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Location: CBB Disclosure Standards > Chapter I Disclosure Requirements for Offerings and Initial Listings > Article 29 Expenses of the Issue
  • Chapter I Disclosure Requirements for Offerings and Initial Listings

    • Article 1 Offers of Securities

      1.1 Unless the Agency permits otherwise, no person may issue any securities in the Kingdom of Bahrain unless:
      1.1.1 A prospectus has been submitted to, and approved by the Agency and published;
      1.1.2 A summary of the prospectus has been published in one Arabic and one English language newspaper published in Bahrain.
      1.2 A prospectus published in accordance with Article 1.1 shall be in such form and contain such financial and other information as the Agency may by Regulation prescribe.
      1.3 In addition to the information prescribed by the Agency, a prospectus must include all such information within the knowledge of those preparing the prospectus as investors and their advisers may reasonably require in order to make an informed assessment of:
      1.3.1 The assets and liabilities, profits and losses, financial position and prospects of the issuer;
      1.3.2 The rights attached to the securities.
      1.4 If between the time of preparation of the prospectus and the time of issue of the securities the issuer, exercising his best professional judgment, believes that:
      1.4.1 There is a material change in the information included in the prospectus; or
      1.4.2 Material new matters arise which would have been required to be included in the prospectus, had they arisen at the time that it was prepared, then
      the issuer must issue a supplementary prospectus that must be approved by the Agency and published in summary form in accordance with Article 1.1.

    • Article 2 The Prospectus

      Cover Page Disclosure and Declarations:

      The prospectus must contain on the front cover page, the following statements:

      2.1 Disclaimer Statement

      The document must contain on its front cover page, the following prominent and legible disclaimer statement:

      2.2 Responsibility Statement

      If not already disclosed on the front cover, the document should include on the inside cover a declaration by those responsible for it (usually the directors of the issuer) that:

      2.3 Offering and/or Listing Summary

      The cover page of the prospectus must contain:
      2.3.1 The name and legal form of the issuer or, if different, the person making the offer.
      2.3.2 A summary description of the public offering and/or listing particulars dealt with in the document.
      2.3.3 The name and legal form of the underwriter, lead manager, co-manager, sponsor and other related parties.

    • Article 3 Identity of Directors, Senior Managers, Advisors and Auditors

      Identify the issuer's representatives and other individuals involved in the issuer's listing.

      3.1 Directors and Senior Management

      Provide the names, business addresses and functions of the issuer's directors and senior management.
      3.2 Advisors

      Provide the names and addresses of the issuer's principal bankers and legal advisors, to the extent that the issuer has a continuous relationship with such entities, the sponsor for listing (where required), and the legal advisors to the issue.
      3.3 Auditors

      Provide the names and addresses of the issuer's auditors for the preceding three years.

    • Article 4 Offering Statistics and Expected Timetable

      Provide key information regarding the conduct of any offering and the identification of important dates relating to that offering and /or listing.

      4.1 Offering Statistics

      For each method of offering, e.g., rights offering, general offering, etc. state the total expected amount of the issue, including the expected issue price, or the method of determining the price and the number of securities expected to be issued.
      4.2 Method and Expected Timetable

      For all offerings, and separately for each group of targeted potential investors, state the following information to the extent applicable to the offering procedure:
      4.2.1 State the time period during which the offer will be open, and where and to whom purchase or subscription applications should be sent. Describe whether the purchase period may be extended or shortened, and the manner and duration of possible extensions to, or shortening of, this period. Describe the manner in which any extension or shortening shall be made public. If the exact dates or periods are not known when the document is first filed or distributed to the public, describe arrangements for announcing the final or definitive date or period.
      4.2.2 State the method and time limits for paying the subscription on the securities; where payment is partial, state the manner and dates on which the amounts due will be paid.
      4.2.3 State the method and time limits for the delivery of securities (including provisional certificates, if applicable) to subscribers or purchasers.
      4.2.4 In the case of preemptive purchase rights, state the procedure for the exercise of any right of preemption, the negotiability of subscription rights and the treatment of subscription rights not exercised.
      4.2.5 Include a full description of the manner in which results of the distribution of securities will be made public and, when appropriate, the manner for refunding excess amounts paid by applicants (including whether interest will be paid).

    • Article 5 Key Information

      Summarize key information about the issuer's financial condition, capitalization and risk factors. If the financial statements included in the document are restated to reflect material changes in the issuer's group structure or accounting policies, the selected financial data must be restated.

