concerning the parties to this arbitration and (b) the form of this Award, which was the subject of further briefing as described in the Procedure at Section II above.
140.
In reaching the decisions made in this Award, the Sole Arbitrator has considered the Parties' written submissions, their oral arguments, and their post-hearing submissions. The main arguments of the parties are summarized prior to the discussion of each issue throughout this Award and the Sole Arbitrator adds that, while the main arguments are summarized, the Sole Arbitrator has considered other arguments raised by the Parties and they will be referred to below to the extent that the Sole Arbitrator considers them relevant.
141.
With respect to the form of this Award, the Sole Arbitrator requested that the parties confirm in writing their respective positions concerning: "the type of reasoned award they are requesting; and (b) whether the Sole Arbitrator must select either Respondents' proposed Award or that of Claimants."72
142.
In their subsequent submission, the parties agreed that the Award should be reasoned,73 consistent with the terms of the Operating Agreement and the ICDR Rules. The parties' respective positions on the parties to this arbitration and whether the Sole Arbitrator must select from the parties' positions, are set forth below, followed by the Sole Arbitrator's decision.

a. Parties to the Arbitration

143.
In Procedural Order No. 2, the Sole Arbitrator rejected Respondents' request to dismiss Green Globe and Pareteum from the proceedings at that time and "invite[d] the Parties to include the facts and law to support the claims and defenses against Green Globe and Pareteum in the Counter-Memorial, Reply, and Rejoinder."74

i. Respondents' Position

144.
As set forth in Procedural Order No. 2, Respondents alleged in their correspondence dated 19 April 2021 that Claimants referred to Green Globe only in explaining its role in the joint venture and the consequences of it dropping out as a Member.75 Respondents further alleged that Claimants abandoned their breach of contract claim against Green Globe. With respect to Pareteum, Respondents alleged that Claimants' claims against Pareteum lacked sufficient facts and evidence and Pareteum should therefore be dismissed as a party.
145.
Respondents' further submissions following Procedural Order No. 2 made similar requests concerning Green Globe and Pareteum. Footnote 3 of Respondents' Counter-Memorial alleged that "[a]lthough Claimants' breach of contract claim is asserted against Artilium and Green Globe, the Amended Memorial is conspicuously missing any evidence or specific allegations about Green Globe" and Respondents again request that the claim against Green Globe should be treated as abandoned.76 With respect to Pareteum, Respondents again alleged that there was no evidence in support of Claimants' allegations against Pareteum.77
146.
Similarly, Footnote 2 of Respondents' Rejoinder provides that "…merely being a 'responsible party' does not mean that Green Globe caused any damage to Claimants, and to this date, Claimants have never pointed to any action by Green Globe that could serve as a basis for liability."78
147.
Footnote 10 of Respondents' Post-Hearing brief alleges that "Claimants have failed to advance any evidence to support any claim against Green Globe. For that reason, all claims against Green Globe should be dismissed."79

ii. Claimants' position

148.
Claimants in turn, alleged with respect to Green Globe that Alain Andries and Jan Cant were appointed by Green Globe and their acts bound both Green Globe and Artilium. With respect to Pareteum, Claimants alleged that there was sufficient circumstantial evidence and adverse inferences to support its case against Pareteum.80
149.
Claimants' further submissions following Procedural Order No. 2 confirmed their prior position concerning the validity of Pareteum and Green Globe as parties. With respect to Green Globe, Claimants alleged in their Reply that "Green Globe is a responsible party in this matter because it is an owning Member of AA and through the appointment of its managers, Alain Andries and Jan Cant to manage AA on their behalf."81
150.
In their Post-Hearing brief, Claimants allege that "Green Globe, as a 15% Member of AA, signed the OA, signed the SA, and is therefore fully bound and obligated under the terms and conditions of those contracts. For all the same reasons Artilium is liable for Breach No. 1 and Breach No. 2, Green Globe is likewise liable."82 With respect to Pareteum, Claimants devoted five pages to their allegation that Pareteum had tortiously interfered with the Operating Agreement.83

iii. Sole Arbitrator's Decision

151.
For the reasons set forth below, both Green Globe and Pareteum are proper parties to this arbitration.
152.
First, with respect to Green Globe, Green Globe is a party to the contract containing the arbitration agreement, the Operating Agreement. There is thus no question that Green Globe is thus a proper party to the arbitration proceedings.
153.
Notwithstanding, the claims against Green Globe are dismissed for lack of evidence. Throughout their submissions, Claimants did not advance any specific claims and/or supporting evidence against Green Globe, beyond articulating that it was "likewise liable" for the claims against Artilium. The Operating Agreement is silent on liability as between Members and Claimants did not make any arguments under Virginia law in this regard on the basis of corporate form and/or share ownership alone.
154.
Second, with respect to Pareteum, as explained above, the judge in the Delaware court proceedings ordered that the dispute filed by Claimants against Pareteum be arbitrated. Moreover, Claimants have extensively briefed in their written submissions their claim for tortious interference with contract. The merits of this claim will be analyzed at Section IX below.

b. Form of the Award

i. Respondents' Position

155.
In their Post-Hearing Brief, Respondents alleged that "[u]nder the Operating Agreement, the Sole Arbitrator must select either Respondents' proposed Award or the Award proposed by Claimants." In this regard, Respondents invoked the Operating Agreement as well as the ICDR's Final Offer Arbitration Supplementary Rules. Specifically, Respondents provide that "[t]he ICDR's Final Offer Arbitration Supplementary Rules recognize that when the parties agree to this kind of proceeding the 'tribunal shall be limited to choosing only one of the final offers submitted by the parties" plus any costs, fees, and interest.84
156.
Respondents further elaborated this position in their 1 October 2021 submission, stating that "Section 15.2.6 of the Operating Agreement provides that the Sole Arbitrator must select one of the positions presented by the parties" and that the ICDR Final Offer Arbitration Supplementary Rules are applicable "[b]ecause the Parties chose to participate in a final offer/baseball arbitration through Section 15.2.6 of the Operating Agreement."85 In this regard, according to Respondents, Section 15.2.6 of the Operating Agreement satisfies Rule 1 of the ICDR Final Offer Arbitration Supplementary Rules which provide for the application of the Rules "where the parties have provided that their arbitration take place as a 'final off,' 'baseball,' or 'last best offer' arbitration."86

ii. Claimants' Position

157.
In their written submission of 1 October 2021, Claimants disagreed with Respondents' contention that this was a "baseball arbitration" and that the ICDR Final Offer Arbitration Supplementary Rules applied.87 As a threshold matter, Claimants note that Pareteum is not a party to the Operating Agreement and thus "that portion of [Respondents'] argument has no application to or bearing on the claim or award against Pareteum."88
158.
According to Claimants, with respect to liability, "Paragraph 15.2.6 of the Operating Agreement demonstrates that the parties have agreed to have the Sole Arbitrator make a decision on liability by choosing, to the extent practicable, one or the other side's position or desired outcome."89 However, with respect to damages, Claimants allege that "damages are a separate and distinct element of a claim that must be proven at trial or litigation."90
159.
Claimants further argue that paragraph 15.2.6 is a "superfluous provision" and that the parties did not intend for "baseball arbitration," as supported by a supplemental declaration by Mr. Mark Westerfield, the prime drafter of the Operating Agreement.
160.
Finally, Claimants allege that the ICDR Final Offer Supplementary Arbitration Rules are inapplicable because the circumstances for their application, as set forth in Article 1 of the Rules, are not satisfied.91 Specifically, according to Claimants, no document refers to the ICDR Final Offer Rules or to "final offer," "baseball," or "last best offer" arbitration.92 In addition, none of the procedural requirements for baseball arbitration has been satisfied.93

iii. Sole Arbitrator's Decision

161.
For the reasons set forth below, the Sole Arbitrator is not required to select either Claimants' or Respondents' List of Issues and Desired Outcome and the ICDR Final Offer Rules do not apply to this arbitration proceeding.
162.
First, the plain language of the Operating Agreement at Section 15.2.6 provides in relevant part that "[a]fter hearing sufficient evidence to permit a decision, to the extent practicable, the Arbitrator shall make his or her decision in the matter by selecting from the position submitted by one of the Members."94 This language includes the phrase, "to the extent practicable," "by selecting from" which extends some flexibility to the Sole Arbitrator in selecting from the two parties' positions.
163.
Second, the flexibility afforded by the phrase "to the extent practicable," and the entire provision of the Operating Agreement does not make any reference to or distinguish between liability and quantum. Accordingly, there is no basis upon which to treat quantum or liability differently for purposes of the clause.
164.
Third, the ICDR Final Offer Arbitration Supplementary Rules do not apply because, as Claimant argues, the conditions established in Article 1 of the Rules for their application are not satisfied. Article 1 of the Rules provides that:

These Final Offer Arbitration Supplementary Rules ("Supplementary Rules") shall apply to any dispute arising out of an agreement that provides for arbitration pursuant to these Supplementary Rules, or where the parties have agreed to arbitrate their disputes pursuant to any other rules of the International Centre for Dispute Resolution (ICDR) or the American Arbitration Association (AAA) where the parties have provided that their arbitration shall take place as a "final offer," "baseball," or "last best offer" arbitration.

