What is meant by Accumulated Losses?
A Company may pledge its Shares as security for a debt, if so provided and permitted in its bylaws, in accordance with the following rules:
1) the pledge must benefit the Company and its shareholders, this shall be based on a statement issued by the Board;
2) the Ordinary General Assembly must approve the Shares pledge transaction, and a pre-approval may be granted for several transactions; and
3) the pledge must not result in a breach of the Companies Law and any other relevant rules and regulations.
What is the purpose of the Procedures and Instructions Related to Listed Companies with Accumulated Losses Reaching 20% or More of their Share Capital?
There is no specific form of power of attorney. The power of attorney may be in any form, provided that it is written in writing and in the form stated in Annex 1 of the Regulatory Rules and Procedures issued pursuant to the Companies Law relating to Listed Joint Stock Companies.
What categories are covered by the Procedures and Instructions Related to Listed Companies with Accumulated Losses Reaching 20% or More of their Share Capital?
It means that the company’s results for the current period added to the company’s accumulated results from prior periods, which in aggregate represent a loss, and appear as a separate item under shareholder’s equity on the balance sheet.
What disclosure requirements are required for listed companies whose cumulative losses have reached 20% or more and less than 35%?
These Procedures and Instructions aim at regulating the mechanism for dealing with a company whose shares are listed in the Exchange when its Accumulated Losses reach 20% or more of its Share Capital.
What disclosure requirements are required for listed companies whose cumulative losses have reached 35% or more and less than 50%?
When accumulated losses of a company reach 20% or more and less than 35% of its share capital. When accumulated losses of a company reach 35% or more and less than 50% of its share capital.
When accumulated losses of a company reach 50% or more of its share capital.
What disclosure requirements are required for listed companies whose cumulative losses have reached 50% or more?
A separate announcement when its Accumulated Losses reach 20% or more and less than 35% of its Share Capital. The announcement should reflect the total Accumulated Losses, its percentage of the capital, and the main reasons that caused the losses, with reference that these procedures will be applicable.
Are there additional disclosure requirements to be made by listed companies whose accumulated losses have reached 50% or more of their capital?
A separate announcement when its Accumulated Losses reach 35% or more and less than 50% of its Share Capital. The announcement should reflect the total Accumulated Losses, its percentage of the capital, and the main reasons that caused the losses, with reference that these procedures will be applicable.
What are the requirements for removing a flag or moving from one category to another in the Procedures and Instructions Related to Listed Companies with Accumulated Losses Reaching 20% or More of their Share Capital?
A separate announcement when its Accumulated Losses reach 50% or more of its Share Capital. The announcement should reflect the total Accumulated Losses, its percentage of the capital, and the main reasons that caused the losses, with reference that these procedures will be applicable.
What is the time period required to be between the date of disclosure of the annual financial statements and the date for convening the annual general assembly meeting for companies?
The company should, immediately and without delay, disclose to the public by a separate announcement upon reduction of its Accumulated Losses from 20% of its Share Capital. The announcement should reflect the remedial steps taken by the company to restore its position including attaching the external auditor’s report illustrating its financial position.
After the Authority's approval of a company's capital increase, is the company required to convene an extraordinary general assembly meeting to approve the capital increase? And when should it be convened?
The financial event is a material development when it is not available to the general public and which may affect the assets and liabilities or financial position or on the general course of business of the issuer or its subsidiaries as described in Part (8) of the Listing and Listing Rules and Part (8) of the Parallel Market Listing Rules.
When does the Authority issue a "notification" to the capital market institution that a private placement of a fund is not permitted?
Yes, the company is to hold an extraordinary general assembly to approve the capital increase, provided that the date of the assembly is announced before it convenes.
Should a capital market institution in relation to a Privately placed fund comply with a specific form to formulate the terms and conditions of the Fund?
The issuer must provide the Authority an annual financial statements must be announced to the shareholders not less than 15 calendar days before the date of convening the general assembly, In accordance with article 42, paragraph (e), of the Listing Rules.
Is it permissible for private funds to issue more than one class of units?
In accordance with Article 75 of the Investment Funds Regulations, the Authority may issue a "notification" to the authorized person stating that the private offer is not to be made or publish a “notice” prohibiting the offer if it decides:
a. the proposed offer of units may not be commensurate with the fund managers ability; or
b. That it may result in a breach of the Capital Market Law or its Implementing Regulations.
Should a Fund Manager of a Privately placed fund comply with a specific form to formulate the terms and conditions of the Fund?
There is no specific form for the formulation of the terms and conditions of a Privately placed Fund, except for private real estate funds, where the Fund Manager must include the terms and conditions of the Fund with the relevant requirements in the Investment Funds Regulations, in accordance with Article 76, subparagraph (d).
What does the (underlying assets received) stated in paragraph (e) of Article (46) of the Investment Funds Regulations mean?
It means the fund's assets deposited with a custodian in favor of the fund including securities available in the fund's Center account.