      5.1 Selected Financial Data
      5.1.1 The issuer shall provide the selected historical financial data for itself for the five most recent financial years (or such shorter period as the issuer has been in operation), in the same currency as the financial statements. Selected financial data for either (or both) of the earliest two years of the five year period may be omitted, if the issuer declares to the Agency that such information cannot be provided, or cannot be provided on a restated basis, without unreasonable effort or expense. If interim period financial statements are included, the selected financial data should be updated for that interim period, which may be unaudited, provided that fact is stated. If selected financial data for interim periods are provided, comparative data from the same period in the previous financial year shall also be provided, unless the requirement for comparative balance sheet data is satisfied by presenting the year-end balance sheet information. In the provision of this summary of financial information, the issuer is required to state whether the financials (a) have been prepared in accordance with International Accounting Standards (IAS); (b) have been audited; and shall state the type of audit opinion received (i.e. 'clean' or 'qualified').
      5.1.2 The selected financial data presented should include items generally corresponding to the following, except that the specific line items presented should be expressed in the same manner as the corresponding line items in the issuer's financial statements. Such data shall include, at a minimum, net sales or operating revenues; income (loss) from operations; income (loss) from continuing operations; net income (loss); net income (loss) from operations per share; income (loss) from continuing operations per share; total assets; net assets; capital shares (excluding long-term debt and redeemable preferred shares); number of shares as adjusted to reflect changes in capital; dividends declared per share in the functional currency of the issuer and also in either US Dollars or Bahraini Dinars, including the formula used for any adjustments to dividends declared, and diluted net income per share. Per share amounts must be determined in accordance with the same body of accounting principles used in preparing the financial statements.
      5.1.3 Where the financial statements provided in response to Article 18 below are prepared in a currency other than the Bahraini Dinar (BHD) or United States Dollar (USD), disclosure of the exchange rate between the financial reporting currency and BHD or USD should be provided, using the exchange rate designated by the Agency for this purpose, if applicable:
      (i) At the latest practicable date;
      (ii) The highest and lowest exchange rates for each month during the previous 12 months; and
      (iii) For at least the last three most recent financial years and any subsequent interim period for which financial statements are presented, the average rates for each period, calculated by using the average of the exchange rates on the last day of each month during this period.
      5.2 Capitalization and Indebtedness

      A statement of capitalization and indebtedness (distinguishing between guaranteed and unguaranteed, and secured and unsecured indebtedness) dated not more than 60 days prior to the date of the document shall be provided, showing the issuer's capitalization on an actual basis, and if applicable, as adjusted to reflect the sale of new securities being issued and the intended application of the net proceeds therefrom. Indebtedness also includes indirect and contingent indebtedness.
      5.3 Reasons for the offer and use of proceeds
      5.3.1 The document shall disclose the estimated net amount of the proceeds of this issue, broken down into each principal intended use thereof. If the anticipated proceeds will not be sufficient to fund all the proposed purposes, the order of priority of such purposes should be given, as well as the amount and sources of other funds required. If the issuer has no specific plans for the proceeds, it should discuss the principal reasons for the offering.
      5.3.2 If the proceeds are being used directly or indirectly to acquire assets other than in the ordinary course of business, briefly describe the assets and their cost. If the assets will be acquired from affiliates of the issuer or their associates, disclose the persons from whom they will be acquired, and how the cost to the issuer will be determined.
      5.3.3 If the proceeds may, or will be used to finance acquisitions of other businesses, give a brief description of such businesses and information on the status of the acquisitions.
      5.3.4 If any material part of the proceeds is to be used to discharge, reduce or retire indebtedness, describe the interest rate and maturity of such indebtedness, and for indebtedness incurred within the past year, the uses to which the proceeds of such indebtedness were put.
      5.4 Risk Factors

      The document shall prominently disclose risk factors that are specific to the issuer or its industry, and which might make the offering speculative or one of high risk, in a section headed "Risk Factors". Issuers are encouraged, but not required, to list the risk factors in the order of their priority to the issuer. Among other things, such factors may include for example: the nature of the business in which it is engaged or proposes to engage; factors relating to the countries in which it operates; the absence of profitable operations in recent periods; the financial position of the issuer; the possible absence of a liquid trading market for the issuer's securities; reliance on the expertise of management; potential dilution; unusual competitive conditions pending expiration of material patents, trademarks or contracts; or dependence on a limited number of customers or suppliers.

    • Article 6 Information on the Issuer

      Provide information about the issuer's business operations, the products or the services it provides, and the factors that affect its business. Also provide information regarding the adequacy and suitability of the issuer's properties, plant and equipment, as well as its plans for future increases or decreases in such capacity. The issuer is also required to provide current valuations of its properties other than those that are available for sale or held as investment, and any additional information regarding these properties, plant and equipment that are not already disclosed in the financial statements of the issuer.

      6.1 History and Development of the Issuer

      The following information shall be provided.
      6.1.1 The legal and commercial name of the issuer.
      6.1.2 The date of incorporation and the length of life of the issuer, except where unspecified.
      6.1.3 The domicile and legal form of the issuer, the legislation under which the issuer operates, its country of incorporation and the address and telephone and facsimile numbers of its registered office (or principal place of business, if different from its registered office). Provide the name and address of the issuer's agent in Bahrain, if applicable.
      6.1.4 Information concerning the nature and results of any material reclassification, merger or consolidation of the issuer, or any of its significant subsidiaries; acquisitions or dispositions of material assets other than in the ordinary course of business; any material changes in the mode of conducting the business; any material changes in the types of products produced or services rendered; name changes; or the nature and results of any bankruptcy, receivership or similar proceedings with respect to the issuer or significant subsidiaries within the preceding 5 years.
      6.1.5 A description, including the amount invested of the issuer's principal capital expenditures and divestitures, including interests in other issuers (other than those in the ordinary course of business), since the beginning of the issuer's last three financial years other than the information disclosed in the accompanying financial statements, up to the date of the offering or listing document.
      6.1.6 Information concerning the principal capital expenditures and divestitures currently in progress (other than those in the ordinary course of business), including the distribution of these investments geographically (home and abroad) and the method of financing (internal or external).
      6.1.7 An indication of any public takeover bids by third parties in respect of the issuer's shares, or by the company in respect of other issuers' shares (other than in the ordinary course of business), which have occurred during both the last and current financial years. The price or exchange terms attached to such offers and the outcomes thereof are to be stated.
      6.2 Business Overview