The ICDR and AAA shall have the discretion to apply or not to apply these Supplementary Rules to a particular case, and the parties will be able to bring any disputes concerning the application or non-application to the appointed arbitrator for a final determination.

165.
Neither the conditions set forth in the first paragraph or the second paragraph of Article 1 are met. The Operating Agreement does not refer to the Final Offer Arbitration Supplementary Rules and the term "final offer," "baseball," or "last best offer" is not included in the Operating Agreement.
166.
Moreover, with respect to the second paragraph of Article 1, neither the ICDR nor the AAA exercised their discretion in respect of applying these Rules.

IX. Merits

167.
This section assesses the following merits issues: (a) Artilium's alleged breach of its obligation to negotiate and generate contracts for Artilium Africa; (b) Artilium's alleged breach of the Duty of Loyalty provision contained in the Operating Agreement; (c) Pareteum's alleged liability for tortious interference; and (d) Respondents' request for dissolution of Artilium Africa.

a. Artilium's alleged breach of its obligation to negotiate and generate contracts for Artilium Africa

i. Claimants' Position

168.
According to Claimants, Artilium failed to negotiate and generate contracts for Artilium Africa in breach of Virginia law. Specifically, Claimants allege there are three elements to find a breach of contract under Virginia law: (a) a legally enforceable obligation of a defendant to a plaintiff; (b) the defendant's violation or breach of that obligation; and (c) injury or damage to the plaintiff caused by the breach of obligation.
169.
According to Claimants, the parties' "respective duties and obligations to further AA's business plan were (Step 1) Tristar, by Mr. Delkaso, was to open doors and facilitate opportunities between AA and African nations; and (Step 2) Artilium was to take advantage of those opportunities, negotiate and enter into contracts with the African nations… ."95 Claimants allege that the Syndicate Agreement and Operating Agreement set out that Mr. Delkaso is responsible for business development, marketing services, local content services, and in-country general services. Artilium, in turn, was then "obligated and contractually bound" to address Data Center managed services, Cloud services, Communication Services for MNO's, MNVO's, IoT and businesses; and General Telecom services.96 While, according to Claimants, Mr. Delkaso fulfilled his duties pursuant to the contract, Artilium did not. Specifically, Artilium "breached its obligation to negotiate and execute final contracts," and then "failed" to set up or arrange wireless system hardware, system software, and necessary financing.97
170.
In their Post-Hearing Response, Claimants allege that the Operating Agreement and Syndicate Agreement established the following obligations: Article 5.1 of the Operating Agreement provided that initial capital contributions would be limited to services by Members; Articles 8, 9 and 10 of the Syndicate Agreement required syndicate members to carry their own costs and expenses; and Artilium had to provide the portfolio of services as defined in the Operating Agreement and the workshares identified in Article 2.1.1 of the Syndicate Agreement.98 Additionally, Claimants allege that Artilium "then demanded a cash infusion from Tristar to cover its own costs for its 'services,' it walked away from the AA business enterprise, it entered into a Strategic Alliance with Pareteum to do the same thing, it was acquired by Pareteum shortly thereafter … ."99
171.
Moreover, Claimants' Post-Hearing Response alleges that Respondents' reseller to revenue sharing model theory is "an attempt to divert the Tribunal's attention" as neither "reseller" nor "revenue sharing" appears in the Operating or Syndicate Agreements. Indeed, according to Claimants, it is an "as-a-service" model whereby Artilium refused to pay US$ 294,000, thus preventing "[the contract] from becoming operational."100 Claimants further argue that the business model did not change because "there was never any amendment, modification, revision, alteration, or any other change to the contract documents."101

ii. Respondents' Position

172.
In their Post-Hearing submission, Respondents argue that the intent of the parties controls, as the fundamental rule of contract interpretation under Virginia law, and that here the "intent of the parties confirms that Artilium did not bear responsibility for funding the investments required under the revenue sharing model."
173.
Specifically, according to Respondents, the "intent of the parties" demonstrates that there was no breach based on Artilium's failure to purchase hardware and make other investments under the revenue sharing model because the parties intended to pursue business under a reseller model that would not require substantial investments.102 Respondents allege that both Mr. Delkaso and Mr. Cant confirmed the reseller model whereby Tristar would assume business development costs and Artilium research and resale costs. The parties were unable to find anyone to purchase Artilium's services under the reseller model and thus purportedly shifted to a new revenue sharing model that required "substantially more investment from Artilium Africa.103
174.
Because the revenue sharing model was not initially contemplated, none of the agreements describe the financial costs associated with such a model, according to Respondents. Section 2.5 of the Operating Agreement defines the "Business of the Company" and limits the products and services to those within Artilium's "Portfolio of Services."104 Even though hardware was included in definition of "Portfolio of Services" corresponding to Artilium, "this reference does not mean that the parties entered the business with a plan or duty to obtain the hardware needed for Artilium's solutions."105 Indeed, Respondents allege that "Artilium's only brief involvement with hardware was as a reseller of 'Gig hardware' under a contract that later dissolved" and even then "not purchasing the hardware necessary for use of its services but acting as a 'reseller.'"106
175.
In their Post-Hearing Rebuttal, Respondents confirm their above allegations, positing that "Claimants never explain what provision of the Operating Agreement or Syndicate Agreement imposes a duty on Artilium to close a deal any time that TAT succeeded in making an introduction."107 Respondents add that Claimants cannot infer that Artilium had a broad duty to finalize contracts because: (1) there is a possibility that "the Agreement failed to allocate the duty to perform activities that no Member expected to be part of the Joint Venture's business" and (2) the "Agreements cannot be read to require Artilium to finalize contracts on behalf of the Joint Venture at all costs."108

iii. Sole Arbitrator's Decision

176.
For the reasons set forth below, there is insufficient evidence to conclude that Artilium breached the Operating Agreement for a failure to negotiate and generate contracts for Artilium Africa.
177.
First, I find, in fact, that pursuant to the Operating Agreement, Respondent Artilium was required to provide hardware and software, whether directly or indirectly. Specifically, as quoted above, Article 2.5 of the Operating Agreement provides that "the duty of the Members of the Company, is limited to those products and services described by Artilium PLC as within its 'Portfolio of Services' in any country in Africa."109 The Operating Agreement defines "Portfolio of Services" as "the hardware, software, or related IT services which Artilium, PLC and third-party suppliers currently market, or which may be marketed during the term of this Agreement, to its customers or potential customers."110 As such, according to the plain language of the Operating Agreement, Artilium had a duty to provide hardware and software. The Operating Agreement does not specify whether this obligation was direct or indirect upon Artilium. Nor does it specify what price, who would finance it and type of technology—both hardware and software—to be provided and supplied.
178.
The Syndicate Agreement does not provide further clarity on this issue, explaining only at its Section 2.1.1 that:

Artilium is a provider of Information and Communications Technology Services ("ICT Services") and enabler for mobile virtual network operations ("Enabler Services") and will especially take care of:

• Data Center managed services

• Cloud services

• Communication services for MNO's, MVNO's, loT and businesses

• General Telecom services.

