Fashion Valet Sdn Bhd’s shareholders’ agreement required board approval before the company could declare dividends, the sessions court heard today.
Corporate lawyer Anne Wong, 49, who was involved in drafting the agreement dated March 5, 2018, said in her witness statement that the approval had to come from a majority of directors, including those appointed by Pulau Tiga Ventures Sdn Bhd, a wholly-owned subsidiary of Khazanah Nasional Bhd.
Wong was testifying in the RM8 million criminal breach of trust trial involving Fashion Valet founders Vivy Yusof and her husband, Fadzarudin Shah Anuar.
Referring to Clause 7.5.1(ii)(b) of the agreement, she said any declaration of dividends required the approval of a majority of directors, including those appointed by Start Today Co Ltd and Pulau Tiga Ventures.
She also said the Companies Act 2016 prohibited a company from declaring dividends if it did not have profits.
On loans and credit facilities, Wong said Fashion Valet was prohibited from extending them to its directors, shareholders, related companies or other parties without the approval of a majority of the board.
Referring to Clause 7.5.1(ii)(d), she said the approval had to include directors appointed by Start Today and Pulau Tiga Ventures.
“As such, any advances to any party must first obtain the board’s approval,” she said.
Wong added that Fashion Valet was required to submit a summary of the utilisation of investment funds to the board every three months and annually until the funds were fully utilised.
She said the company was not required to disclose its entire operational expenditure.
Vivy and Fadzarudin, both 38, were jointly charged on Dec 5, 2024, with criminal breach of trust involving investment funds from Khazanah and Permodalan Nasional Bhd (PNB).
They are accused of authorising a payment of RM8 million from Fashion Valet’s corporate bank account to 30 Maple Sdn Bhd without board approval on Aug 21, 2018, at Public Bank’s Bukit Damansara branch.
The charge, under Section 409 of the Penal Code, carries a maximum jail term of 20 years, whipping and a fine upon conviction.
They also pleaded not guilty to an alternative charge of dishonestly misappropriating RM8 million in investment funds from Khazanah and PNB belonging to Fashion Valet.
The offence, under Section 403 of the Penal Code, carries a jail term of between six months and five years, whipping and a fine upon conviction.
Lawyer Shaarvin Raaj represented the couple, while deputy public prosecutor Nidzuwan Abd Latip appeared for the prosecution.
The trial before judge Rosli Ahmad continues on Nov 20.