      The information required by this item may be presented without prejudice to the competitive position of the issuer on the same basis as that used to determine the issuer's business segments under the body of accounting principles used in preparing the financial statements. The following information shall be provided:
      6.2.1 A description of the nature of the issuer's operations and its principal activities, stating the main categories of products sold and/or services performed for each of the last three financial years. Indicate any significant new products and/or services that have been introduced, and to what extent the development of new products or services has been publicly disclosed, giving the status of such development.
      6.2.2 A description of the principal markets in which the issuer competes, including a breakdown of total revenue (by category) for each activity and split into different geographical markets for each of the last three financial years.
      6.2.3 A description of the seasonal nature of the issuer's main business.
      6.2.4 A description of the sources and availability of raw materials, including a description of whether prices of principal raw materials are volatile.
      6.2.5 A description of the marketing channels used by the issuer, including an explanation of any special sales methods, i.e. by installments.
      6.2.6 A summary of information regarding the extent to which the issuer is dependent, if at all, on patents or licences, industrial, commercial or financial contracts (including contracts with customers or suppliers), or new manufacturing processes, royalty agreements, franchises, agencies and other contracts where such factors are material to the issuer's business or profitability.
      6.2.7 The basis for any statements made by the issuer regarding its competitive position shall be disclosed. If the issuer claims a competitive advantage, it should disclose the basis for that claim. If the issuer does not disclose some information based on competitive issues, it should also disclose that fact.
      6.2.8 A description of the material effects of government regulations on the issuer's business, identifying the regulatory body for the issuer.
      6.3 Organizational Structure

      If the issuer is part of a group, include a brief description of the group and the issuer's position within the group. Provide a listing of the issuer's subsidiaries, including name, country of incorporation or residence, proportion of ownership interest, and if different, proportion of voting power held.
      6.4 Property, Plant and Equipment

      Provide information regarding any tangible fixed assets, including leased properties, and any major encumbrances thereon, including a description of the size and uses of the property; productive capacity and extent of utilization of the issuer's facilities; how the assets are held; the products produced; and the location. Also describe any environmental issues that may affect the issuer's utilization of the assets. With regard to any plans to construct, expand or improve facilities, describe the nature of and reason for the plan, an estimate of the amount of expenditure, including the amount of expenditures already paid, a description of the method of financing the activity, the estimated start dates and completion of the activity, and the increase of production capacity anticipated after completion.

    • Article 7 Operating and Financial Review and Prospects

      7.1 Give an explanation (in financial statement line items) of factors that have affected the issuer's financial condition and results of operations for each year, as well as the interim period for which the financial statements are required in the prospectus, including the causes of these material changes from year-to-year. The information provided shall also relate to a forecast or statement of the issuer's prospects for the current and future periods. This may include management's assessment of factors and trends that are anticipated to have a material effect on the issuer's financial conditions and results of operations in the same future period. Provide the information as specified below, as well as any information that is necessary for an investor's understanding of the issuer's business as a whole, including all separate segments of the issuer.
      7.2 Operating Results

      Provide information regarding significant factors, including unusual or infrequent events or new developments that are materially affecting the issuer's income or its operations, indicating the extent to which income was so affected. Describe any other significant component of revenue or expenses necessary to understand the issuer's results of operations.
      7.2.1 To the extent that the financial statements disclose material changes in net sales or revenues, provide a narrative discussion of the extent to which such changes are attributable to changes in prices or to changes in the volume, or the amount of products or services being sold, or the introduction of new products or services.
      7.2.2 Describe the impact of inflation, if material. If the currency in which financial statements are presented is from a country that has experienced hyperinflation, a minimum of at least five years history of the annual rate of inflation and a discussion of the impact of hyperinflation on the issuer's business shall be disclosed.
      7.2.3 Provide information regarding the impact of foreign currency fluctuations on the issuer, if material, and the extent to which foreign currency net investments are hedged by currency borrowings and other hedging instruments.
      7.2.4 Provide information regarding any governmental economic, fiscal, monetary or political policies or factors that have materially affected, or are expected to materially affect, directly or indirectly, the issuer's operations or investments by host country shareholders.

    • Article 8 Liquidity and Capital Resources

      The following information shall be provided:

      8.1 Information regarding the issuer's liquidity (both short and long term), including:
      8.2 An evaluation of the sources and amounts of the issuer's cash flows, including the nature and extent of any legal or economic restrictions on the ability of subsidiaries to transfer funds to the issuer in the form of cash dividends, loans or advances and the impact such restrictions have had, or are expected to have, on the ability of the issuer to meet its cash obligations.
      8.3 To the extent this information is not already mentioned in the financial statements, a description of the internal and external sources of liquidity, and a brief description of any material and unused sources of liquidity. A statement should be included by the issuer stating that, in its opinion, the working capital is sufficient for the issuer's present requirements, or if not, how it proposes to provide the additional working capital needed. Information must be included on the level of borrowings at the end of the period under review, the seasonal borrowing requirements and the maturity profile of borrowing and committed borrowing facilities, with a description of any restrictions on their use.
      8.4 To the extent this information is not already mentioned in the financial statements, information regarding the type of financial instruments used, the maturity profile of debt, and the currency and interest rate structure. The description should also include funding and treasury policies and objectives, in terms of the manner in which treasury activities are controlled, the currencies in which cash and cash equivalents are held, the extent to which borrowings are at fixed rates, and the use of financial instruments for hedging purposes.
      8.5 To the extent this information is not already mentioned in the financial statements, information regarding the issuer's material commitments for outstanding capital expenditure as of the end of the latest financial year and any subsequent interim period, and an indication of the general purpose of such commitments, and the anticipated sources of funds needed to fulfill such commitments.

