Significance: In Public Prosecutor v Tay Chee Ming  SGMC 1, the court found a company director and shareholder, Tay, guilty of an offence under section 240 of the Securities and Futures Act (Cap. 289) (SFA) for raising funds from the public in Singapore through offers of convertible loan agreements (CLA) with investors by his company. Tay was sentenced to imprisonment for 15 months. Tay raised about S$8 million in total.
This appears to be the first court decision on the offence and a discussion on the small offer exemption under section 272A(1) of the SFA, which is one of the safe harbour exemptions from prospectus requirements for businesses to raise funds. The private placement exemption in section 272B of the SFA was not raised by the accused and so was not considered.
Continue reading “Case: Offence of Raising Funds Without Prospectus and Small Offer Exemption”
WHAT TO DO IF A COMPANY THAT OWES ME MONEY HAS BEEN WOUND UP?
By Ronald JJ Wong and Stacey Lopez
In this article, we address some questions you may have if you are a creditor of a Singapore company that has entered or is entering into liquidation or winding up due to insolvency or otherwise.
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Summary: Directors have almost presumptive rights to inspect documents in the possession of the company which fall within the ambit of s 199 of the Companies Act unless there’s some abuse of process such as ulterior purpose or privilege.
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Registering a suitable business entity structure is important for film financing because the structure affects the options in terms of what you can offer to investors.
In theory, there are many options for a business structure: sole proprietorship, general partnership, limited partnership, limited liability partnership (LLP), private limited company.
I’ll just cut straight to the point. If you want to have more options in terms of offering equity / shares to investors, then opt for a private limited company.
Continue reading “Film Financing 2: Understand the Different Types of Business Structures”
Significance: Singapore Court of Appeal sets out principles on reasonably necessary disclosure required for court to grant leave for calling a creditors’ meeting to consider a proposed scheme of arrangement. Court holds that applicant did not provide necessary financial disclosure required and refused to grant leave.
Continue reading “Case Update: Pathfinder Strategic Credit LP and another v Empire Capital Resources Pte Ltd  SGCA 29 – Necessary Disclosure for Leave for Creditors’ Meeting for Scheme of Arrangement”
If A buys shares from B, and B made certain warranties to A about the company which turned out to be false, A can sue B for breach of warranty. Separately, if B had made misrepresentations to A to induce A to purchase the shares, A can sue B for misrepresentation in addition to breach of contract.
This may occur for example where it was falsely warranted that the company’s profits were higher than they in fact were, or that certain machinery or property of the company was in good working condition and free of defects.
How is the loss measured in such a scenario?
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What is a Shareholders Agreement?
A shareholders agreement is a legal document setting out the rights and obligations of the shareholders in a company. Shareholders agreements are often used in private companies or joint ventures. Unlike the company constitution, the shareholder agreement is not mandatory under the Companies Act. The Companies Act is the main governing legislation for companies incorporated in Singapore. If there is no shareholders agreement, the relationships of shareholders as between themselves and with the company are governed by the constitution or articles of association of the company.
Continue reading “Shareholders Agreement Drafting Questionnaire”