GROUNDS OF DECISION

BSN Commercial Bank (Malaysia) Berhad ("BSN Bank") granted diverse banking facilities to the 1^st Defendant vide 2 loan agreements dated 3^rd December 1996 and 8^th August 1997. As a result of the 1^st Defendant's default in complying with the terms and conditions of the 2 loan agreements, the 1^st Defendant was indebted to the lenders in the sum of RM2,906,936.20 in respect of the term loan as at 31^st March 2002 together with interest at 1.5% per annum above BLR with monthly arrears from 1^st April 2002 to the date of payment. The 1^st Defendant was also indebted to the lenders in the sum of RM3,563,815.25 under the overdraft account as at 31^st March 2002 together with interest at 2.5% per annum above BLR with monthly arrears from 1^st April 2002 to the date of payment.

Under a guarantee dated 8^th August 1997, the 2^nd and 3^rd Defendants as Directors of the 1^st Defendant agreed to pay on demand all monies due and owing from the 1^st Defendant in respect of facilities granted to the 1^st Defendant under the 2 loan agreements and generally agreed to pay to the lenders all monies due in the account operated by the 1^st Defendant. By Clause 5 of the Guarantee, the partie