DEMUTUALISATION (KUALA LUMPUR STOCK EXCHANGE) ACT 2003

Demutualisation (Kuala Lumpur Stock Exchange) LAWS OF MALAYSIA REPRINT Act 632 DEMUTUALISATION (KUALA LUMPUR STOCK EXCHANGE) ACT 2003 Incorporating all amendments up to 1 January 2006 PUBLISHED BY THE COMMISSIONER OF LAW REVISION, MALAYSIA UNDER THE AUTHORITY OF THE REVISION OF LAWS ACT 1968 IN COLLABORATION WITH PERCETAKAN NASIONAL MALAYSIA BHD 2006 1 2 DEMUTUALISATION (KUALA LUMPUR STOCK EXCHANGE) ACT 2003 Date of Royal Assent ... ... ... … … 26 December 2003 Date of publication in the Gazette … … 31 December 2003 PREVIOUS REPRINT First Reprint ... ... ... ... ... 2005 3 LAWS OF MALAYSIA Act 632 DEMUTUALISATION (KUALA LUMPUR STOCK EXCHANGE) ACT 2003 ARRANGEMENT OF SECTIONS PART I PRELIMINARY Section 1. Short title and commencement 2. Interpretation PART II CONVERSION TO PUBLIC COMPANY LIMITED BY SHARES 3. Conversion to public company limited by shares 4. Effect upon conversion 5. Alteration of memorandum and articles of association, etc. 6. Status of member company upon conversion 7. Other effects of conversion PART III TRANSFEREE COMPANY 8. Designation of a transferee company by the Minister 9. Vesting provisions 10. The transferee company operating as a stock exchange 11. Power of Minister to make regulations 12. Immunity Laws of Malaysia 4 PART IV TRANSITIONAL PROVISIONS Section 13. Prevention of anomalies ACT 632 Demutualisation (Kuala Lumpur Stock Exchange) 5 LAW OF MALAYSIA Act 632 DEMUTUALISATION (KUALA LUMPUR STOCK EXCHANGE) ACT 2003 An Act to provide for the conversion of Kuala Lumpur Stock Exchange from a company limited by guarantee to a public company limited by shares and to provide for matters incidental thereto and connected therewith. [2 January 2004, P.U. (B) 6/2004] ENACTED by the Parliament of Malaysia as follows: PART I PRELIMINARY Short title and commencement 1. (1) This Act may be cited as the Demutualisation (Kuala Lumpur Stock Exchange) Act 2003. (2) This Act comes into operation on a date to be appointed by the Minister by notification in the Gazette, and the Minister may appoint different dates for different provisions of this Act. Interpretation 2. In this Act, unless the context otherwise requires— “Exchange” means Kuala Lumpur Stock Exchange; “rights” means all rights, powers, privileges and immunities, whether present or future, actual, contingent or prospective, and whether enforceable in Malaysia or elsewhere; Laws of Malaysia 6 ACT 632 “property” means any movable or immovable property and includes— (a) in relation to property, any interest, easement or right, whether equitable or legal, title, claim, chose-in-action, power or privilege, whether present or future, vested or contingent, or which is otherwise of value; (b) any conveyance executed for conveying, assigning, appointing, surrendering or otherwise transferring or disposing of immovable property, of which the person executing the conveyance is proprietor, possessed or entitled to a contingent right either for the whole interest or for any less interest; (c) securities; (d) any negotiable instrument, including any bank note, bearer note, Treasury Bill, dividend warrant, bill of exchange, promissory note, cheque and negotiable certificate of deposit; (e) any mortgage or charge, whether legal or equitable guarantee, lien or pledge, whether actual or constructive letter of hypothecation or trust receipt, indemnity undertaking or other means of securing payment o discharge of a debt or liability, whether present or future vested or contingent; and (f) any other tangible or intangible property; “rules” has the meaning assigned to it in the Securities Industry Act 1983 [Act 280]; “liabilities” includes debts, charges, duties and obligations of every description, whether present or future, vested or contingent; “Minister” means the Minister for the time being charged with the responsibility for finance; “Registrar” has the meaning assigned to it in the Companies Act 1965 [Act 125]; “Commission” means the Securities Commission established under the Securities Commission Act 1993 [Act 498]; “company limited by shares” has the meaning assigned to it in the Companies Act 1965; Demutualisation (Kuala Lumpur Stock Exchange) 7 “transferee company” means a company designated by the Minister under section 8; “vesting date” means the date appointed by the Minister under section 9; “conversion date” means the date on which the Exchange is converted to a public company limited by shares as appointed by the Minister under subsection 3(3); “vested”, in relation to property, includes having rights to property which are future or contingent and rights in reversion and remainder. PART II CONVERSION TO PUBLIC COMPANY LIMITED BY SHARES Conversion to public company limited by shares 3. (1) The Exchange shall not apply to convert itself from a company limited by guarantee to a public company limited by shares unless the written approval of the Minister, on the recommendation of the Commission, is obtained. (2) Notwithstanding any of the provisions in the memorandum and articles of association of the Exchange immediately before the conversion date, the Companies Act 1965 and any other law, but subject to the provisions of this Act, the Exchange may apply to convert itself from a company limited by guarantee to a public company limited by shares by lodging with the Registrar— (a) a copy of the Minister’s written approval referred to in subsection (1); (b) copies of special resolutions, passed in accordance with the articles of association of the Exchange immediately before the conversion date, approving the conversion of the Exchange to a public company limited by shares and adopting the amended memorandum and articles referred to in paragraph (c); (c) a copy of the memorandum and articles of association of the Exchange duly amended to reflect that it is a public company limited by shares; 8 Laws of Malaysia ACT 632 (d) a copy of the Commission’s written