Section 3Part 0 —
Emergency Measures
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The Company shall in addition to the powers conferred upon it by the Companies Law and those contained in its Memorandum and Articles of Association have power to make such arrangements as it may consider necessary for the preservation and protection of its undertaking, property and assets and of the interests of members against loss resulting from actual or threatened international or national emergencies, wars, revolutions, expropriation, confiscation or other occurrences, restrictions or natural disasters affecting its assets (any such event being hereinafter called Han emergency") and no such arrangement shall be invalidated or void or voidable and no liability shall be imposed on any person who effects or is involved in effecting the same unless it is shown that:-
such arrangements do not take account of the interests ofthe members of the Company for the time being; or
such arrangements do not take account of the claims of all bona fide creditors and other persons for the time being having claims against the Company.
Without prejudice to the generality of subsection (1) an arrangement pursuant to that subsection may take the form of a reconstruction transferring the whole or any part ofthe undertaking, property and liabilities of the Company to another body whether corporate or unincorporate established in the Cayman Islands or elsewhere (in this subsection referred to as the "transferee") in consideration of the issue of shares, debentures or other forms of capital or interest in the transferee to the holders of shares, debentures or other forms of capital and interest and other interests in the Company and the assumption by the transferee ofliabilities of the Company. Such reconstruction shall be effected by agreement between the Company and the transferee which shall provide for the following matters:-
the transfer to the transferee of the whole or any part of the undertaking and of the property and liabilities of the Company;
the allocation or appropriation by the transferee of any shares, debentures or other forms of capital or interest which under the arrangement are to be allotted or appropriated by the transferee to or for the holders of shares, debentures or other forms of capital or interest in the Company;
the continuation by or against the transferee of any legal proceedings pendingby or against the Company; and
such incidental, consequential and supplemental matters as are necessary to secure that the reconstruction shall be fully and effectively carried out.
Where an agreement under this subsection provides for the transfer of property or liabilities, that property shall, by virtue of the agreement, be transferred to and vest in, and those liabilities shall, by virtue of the agreement, be transferred to and become the liabilities of, the transferee subject in the case of any property to all charges,mortgages,liens and other encumbrances to which the same was subject immediately before the transfer thereof. (In this subsection the expression "property"includes assets, rights and powers of every description, and the expression "liabilities" includes duties and obligations of every description).
The powers hereby conferred on the Company shall be exercisable by its Directors provided that before exercising such powers two Directors of the Company shall each make a voluntary declaration or swear an affidavit and shall despatch the same to the Registrar of Companies stating that, in their opinion, the measures to be adopted by the Company take account of the interests of the members of the Company for the time being and of the claims of all bona fide creditors and other persons for the time being having claims against the Company.
Any Director of the Company making a declaration under the provisions of the preceding subsection without having any reasonable grounds for the opinion required to be given under such subsection shall be guilty of an offence and liable upon conviction by a court of summary jurisdiction to imprisonment for a period of three years or to a fine of Cayman Islands dollars fifteen thousand (Cl$15,000) or to both.