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                Disclosure Department

                The Disclosure Department is in charge of overseeing issues related to disclosure, reviewing periodic reports from issuing companies such as annual and semi-annual reports and preliminary data, reviewing auditors’ reports related to financial statements, monitoring auditors’ compliance with regulations and instructions issued by the Commission, and monitoring auditing committees of issuing companies and their reports. The Department also monitors disclosures by insiders and their compliance with related disclosure requirements regarding their holding and changes thereto and that of their relatives of shares pertaining to issuing companies or subsidiary affiliate, or sister companies of the mother company, monitors the holdings of major shareholders, and monitors disclosures of issuing companies of material information.

                Services provided by the Disclosure Department:

                • Submitting preliminary business results to the Commission:

                Documents needed to provide the service:
                The issuing company shall publish and provide the Commission with a copy of its preliminary business results after its auditor has conducted the preliminary audit, within a period not exceeding 45 days of the end of its fiscal year. Said information shall include:

                  1. The net revenues.
                  2. The expected net profit before tax.
                  3. The allocation for income tax on expected profit.
                  4. Minority interest in the profits.
                  5. Net profit accruing to shareholders after deducting the tax allocation and minority interest.
                  6. Comparative figures of item 1-5 above with the figures of the preceding fiscal year.
                  7. A summary of the company’s activities during the fiscal year.
                • Submitting the annual report to the Commission:

                Documents needed to provide the service:
                The board of directors of the issuing company shall prepare and submit to the Commission the company’s annual report within a period not exceeding three months from the end of its fiscal year. The annual report shall include:

                  1. The message of the chairman of the board.
                  2. The report of the board of directors, which shall include:
                    • A description of the company’s principle activities, their respective geographic locations, the volume of capital investment, and their number of employees.
                    • A description of subsidiary companies, the nature of their business, and their areas of activity.
                    • A statement detailing the names and brief resumes of members of the board of directors, and the names, rank and brief resumes of senior executive management members.
                    • The names of major shareholders of shares issued by the company and the number of shares owned by each one of them if it constitutes (5%) or more in comparison with the previous year.
                    • The company’s competitive position within its sector, its principal markets, its share of the local market, and, if possible, its share of international markets.
                    • The extent of dependence on specific suppliers and/or major clients (local and international) where this constitutes (10%) or more of total purchases and/or sales or revenues.
                    • A description of any government protection or concession granted to the company or to any of its products pursuant to laws, regulations or otherwise, specifying the effective period therefore, as well as a description of any patents or licensing rights owned by the company.
                    • A description of any decisions by the government, international organizations or otherwise that have a material effect on the company’s business, its products or its competitiveness, and disclosure of the company’s compliance with international quality standards.
                    • The issuing company’s organogram, the number of its employees and their categories and qualifications, and the company’s personnel qualifying and training programs.
                    • A description of the company’s risk exposure.
                    • A description of the company’s accomplishments supported by numbers and a description of significant occurrences to the Company during the fiscal year.
                    • The financial impact of non-recurrent transaction during the fiscal year which are not part of the company’s core activities.
                    • A chronology of the realized profits or losses, dividends, shareholders’ net equity and the price of securities issued by the company, for a minimum of five years or for the period since the establishment of the company whichever is less, together with graphic representations thereof where possible.
                    • An analysis of the Company’s financial status and of the results of its activities for the fiscal year.
                    • Important future developments such as prospective expansions or new projects, the company’s proposed plan for at least one upcoming year, and the board of directors’ forecasts for the outcomes of the company activities.
                    • The external auditor’s remuneration for the company and its subsidiaries and any other fees received by or due to the auditor.
                    • A statement detailing the number of securities issued by the company that are owned by any member of its board of directors, any member of its senior executive management or any of their relatives, or by companies controlled by any of the above, all benchmarked against the preceding year.
                    • The benefits and remunerations of the chairman and members of the board of directors and senior executive management during the fiscal year including payments received by any of them as remunerations, salaries bonuses, and otherwise, and sums paid to them as travel and transportation expenses within the kingdom and aboard.
                    • A statement detailing the donations and grants paid by the Company during the fiscal year.
                    • A statement detailing the issuing company’s contracts, projects and engagements concluded with its subsidiaries, sister or affiliate companies, as well as those with the chairman or members of the board of directors, the general manager or any employee of the company or relatives of the above.
                    • The Company’s contribution to environmental protection and local community service.
                  3. The Company’s annual audited financial statements benchmarked with the previous year, which shall include the following:
                    • The balance sheet.
                    • The profit and loss account.
                    • The cash flow statement.
                    • Statement of changes in shareholders’ equity.
                    • Explanatory notes on the financial statements.
                  4. The auditors’ report on the company’s annual financial statements, including an affirmation that auditing procedures are consistent with the audit standards adopted by these Instructions.
                  5. A. A declaration from the board of directors that there are no material issues that might affect the company’s continuity during the next fiscal year.
                    B. A declaration by the board of directors affirming its responsibility for preparing the financial statements and for providing an effective system of oversight in the company.
                    C. A declaration affirming the correctness, accuracy and completeness of the information and data stated in the report, signed by the company’s chairman of the board of directors, general manager, and financial manager.
                • Submitting the semiannual report to the Commission:

