Commonwealth Numbered Acts

COMPANIES ACT 1981 No. 89 of 1981 - SECT 409

409. (1) Where it is proposed that the whole or part of the business or
property of a company (in this section referred to as the ''company'') be
transferred or sold to another corporation (in this section referred to as the
''corporation''), the liquidator of the company, may, with the sanction of a
special resolution of the company conferring either a general authority on the
liquidator or an authority in respect of any particular arrangement, receive,
in compensation or part compensation for the transfer or sale, shares,
debentures, policies or other like interests in the corporation for
distribution among the members of the company or may enter into any other
arrangement whereby the members of the company may, in lieu of or in addition
to receiving cash, shares, debentures, policies or other like interests,
participate in the profits of or receive any other benefit from the
corporation, and any such transfer, sale or arrangement is binding on the
members of the company.

(2) If a member of the company who did not vote in favour of the special
resolution expresses his dissent from the resolution in writing addressed to
the liquidator and left at the office of the liquidator within 7 days after
the passing of the resolution, he may require the liquidator either to abstain
from carrying the resolution into effect or to purchase his interest at a
price to be determined by agreement or by arbitration in the manner provided
by this section.

(3) If the liquidator elects to purchase the member's interest, the purchase
money shall be paid before the company is dissolved and be raised by the
liquidator in such manner as is determined by special resolution.

(4) A special resolution is not invalid for the purposes of this section by
reason that it is passed before or concurrently with a resolution for
voluntary winding up or for appointing liquidators but, if an order for
winding up the company by the Court is made within a year after the passing of
the resolution, the resolution is not valid unless sanctioned by the Court.

(5) For the purposes of an arbitration under this section, the law relating to
commercial arbitration applies as if there were a submission for reference to
2 arbitrators, one to be appointed by each party, and the appointment of an
arbitrator may be made under the hand of the liquidator or, if there is more
than one liquidator, under the hands of any 2 or more of the liquidators, and
the Court may give any directions necessary for the initiation and conduct of
the arbitration and any such direction is binding on the parties.

(6) In the case of a creditors' voluntary winding up, the powers of the
liquidator under this section shall not be exercised except with the approval
of the Court or the committee of inspection.