179.
The same section of the Syndicate Agreement provides, with respect to Tristar, that:

Tristar is specialized in the marketing and sales in Africa and will render essentially the following basic services:

• Business development

• Marketing services

• Local content services

• In country general services.111

180.
Both Agreements lack specificity as to how the respective parties will execute their responsibilities and at what price. Nor does the evidence submitted in this arbitration clarify this issue. The Operating Agreement, as well as the Syndicate Agreement, broadly set forth the obligations of the parties to each Agreement, but they do not further specify how these obligations will be carried out.
181.
Unfortunately, the MOUs negotiated by Mr. Delkaso are likewise broadly construed. Specifically, the evidence submitted in this arbitration demonstrates that Claimants provided some services to obtain the MOUs, but they were nothing more than extraordinarily preliminary indications of interest. Indeed, these MOUs did not include any real detail as to: (a) what hardware and software the Country required and at what cost; (b) what entity in the Country would be responsible for the conclusion of a deal; (c) how any such deal would be financed; or (d) the specifics required to conclude a contract with these third-party countries.
182.
There is nothing in the record that explains with any precision the role of any party in respect of the MOUs. It is clear that Mr. Delkaso approached governments for the MOUs. It is also clear that these MOUs were indications of interest and not binding on the parties. What is not clear is what steps had to be taken to execute and implement the MOUs, what variations of systems, software, devices, networking components, applications and systems would be required for each country and/or potential customer, the services that had to be provided and who would provide them, and any other requirements. During the time when Mr. Delkaso was actively working on behalf of Artilium Africa, no MOU went beyond this extremely preliminary stage, with the exception of the Hamilton Telecom deal, which likewise failed.
183.
In this regard, both parties blame each other for the failure of the MOUs.112 Claimants concede that "[t]he OA and SA do not specifically provide whether Tristar or Artilium was responsible for negotiating, preparing, and executing the final contracts between AA and the various African nations or other entities."113 As explained above, Claimants allege that Artilium was responsible for generating final contracts, pointing to Articles 2.5 and 5.1 of the Operating Agreement.114 Neither of these Articles provides that Artilium has a "contractual obligation to finance the hardware and software."115 Nor is the Operating Agreement sufficiently specific to provide what hardware is being provided and whether it aligns with what is needed for the systems in each country and its respective customers. Article 2.5 sets out the "Business of the Company" and defines "Portfolio of Services." Article 5.1 refers only to "Initial Capital Contributions." Claimants also rely on Article 10.1 of the Syndicate Agreement which provides "[e]very syndicate member is responsible for providing the funding necessary for its workshare and therefore carries all expenses being connected with it."116 Notwithstanding, neither agreement specifies how the hardware is to be supplied or even what hardware—they may have to contract for specific hardware or they could acquire it, but both agreements lack any specificity as to what is needed and/or required for a specific customer. Indeed, given the lack of specific language in the agreements, while Article 10 refers to "carrying expenses" related to the workshare, it is at best ambiguous as it fails to specify any customer requirements and/or costs—the amount is incalculable.
184.
On the basis of the record, there is insufficient evidence to conclude what either party did—or was required to do—to implement the MOUs during the 2016-2017 period. Respondents should have used good faith to attempt to pursue the potential opportunities. At the same time, Respondents were without realistic possibilities to conclude a deal due to factors such as the high costs of the product offered and the inability of the customers to pay. Nothing in the operating Agreement or Syndicate Agreement required Respondents to offer the services, hardware or software, on any specific terms, even unreasonable terms: financial or otherwise.
185.
Moreover, in their submissions, both parties made arguments as to whether the business model changed from "reseller" to "revenue sharing." As Claimants provide, no change was made to the Operating Agreement. Article 20.5 of the Operating Agreement provides that "[n]o amendment, modification or waiver of any provision this Operating Agreement shall be effective except upon the written consent of Members holding not less than three-fourths of the outstanding Economic Units entitled to be voted."117 There is no express indication that the Operating Agreement was a "reseller" agreement, much less any change to "revenue sharing" pursuant to Article 20.5 of the Operating Agreement. Indeed, it appears that Respondents lost the GiG.tech contract to provide hardware and did not disclose it and thus were unable to perform their end of the deal. Instead of acquiring a replacement source for hardware, Respondents alleged the model changed. Nothing in the record supports such a change in model.

b. Artilium's alleged breach of the Duty of Loyalty Provision

186.
It is undisputed between the Parties that there was an express duty of loyalty under the agreements.
187.
Specifically, Article 4.8 of the Operating Agreement provides as follows:

4.8. Duty of Loyalty to Company. The Members agree that any business opportunity or activity encompassed by the business of the company, as referenced herein, to be conducted in any country in Africa by an Initial Member shall be conducted exclusively through Artilium Africa, unless the other Member or Members agree(s) to the contrary. Except for this limitation, the Members and Managers may engage in and/or possess an interest in other business ventures of any nature and description, independently or with others, including but not limited to the ownership, financing, operation, management and development of businesses which are similar in nature to the Business; and neither the Company nor any of the Members shall have any right by virtue of this Agreement to enter into any such independent venture or to share in any income or profits derived therefrom. Neither the Member, Manager nor any Affiliate thereof shall be obligated to present any particular investment opportunity to the Company or other Members even if such opportunity is of a character that, if presented to the Company, could be taken by the Company, and the Member and/or Manager shall have the right to take for his or its own account or to recommend to others any such particular investment opportunity.118

188.
Additionally, paragraph 5.3 of the Syndicate Agreement provides as follows:

5.3 Loyalty

The parties are obliged to mutual loyalty. During the contract implementation the syndicate members may not alienate staff members of the respectively other syndicate member.119

i. Claimants' Position

189.
According to Claimants, the duty of loyalty bound the parties to the agreements to (1) not engage any business within Africa that fell within AA's business of the company, (2) act only within the scope of the Syndicate Agreement and not to act via joined enterprises, and (3) mutual loyalty.120 Specifically, Claimants allege that Artilium would breach the Operating Agreement's duty of loyalty if "it has engaged in any work in Africa since AA was created (March 10, 2016), which was not through AA, if that work involved any of the … eight services Artilium provides[…]."121
190.
There are two relevant dates, according to Claimants, in respect of the alleged breach of the Duty of Loyalty: (a) after the Strategic Alliance was entered into on 16 October 2017; and (b) after Pareteum acquired Artilium on 7 June 2018.122 Claimants rely on press releases in support of their claim that Respondents breached the duty of loyalty. For example, a 28 November 2017 press release provided that the Strategic Alliance "enabled Artilium to leverage our strong presence and reach in global markets, particularly in Asia and Africa."123 A subsequent 2019 press release referred to "new customer transactions" in Africa, among other regions.124 Claimants suggest that this was "made possible by Mr. Delkaso setting the stage so that it could happen."125 Two press releases in 2019 referred to executed contracts in Africa: "… and cloud communications platform for Internet of Things (IoT) global provider based in Africa" and "12,000,000 contract with a leading telecommunications company in Sub-Saharan Africa to enable Mobile Virtual Network Operator (MVNO) and Internet of Things (IoT) connectivity."126 In addition to the press releases, Claimants allege that a 2017 email from Mr. Turner to Mr. Bozzo provided that "JPM 'expects this [the Pareteum/Artilium Strategic Alliance] to accelerate Artilium's growth throughout Africa and facilitate the cooperation among other companies in Africa."127
191.
In their Post-Hearing Response, Claimants further alleged that Pareteum acquired Artilium's duty of loyalty when it acquired Artilium because (1) encumbrances are part of a share exchange, (2) Pareteum and Artilium deem themselves one company without an "iron curtain," (3) Pareteum was aware of AA and does work in Africa, (4) Pareteum is legally bound by the duty of loyalty, and (5) the share exchange was a de facto merger.128
192.
Specifically, Claimants claimed that Pareteum was bound by the duty of loyalty as its acquisition of Artilium was a de facto merger and the two companies became one. In support of this claim, Claimants cite VA. Code Ann. § 13.1-721.A.4;129 a series of press releases, emails, and other statements to the effect that Pareteum and Artilium deem themselves one company and should not have an iron curtain;130 and several Virginia court decisions on de facto mergers, most notably Crawford Harbor and Augusta Lumber.131

ii. Respondents' Position

193.
According to Respondents, Artilium did not breach the duty of loyalty provision in the Operating Agreement when it entered into the Strategic Alliance with Pareteum. Respondents further alleged that the Strategic Alliance did not prevent Artilium from fulfilling its obligation "to conduct any business in Africa through Artilium Africa" and that there is "no evidence … that Artilium ever conducted any business in Africa, with or without Pareteum."132 Moreover, according to Respondents, aside from the limitation, the Operating Agreement "permitted Members to 'engage in and/or possess an interest in other business ventures … independently or with others … including but not limited to … businesses which are similar in nature to the Business' of Artilium Africa." Respondents also rely on Articles 9.6 and 4.8 of the Operating Agreement for recognizing that "no Member 'shall be obligated to present any particular investment opportunity to the Company."133 Further, the Operating Agreement was based on a reseller model, and reflects "the parties did not intend the Operating Agreement to require the Members to contribute anything beyond an initial contribution of their services."134 One of the challenges of the reseller model, according to Respondents, was that "it required Artilium Africa's partners to obtain a bank guarantee."135
194.
Respondents' Post-Hearing brief describes in greater detail the alleged shift to the revenue sharing model, providing that Artilium Africa "failed to find any [o]perators that would work with the Joint Venture under the reseller model."136 Respondents further allege that "[s]ince the Members had not contemplated this kind of upfront investment, they would have to agree on how to fund the Joint Venture's operations under the revenue sharing model."137
195.
In their Post-Hearing Rebuttal, Respondents allege that they could not have breached the duty of loyalty because "[t]he simple fact that Artilium never conducted business in Africa forecloses Claimants' argument."138 Specifically, according to Respondents, Claimants' argument that Artilium and Pareteum breached the duty of loyalty as a result of Pareteum's business in Africa "ignores that Artilium maintained its separate corporate existence and operations, functioning as a subsidiary of Pareteum."139 Any business that Pareteum did in Africa after the merger was without the involvement of Artilium, according to Respondents. Respondents further allege that Claimants' reliance on a Virginia merger statute is inapplicable because neither Artilium nor Pareteum are Virginia corporations, and in any event, the two corporations never merged.140 Finally, Respondents allege that Claimants' "suggest[ion]" that Pareteum breached the Operating Agreement's duty of loyalty is "a misstatement of basic principles of corporate law" as Pareteum is not a party to the Agreements and never agreed to the duty of loyalty.141
196.
Specifically, Respondents argue that Artilium maintained a separate corporate existence and operations and that VA. Code Ann. § 13.1-721 is inapplicable as neither Artilium nor Pareteum are Virginia corporations.142 Respondents point out that there are separate provisions of VA. Code Ann. § 13.1-721 for mergers and for share exchanges, and that the general rule in Virginia is that a company may acquire the assets of another without assuming its debts and liabilities.143

