SINGAPORE (March 9): ISR Capital, under stress for links to penny stock saga mastermind John Soh Chee Wen, has lurched into yet another wave of troubles.

(See alsoSGX to allow ISR Capital to resume trading on March 6; shares said to be manipulated by John Soh)

In a filing on Wednesday night, ISR announced that David Rigoll, the company’s largest shareholder, has resigned as an executive director with effect from Monday. He has also started dumping shares in the company.  

Rigoll is accusing ISR of not paying him his salary for February this year. He is also planning not to honour a moratorium to sell or transfer his shares, said ISR.

Rigoll, 54, also accused ISR’s board for failing to “act in accordance” to its duties. Specifically, he questioned the appropriateness of the appointment of ISR’s previous legal adviser, whose appointment puts it in a conflict of interest. ISR did not say who the legal adviser is.

“The Board has requested for Mr Rigoll to provide evidence to support his allegations. The Board has to-date, not received any such evidence to support Mr Rigoll's allegations, which the Board considers baseless,” the company said.

“For the avoidance of doubt, the Board and the Company deny all allegations made by Mr Rigoll and will be seeking legal advice if required,” it added.

In addition, Rigoll has alerted ISR he will withdraw a voluntary undertaking to not sell or transfer ISR shares held by him before November 2017.

ISR drew attention to itself last June by trying to acquire a stake in a rare earth concession in Madagascar for $40 million from an entity called REO Magnetic. The same concession was bought by REO Magnetic for just one-seventh this price just six months earlier from a company listed in Dusseldorf. Up until June 3, Rigoll was a director of that German company, Tantalus Rare Earths AG.

Trading of ISR shares resumed only this Monday following a suspension by SGX that began on Nov 27 last year.

In a separate filing, ISR said Rigoll has sold nearly 21.3 million shares at an average of 4.7049 cents per share, with a total value of $ 1,000,859.

Rigoll first bought into ISR last year, paying Value Capital Asset Management (VCAM) 0.5 cent a share for VCAM’s stake in ISR. VCAM has an on-going $35 million convertible bond programme with ISR and the shares Rigoll bought from VCAM came from a tranche of bonds which were converted by VCAM into new ISR shares.

According to ISR filings, even after Monday’s sale, Rigoll is still the largest shareholder by far, with 407,840,300 shares, or 26.07% stake -- down from 27.43% before the sale.

ISR’s board now sees Rigoll’s sale of shares on Monday as a breach of agreement and will be seeking legal advice.

When ISR shares resumed trading on Monday, it dropped by 80% from the pre-suspension price of 12.7 cents. On Wednesday, the shares closed 25% lower at 3 cents.

(See also: ISR Capital plunges 76.4% on opening at resumption of trading)