According to unrestricted composition (UC) for any plurality of things there is a whole that is exactly composed of them. Sider offers a continuity argument for UC. Here's a vivid formulation. Let the Ps be the particles in the even-numbered books on one of my bookshelves. If UC is false, then in the actual world the Ps will be a paradigm case of something that doesn't compose a whole. But there is a world where the Ps compose a dog. And between these two worlds there is a continuous sequence of worlds where the Ps gradually migrate from their every-second-book positioning to their canine positioning. It is absurd to think that suddenly somewhere in this continuous sequence the particles come to compose something. So, Sider concludes, they compose something all along, even in the actual world.
But to a hylomorphist, the argument as I've put it simply fails. There is no world where the Ps compose a dog, since a dog—or any other complex entity—is not composed of matter, but of matter and form. The argument can, however, be reformulated. Say that the Ps materially compose an F provided that the Ps are material and together with some form compose an F. Then the argument gets off the ground. In the actual world, the Ps do not materially compose anything while in the final world they materially compose something. Where along the line do they come to materially compose something?
Now, however, the story is underdescribed. For we have failed to say in which worlds in the sequence there is a substantial form of the dog informing the Ps. Facts about substantial forms should not be assumed to supervene on facts about the arrangement of the particles. There could be zombie dogs that are nothing but heaps of particles looking like a dog. In other words, it's a contingent matter whether a certain kind of arrangement of particles materially composes something—if there is a form informing them, then they compose and if not, not.
Of course, there is a question of explanation: Why is there no form informing the Ps in the actual world but there is one in the the non-zombie dog worlds? But the answers aren't particularly troublesome. Maybe the laws of nature explain that. Maybe God just decides when to create forms and make them inform particles.
However, there is a final move that Sider can make. Instead of asking in which worlds the Ps (materially) compose something, he could ask which arrangements of particles are such that something could be materially composed of the particles in that arrangement. Of course the dog-like arrangement is like that. And the even-numbered-book arrangement is not. So where is the transition in the continuous deformation of the even-numbered-book arrangement into the dog-like arrangement?
This is an interesting question for the hylomorphist. It is closely to the question of what forms there could be (cf. the discussion here and in the Murphy book referenced in the comments there). The hylomorphist could take an unrestricted view. There is a sufficiently wide variety of possible forms and defects that any possible arrangement of matter is compatible with being informed by some form—perhaps defectively. There could be a possible world where something looking just like our even-numbered-book arrangement is a highly defective (it doesn't grow or reproduce) plant.
Nonetheless, there is a remaining problem. While the even-numbered-book arrangement may be apt for materially composing a defective plant, it's surely inapt for materially composing a dog. So there will seem to be a discontinuous transition between those arrangements that can and those that cannot materially compose a dog. One answer here is that "dog" is vague. This doesn't fit with traditional Aristotelian views, though, on which all dogs have an exactly similar form, and so one could meaningfully ask about the range of arrangements that could be informed by a form that's exactly like that. But perhaps the Aristotelian can yield some ground here. Another answer would be unrestricted canine composition: any material arrangement could materially compose a dog, albeit a highly defective one. I am somewhat drawn to this strange view. Yet is it that strange? I think I can imagine a dog continuously deforming into the even-numbered-book arrangement but where rather than dying the dog comes to be more and more defective. I am dualist enough that I can even imagine the dog being conscious throughout the process.