iii. Sole Arbitrator's Decision

197.
There is no dispute between the parties that the duty of loyalty in the Operating Agreement binds TAT, Artilium, and Green Globe. Nor is there any dispute between the parties that there is a duty of loyalty provision at Articles 4.8 and 9.6 of the Operating Agreement.
198.
First, the terms of the Operating Agreement clearly provided that "any business opportunity or activity encompassed by the business of the company… conducted in any country in Africa by an Initial Member shall be conducted exclusively through Artilium Africa."144 Additionally, it is noted that "neither the Company nor any of the Members shall have any right by virtue of this Agreement to enter into any such independent venture or to share in any income or profits derived therefrom." Furthermore, the business of the company is limited to the hardware, software or related IT services which Artilium market (the "Portfolio of Services").145 I find these provisions regarding the scope of the duty of cloyalty to be clear in their plain meaning: the parties to the Operating Agreement had a duty of loyalty that foreclosed them from conducting similar business to that of Artilium Africa through any other company or venture until they advised the other Members and terminated the agreement.
199.
Second, I now turn to Respondents' argument that the Operating Agreement permitted the Members to engage in and/or possess an interest in other business ventures including those similar in nature to AA's business. This argument involves the second sentence of the duty of loyalty provision in the Operating Agreement which provides that "[e]xcept for this limitation, the Members and Managers may engage in and/or possess an interest in other business ventures … including but not limited to the ownership, financing, operation, management and development of businesses which are similar in nature to the Business." While Respondents correctly quote the second sentence in their submissions, they read out the phrase "except for this limitation" in their reading of the sentence. It is clear that "except for this limitation" refers to the first sentence of Article 4.8, which limits Business in Africa to "be conducted exclusively through Artilium Africa."
200.
Accordingly, to the extent that one of the Members conducted "any business opportunity or activity encompassed by the business of the company … in any country in Africa" it had to be "conducted exclusively through Artilium Africa." If this was not satisfied, the duty of loyalty would be breached. Nothing prevented Artilium—in sequence—from terminating the Operating Agreement and the Syndicate Agreement, and so advising Artilium Africa and Tristar.
201.
Third, prior to addressing whether Respondents did, in fact, breach the duty of loyalty on the basis of the evidence before me, I will address Claimants' allegation that the duty of loyalty also bound Pareteum. As an initial matter, Respondents correctly stated that Pareteum is not a party to the Agreements and never agreed to the duty of loyalty.146
202.
While Claimants submitted a press release in this arbitration announcing that "Pareteum and Artilium Announce Agreement for Pareteum to Acquire Artilium for $104.7 Million Transaction," the details of the acquisition are unknown, including the terms of the asset acquisition with respect to debts and liabilities. The press release does not use the term "merger."
203.
To support their argument of a de facto merger, Claimants rely on the factors established in Crawford and subsequent Virginia case law, namely (1) continuity of management, personnel, physical location, assets, and general business operations (i.e., continuity of enterprise); (2) continuity of ownership; (3) prompt cessation of the seller corporation's operations; and (4) assumption by the purchaser of obligations ordinarily necessary for the uninterrupted continuation of normal business operations of the seller.147 However, the court in Crawford also explained that the 'de facto merger' exception applies "where one corporation takes all of another's assets without providing any consideration…or where the consideration consists wholly of shares of the purchaser's stock…"148 While Mr. Weijermars testified that the acquisition was mainly through a stock exchange, he also testified that it was through some cash as well.149 Regarding the continuity of management, Claimants point to Mr. Weijermars and his role as CEO of Artilium and CEO of Pareteum. Beyond this fact, there is no evidence that the management, personnel, physical location, assets, and general business operations remained the same after the acquisition and there was no cessation of Artilium's operations. Therefore, I find there is insufficient evidence to conclude a de facto merger occurred in the acquisition of Artilium by Pareteum.
204.
For these reasons, the express duty of loyalty contained in the Operating Agreement does not bind Pareteum. It is not credible however that Pareteum entered into the close operating relationship with Artilium without knowledge of the Operating Agreement, Syndicate Agreement, and the duty of loyalty (exclusivity) and duty to inform contained therein. Actions that would be in contravention of that could constitute inducing a breach of the duty of loyalty.
205.
In their arguments on the duty of loyalty, both parties make extensive arguments concerning the "model" of the Operating Agreement, i.e. whether it is a reseller or revenue-sharing model. Curiously, there are no such words in the Operating Agreement. Nowhere does the Operating Agreement provide that it is a "reseller model," nor use the term "reseller." Moreover, there is no evidence of any amendment to the Operating Agreement demonstrating that it became a "revenue sharing" model. Indeed, the Operating Agreement does not: specify the cost to the third parties of any of the hardware or services provided, include any provision on who was responsible for the technical provisions, and/or refer to any modalities for the negotiation and completion of any customer agreement. This absence of specificity applies as between the parties to the Operating Agreement as well as with third party customers. None of the agreements—whether the Operating Agreement or the Syndicate Agreement—addresses the cost of providing the service for the hardware or who would arrange the financing for the purchase and/or the acting party.
206.
Pareteum and Artilium PLC however (with the same CEO) failed to inform AA and/or TAT of their new arrangement and permitted AA and Mr. Delkaso of the relationship and the competition for the business in Africa. Mr. Delkaso continued in his efforts from 1 May until 7 June 2018 under the belief that the duty of loyalty was in force under the Operating Agreement. At a minimum, Artilium and Pareteum were negligent in failing to inform Mr. Delkaso of the new arrangement such that he could stop incurring expenses in pursuit of what he believed to be the realization of the Operating Agreement.
207.
In addition, there was not even any transparency concerning the terms of Artilium PLC's deal with GiG.tech, that Artilium PLC eventually lost. In August 2017, Mr. Westerfield wrote to Mr. Andries providing in part that:

[w]e asked you to provide a clear explanation of the financial relationship between Artilium PLC and GiG.tech. We asked for an explanation of whether under your plan, the capital would be utilized by Artilium Africa to purchase the servers directly from GiG.tech. We also asked why your plan was to purchase the servers directly from GiG.tech, contrary to the previously described business plan by which the GiG.tech would be compensated by Artilium PLC.150

