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CORPORATIONS ACT 2001 - SECT 453P

Effect of restructuring on company's members

Transfer of shares

             (1)  A transfer of shares in a company that is made while the company is under restructuring is void except if:

                     (a)  both:

                              (i)  the restructuring practitioner gives written consent to the transfer; and

                             (ii)  that consent is unconditional; or

                     (b)  all of the following subparagraphs apply:

                              (i)  the restructuring practitioner gives written consent to the transfer;

                             (ii)  that consent is subject to one or more specified conditions;

                            (iii)  those conditions have been satisfied; or

                     (c)  the Court makes an order under subsection (4) authorising the transfer.

             (2)  The restructuring practitioner may only give consent under paragraph (1)(a) or (b) if the restructuring practitioner believes on reasonable grounds that the transfer is in the best interests of the company's creditors as a whole.

             (3)  If the restructuring practitioner refuses to give consent under paragraph (1)(a) or (b) to a transfer of shares in the company:

                     (a)  the prospective transferor; or

                     (b)  the prospective transferee; or

                     (c)  a creditor of the company;

may apply to the Court for an order authorising the transfer.

             (4)  If the Court is satisfied, on an application under subsection (3), that the transfer is in the best interests of the company's creditors as a whole, the Court may, by order, authorise the transfer.

             (5)  If the restructuring practitioner gives consent under paragraph (1)(b) to a transfer of shares in the company:

                     (a)  the prospective transferor; or

                     (b)  the prospective transferee; or

                     (c)  a creditor of the company;

may apply to the Court for an order setting aside any or all of the conditions to which the consent is subject.

             (6)  If the Court is satisfied, on an application under subsection (5), that any or all of the conditions covered by the application are not in the best interests of the company's creditors as a whole, the Court may, by order, set aside any or all of the conditions.

             (7)  The restructuring practitioner is entitled to be heard in a proceeding before the Court in relation to an application under subsection (3) or (5).

Alteration in the status of members

             (8)  An alteration in the status of members of a company that is made while the company is under restructuring is void except if:

                     (a)  both:

                              (i)  the restructuring practitioner gives written consent to the alteration; and

                             (ii)  that consent is unconditional; or

                     (b)  all of the following subparagraphs apply:

                              (i)  the restructuring practitioner gives written consent to the alteration;

                             (ii)  that consent is subject to one or more specified conditions;

                            (iii)  those conditions have been satisfied; or

                     (c)  the Court makes an order under subsection (12) authorising the alteration.

Note:          An alteration in the status of members of a company that is made while a company is under restructuring may not be void if it is made for the purposes of the conversion and write-off provisions determined by APRA (see Subdivision B of Division 1A of Part II of the Banking Act 1959 , Division 2 of Part IIIA of the Insurance Act 1973 and Division 1A of Part 10A of the Life Insurance Act 1995 ).

             (9)  The restructuring practitioner may only give consent under paragraph (8)(a) or (b) if the restructuring practitioner believes on reasonable grounds that the alteration is in the best interests of the company's creditors as a whole.

           (10)  The restructuring practitioner must refuse to give consent under paragraph (8)(a) or (b) if the alteration would contravene Part 2F.2.

           (11)  If the restructuring practitioner refuses to give consent under paragraph (8)(a) or (b) to an alteration in the status of members of a company:

                     (a)  a member of the company; or

                     (b)  a creditor of the company;

may apply to the Court for an order authorising the alteration.

           (12)  If the Court is satisfied, on an application under subsection (11), that:

                     (a)  the alteration is in the best interests of the company's creditors as a whole; and

                     (b)  the alteration does not contravene Part 2F.2;

the Court may, by order, authorise the alteration.

           (13)  If the restructuring practitioner gives consent under paragraph (8)(b) to an alteration in the status of members of a company:

                     (a)  a member of the company; or

                     (b)  a creditor of the company;

may apply to the Court for an order setting aside any or all of the conditions to which the consent is subject.

           (14)  If the Court is satisfied, on an application under subsection (13), that any or all of the conditions covered by the application are not in the best interests of the company's creditors as a whole, the Court may, by order, set aside any or all of the conditions.

           (15)  The restructuring practitioner is entitled to be heard in a proceeding before the Court in relation to an application under subsection (11) or (13).



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