    • Article 9 Research and Development, Patents and Licences etc.

      Provide a description of the issuer's research and development policies for the last three years, where significant, including the amount spent during each of the last three financial years on issuer-sponsored research and development activities.

    • Article 10 Directors and Employees

      10.1 Provide information on the issuer's directors and senior managers that will allow investors to assess such individuals' expertise, qualifications and levels of compensation, as well as their relationship with the issuer.
      10.2 Directors and Senior Management

      The following information shall be disclosed with respect to the issuer's directors and senior management, and any employees such as scientists or designers, upon whose work the issuer depends:
      10.2.1 Name, business experience, functions and areas of expertise in the issuer.
      10.2.2 Principal business activities performed outside the issuer (including, in the case of directors, other principal directorships).
      10.2.3 Date of birth, or age.
      10.2.4 Any arrangement or understanding with major shareholders, customers, suppliers or others, pursuant to which any person referred to above was selected as a director, or member of senior management.
      10.2.5 Whether such person is a party to current debt recovery litigation or has a record of being a cheque abuser, or has been involved previously in any bankruptcy, fraud, money laundering or other serious criminal proceedings, as can be ascertained from the Agency's or other similar records in other jurisdictions. If so, disclose circumstances.

    • Article 11 Compensation

      For the latest audited full financial year of the issuer, provide information related to compensation separated into two distinct categories; (i) for the issuer's directors in the aggregate, and (ii) for the issuer's employees in the aggregate, including key members of its administrative, supervisory or management bodies. The information provided should cover:

      11.1 The amount of compensation paid and benefits in kind granted in the aggregate to persons in each of the two categories by the issuer and its subsidiaries, for services in all capacities to the issuer and its subsidiaries by such persons. Disclosure of compensation is required on a categorical basis only, unless individual disclosure is required in the issuer's home country or is otherwise publicly disclosed by the issuer.
      11.2 Contingent or deferred compensation accrued for the year, even if the compensation is payable at a later date.
      11.3 The total amounts set aside or accrued by the issuer or its subsidiaries, to provide pension retirement or similar benefits.
      If any portion of the compensation was paid (a) pursuant to a profit-sharing plan, provide a brief description of the plan; or (b) in the form of stock options, provide the title and amount of securities covered by the options in the aggregate, the exercise price, the purchase price (if any), and the expiration date of the options.

    • Article 12 Board Practices

      The following information for the issuer's last completed financial year shall be given with respect to, unless otherwise specified, the issuer's directors.

      12.1 Date of expiration of the current term of office, if applicable, and the period during which the person has served in that office.
      12.2 Details of directors' service contracts with the issuer or any of its subsidiaries, providing for benefits upon termination of employment, or an appropriate negative statement.
      12.3 Details relating to the issuer's primary board committees, including but not limited to audit committee and remuneration committee, including the names of committee members, and a summary of the terms of reference under which the committee operates.

    • Article 13 Employees

      13.1 Give the number of employees at the end of each of the last three financial years. If possible, provide a breakdown of persons employed by nationality, main category of activity and geographic location during the most recent full financial year. Also disclose any significant change in the number of employees, and information regarding the relationship between management and any labour committee or union. If the issuer employs a significant number of temporary employees, include the number of temporary employees on an average during the most recent financial year.
      13.2 Share Ownership
      13.2.1 With respect to employees, provide information as to their share ownership in the issue as of the most recent practicable date, including disclosure of the total number of shares and percentage of shares outstanding of that class, whether they have different voting rights where held by the employees and a description of options granted to them on the issuer's shares. Information regarding options shall include the title and amount of securities called for by the options; the exercise price; the purchase price, if any; and the expiration date of the options.
      13.2.2 Describe any arrangements for involving the employees in the capital of the issuer, including any arrangement that involves the issue or granting of options, shares or other securities of the issuer.

    • Article 14 Major Shareholders and Related Party Transactions

      Information about major shareholders:

      Unless otherwise disclosed in the financial statements, provide information regarding the major shareholders and others that control or may control the issuer. Also give information regarding transactions the issuer has entered into with persons affiliated/associated with the issuer, and advise whether the terms of such transactions are at arms' length to the issuer.