208.
Notwithstanding this lack of specificity in the Operating Agreement and its related Syndicate Agreement, there is no doubt that the Agreement imposes a duty of loyalty preventing Members from entering into deals with other providers in Africa in the same space as the business of Artilium Africa, as established above.
209.
The evidence submitted in this case demonstrates that Respondent Artilium breached the duty of loyalty contained in the Operating Agreement.
210.
First, beginning in the summer of 2017, shortly after Respondents' loss of the hardware contract with GiG.tech, there is evidence that Artilium began to investigate undertaking their business alongside Pareteum, without ever disclosing it to Mr. Delkaso. At the hearing, Mr. Weijermars testified that "Artilium and Pareteum offer[ed] similar products and services, although in different geographic regions," "Pareteum was focused more outside of Europe," and "Pareteum was 'a direct competitor' of Artilium."151 Indeed, the critical date here is the loss of the GiG.tech contract, following which Artilium never held up its end of the bargain, and instead negotiated a separate deal with a competitor without ever disclosing it to Artilium Africa. Mr. Delkaso exchanged correspondence with Mr. Cant and other executives in 2017 and 2018, including when Mr. Cant requested the dissolution of Artilium Africa, but none of this correspondence ever mentioned the Strategic Alliance Agreement or Pareteum's acquisition of Artilium planned for September 2018, announced in June 2018. 152 The loss of the GiG.tech deal marked the onset of a series of circumstances, that in their totality, resulted in the breach of the duty of loyalty.
211.
Second, there is evidence that Pareteum and Artilium were working together to exploit opportunities in Africa in the Strategic Alliance Agreement. The 16 October 2017 Strategic Alliance Agreement entered into between Artilium and Pareteum refers expressly to Africa in its definition of Territory: "'Territory' means the continent[s] of South America, Asia and Africa, and such other jurisdictions anywhere in the world as may be agreed between the Parties in writing from time to time."153 Article 3 of the Strategic Alliance Agreement established that "[t]he Parties desire to set forth the general terms upon which they shall cooperate … in respect of future commercial opportunities to supply their own and each other's Solutions through exploiting Projects with potential new Customers in the Territory."154 "Projects" is a defined term in the Strategic Alliance Agreement and those of Pareteum include its "Managed Services Platform" and "Global Mobility Cloud Platform," while those of Artilium include its "ARTA solution suites, including … real-time session control, rating, usage monitoring and billing of voice, sms, mms, data sessions and mobile payments for prepaid and postpaid offerings."155 Thus, the Strategic Alliance Agreement specifically included Africa as a region that Artilium and Pareteum would pursue as part of their alliance, and the services they offered overlapped with those services listed in the Operating Agreement. This collective activity was contrary to the specific obligation of loyalty /exclusivity in the Operating Agreement and constituted a breach.
212.
Moreover, Artilium Africa was never made aware of any of this activity between Pareteum and Artilium—neither the Strategic Alliance Agreement nor the deals that followed.
213.
Third, a series of press releases followed the signature of the Strategic Alliance that likewise referred to business in Africa, as Claimants set forth in their submissions. For example, the CEO of Pareteum, Hal Turner drafted a press release stating, inter alia "Artilium and Pareteum announced today that they will partner together and work closely together to market and sell services initially in Africa…" "[t]his is a formal arrangement between Artilium and Pareteum…to share resources in a concerted focus in Africa…" "Artilium and Pareteum's strategic alliance to cooperate in Africa strengthens each company."156 Indeed, Pareteum issued a press release along with the signing of the Strategic Alliance which contained the subheading of a "[s]trong focus on burgeoning new geographic markets such as Africa…" and quoting Hal Turner that "[w]e see Asia and Africa as a strategic next step, a plan to move on to jointly pursue those and additional markets..."157 Subsequently, Pareteum issued a press release titled "Pareteum Expands Into African Market…" which described a 5-year contract for Pareteum's Managed Services Platform in Sub-Saharan Africa for an estimated US$ 12 million in the first three years.158
214.
Fourth, the Operating Agreement is clear that any other business in Africa "encompassed by the business of the company" could not take place "unless the other Member or Members agree(s) to the contrary." Here, there was simply no disclosure. No one told Mr. Delkaso or anyone else about the Strategic Alliance and subsequent merger, much less the focus on Africa. No one told Mr. Delkaso or anyone else about the termination of the GiG.tech contract or its effect on his efforts in individual African countries. There was certainly no agreement from the Members at any point in the Artilium-Pareteum relationship because the other Members were not informed, and once they were, it was clear they were not in agreement that Artilium and Pareteum could jointly pursue comparable projects in Africa.
215.
Accordingly, the evidence demonstrates that Artilium breached the duty of loyalty contained in the Operating Agreement. I conclude, in fact, that Artilium breached the duty of loyalty, including the duty to disclose its activity with Pareteum in Africa, and Artilium should have prevented Mr. Delkaso from making further efforts in their joint regard. Artilium was fully aware of what it was doing, and both Artilium and Pareteum should have been aware of the Operating Agreement and Syndicate Agreement and their terms. Moreover, it is incomprehensible that none of the individuals involved in the side-by-side agreement for potential joint work in Africa had done no due diligence, read no reports, or were otherwise informed as to the Operating Agreement between Artilium, Artilium Africa, and Tristar.
216.
The damages resulting from this breach will be discussed at Section X below.

c. Intentional or Tortious Interference With Contract

i. Claimants' Position

217.
In their Post-Hearing brief, Claimants allege that there are four elements for a claim of tortious interference under Virginia law: (a) existence of a valid contractual relationship or business expectancy; (b) knowledge of the relationship or expectancy on the part of the interferor; (c) intentional interference inducing or causing a breach or termination of the relationship or expectancy; and (d) resultant damages to the party whose relationship or expectancy has been disrupted.159
218.
According to Claimants, these four elements have been satisfied. With respect to (a), Claimants allege there is a contract between Artilium, Green Globe and Tristar, the Operating Agreement. With respect to (b), Claimants ask that the Sole Arbitrator draw adverse inferences from Respondents' production of two email messages in response to a document request for "[a]ll documents concerning Pareteum's communication and negotiation of the Strategic Alliance in October 2017 and the merger Agreement announced in June 2018." 160 Claimants' request for adverse inferences is based on Article 20 of the ICDR International Arbitration Rules and Virginia law. Notwithstanding the lack of produced documents, according to Claimants, "what Claimants have on this issue is telling and demonstrate that Pareteum knew of the African market, intended to immerse itself in it, and perceived Artilium—through Artilium Africa and what Mr. Delkaso had done—as its gateway into that market."161 As evidence, Claimants refer to a 7 October 2017 email from Mr. Turner that includes a block copy of an Artilium Africa press release from earlier in the year, and relies on this same email to allege the third element of tortious interference. In terms of the fourth element, Claimants allege that US$ 49,732,164 in damages were caused by Pareteum's tortious interference.
219.
In their Post-Hearing Response, Claimants further rely on Mr. Weijermars' first witness statement and his testimony at the hearing as evidence of Pareteum's knowledge of the Artilium Africa joint venture. Claimants also allege that Pareteum has entered into new contracts in Africa on the basis of press releases submitted as evidence in this arbitration, namely a 15 March 2019 press release referring to "new customer transactions" spanning several continents including Africa, worth US$ 17 million.162

ii. Respondents' Position

220.
In their Post-Hearing Rebuttal, Respondents allege that Claimants failed to demonstrate that Pareteum interfered with Artilium Africa. Specifically, Respondents allege that the email message from Mr. Turner "outlined his rough thoughts for a press release about the strategic alliance" and that "Claimants point to a placeholder statement from Artilium that they expected the strategic alliance to 'accelerate Artilium's growth throughout Africa,'" which Respondents claim does not violate the duty of loyalty. According to Respondents, Artilium "never conducted" business in Africa and "it is unclear what connection the inclusion of this press release has to a breach of the duty of loyalty."163
221.
Respondents allege that there is "no evidence that Pareteum was involved in any way in Artilium's consideration of the Hamilton Telecom opportunity in the summer of 2017."164 Further, Respondents allege that "Claimants have presented no evidence whatsoever that Artilium was involved in Pareteum's actual business dealings in Africa to the exclusion of the Joint Venture."165 Finally, Respondents claim that Mr. Weijermars affirmed in his witness statements that "Artilium was not involved in any of Pareteum's attempts to develop business in Africa before, during, or after the strategic alliance."166
222.
With respect to Claimants' request for adverse inferences, Respondents allege there adverse inferences are not warranted because: (a) Respondents "did not improperly withhold any documents responsive to Claimants' document requests"; (b) Claimants ignore Mr. Cant's testimony that communications between Artilium and Pareteum were "almost exclusively oral"; and "Respondents do not even dispute that which Claimants would have the Sole Arbitrator infer."167

iii. Sole Arbitrator's Decision

223.
Respondents do not dispute that Virginia law establishes four elements to prove a claim of tortious interference including inducing a breach of a relationship. Accordingly, I will analyze the parties' arguments on the evidence whether these four elements have been satisfied.
224.
First, there is a valid contractual relationship or business expectancy, as required under the first element of the test. Here, there is no question that a contractual relationship exists through the Operating Agreement, as well as the Syndicate Agreement. The parties to those agreements were actively pursuing their respective duties at the time when Artilium and Pareteum entered into negotiations.
225.
Second, while the evidence concerning Pareteum's knowledge of the contractual relationship is scant, Artilium and Pareteum had the same CEO obviously he had knowledge of the duty of loyalty and Claimants submitted one email between Mr. Turner and Mr. Bozzo concerning a draft press release for the announcement of the Strategic Alliance. Copied on this email were three additional individuals from Pareteum as well as one individual with a "corporateprofile.com" email address.168 Pages 3-5 of this email reproduce a press release about Artilium Africa, "Telecom and Cloud Service Options Expand in Africa." Mr. Turner's signature block appears below the reproduced article about Artilium Africa. This email is dated 7 October 2017 and clearly establishes that Mr. Turner and the other Pareteum employees copied on the email were aware of Artilium Africa's existence and should have been informed as to the terms of the Operating Agreement and the consequences of competing business in Africa.
226.
Third, Pareteum induced the breach of the duty of loyalty, partnering with Artilium and seeking out contracts in Africa. Artilium and Pareteum had the same CEO, and thus any interference was intentional given knowledge of the terms of the Operating Agreement. Indeed, Mr. Weijermars was CEO of Artilium from July 2014 to September 2018, Pareteum's CEO-EMEA from October 2018 to November 2019, and interim CEO of Pareteum from 2019 to the present,169 thus it is not credible that he was unaware of any duty of loyalty or duty to disclose the relationship with Pareteum.
227.
Fourth, damages resulted from Pareteum's tortious interference. Specifically, Mr. Delkaso continued to seek out memorandums of understanding and travel to Africa during the period of undisclosed breach.
228.
In view of the above finding on intentional or tortious interference with contract, the Sole Arbitrator finds that it is not necessary to address Claimants' adverse influences claim.

