Corporate law

Topic :shares

https://www.slideshare.net/syafawanimahadi/capital-shares-companies-act-2016

Rayyan Global Son Bhd's share capital comprises of RM40, 000 ordinary shares issued at RM5.00 each, 5000 preference shares issued at RM3.00 each. The preference shareholders rights as stated within the constitution are: entitlement to 10 percent dividends each year in priority to other classes of shares; the rights to share in surplus assets upon completing equally with ordinary shareholders. Via the subsequent transaction, the corporate plans to lift additional capital: i. To issue 10,000 of new preferred shares with the identical rights as existing preference shares. ii. To cancel the preference shareholders right to share in surplus assets upon effecting equally with ordinary shareholders. hii. To introduce a provision within the constitution: "Any variation of sophistication rights must be voted on at a separate class meeting of preference shareholders and the variation must be approved by a standard resolution of members of that class". iv. To issue new "Class B" common share with two votes each on each of the voting share by poll. The corporate is of the view that proposals (iii) and (iv) are affected without the approval of the preference shareholders. Din and Man who hold 15% of the preference shares disagree with the company's view. Briefly explain the company on the legal criteria requirements that the company must comply with to carry out the above proposals.Based on the above situation, answer the following questions and support with the relevant cases and section of act: a. Identify and explain FOUR (4) variations of the class rights attaching to those shares based on the scenario issues. (30 Marks) b. Based on the case above, there are 4 issues can be collected. Analyses whether Rayyan Global Son Bhd can issue new ordinary shares and what are the procedures involved? (30 Marks) c. According to the Companies Act 2016. The variation of class rights has several procedures in order for the proposal to be affected. Explain the procedures for variations that need to be conformed in the class rights. (20 Marks) d. Identify whether the approval of preference shareholder is required for proposal (iii) and (iv) to be effected? (20 Marks)