    • Article 15 Major Shareholders

      15.1 To the best extent of the issuer's knowledge and information, or to the extent it can be ascertained from public records, the issuer should provide, as of the most recent practicable date, the number of shares held, including shares beneficially owned by the issuer's major shareholders, e.g. shareholders that are the beneficial owners of 5% or more of each class of the issuer's voting securities:
      15.1.1 Provide the names and nationalities of the major shareholders, and the number of shares and percentage of outstanding shares of each class owned by each of them as of the most recent practicable date, or an appropriately worded statement if there are no major shareholders.
      15.1.2 Disclose any significant change in the percentage ownership held by any major shareholders during the past three years.
      15.1.3 Indicate whether the company's major shareholders have different voting rights, or include an appropriately worded negative statement.
      15.2 Information shall be provided as to the portion of each class of securities held, and the number of recorded shareholders in the Kingdom of Bahrain.
      15.3 To the extent known to the issuer, state whether the issuer is directly or indirectly owned or controlled by another corporation(s), by any foreign government, or by any other person(s) separately or jointly, and, if so, give the name(s) of such controlling corporation(s), government or other person(s), and briefly describe the nature of such control, including the amount and proportion of capital held giving a right to vote.
      15.4 Describe any arrangements known to the issuer, the existence or operation of which may at a subsequent date, result in a change in control of the issuer.

    • Article 16 Related Party Transactions

      16.1 Unless otherwise disclosed in the audited financial statements, provide the information required below for the whole of the issuer's last two financial years up to the date of the document, with respect to transactions or loans between the issuer and:
      16.1.1 Persons that directly or indirectly through one or more intermediaries, control or are controlled by, or are under common control with, the issuer;
      16.1.2 Associates, other than those transactions in the ordinary course of business. An associate is an unconsolidated enterprise in which the issuer has a significant influence, or which has significant influence over the issuer, and includes enterprises owned by directors or major shareholders of the issuer and enterprises that have a member of key management in common with the issuer. Significant influence over an enterprise is the power to participate in the financial and operating policy decisions of the enterprise, but does not have control over those policies. Shareholders beneficially owning 10% or more interest in the voting power of the issuer are presumed to have a significant influence on the issuer.
      16.1.3 Individuals owning, directly or indirectly, an interest in the voting power of the issuer that gives them significant influence over the issuer, and close members of any such individual's family. Close members of an individual's family are those that may be expected to influence, or be influenced by that person in their dealings with the issuer.
      16.1.4 Key management personnel, i.e. those persons having authority and responsibility for planning, directing and controlling the activities of the issuer, including directors and senior management of issuers, and close members of such individuals' families; and
      16.1.5 Enterprises in which a substantial interest in the voting power is owned, directly or indirectly, by any person described in 16.1.2 or 16.1.3, or over which such a person is able to exercise significant influence.
      16.2 Describe the nature and extent of any transactions or currently proposed transactions that are material to the issuer or the related party, or any transactions that are unusual in their nature or conditions, involving goods, services, or tangible or intangible assets to which the issuer or its holding company, or any of its subsidiaries was a party.
      16.3 Describe the amount of outstanding loans (including guarantees of any kind) made by the issuer or any of its holding companies or subsidiaries, to or for the benefit of any of the persons mentioned in 16.1 above. The information given should include the largest amount outstanding during the period covered, the amount outstanding as of the latest practicable date, the nature of the loan and the transaction in which it occurred, and the interest rate on the loan.

    • Article 17 Interests of Experts and Counsel

      If any of the named experts or counselors were employed on a contingency basis, and own an amount of shares in the issuer or its subsidiaries which is material, or has a material (direct or indirect) economic interest in the company, or has an interest that depends on the success of the offering, provide a brief description of the nature and terms of such contingency or interest.

    • Article 18 Financial Information

      The audited financial statements shall be presented for the last two financial years and the primary statements; including the balance sheet, income statement, cash flow statement and change in shareholders' fund for the last three financial years (or a shorter period if the company has not been in operation that long), must be included in the document. Where there has been a material change to the issuer's entity or to the company's group structure or accounting policies, the financial statements should be restated to show such changes. In addition, if the last year of audited financial statements are older than 15 months at the time of the offering or listing, interim period reviewed financial statements, as compared with the same period in the previous financial year, shall also be provided. If the financial statements and other financial information are presented in a currency other than Bahraini Dinar (BHD) or United States Dollar (USD), the exchange rate against BHD and /or USD, as well as the inflation rate, shall also be included as designated by the Agency for this purpose.

    • Article 19 Consolidated Statements and Other Financial Information

      19.1 In addition to Article 18 above, if the issuer is part of a group, the annual consolidated financial statements shall be included in the documents as follows:
      19.1.1 The document must contain consolidated financial statements, audited by an independent auditor and accompanied by an audit report, comprising of:
      (i) a balance sheet;
      (ii) an income statement;
      (iii) a statement showing either (a) changes in equity other than those arising from capital transactions with owners and distributions to owners; or (b) all changes in equity (including a sub-total of all non-owner movements in equity);
      (iv) a cash flow statement,
      (v) related notes and schedules required by the International Accounting Standards, pursuant to which the financial statements are prepared; and
      (vi) if not included in the primary financial statements, a note analyzing the changes in each caption of shareholders' equity presented in the balance sheet.
      19.2 The document should include comparative audited financial statements that cover the last three financial years, and the audited primary financial statements for the last two years.
      19.3 The audit report(s) must cover each of the periods for which these disclosure standards require audited financial statements. If the auditors have refused to provide a report on the annual accounts, or if the report(s) contain qualifications or disclaimers, such refusal, qualifications or disclaimers shall be reproduced in full and the reasons given, so that the Agency can determine whether or not to accept the financial statements of the document. An indication of any other information in the document that has been audited by the auditors should be included.
      19.4 If the document is dated more than nine months after the end of the last audited financial year, it should contain consolidated Interim Financial Statements covering at least the first six months of the financial year. These statements may be unaudited but must be reviewed by an independent auditor and a copy of the auditor's interim review report must be provided in the document. The Interim Financial Statements should be prepared in accordance with IAS.
      19.5 If, on the date of the document the issuer has published Interim Financial Statements that cover a more current period than those otherwise required by 19.4 above, the more current Interim Financial Statements must be included in the document. That may be unaudited but must be reviewed by an independent auditor and a copy of the auditor's interim review report must be provided in the document.
      19.6 If the amount of export sales constitutes a significant portion of the issuer's total sales volume, provide the total amount of export sales and the percentage and amount of export sales in the total amount of sales volume.
      19.7 Provide information on any legal or arbitration proceedings, including those relating to bankruptcy, receivership or similar proceedings, and those involving any third party, which are expected to have, or have had in the recent past, significant effects on the issuer's financial position or profitability. This includes governmental proceedings pending, or known to be contemplated.
      19.8 Describe the company's policy on dividend distributions.