d. Dissolution of Artilium Africa

229.
Respondents request the termination of the Operating Agreement in their submissions.
230.
Article 13 of the Operating Agreement addresses "Dissolution and Termination." Specifically, Article 13.1 provides that:

13.1 Events of Dissolution. The Company shall be dissolved upon the first to occur of the following:

13.1.1 At the time or the happening of any events specified in the Articles of Organization or this Operating Agreement;

13.1.2 Upon the unanimous written consent of the Members;

13.1.3 Any event under applicable law that requires dissolution of the Company, provided that the death, resignation, retirement, bankruptcy, or dissolution of a Member or occurrence of any other event that terminated the continued membership of a Member in the Company shall not cause the dissolution of the Company.

i. Respondents' Position

231.
Respondents request that the Sole Arbitrator dissolve Artilium Africa due to "any event under applicable law that requires the dissolution of the Company." According to Respondents, Artilium Africa has been "terminated as a matter of fact" under Virginia law.170 Specifically, Respondents rely on Snead v. Burke to argue that termination is due because "its Members '[b]y their actions … are not working together.'"171 Factually, Respondents allege that "the parties have failed to work together for years," Mr. Weijermars "called for the parties to either dissolve the Joint Venture or hold a meeting of principals in October 2017," 172 and that in August 2018 Mr. Cant "inquired about either dissolving the Joint Venture or finding a path forward."173

ii. Claimants' Position

232.
In their Post-Hearing Brief, Claimants allege that the Sole Arbitrator "does not have the power to dissolve AA" due to "the terms and conditions of the OA, as well as the fact that Respondents have no claim through which they can seek any relief."174 According to Claimants, none of the three options for termination under the Operating Agreement have been satisfied: "Claimants see no event specified in writing under Paragraph 13.1.1 that could give this Tribunal the power to order dissolution … [n]or do Claimants perceive any event under Virginia law that requires the dissolution." Finally, Claimants add that they "do not believe that there are grounds that give Arbitrator Lamm the authority to dissolve the LLC without the unanimous written consent of the Members."175
233.
As a procedural matter, Claimants allege that Respondents have "no standing" to request the termination or dissolution of the Operating Agreement because they wrote on 16 April 2021 that "Respondents…are not maintaining a counterclaim in this arbitration."176
234.
Claimants did not address this issue in their Post-Hearing Response brief.

iii. Sole Arbitrator's Decision

235.
As a threshold matter, the Sole Arbitrator finds that the relationship/ agreement as established under the OA and SA was de facto terminated in October 2017. It was then, following attempts at side deals and arguments over additional capital contributions, that Mr. Weijermars first requested termination of the Operating Agreement. It has not functioned since before that date and the breach of the duty of loyalty—including Pareteum's tortious interference—establishes that the Operating Agreement and Syndicate Agreement no longer function as a matter of fact.
236.
Despite the mischaracterization of the request for termination (which is indeed a counterclaim), I find that I may still decide on the substance of this issue given that it was part of the questions posed to the parties at the end of the hearing and they had ample opportunity to fully brief the issue.
237.
I now turn to the substance of Respondents request for termination. There is no dispute between the parties that neither 13.1.1 nor 13.1.2 were satisfied, thus I will move directly to 13.1.3 and the question of whether there is an "event under applicable law that requires dissolution" of Artilium Africa.
238.
Respondents rely on Snead in support of their claim for dissolution of Artilium Africa. In that case, while the Court found that the two doctors had not entered into a partnership agreement, it did find that a joint venture was formed for the purchase, installation and use of a cobalt machine.177 Relying on the Michie's Jurisprudence treatise, the Snead court held that "a joint venture is not terminated 'until its performance is accomplished, or until such accomplishment becomes impracticable.'"178 The Snead Court further explained that "a joint venture is terminated when the purpose that produced the enterprise ends, or becomes irrelevant."179
239.
Here, all of the evidence points to the fact that Artilium Africa has become irrelevant. The Memoranda of Understanding, preliminary as they were, date from 2016. Since then, no further Memoranda of Understanding have been signed, nor were any existing ones executed or further developed. Mr. Delkaso has not taken a trip since the fall of 2017, which is the last expense he submitted.180 There is no evidence that any work in furtherance of the Operating Agreement and Artilium Africa has continued beyond 2017. At the same time, Artilium and Pareteum have continued announcing joint projects in Africa, as evidenced by their press releases. Artilium Africa has been inactive and none of the Members has indicated an interest in reviving its operations.
240.
Accordingly, the parties by their conduct have effectively dissolved Artilium Africa.

X. Damages

241.
In view of the above findings on the merits, the Sole Arbitrator now assesses the damages due resulting from Respondents' breaches. Specifically, Claimants request damages in the amount of US$ 49,732,164, corresponding to (1) lost profits in the amount of US$ 48,040,915; (2) Mr. Delkaso's time in the amount of US$ 1,576,800 and Mr. Delkaso's expenses in the amount of US$ 114,449.06 (airfare of US$ 47,250.00 and expenses for US$ 67,199.06), totaling US$ 1,691,249.06.181

a. Lost Profits

i. Claimants' Position

242.
In their Post-Hearing brief, Claimants first describe the alleged evolution of the law of lost profits under Virginia law, noting that "[h]istorically it was difficult for new or unestablished businesses to recover lost profits under Virginia law."182 According to Claimants, this changed over time, as memorialized in the Lockheed case183 and the 2002 enactment by the General Assembly of Va. Code 8.01-221.1 which provided that "[a] party shall not be deemed to have failed to prove lost profits because the new or unestablished business has no history of profits."184 According to Claimants, the decision in Preferred Sys. Sols., Inc. v. GP Consulting provides "a good roadmap in terms of what proofs are required for, and the standards governing, an award of lost profits."185 The Preferred Sys. Court identified three factors for an analysis of a lost profits claim, two of which are relevant to this case, according to Claimants: "(1) the certainty of the future contracts (or lack thereof) from which the lost profits were calculated; and (2) the calculation of the lost profits in terms of their certainty."186 With respect to (1), the Court held that "[t]he plaintiff is tasked merely with proving the elements of damages from lost profits by a preponderance of the evidence."187 With respect to (2), the Court provided that "lost profits—must be proved with reasonable certainty. … Damages are not rendered uncertain because they cannot be calculated with absolute exactness. It is sufficient if a reasonable basis of computation is afforded."188
243.
Claimants further allege that "the vast majority of courts recognize that a new business" can recover lost profits and that Virginia "eliminated all doubt by enacting the statute titled Unestablished Business Damages."189
244.
According to Claimants, their claim for lost profits is "based on Artilium's projected profits, has been made with reasonable certainty, and is reasonable because it could have been far greater."190 Specifically, Claimants calculated their damages on the basis of Artilium's forecasted revenues for 2018191 and described their calculation as "(1) take the other side's (Artilium's) forecast of revenues going into the future; and (2) see if the other side (Artilium and Pareteum) has done anything with the nascent business model (Artilium Africa) that was scuttled."192
245.
According to Claimants, the following additional calculations had to be made on the basis of predicted lost revenues: "(1) profits have to be derived from the total … in economic harm; (2) the profits then must be divided by two (Tristar was only entitled to 50% of the profits); (3) that number needs to be multiplied by ten years for a total loss to Tristar; and (4) that number needs to be configured to its present value for future years."193
246.
In their Post-Hearing brief, Claimants specifically address the revenue projections on which they based their damages calculation, alleging that "the numbers were solid, at least if the parties had done what they contracted to do" and "were the work product of Mr. Andries."194

