QUESTION:

Bakar, his wife, Zana and Razak are three shareholders of Bunga Melati Sdn Bhd. Bakar dan Zana, who were the directors, held two thirds of the shares of the company. During a board of directors' meeting, they resolved to do the following:

1. To employ Zana as an executive director under a service contract which provides for a large termination payment in favour of Zana.
2. To issue additional shares to themselves at par, and
3. To establish a superannuation fund for Zana.

Razak wishes to challenge the validity of the resolutions. Advise Razak on his chances of success.

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Please use the suggested format below. Thank you.

Suggested template:

ISSUE ONE

1. Issue

State the issue here ...

1. Whether......?
2. Whether ...?

2. Law

Start your law content here ... a definition perhaps ...

Paragraph two... state the theory/ rule/ explanation about the issue...

Paragraph three.. state the section

Paragraph four ... explain case one

Paragraph five .. explain case two

Paragraph ...

3. Application

Apply the above law - rule and support with section and case(s) to the problem. Quote the relevant law/section/case only. You are acting as a lawyer to give advice about the problem in the question...

4. Conclusion

In short, what is your conclusion ....