    • Article 20 Material Changes

      Disclose whether or not any material change has occurred since the date of the annual financial statements, and/or since the date of the most recent interim financial statements, if any, included in the document.

    • Article 21 Restatement of Financial Statements

      Where there have been material changes to the issuer's group structure or accounting policies, certain adjustments or reclassifications to the figures previously reported in the financial statements may be required, if the amounts involved are material. Adjustments are required where necessary, in order for the financial statements to be presented on a consistent and comparable basis. The financial statements for earlier years required in this document shall be restated or reformatted into a combined presentation, and shall include an audit report to reflect such changes.

    • Article 22 Ratios

      It is the responsibility of each issuer to determine which ratios should be calculated, according to the particular nature of its own business and the securities for which offering or listing is sought, according to what is necessary to enable the investors or potential investors to make an informed assessment about the health and soundness of the financial position and operating results. Information about the method of calculation of stated ratios should also be provided in the document.

    • Article 23 Projections of Financial Statements

      Projections of future operating results are not required in the document. However, if the issuer decides to disclose such information, it has to justify its projections adequately. The issuer also has to provide an explanation on how the projections were calculated, taking into account all the assumptions and the risk of failure in the projected results. If such statements are presented in the document, they must be examined and reported on by the reporting accountants, experts or consultants.

    • Article 24 Separate Financial Information

      For better and adequate presentation of the issuer's financial condition, or where necessary for the protection of the investor, separate financial information of an acquired subsidiary or where the acquirer has a controlling interest, which is not held for resale and which is not consolidated in the financial statements of the issuer, must be provided.

      The separate financial information can be in the form of summarized or condensed financial highlights.

    • Article 25 The Offering and Listing

      Provide information regarding the offering or listing of securities, plans for distribution of the securities and other related matters.

      25.1 Resolutions, Authorizations and Approvals

      Indicate the name, nature and date of all the resolutions, authorizations and approvals, by virtue of which the securities have been, or will be, offered and listed. If there are any special arrangements or conditions pursuant to which the offering and listing of securities has been approved, such arrangements or conditions must be presented in the document.
      25.2 Listing on Other Exchange(s)

      State the name of any other stock exchange(s) and regulated market(s) on which the issuer's securities (equity or debt) are listed, or are planned to be listed. Indicate the stock exchange(s) where the issuer will have its primary listing. Indicate the trading, clearing and settlement arrangements between such exchanges.
      25.3 Offering and Listing Details
      25.3.1 Indicate the price at which the securities will be offered, or the method for determining the price and the amount of any expenses specifically charged to the subscriber or purchaser.
      25.3.2 If there is no established market for the securities, the document shall contain information regarding the manner of determination of the offering price, as well as of the exercise price of warrants, and the conversion price of convertible securities, including identifying the persons who established the price, or who is formally responsible for the determination of the price, the various factors considered in such determination and the parameters or elements used as a basis for establishing the price.
      25.3.3 If the issuer's shareholders have pre-emptive purchase rights and where the exercise of the right of pre-emption of shareholders is restricted or withdrawn, the issuer shall indicate the basis for the issue price, if the issue is for cash, together with the reasons for such restriction or withdrawal and the beneficiaries of such restriction or withdrawal, if intended to benefit specific persons.
      25.3.4 Information regarding the price history, where available of the security to be offered or listed shall be disclosed as follows:
      (i) for at least the last three most recent financial years: the annual highest and lowest closing prices;
      (ii) for the most recent financial year and any subsequent period: the highest and lowest closing prices for each full financial quarter;
      (iii) for the last six months: the highest and lowest closing prices for each month;
      (iv) for pre-emptive issues, the closing prices for the first trading day in the last six months, for the last trading day before the announcement of the offering, and (if different) for the latest practicable date prior to publication of the document.
      25.3.5 Information shall be given with respect to the closing price on the Exchange and the principal trading market in other exchange(s). If any trading suspensions occurred in the previous three years, these should also be disclosed. If the securities are not regularly traded in an organized market, information must be given about any lack of liquidity.
      25.3.6 State the type and class of the securities being offered or listed, and furnish the following information:
      (i) In the case of shares, provide the number of shares to be issued and made available to the market for each kind of share. The nominal par or equivalent value should be given on a per share basis, and where applicable, a statement of the minimum offer price. Describe the coupons attached, if applicable;
      (ii) Describe arrangements for transfer and any restrictions on the free transferability of the shares.
      25.3.7 If the rights evidenced by the securities being offered or listed are, or may be materially limited or qualified by the rights evidenced by any other class of securities, or by the provisions of any contract or other documents, include this information and its effect on the rights evidenced by the securities to be listed or offered.
      25.3.8 With respect to securities other than common or ordinary shares to be listed or offered, outline briefly the rights evidenced thereby:
      (i) If subscription warrants or rights are to be listed or offered, state the title and amount of securities called for; the amount of warrants or rights outstanding; provisions for changes to or adjustments in the exercise price; the period during which and the price at which the warrants or rights are exercisable; and any other material terms of such warrants or rights.
      (ii) Where convertible securities or stock purchase warrants to be listed or offered are subject to redemption or call, the description of the conversion terms of the securities or material terms of the warrants should include whether the right to convert or purchase the securities will be forfeited, unless it is exercised before the date specified in the notice of redemption or call; the expiration or termination date of the warrants; the kind, frequency and timing of notice of the redemption or call, including where the notice will be published.

