Section 370. Reconstruction and amalgamation of companies

(1) This section applies where an application is made to the Court under this Subdivision for the approval of a compromise or arrangement and it is proved to the Court that—

(a) the compromise or arrangement has been proposed for the purposes of, or in connection with, a scheme for the reconstruction of any company or the amalgamation of any two or more companies; and

(b) under the scheme the whole or any part of the undertaking or the property of any company concerned in the scheme, “transferor company”, is to be transferred to another company, “transferee company”.

(2) The Court may, either by the order approving the compromise or arrangement or by any subsequent order, make provision for all or any of the following matters:

(a) the transfer to the transferee company of the whole or any part of the undertaking and of the property or liabilities of the transferor company;

(b) the allotting or appropriation by the transferee company of any shares, debentures, policies or other similar interests in that company which under the compromise or arrangement are to be allotted or appropriated by that company to or for any person;

(c) the continuation by or against the transferee company of any legal proceedings pending by or against the transferor company;

(d) the dissolution without winding up of the transferor company;

(e) the provision to be made for any persons who, within such time and in such manner as the Court directs, dissent from the compromise or arrangement; and

(f) such incidental, consequential and supplemental matters as are necessary to secure that the reconstruction or amalgamation shall be fully and effectively carried out.

(3) If an order made under this section provides for the transfer of property or liabilities—

(a) the property shall, by virtue of the order, be transferred to and vest in the transferee company; and

(b) the liabilities shall, by virtue of the order, be transferred to and become the liabilities of the transferee company,

and in the case of any particular property if the order directs free from any charge which is by virtue of the compromise or arrangement to cease to have effect.

(4) Every company in relation to which an order is made under this section shall lodge an office copy of the order—

(a) with the Registrar within seven days of the making of the order; and

(b) if the order relates to land, with the appropriate authority concerned with the registration or recording of dealings in that land.

(5) No vesting order referred to in this section shall have any effect or operation in transferring or otherwise vesting land until the appropriate entries are made with respect to the vesting of that land by the appropriate authority.

(6) The company and every officer who contravene this section commit an offence and shall, on conviction, be liable to a fine not exceeding ten thousand ringgit and, in the case of a continuing offence, to a further fine not exceeding five hundred ringgit for each day during which the offence continues after conviction.

(7) In this section—

(a) “liabilities” includes duties;

(b) “property” includes all rights and powers relating to the property.