The court affirmed that a party must demonstrate bona fide triable issues to resist a summary judgment application, and mere allegations without substantive evidence do not suffice.

JUDGMENT

Atan Mustaffa Yussof Ahmad J:

Introduction

[1] This judgment concerns an application by Kenanga Investors Berhad, for summary judgment against the Zulrafq Capital Sdn Bhd and Tan Sri Zulhasnan bin Rafique in respect of the Plaintiff's claim. The Plaintiff's claim is premised on a Put and Call Option Agreement and a Supplemental Option Agreement as well as a Personal Guarantee. The Defendants resist the summary judgment application, raising issues of an understanding involving a third party being liable for payments and an alleged conspiracy against them. Having considered the cause papers, affidavits and submissions of the parties, this court now provides its decision and grounds on the Plaintiff's summary judgment application.

Brief Facts

[2] On 22 October 2021, the Plaintiff, Kenanga Investors Berhad, and the First Defendant, Zulrafq Capital Sdn Bhd, entered into a Put and Call Option Agreement with a Term Sheet attached ("Option Agreement'). Under the agreement, the Plaintiff granted the First Defendant a Call Option to buy back from the Plaintiff 190,476,190 ordinary shares in KNM Group Berhad worth RM40,000,000 ("the Option Shares'). The Plaintiff was also granted an irrevocable Put Option to sell the Option Shares to the First Defendant or its nominee on the Maturity Date of 4 August 2022.

[3] The Call Option was exercisable by the First Defendant within 6 months from the Transaction Date of 5 November 2021 ("Call Option 1") or 3 months from the expiry of Call Option 1 ("Call Option 2"). The Put Option was exercisable by the Plaintiff by serving written notice at least 10 business days prior to the Maturity Date.

[4] The First Defendant was required to procure a personal guarantee from the Second Defendant, Tan Sri Zulhasnan bin Rafique, to guarantee the First Defendant's performance ("Personal Guarantee"). This Personal Guarantee was executed by the Second Defendant on 22 October 2021.

[5] On 27 July 2022, the First Defendant applied to the Plaintiff for a 9-month extension and rollover of the Call Option Period and Put Option Period from the original Maturity Date of 4 August 2022. The First Defendant agreed to pay a premium of RM4,800,000 by 15 September 2022 ("Premium"), a rollover fee of RM400,000 by 30 August 2022 ("Rollover Fee") and all relevant fees and expenses incurred in the extension by 15 September 2022.

[6] The Plaintiff accepted these Extension and Rollover Terms A Supplemental Option Agreement was executed by both parties on 3 August 2022 to vary the original agreement ("Supplemental Option Agreement'). Under the Supplemental Option Agreement, the Call Option ('Call Option") was now exercisable by the First Defendant within 6 months from the expiry of Call Option 2 (Call Option 3 expiring on 3 February 2023) or 3 months from the expiry of Call Option 3 (Call Option 4 expiring on 3 May 2023). The Put Option Period was varied to 18 months from the Transaction Date.

[7] However, the First Defendant subsequently failed to pay the agreed Premium, Rollover Fee and expenses. The Plaintiff initiated legal proceedings against the Defendants in Suit No WA-22NCC-141-03/2023 over this breach, which is before this court.

[8] On 19 June 2023, the Plaintiff issued a letter of demand to both Defendants, demanding that they purchase the Option Shares at the price of RM44,952,380.84 pursuant to the Option Agreement and Supplemental Option Agreement, or alternatively pay that sum as damages.

[9] The Defendants failed to purchase the Option Shares or pay the demanded sum. The First Defendant failed to exercise the Call Option to purchase the shares. As a result, the Plaintiff filed the current suit and applied for summary judgment against the Defendants.

The Plaintiff's Application

[10] The Plaintiff's application in encl 6 is for summary judgment against the Defendants seeking the following orders from the court:

a) The Defendants to specifically perform their obligation to purchase Option Shares according to the terms of the Su