                Documents needed to provide the service:
                The board of directors of the issuing company shall prepare and submit to the Commission a comparative semiannual report and publish it within a period not exceeding one month from the date of the end of that period. The semiannual report shall include:

                  1. The balance sheet.
                  2. The profit and loss account.
                  3. Changes in shareholders’ equity.
                  4. The cash flow statement.
                  5. The required explanatory notes.
                  6. The company auditor’s report, which shall include an affirmation that the records and financial statements have been audited in accordance with the auditing standards adopted by these Instructions.
                  7. A brief summary of the results of the company’s activities for the period compared with the future plan drawn earlier.
                • Notifying the Commission of material facts and events:

                Documents needed to provide the service:
                The issuing company shall notify the Commission, without delay and by any means that ensure the required swiftness, and shall promptly issue a public notice of any emerging material facts, particularly the following:

                  1. Important changes that occur in any of the following:
                    • The company’s assets.
                    • The company’s long and short term obligations and any attachments upon its assets.
                    • The capital structure.
                    • The company’s credit rating, if any, and changes thereto.
                    • The company’s products.
                    • Changes in share ownership, which affect control of the company.
                  2. Major transactions concluded by the company and rescissions thereof, and the board of directors’ evaluation of the anticipated impact of such on the company’s profitability and its financial position.
                  3. Non-recurrent transactions that might affect the profit of the company or its financial position.
                  4. Any disasters, fires or accidents and their expected impact on the company’s financial position.
                  5. Any unanticipated financial losses that affected the company’s financial position and an explanation of the causes.
                  6. Important decisions by the board of directors that might affect the prices of the securities issued by the company including the decisions related to:
                    • Issuance of new securities, or amortization of any existing securities.
                    • Changes in the company’s capital investments, objectives, or markets.
                    • Initiation of a merger.
                    • Distribution of dividends.
                    • Buyback by the issuing Company of its own shares or any disposal thereto.
                    • Voluntary liquidation.
                  7. Decisions of the company’s general assembly.
                  8. Invitations to an extraordinary general assembly meeting.
                  9. The formation of a new board of directors for the company, or the registration of any board member or of the company’s general manager and any vacancy in any of those positions, with an explanation of the reason thereof immediately upon its occurrence, as well as the appointment of any new board members or of a new general manager for the company plus the appointees’ qualifications.
                  10. Cessation of company activities or any of its branches, factories, or subsidiaries and the reasons for it.
                  11. Any legal action by or against the company or any judicial or labor disputes that might materially affect the company’s financial position. The Commission shall be provided with a thorough report about such proceedings or disputes and their expected impact on the company’s profitability and financial position.
                • Notifying the Commission of trading by insiders and their relatives, persons accredited to perform financial brokerage activities and their relatives, and major shareholders:

                Documents needed to provide the service:

                  1. A letter from the insider of the issuing company notifying the Commission of the securities issued by that company held by him and his relatives, or those issued by subsidiary, affiliate, or sister companies or by the mother company, within a week of his/her election or appointment as applicable, as well as a written notification of any change to these data within one week of this change occurring.
                  2. Every person accredited to perform financial brokerage activities in any financial services company shall notify the Commission by monthly reports of any trading in securities by him and his relatives, whether buying or selling, within seven days of the end of the month in which the trading took place.
                  3. A letter from the person who owns or controls for the first time 5% or more of any securities by the same issuing company, notifying the Commission of this within one week of the occurrence. The said person shall also notify the Commission in writing when he/she comes to own an additional 1% within one week of the occurrence, and to disclose his/her intention to buy when he reaches 10%.





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