ii. Respondents' Position

247.
In their rebuttal to Claimants' letter submission on damages, Respondents allege that Preferred Systems "shows precisely why Claimants' request for damages must fail" and that Claimants "ignore" the Court's finding that "[w]hen an established business, with an established earning capacity, is interrupted and there is no other practical way to estimate the damages thereby caused, evidence of the prior and subsequent record of the business has been held admissible to permit an intelligent and probable estimate of damages."195
248.
According to Respondents, unlike in Preferred Systems, "Artilium Africa was a new joint venture with no track record and no established earnings potential."196 Respondents further allege that none of the exhibits relied on by Claimants show damages attributable to the Respondents with any certainty. For example, according to Respondents, Exhibit C-361 conveys projections for "potential profits with one potential customer" and Exhibit C-7 "is used for its projections of potential revenue (not profits) in 2018 arising out of potential deals with unidentified customers in various countries, but those completely speculative projections are also entirely unreliable when you consider that Artilium Africa did not even meet the revenue projections in that document for years 2016 or 2017."197
249.
In addition, with respect to Exhibit C-409, Claimants' Estimate of Economic Damages from Tortious Interference, Respondents allege that it is "unexplained, undefined, and untethered from reality" and that "Claimants appear to be basing their new theory of lost profit damages not on lost profits at all, … but on the value of Artilium at the time it merged with Pareteum."198
250.
In their Post-Hearing brief, Respondents allege that the burden of proof to demonstrate lost profits a new business is high, relying on Clark.199 Respondents also criticize Claimants' damages methodology, alleging that they: (a) rely on revenue and not profits projections to calculate lost profits; (b) rely on revenue projections developed shortly after the creation of Artilium Africa or on Pareteum's business in Africa; (c) argue that lost profits can be measured by taking half of the revenue projections; and (d) created a model of damages based on a draft business plan. 200
251.
With respect to the revenue projections, Respondents allege that they were "not even intended as an accurate representation of likely revenues," providing that it was to show the "ambition" of Artilium Africa and that they were, in any event, made under the reseller model that was abandoned for the revenue sharing model.201 Respondents further allege that Artilium Africa "never met its revenue projections" and that Claimants "acknowledge that the numbers generated…do not show profit."202 The profit calculation of 10% was announced "without support,"203 according to Respondents. Respondents again invoke Clark, alleging that an eight month record of profits was insufficient for a finding of lost profits "since the partnership's dental practice was a new enterprise lacking an established earning capacity."204
252.
In their Reply Post-Hearing brief, Respondents allege that Claimants have failed to meet their burden of proving that their losses were caused by Artilium because Artilium Africa did not succeed due to other factors.205 Additionally, according to Respondents, Claimants' causation argument relies on press releases and public statements and given that Claimants did no more than enter into a Joint Venture with Pareteum, any attempted causation is unsupported.

iii. Sole Arbitrator's Decision

253.
An award of lost profits for unestablished businesses under Virginia law provides that "[d]amages … may be recoverable upon proper proof."206 The statute does not provide what constitutes "proper proof" nor have the parties cited to any jurisprudence that elaborates this standard. The parties agree that the traditional "reasonable certainty" standard is applicable to determinations of lost profits under the new business statute.207
254.
Claimants have not satisfied the "reasonable certainty" threshold for a finding of lost profits under Virginia law, even taking into consideration the Virginia new business statute. Specifically, the Claimants have not provided any means to calculate lost profits in terms of an ongoing business that reached a commercial reality. No actual deals resulted from the various memoranda of understanding Mr. Delkaso sought to negotiate and no metric exists to measure with reasonable certainty any lost profits that would have resulted. Indeed, Claimants rely on projected revenues—that were never met and never realized for previous years. In short, projected revenues are not established profits–particularly in the context of this case given the lack of any real financial terms in the Operating Agreement and/or Syndicate Agreement, and the lack of any evidence ever produced. There simply is not any basis to project lost profits on the basis of evidence presented. Claimants failed also to consider and calculate the cost that should be borne by third parties.
255.
Claimants rely on Exhibit C-409, which includes a series of documents in support of their damages claim. Claimants rely heavily on the Business Plan Artilium Africa, C-7. This document includes forecast revenues by country target for the period 2016-2020. This document is not a reliable source given that: (a) as of 2016, none of the projected revenue figures had been met; (b) some of the countries with which preliminary memoranda of understanding were signed are not even included in the list of countries in the Business Plan; (c) Mr. Delkaso testified that actual revenues for 2016 and 2017 were zero;208 and (d) a subsequent version of the business plan submitted by Respondents (R-66) shows "much lower projections for 2018 and other years."209
256.
During the hearing and in their post-hearing submissions, Claimants alleged that these revenue goals would have been met but for the Strategic Alliance between Artilium and Pareteum. This argument is not convincing. There is evidence on the record that the parties actively sought to enter into these MOUs, but despite these efforts, they did not succeed in moving them past an extraordinarily preliminary phase—even prior to the loss of the GiG.tech deal and the subsequent Strategic Alliance.210
257.
Accordingly, Claimants' request for lost profits is rejected.

b. Mr. Delkaso's Expenses and Compensation

i. Claimants' Position

258.
Claimants rely on Article 4.15 of the Operating Agreement in their request for reimbursement of Mr. Delkaso's expenses and compensation for his services. The claim for expenses is US$ 114,449.06 and the claim for compensation is US$ 1,576,800 (3,504 hours at US$ 450/hr.), totalling US$ 1,691,249. 211 In his Supplemental Declaration, Mr. Delkaso alleges that he spent "roughly 3,504 hours of time, including traveling hours, fulfilling my obligations under the AA Operating Agreement" and that "[a] fair and reasonable rate for my time is US$ 450 per hour."212
259.
Claimants allege four reasons why Mr. Delkaso should be compensated for his services under the terms of the Operating Agreement: (1) Member approval is "deemed to be made" given Artilium and Green Globe's breach of contract; (2) Mr. Delkaso incurred costs pursuing the business interests of Artilium Africa; (3) the amount requested is reasonable because Mr. Delkaso is actually entitled to "cost plus 10 percent"; and (4) a majority of Members approve such an award.213 Claimants allege that Tristar's majority of 500 Class A shares over Artilium's 350 Class B shares even when added to Green Globe's 150 Class A shares allow for it to approve the compensation of Mr. Delkaso, to be paid by Artilium and Green Globe as they breached the contract.214 In this regard, Claimants allege that "simple majority approval is all that is required for payment of fees and services under Paragraph 4.15 of the OA and Paragraph 9.2 on unanimous decisions does not present a barrier."215
260.
Claimants also allege that Mr. Delkaso is entitled to damages for expenses and services under Virginia law. Relying on Appalachian Power and Kamlar Corp., Claimants allege that damages are intended to put "the party injured in the same position, as far as money can do it, as he would have been if the contract had been performed" and that "damages … are … limited to those losses which are reasonably foreseeable when the contract is made."216 Finally, Claimants again invoke Kamlar Corp. for the proposition that Mr. Delkaso's sunk costs are "within the contemplation and control of the parties in framing their agreement" because those costs "would have been profitable for all parties had Artilium and Green Globe not breached the contract."217

ii. Respondents' Position

261.
According to Respondents, Claimants do not meet the burden of "reasonable certainty" required for a finding of damages in their favor. Specifically, Respondents allege that: (i) Claimants cannot show a causal connection between the alleged breach and the damages, as required by the Saks Fifth Ave. judgment, because Claimants have not shown that Artilium Africa would have generated revenue that would have allowed them to recover their costs. Artilium Africa did not identify any customers under the reseller model, nor any Operators under the revenue sharing model.218; (ii) Claimants have "failed to show these costs with adequate certainty" because Mr. Delkaso "speculated" about the value of his time and no member of the joint venture was being compensated at an hourly rate;219 and (iii) Claimants include expenses "with no clear connection to Artilium Africa's business."220 According to Respondents, Claimants ask the Sole Arbitrator to infer that "Artilium Africa could have been a success from the fact that Pareteum entered contracts in Africa and has allegedly been massively profitable since acquiring Artilium."221 Pareteum had allegedly historically entered into contracts in Africa and entered into them separate from Artilium.222 Moreover, Respondents allege that Pareteum has "consistently lost money both in Africa and worldwide."223
262.
In their Post-Hearing Rebuttal, Respondents object to the reimbursement of Mr. Delkaso's alleged expenses and compensation for his time, alleging that: (a) Tristar Africa Telecom—and not Mr. Delkaso—is the party to this proceeding. The provisions for reimbursing a Manager are irrelevant because Tristar Africa Telecom is a Member under the Operating Agreement, according to Respondents;224 (b) Delkaso's time cannot be compensated without approval from the Members and the Operating Agreement only provides for reimbursement of expenses to Managers. The Member approval requires unanimous consent of Class A shares pursuant to Article 9.2 of the Operating Agreement;225 and (c) Claimants have not demonstrated that Mr. Delkaso's expenses were connected to his work on behalf of Artilium Africa or that they were "reasonable."226