approval on the amended memorandum and articles referred to in paragraph (c); and (e) information on the number and types of shares, as defined in the Companies Act 1965, to be issued upon its conversion. (3) Upon the Registrar being satisfied that the lodgement required in subsection (2) has been effected, the Registrar shall so inform the Minister, and the Minister may, by notification published in the Gazette, appoint a conversion date and on such date the conversion of the Exchange to a public company limited by shares shall take effect. (4) On the conversion date, the Registrar shall appropriately alter the details of the registration of the Exchange and issue a new certificate of incorporation which reflects the conversion of the Exchange from a company limited by guarantee to a public company limited by shares in such form as the Registrar considers appropriate and upon the issue of such new certificate of incorporation, the previous certificate of incorporation of the Exchange as a company limited by guarantee shall be deemed cancelled. (5) Notwithstanding any of the provisions in the Companies Act 1965, the new certificate of incorporation issued pursuant to subsection (4) shall be a valid certificate of incorporation of the Exchange as a public company limited by shares for the purposes of the Companies Act 1965 or for any other purpose. Effect upon conversion 4. (1) Upon the conversion of the Exchange to a public company limited by shares pursuant to section 3— (a) the amended memorandum and articles referred to in paragraph 3(2)(c) shall be the memorandum and articles of association of the Exchange; (b) the Exchange shall cease to be a company limited by guarantee and shall be deemed to be a public company limited by shares in accordance with the amended memorandum and articles of association referred to in Demutualisation (Kuala Lumpur Stock Exchange) 9 paragraph 3(2)(c); (c) the liability of each member of the Exchange under the articles of association of the Exchange immediately before the conversion date and past member of the Exchange as a guarantor immediately before the conversion date shall be deemed to be extinguished; (d) voting shares in the Exchange as a public company limited by shares shall be issued to such persons and in such proportions as may be specified by the Minister on the recommendation of the Commission; (e) the board or the governing body, by whatever name called, of the Exchange immediately before the conversion date shall be deemed to be the inaugural board of the Exchange as a public company limited by shares until a new board or governing body is appointed in accordance with the amended memorandum and articles of association referred to in paragraph 3(2)(c), provided that the inaugural board shall operate for a period not exceeding one year or until the date on which the Exchange as a public company limited by shares is listed, whichever is the earlier; and (f) subject to subsection (2), any member who is on the register of members of the Exchange immediately before the conversion date shall cease to be such member. (2) The persons to whom voting shares are issued under paragraph (1)(d) shall be deemed to be members in the register of members of the Exchange as a public company limited by shares and their names shall be entered as such in the register of members on the conversion date. (3) Sections 32, 33B and 41 of the Securities Commission Act 1993 and sections 50, 52, 54 and 142 of the Companies Act 1965 shall not apply to any matters relating to the allotment, issue and acquisition of voting shares pursuant to paragraph (1)(d) and the conversion of the Exchange to a public company limited by shares. (4) Unless the approval of the Minister, on the recommendation of the Commission, is obtained no person shall dispose of any voting shares issued under paragraph (1)(d) unless and until such voting shares have been listed. (5) In the event of a breach of subsection (4), the Commission may impose a moratorium on, or prohibit any trading of, or any dealing in, the voting shares referred to in paragraph (1)(d). 10 Laws of Malaysia ACT 632 (6) For the purposes of this section,“listed” has the meaning assigned to it in the Securities Commission Act 1993. Alteration of memorandum and articles of association, etc. 5. Nothing in this Part shall prevent or limit the Exchange as a public company limited by shares from altering its memorandum and articles of association or changing its type, share capital, shareholders and directors in accordance with the provisions of any law that is applicable to it after its conversion to a public company limited by shares. Status of member company upon conversion 6. Upon the conversion of the Exchange under this Part, a person who immediately before such conversion— (a) is a company which carries on a business of dealing in securities and is recognised as a member company under the relevant rules of the Exchange shall be recognised as a participating organization by the transferee company and shall be subject to the rules of the transferee company, after the conversion date; or (b) is in the employment of, or acting for or by arrangement with, the member company referred to in paragraph (a) and performs for that member company any of its business of dealing in securities and is recognised or registered by the Exchange as such, shall be recognised or registered to act in such capacity by the transferee company, and shall be subject to the rules of the transferee company, after the conversion date. Other effects of conversion 7. It is hereby declared that the conversion of the Exchange under this Part— (a) shall not create a new legal entity or prejudice or affect its identity or continuity; (b) shall not render defective or affect any legal, disciplinary or other proceedings that could have been continued or commenced by or against it prior to the conversion, notwithstanding any change in its name or status i