Nominee Structure & Share Trustee
Equity Crowdfunding (ECF) is aimed at getting a crowd of people to invest, the number of investors per company is likely to be higher than 50. Current Malaysian Company Law does not allow for private limited companies to have more than 50 shareholders. AMB Connect hence provide for using either nominee or share trustee structure for issuer to choose to accommodate large number of investors.
Nominee Structure
Under this structure, Investors who participate in ECF campaigns through AMB Connect become part of the AMB Connect Nominee structure, which means that AMB Connect acts as a nominee or representative for all investors in the campaign. This simplifies the investment process for investors and allows AMB Connect to hold and manage the shares on behalf of the investors. This structure also helps to ensure that the investors' rights and interests are protected in the event of any changes, disputes or issues that may arise.
Benefit of AMB Connect Nominee Structure to investors:
- Simplified Investment Process: Being part of the AMB Connect Nominee structure means that AMB Connect acts as a nominee or representative for all investors in the campaign. This can simplify the investment process for investors, as AMB Connect has a specialised team to handle the administrative and legal aspects of the investment, such as shareholding and voting rights, on behalf of the investors.
- Professional Management: As a nominee, AMB Connect manages the shares on behalf of the investors, which can help to ensure that the shares are managed professionally and in compliance with regulatory requirements.
- Protection of Investor Rights: The nominee structure can help to protect the investors' rights and interests in the event of any disputes or issues that may arise, as AMB Connect can act as a mediator or advocate for the investors.
- Enhanced Transparency: As a nominee, AMB Connect is required to provide regular updates and reports to the investors on the company's performance, financials, and any other material information that may impact the investment. This can enhance transparency and help investors make informed decisions.
- Reduced Risk: By investing through the nominee structure, investors may also be able to reduce their risk exposure, as AMB Connect can help to identify and mitigate potential risks, such as fraud or non-compliance with regulatory requirements.
Share Trustee Structure
Under this structure, Issuer appoint a licensed Trustee via AMC Connect panel to become the share trustee for investor who participated in ECF campaigns. The Trustee will carry out their responsible as follows:
- To execute the Share Trust Deed and Shareholders Agreement, to be entered into between the Issuer and Trustee.
- To represent the interest and rights of the ECF Investors in accordance with the terms and conditions of the Share Trust Deed and Shareholders Agreement, if any.
- To hold the Issuer's shares issued in relation to the ECF Campaign on trust for the benefit of the ECF Investors.
- To ensure that the Issuer acts in accordance with the terms and conditions of the Share Trust Deed and issue the relevant notices in the event the Trustee becomes aware of any breaches on the part of the Issuer.
- To forward notices, information and reports received from the Issuer to the ECF Investors via e-mail upon receipt of the same from the Issuer.
- Attendance in one (1) general shareholder meeting of the Issuer per annum.
- Maintenance of the Register of Investors at our office premises. The Issuer shall furnish the updated and complete details of the investors to Trustee upon completion of the ECF Campaign and before the Issuer's shares are transferred to the Trustee to be held on trust.
- Issuance of Trustee share certificates to the ECF Investors.
- To maintain and administer a trust account, perform fund transfers and receive dividend payments from the Issuer to be distributed to the ECF Investors.
- To observe and abide by the provision of the trust deed, SC guidelines and other guidelines issued by the regulators governing ECF Campaigns; and
- The powers and duties of the Trustee will be set out in the legal documentation drawn up with reference to the Securities Commission's Trust Deed Guidelines and any other applicable guidelines that may be issued from time to time by the appropriate authority.
Last Update: 22 July 2024