    • Article 26 Plan of Distribution

      26.1 The names and addresses of the person(s) underwriting and/or guaranteeing the offering shall be provided.
      26.2 To the best of the issuer's knowledge, indicate whether major shareholders, directors or members of the issuer's management, supervisory or administrative bodies intend to subscribe to the offering, or whether any person intends to subscribe to 5% or more of the offering.
      26.3 Identify any group of targeted potential investors to whom the securities are offered. If the offering is being made simultaneously in the markets of two or more countries and if a tranche has been, or is being reserved for certain of these, indicate any such tranche.
      26.4 If securities are reserved for allocation to any group of targeted investors, including for example, offerings to existing shareholders, directors, or employees and past employees of the issuer or its subsidiaries, provide details of these and any other preferential allocation arrangements.
      26.5 Indicate whether the amount of the offering could be increased, such as by the exercise of an underwriter's over-allotment option or "greenshoe", and by how much.
      26.6 Indicate the amount, and briefly outline the plan of distribution of any securities that are to be offered other than through underwriters. If the securities are to be offered through the selling efforts of brokers or dealers, describe the plan of distribution and the terms of any agreement or understanding with such entities. If known, identify the broker(s) or dealer(s) that will participate in the offering and state the amount to be offered through each.
      26.7 If the securities are to be offered in connection with the writing of exchange-traded call options, briefly describe such transactions.
      26.8 If simultaneously, or almost simultaneously, with the creation of shares for which admission to official listing is being sought, shares of the same class are subscribed for or privately placed, or if shares of other classes are created for public or private placing, provide details of the nature of such operations and of the number and characteristics of the shares to which they relate.
      26.9 Unless otherwise described under the response to Article 31.2 ("Material Contracts"), describe the features of the underwriting relationship, together with the amount of securities being underwritten by each underwriter in accordance with the terms of contract with the issuer or selling shareholders. The foregoing information should include a statement as to whether the underwriters are, or will be committed to take and pay for all of the securities, if any are taken, or whether it is an agency or the type of "best efforts" arrangement, under which the underwriters are required to take and pay for only such securities as they may sell to the public.
      26.10 Describe the nature and terms of any relationship, other than those in the ordinary course of business, with any underwriters or other financial advisers.

    • Article 27 Selling Shareholders

      The following information shall be provided:

      27.1 The name and address of the person or entity offering to sell the securities, the nature of any position, office or other material relationship that the selling shareholder has had within the past three years with the issuer, or any of its predecessors or affiliates.
      27.2 The number and class of securities being offered by each of the selling holders, and the percentage of the existing equity capital. The amount and percentage for each particular type of securities beneficially held by the selling holder, before and immediately after the offering shall be specified.

    • Article 28 Dilution

      28.1 The following information shall be provided:
      28.1.1 Where there is a substantial disparity between the public offering price and the effective cash cost to directors or senior management, or affiliated persons of equity securities acquired by them in transactions during the past five years, or which they have the right to acquire, a comparison should be included of the price to the public in the proposed public offering, and the cost to such persons.
      28.1.2 Disclose the amount and percentage of immediate dilution resulting from the offering, computed as the difference between the offering price per share and the net book value per share and the average closing market price for the last 30 days for the equivalent class of security, as of the latest audited/reviewed balance sheet date.
      28.1.3 In the case of a subscription offering to existing shareholders, disclose the amount and percentage of immediate dilution if they do not subscribe to the new offering in the same manner as described above in Article 28.1.2.

    • Article 29 Expenses of the Issue

      29.1 The following information shall be provided:
      29.1.1 The total amount of discount or commission agreed upon by the underwriters or other placement or selling agents and the issuer or selling shareholders, as well as the percentage such commissions represent of the total amount of the offering, and the amount of discounts or commissions per share.
      29.1.2 A reasonably itemized statement of the major categories of expenses incurred in connection with the issuance and distribution of the securities to be listed or offered, and by whom the expenses are payable, if other than the issuer. If any of the securities are to be offered for the account of a selling shareholder, indicate the portion of such expenses to be borne by him. The information may be given subject to future contingencies. If the amounts of any items are not known, estimates (identified as such) shall be given.

