Question

Text: Demonstrate in detail the concept of company constitution and managing company finance of shares and loans properly with the required knowledge in facing all possible issues in the company secretarial world. QUESTIONS 1: a) Komputer Kaya Sdn. Bhd., a company which is involved in buying and selling computer equipment, intends to redeem its preference shares which are fully paid up by its preference shareholders. The aforementioned redemption is to be made out of the company's capital. However, upon an inquiry into the affairs of Komputer Kaya Sdn. Bhd., the balance sheet of the company provides a summary that the liabilities of Komputer Kaya Sdn. Bhd. are greater than its assets held. Komputer Kaya Sdn. Bhd. wishes to proceed nevertheless. Advise Komputer Kaya Sdn. Bhd. whether the transaction is in accordance with the rule of maintenance of share capital. Support your answer with the Companies Act 2016 and any decided cases if applicable: Q2: Rainbow Sdn. Bhd is a holding company of one subsidiary, namely Rain Sdn. Bhd. Both of the companies are involved in the business of providing raw materials for construction purposes. On December 2021, Light Sdn. Bhd. intended to purchase the shares owned by Rainbow Sdn. Bhd. Light Sdn. Bhd managed to obtain a loan from Moon Bank for financing the purchase transaction. Moon Bank requires security and Light Sdn. Bhd. has proposed to the board of directors of Rainbow Sdn. Bhd. that the security will be provided by Rain Sdn. Bhd. On top of that, Rainbow Sdn. Bhd. voluntarily agrees to become a guarantor for the loan. Explain whether the above constitutes financial assistance under the Companies Act 2016. Support your answer with the Companies Act 2016 and any decided cases if applicable. Q3: Red Sdn. Bhd. borrowed RM200,000.00 from Interest Bank, secured by a floating charge. The floating charge was created in November 2020 and registered with the Companies Commission of Malaysia. Unfortunately, the money borrowed was not sufficient to sustain Red Sdn. Bhd. On January 2022, a compulsory liquidation proceeding commenced against Red Sdn. Bhd. Advise Interest Bank as to the position of the security given by Red Sdn. Bhd. in the above situation. Support your answer with the Companies Act 2016 and any decided cases if applicable.

Text: Demonstrate in detail the concept of company constitution and managing company finance of shares and loans properly with the required knowledge in facing all possible issues in the company secretarial world.

QUESTIONS 1:
a) Komputer Kaya Sdn. Bhd., a company which is involved in buying and selling computer equipment, intends to redeem its preference shares which are fully paid up by its preference shareholders. The aforementioned redemption is to be made out of the company's capital. However, upon an inquiry into the affairs of Komputer Kaya Sdn. Bhd., the balance sheet of the company provides a summary that the liabilities of Komputer Kaya Sdn. Bhd. are greater than its assets held. Komputer Kaya Sdn. Bhd. wishes to proceed nevertheless.
Advise Komputer Kaya Sdn. Bhd. whether the transaction is in accordance with the rule of maintenance of share capital. Support your answer with the Companies Act 2016 and any decided cases if applicable:

Q2:
Rainbow Sdn. Bhd is a holding company of one subsidiary, namely Rain Sdn. Bhd. Both of the companies are involved in the business of providing raw materials for construction purposes. On December 2021, Light Sdn. Bhd. intended to purchase the shares owned by Rainbow Sdn. Bhd. Light Sdn. Bhd managed to obtain a loan from Moon Bank for financing the purchase transaction. Moon Bank requires security and Light Sdn. Bhd. has proposed to the board of directors of Rainbow Sdn. Bhd. that the security will be provided by Rain Sdn. Bhd. On top of that, Rainbow Sdn. Bhd. voluntarily agrees to become a guarantor for the loan.
Explain whether the above constitutes financial assistance under the Companies Act 2016. Support your answer with the Companies Act 2016 and any decided cases if applicable.

Q3:
Red Sdn. Bhd. borrowed RM200,000.00 from Interest Bank, secured by a floating charge. The floating charge was created in November 2020 and registered with the Companies Commission of Malaysia. Unfortunately, the money borrowed was not sufficient to sustain Red Sdn. Bhd. On January 2022, a compulsory liquidation proceeding commenced against Red Sdn. Bhd.
Advise Interest Bank as to the position of the security given by Red Sdn. Bhd. in the above situation. Support your answer with the Companies Act 2016 and any decided cases if applicable.

Added by Thomas B.

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