iii. Sole Arbitrator's Decision

263.
In view of the above finding that Respondents breached the Operating Agreement's duty of loyalty and Pareteum induced the breach of the duty of loyalty by tortuously interference with the contract, Mr. Delkaso is entitled to expenses and compensation for the reasons set forth below.
264.
First, as a Manager Mr. Delkaso is "entitled to reimbursement of reasonable expenses incurred in connection with the performance of [his] activities on behalf of the Company or in furtherance of [his] duties"227 from the moment Respondents breached the duty of loyalty in the Operating Agreement. As explained above, Artilium breached its duty of loyalty when Artilium began negotiating a deal with Pareteum that included services in Africa and simultaneously lost their hardware contract with GiG.tech as of 1 May 2017, without disclosing it to Claimants.228 From that date until June 2018, when Pareteum announced its acquisition of Artilium following the prior 16 October 2017 announcement of the Strategic Alliance Agreement,229 Artilium was responsible for any further efforts undertaken by Mr. Delkaso in their joint regard without knowledge of the de facto termination. The parties exchanged emails concerning the work of Artilium Africa and the Hamilton Telecom deal, for example, yet the relationship between Artilium and Pareteum was not once mentioned.
265.
In order to calculate the amount due in expenses, it is necessary to look to the expenses incurred during the relevant time period, i.e. 1 May 2017 to 7 June 2018. According to Mr. Delkaso's Second Supplemental Declaration, one of eleven trips in furtherance of Artilium Africa's business occurred during this time, specifically a trip to Ethiopia between 18 and 21 September 2017. 230 Accordingly, Claimants are entitled to recover the amount of one eleventh of the US$ 47,250 claimed for Mr. Delkaso's travel, namely US$ 4,295.45. Respondents did not contest the flights. Furthermore, of the expenses claimed in Exhibit A, 20 entries occurred within the relevant time period totaling US$ 8,756.54. Therefore, Claimants are entitled to recover a total of US$ 13,051.99.
266.
Second, Mr. Delkaso is also entitled to compensation for the damages resulting from Pareteum's tortious interference with contract. The appropriate remedy is in tort, and not in contract, and thus the provisions on the Operating Agreement cited by both parties are irrelevant to this analysis.
267.
Mr. Delkaso requests US$ 1,576,800 as compensation for his services, comprised of 3,504 hours at a rate of US$ 450 per hour. Mr. Delkaso testified that his hourly rate of US$ 450 is the "State Department number for when you go to Africa as an American citizen," which fluctuates between US$ 400-450. At the hearing Mr. Delkaso further testified concerning the 3,504 hours that he worked, explaining that "[i]f you calculate the time between 2016 and 2018, the brokerage of Artilium, Mr. Cant there is [sic] over 7,000-something hours, so I calculated reasonably that's the time that I come up with in order to facilitate the process."
268.
This amount of damages is analogous to the hourly rate and hours expended by Mr. Delkaso and represent reasonable compensation for his efforts in establishing relationships in Africa, given the ongoing trips, meetings and exchanges he had with individuals in various African countries, that continued even after Pareteum tortiously interfered with the contract to the detriment of Mr. Delkaso and Artilium Africa. As such, compensation for services is due from 1 May 2017 when Artilium lost the GiG.tech contract and then began negotiating with Pareteum, until 7 June 2018 when Pareteum announced its acquisition of Artilium. Therefore, Claimants are entitled to recover for the amount of hours worked in the relevant time period as a proportion of the total amount claimed from 2016 to 2018. There are 402 days between 1 May 2017 and 7 June 2018, amounting to 1,286.40 hours. This results in damages of US$ 578,880.
269.
Accordingly, the amount due for expenses and services is US$ 591,931.99, comprised of US$ 13,051.99 in expenses and US$ 578,880 in services.

XI. Costs And Fees

270.
Pursuant to Rule R-34, the Sole Arbitrator "shall fix the costs of arbitration its award(s). The tribunal may allocate such costs among the parties if it determines that allocation is reasonable, taking into account the circumstances of the case."231
271.
In addition, Article 20.16 of the Operating Agreement provides that:

Attorney Fees. Any Member or Manager seeking to enforce his or its rights or seeking to enforce any provision of the Operating Agreement against the Company or any other Member or Manager, if deemed to be the prevailing party, shall be entitled, in addition to any other rights and remedies available to him or her, to collect from the non-prevailing party the reasonable costs and expenses incurred in the investigation and the prosecution of such action, including but not limited to reasonable attorney fees and court costs from the person or entity who shall have necessitated such enforcement, provided that the non-prevailing party or parties breached, or attempted to breach, any obligations owed under this Operating Agreement or the non-prevailing party or parties initiated or joined any claim, demand, arbitration or action against the enforcing party in contravention of, or inconsistent with, the provisions of this Operating Agreement.

272.
The administrative fees and expenses of the International Centre for Dispute Resolution (ICDR) total US$ 34,709.82 and the compensation and expenses of the arbitrator and tribunal secretary total US$ 113,260.90.
273.
Claimants' invoice No. 2664 includes costs, expenses and attorney's fees in the amount of US$ 1,161,313.94.
274.
Respondents submitted "costs and fees incurred by Respondents relating to the Artilium matters, including successfully compelling arbitration in the Delaware litigation" in the amount of US$ 1,490,002.81; costs including "court reporter fees, pro hac vice admission fees, and fees owed to the American Arbitration Association in connection with this ICDR proceeding" in the amount of US$ 63,810.76; and "work in progress" fees of US$ 66,226.95.232
275.
Pursuant to Rule R-34 and Article 20.16 of the Operating Agreement, and taking into consideration the fact that the Sole Arbitrator found Respondents liable for breach of contract, Respondents are ordered to pay 25% of Claimants' share of administrative fees and expenses of the ICDR as well as 25% of Claimants' share of the compensation and expenses of the arbitrator. Accordingly, the administrative fees and expenses of the ICDR shall be borne US$ 8,677.45 by Artilium Africa, LLC and US$ 26,032.36 by Artilium Group Limited and Pareteum Corporation. The compensation and expenses of the arbitrator and tribunal secretary shall be borne US$ 28,315.22 by Artilium Africa, LCC and US$ 84,945.67 by Artilium Group Limited and Pareteum Corporation. Therefore, Artilium Group Limited shall pay Artilium Africa, LCC, an amount of US$ 54,347.59 upon proof of final payment.
276.
While Claimants prevailed partially on liability and damages, they were unable to demonstrate the bulk of their damages claim for lost profits. Moreover, Respondents were successful on their request for termination of the Operating Agreement. Accordingly, this recovery of 25% for Claimants is reasonable.

XII. Final Award

277.
The Sole Arbitrator FINDS and AWARDS as follows:

a. Claimants Artilium Africa, LCC and TriStar Africa Telecom, LLC's claims against Respondent, Green Global Services, LLC are denied;

b. Respondent, Artilium Group Limited has breached the duty of loyalty;

c. Respondent, Pareteum Corporation has intentionally interfered with the contract and induced the breach of the Operating Agreement's duty of loyalty provision;

d. Artilium Africa, LLC is dissolved;

e. Respondents, Artilium Group Limited, and Pareteum Corporation, jointly and severally, owe Claimant, TriStar Africa Telecom, LLC damages in the amount of US$ 591,931.99 on the claim for a breached duty of loyalty and tortious interference with contract within thirty (30) days of the date of this FINAL AWARD;

f. The administrative fees and expenses of the ICDR shall be borne US$ 8,677.45 by Artilium Africa, LLC and US$ 26,032.36 by Artilium Group Limited and Pareteum Corporation. The compensation and expenses of the arbitrator and tribunal secretary shall be borne US$ 28,315.22 by Artilium Africa, LLC and US$ 84,945.67 by Artilium Group Limited and Pareteum Corporation. Therefore, Artilium Group Limited shall pay Artilium Africa, LCC, an amount of US$ 54,347.59 upon proof of final payment; and

g. This Final Award is in full satisfaction of all claims submitted to this arbitration. All other claims and defenses not expressly granted herein are dismissed.

I hereby certify that, for the purposes of Article I of the New York Convention of 1958, on the Recognition and Enforcement of Foreign Arbitral Awards, this Final Award was made in Washington, D.C., USA

Date: 8 February 2022

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