Financial Difficulties
On March 12, 2009 Strategy First's parent company Silverstar Holdings Ltd was formally delisted from the NASDAQ market after failing to meet a timeline extension to become compliant with NASDAQ Marketplace Rules, specifically they "had not regained compliance with the stockholders’ equity requirement". The final statements publicly published by Silverstar were for the period ending December 31, 2008, filed on February 20, 2009. In these statements, Silverstar indicated that Strategy First revenues were minimal for the three months ended December 31, 2008 ("about $400,000" out of revenues of $8.7 million), with the bulk of revenues coming from the Empire Interactive division. Silverstar's total loss for this period was $3.4 million. As of December 31, 2008 Silverstar reports current assets of about $4 million versus liabilities of $17 million. Accounts Payable and Royalties Payable totaled $4.3 million, versus only $422,000 in available cash. In their management review Silverstar states "These factors raise substantial doubt about the Company’s ability to continue as a going concern. Since June 2008, the Company has been seeking to raise additional capital in the form of both debt and equity; to this point with no success. The results of the quarter ended December 31, 2008 have further impacted the Company’s liquidity position and without a very short-term solution to this lack of liquidity, there is substantial doubt about the Company’s ongoing viability."
Subsequent to the SEC 10-Q filing, Silverstar reported that on May 1, 2009 their Empire Interactive division filed for "administration" (bankruptcy) in the UK, and that "Empire has sold its intellectual property assets to New World IP, LLC ", and all 49 staff were laid off. New World IP then leased the rights to publish Empire's entire catalogue to Zoo Games.
Additionally, Silverstar has reported that it is in default on its repayments on both its 2008 and 2006 Debentures.
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