MySQUAR Limited Investigation Update and Delisting (7279J)
07 December 2018 - 6:00PM
UK Regulatory
TIDMMYSQ
RNS Number : 7279J
MySQUAR Limited
07 December 2018
7 December 2018
MySQUAR Limited ("MySQUAR" or the "Company")
Investigation Update and Delisting
Operations Update
MySQUAR announces that in order to preserve cash the Company has
temporarily shut down one division and part of another to further
conserve cash. The Mobile Money division and MyMingalarbar, a
social app, have ceased operations within the past week. Some staff
from both these divisions have been made redundant. Furthermore,
the Directors and senior staff have not been paid for between two
and three months.
The Mobile Games division and Mingalarbar Morning, a lifestyle
and entertainment portal, remain active and continues to
operate.
Investigation Update
MySQUAR announces that following the announcements of 5(th)
November 2018 and 9(th) November 2018, the non-executive directors
of the Company are able to provide further details on a related
party transaction following a review of the segregated account into
which the proceeds were paid from the bond issues announced on 7th
March 2018 and 20th June 2018.
Related Party Transaction
On 5(th) February 2018 it appears that a Loan of GBP200,000 was
provided to the Company by a company that may have been a
substantial shareholder of the Company at the time under the terms
of a promissory note dated 2(nd) February 2018 issued by the
Company to that shareholder (the "Loan"). The terms of the
promissory note are that the Loan was repayable in 45 days with the
Company to bear the USD 500 of administrative and transaction fees
of the lender. The Loan was repaid on 13(th) March 2018 out of the
proceeds of the convertible bonds issued by the Company and
announced on 7(th) March 2018.
The preliminary view of the non-executive directors is that:
(a) this Loan may have constituted a related party transaction
under Rule 13 of the AIM Rules for Companies ("AIM Rules") and, as
such, should have been notified at the time together with a
statement that the directors of the Company, having consulted with
its nominated adviser, considered the Loan to be fair and
reasonable insofar as the Company's shareholders are concerned;
(b) In breach of Rule 13 the Company did not consult with its
nominated adviser at the time in relation to the Loan.
(c) regardless of whether the Loan did or did not require
disclosure as a related party transaction it may have otherwise
required disclosure in accordance with the AIM Rules; and
(d) the Loan should have been considered and approved by the
Board of the Company in compliance with the Board Memorandum on the
Financial Position and Prospects Procedures ("FPPP") adopted by the
Company on 29(th) June 2015.
The related party transaction referred to above is included in
payments amounting to approximately GBP900,000 referred to in the
Company's RNS of 9(th) November 2018. In addition to these payments
two further series of payments have come to light which ought to
have received Board approval:
- a payment made on 22(nd) February 2018 in the sum of USD
13,800 to Rising Dragon Singapore Pte Limited. The Board considers
Rising Dragon Singapore Pte Limited to be a related party but that
this sum falls below the class tests for the purposes of AIM Rule
13; and
- various payments made to a company believed to be related to a
director of MyPay Limited made between 8(th) February 2018 to 4(th)
April 2018 in the sum of USD 188,742.
The Board is currently considering its options in relation to
the above matters.
Corporate Update
The Company's cash position remains critically low. The creditor
of the Company who had previously indicated it was prepared to
provide a working capital facility has completed its due diligence
and the Company awaits an offer of funding. There can be no
certainty an offer of funding will be forthcoming so there remains
a material uncertainty regarding the Company's working capital
position.
The Company is in discussions with a NEX quoted company
regarding the sale of the Company's subsidiary companies. It is
proposed that the consideration on such a sale include shares in
the NEX quoted company and that, in due course, such shares be
distributed to the Company's shareholders. However, there can be no
certainty that this sale will complete or in what timeframe.
The Company's shares will cease to be traded on AIM with effect
from 7am on 10(th) December 2018 as the Company has been unable to
appoint a new nominated adviser pursuant to AIM Rule 1.
Further announcements will be made on the Company's website
https://investors.mysquar.com/ following 10(th) December 2018.
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
For further information:
MySQUAR Limited
Stephen Chong (Interim Chief Tel: +65 6725 6388
Executive)
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contact rns@lseg.com or visit www.rns.com.
END
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