Securities lending under arbitration 12 November 2018Singapore Reporter: Jenna Lomax
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America2030 Capital Limited has released a statement to clarify allegations released by a former client.
According to America2030, two executives from a Singapore public company, each executed two loan agreements with them to obtain a loan against their publicly traded securities.
America2030 stated the contracts were executed in early June of 2018 and borrowers did not deposit the securities until the end of October, almost five months after contracts were executed.
It continued: “Three months after the contracts were executed, borrowers attempted to renegotiate terms. We accommodated the borrowers and agreed to their new terms and an addendum was executed, thus amending the contract.”
“Despite the new terms, the borrowers were still indecisive and continued to renegotiate the contracts and again to seek new terms, despite the existence of executed contracts.”
Between the time that the contracts were executed in early June and shortly after the deposit by borrowers of the pledged collateral at end of October, the price of the stock declined by more than 50 percent, according to America2030.
It added: “Borrowers executed the closing statement which required them to deliver additional securities to make-up for loss in value of their shares. Also, according to the loan agreement, borrowers were required to deposit additional collateral to stay within the terms of the loan but failed to do so, instead again borrowers continued to demand a $6 million loan against collateral worth less than $6 million and to further renegotiate terms.”
America2030 said it sought to terminate the contracts after borrowers failed to comply with the terms of the contracts and ignored notifications warning of an imminent default.
The firm said: “Borrowers failed to adhere to the terms of the contracts and repeatedly used every opportunity to renegotiate the terms.”
America 2030 Capital has referred the matter to arbitration for resolution and adjudication.
Val Sklarov, CEO of America2030, said: "It's unfortunate that some people do not want to follow terms of contracts because they think that they are special, but would rather resort to distribution of incorrect, defamatory and sensational press releases and to attempt to litigate a dispute in the public media as opposed to in court or arbitration as required under the contract.”
He added: “We would be pleased to resolve the matter amicably in accordance with the contract, but our calls to do so were ignored."
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