WAM Issuance and listing of Covered Bonds To approve the issuance and listing of Covered Bonds, an application to approve the issuance and listing of the Covered Bonds must be submitted to the SCA on the form prepared for this purpose together with the documents supporting the application for each issue made by the Issuer, in particular : 1. The prospectus, which should contain all the conditions and necessary information, including the price, type ( buy / sell ), execution price, conversion rate of the note, and the method of settlement ( cash / in-kind ), the method of calculating the settlement price, the price of the index point if the bonds are issued on index, the set date for the expiration of the note, and the minimum allocation, if any.
The approval is also subject to the requirement to specify the number of Covered Bonds which the Issuer wishes to issue, provided that it should not be less than one million bonds corresponding to at least one million units of the assets subject of the contract.
It is also required that the Issuer should be responsible for the pricing of all Covered Bonds, and provide the market maker functions or must appoint another market maker in accordance with the applicable regulations in this regard .
The shares based on which the Covered Bonds will be issued should be tradable in the market, convertible without restrictions and has sufficient liquidity in accordance with the controls set by the markets.
It is also required that the number of issues of Covered Bonds to be issued in addition to the bonds that have been issued before and still outstanding may not be in excess of 50% of the total number of issued shares of the company, if the bonds are issued on the shares.
It also required that there should be a disclosure mechanism - to the SCA and the market - about the acquisition of the Covered Bonds in cases where disclosure of the ownership of shares based on which those bonds were issued.
Payment of the fees prescribed by the SCA The SCA shall issue its decision to approve the issuance and listing of the Covered Bonds according to market conditions and the public interest requirements within thirty days from the date of submission of an application satisfying all conditions and requirements contained in the provisions of this Regulation.
Listing and trading of the Covered Bonds The application for the listing of Covered Bonds on the market shall be submitted enclosing the required documents and information in accordance with the internal procedures applicable in the market. The maximum limit (up or down) for the price movement per day stipulated in the Regulations as to Trading, Clearing, Settlement, Transfer of Ownership and Custody of Securities or applicable in the market shall not apply to the trading of Covered Bonds.
Without prejudice to the provisions of this Regulation, the Regulations as to Trading, Clearing, Settlement, Transfer of Ownership and Custody of Securities shall apply to the trading of Covered Bonds.
The Authority may suspend the listing of Covered Bonds in the event the listing of underlying assets of the bonds is suspended.
Settlement of Covered Bonds Covered Bonds shall be settled once the owner of the note uses the option granted to him. Settlement can be in kind or in cash according to the method of settlement specific in the Prospectus.
The in kind settlement shall be made by handing over the underlying assets of the bonds - as the case may be - to the owner of the note as per the agreed conversion rate and execution price through the settlement systems in place in the market.
??The cash settlement shall be made by paying the difference between the execution price and the settlement price to the owner of the note.
The settlement shall be always in cash if the Covered Bonds are issued on an index, and if the Covered Bonds are issued on underlying assets issued outside the State or in a financial free zone within the State, and if the in-kind settlement will influence the proportions of ownership of citizens as stipulated in the Commercial Companies Law or in the Articles of Association of the company.
The note owner may not recover the value of the note in any case.
Regulations and Procedures of the Market Subject to SCA approval, the market shall develop a number of regulations and procedures as follows: the internal procedures and controls necessary for the application of this Regulation; the technical controls for the market maker of Covered Bonds; the listing fees and trading commissions for Covered Bonds, and the proportion for the SCA and the market therefrom.
Violations and Sanctions In the case of violating the provisions of laws, applicable regulations, this Regulation or the prospectus, the SCA may impose a sanction as follows: a warning and a fine not to exceed the maximum limit stipulated in the Law and the regulations issued pursuant thereto; deprive the Issuer of approval for any new issues and revoke the license of the Issuer.
The decision to cancel the license of the Issuer shall be published in two daily newspapers issued in the State, at least one in Arabic language, at the Issuer's expense.
In case of cancellation of the Issuer's license, the current legal positions shall be dealt with until fully settled in accordance with the controls set by the SCA.