GREAT BARRINGTON, MA / ACCESSWIRE / September 21, 2020 / To the Management of Tapinator and the One Member of the Board of Directors:
As a follow up to my last Press Release, Activist Shareholder Asks Tapinator Managment, "What have you Done for Us?", I now ask "WHAT HAVE YOU DONE TO US?".
Over the last month, the Management and Board of Director of Tapinator, Inc. have totally changed the company Bylaws to give themselves substantially more control over the company despite the fact that the three gentlemen own ONLY approximately 20% of the company.
In addition, the Management and the Board of Tapinator, Inc. have eliminated the Audit Committee, the Compensation Committee and the Oversight Committee.
WHAT HAVE YOU DONE TO US??? WHY ARE YOU DOING THIS. Don't the shareholders who own 80% of the company deserve to vote on this? Don't we have a say?
These safeguards that protect our interest have been in place for years. They were in place when we made our investment in the company.
Why all of a sudden are the three of you making these changes? Don't we have a right to know?
It appears that the three of you have not changed the Company's Code of Ethics dated April 28, 2018 that is on the Company's website. I have reviewed this document and I would like to point out some potential violations and have some questions thereon.
The Code of Ethics clearly states that the Company, "expect all of our directors, executives, managers and other supervisory personnel to help foster a sense of commitment to this Code among all our employees, and to foster a culture of fairness, honesty and accountability within the Company."
It is my understanding that this document protects the employees as well as the Company's Shareholders, given that this was written when the company was a fully reporting company with Shareholders that had recently invested more than $3 million at $19.20.
Here are a few of the potential violations and questions:
Section 2. Conflicts of Interest.
The fact that the two managers, Andy and Ilya who have control of the Board with 2 of 3 directors and own about 20% of the shares of the company have orchestrated a total change in the Structural Management of the company for their own benefit by 1) completely changing the Bylaws and 2) eliminating ALL of the various oversight committees.
There is an item listed in Section 2 of Conflicts of Interest that identifies one of the criteria as "whether the activity would appear improper to an outsider". I would categorize myself and the other Shareholders as "outsider" and we think this appears improper.
The document refers to the "Compliance Officer" many times. We would like to know who has held this position since the date of the document?
Section 3 Insider Trading.
"Every employee officer and director is prohibited from using "inside" or material nonpublic information about the Company …..It is illegal, and it is a violation of this Code and other Company policies to tip or to trade on inside information."
The Company has announced recent stock acquisition by the Executives and Board Member that appear to be a violation of this Code of Ethics. We would like these employees and Board member to address this concern and explain why their recent share acquisitions would not be considered insider trading.
Section 4 Corporate Opportunity
This section refers to the Audit Committee that no longer exists. How is the company going to deal with this fact?
Section 6 Maintenance of Corporate Books…
The section states that the "Company reports and documents filed with or submitted to the SEC and other public disclosures are full, fair and accurate that they fairly present our financial condition and results of operations, and that they are timely and understandable."
It also notes that "No employee may take or authorize any action that would cause the Company's financial records or financial disclosure to fail to comply with generally accepted accounting principles, the rules and regulations of the SEC or other applicable laws, rules and regulations."
This appears to require the company to supply the SEC with proper financial information. How does this relate to the Form 15 filed in February? It seems that the Company is filing certain documents with the SEC (individual stock purchase transactions) and not others (audited financial statements). We think the shareholders deserve a clarification on this issue.
This paragraph also mentions that the company has an independent public accountant and we would like to know who that is and what the responsibilities are.
Section 12 Amendments and Waiver
Has there ever been any amendments or waivers granted by the Board of Directors? If so, could you supply them?
Section 13 Compliance Standards and Procedures
This section mentions "the Chair of the Audit Committee'. Now that there is no Audit Committee, this should be corrected.
There are many other lesser items that we would like to have an opportunity to discuss with the Management of the Company however, given the fact that the Company has dissolved the Corporate Governance Committee, there does not seem to be a way to do this.
Hopefully, you will take into consideration our concerns and correct the various violations noted in this document.
Yours truly,
David W. Unger
Tapinator Shareholder of 21,875 shares.
CONTACT:
New Hope Capital
David W. Unger
413-645-3357
SOURCE: New Hope Capital
View source version on accesswire.com:
https://www.accesswire.com/606988/Activist-Shareholder-Asks-Tapinator-Management-What-Have-You-Done-To-Us