    • Article 30 Additional Information

      30.1 Share Capital

      The following information shall be given as of the date of the most recent balance sheet included in the financial statements, and as of the latest practicable date:
      30.1.1 The amount of issued capital and, for each class of share capital: (a) the number of shares authorized; (b) the number of shares issued and fully paid-up and issued but not fully paid-up; (c) the par value per share and (d) a reconciliation of the number of shares outstanding at the beginning and end of the year. If more than 10% of capital has been paid for with assets other than cash within the past five years, that fact should be stated.
      30.1.2 If there are shares not representing capital, the number and main characteristics of such shares shall be stated.
      30.1.3 Indicate the number, book value and face value of shares in the issuer, held by the issuer directly or indirectly, or by subsidiaries of the issuer.
      30.1.4 Where there is authorized but unissued capital, or an undertaking to increase the capital for example, in connection with warrants, convertible obligations or other outstanding equity-linked securities, or subscription rights granted, indicate: (i) the amount of outstanding equity-linked securities and of such authorized capital or capital increase and, where appropriate, the duration of the authorization; (ii) the categories of persons having preferential subscription rights for such additional portions of capital; and (iii) the terms, arrangements and procedures for the share issue corresponding to such portions.
      30.1.5 The persons to whom any capital of the issuer is under option, or agreed conditionally or unconditionally to be put under option, including the title and amount of securities covered by the options; the exercise price; the purchase price, if any; and the expiration date of the options. Where options have been granted, or agreed to be granted to all the holders of shares or debt securities, or of any class thereof, or to employees under an employees' share scheme, it will be sufficient so far as the names are concerned, to record that fact without giving names.
      30.1.6 A history of share capital for the last three years, identifying the events during that period which have changed the amount of issued capital and/or the number and classes of shares of which it is composed, together with a description of changes in voting rights, attached to the various classes of shares during that time. If there is any share capital issued for consideration other than cash, details on the price and terms of such issue (including information regarding discounts, special terms or installment payments) should be given. If there are no such issues, an appropriately worded statement must be made. The reason for any reduction of the amount of capital and the ratio of capital reductions shall also be given.

    • Article 31 Memorandum and Articles of Association

      A copy of the Memorandum and Articles of Association should be incorporated by reference in the prospectus.

      31.1 The following information shall be provided:
      31.1.1 With respect to directors, provide a summary of any provisions of the issuer's Articles of Association, or charter and by-laws with respect to: (a) a director's power to vote on a proposal, arrangement or contract in which the director is materially interested; (b) the directors' power, in the absence of an independent quorum to vote for compensation to themselves, or any members of their body; (c) borrowing powers exercisable by the directors, and how such borrowing powers can be varied; (d) retirement or non-retirement of directors under an age limit requirement; and (e) number of shares, if any, required for the director's qualification.
      31.1.2 Describe the rights, preferences and restrictions attached to each class of shares, including: (a) dividend rights, including the time limit after which dividend entitlement lapses and an indication of the party in whose favour this entitlement operates; (b) voting rights, including whether directors stand for re-election at staggered intervals, and the impact of that arrangement where cumulative voting is permitted or required; (c) rights to share in the issuer's profits; (d) rights to share in any surplus in the event of liquidation; (e) redemption provisions; (f) sinking fund provisions; (g) liability to further capital calls by the issuer; and (h) any provision discriminating against any existing or prospective holder of such securities as a result of such shareholder owning a substantial number of shares.
      31.1.3 Describe what action is necessary to change the rights of holders of the shares, indicating where the conditions are more significant than is required by law.
      31.1.4 Describe the conditions governing the manner in which annual general meetings and extraordinary general meetings of shareholders are convened, including the conditions of admission.
      31.1.5 Describe any limitations on rights to own securities, including the rights of foreign shareholders to hold, or exercise voting rights on the securities imposed by foreign law, or by the charter or other constituent document of the issuer or state that there are no such limitations if that is the case.
      31.1.6 Describe the limitations, if any, on voting power in annual general meetings of shareholders, including such limitations on the voting power of brokerage firms, nominees, portfolio managers and any other person who holds or manages the portfolios on behalf of others.
      31.1.7 Describe briefly any provision of the issuer's Articles of Association that would have the effect of delaying, deferring or preventing a change in control of the issuer or that would operate only with respect to a merger, acquisition, or corporate restructuring involving the issuer (or any of its subsidiaries).
      31.1.8 Describe provision in the Articles of Association, if any, governing the ownership threshold above which shareholder ownership must be disclosed.
      31.1.9 With respect to Articles 31.1.1 through 31.1.8 above, if the law applicable to the issuer in these areas is significantly different from that in the Kingdom of Bahrain, the effect of the law in these areas should be explained.
      31.1.10 Describe the conditions imposed by the Memorandum and Articles of Association governing changes in the capital, where such conditions are more stringent than is required by law.
      31.2 Material Contracts

      Provide a summary of each material contract, other than contracts entered into in the ordinary course of business, to which the issuer or any member of the group is a party, for any outstanding contracts at the time of publication of the document, including dates, parties, general nature of the contracts, terms and conditions, and amount of any consideration passing to or from the issuer, or any other member of the group.
      31.3 Exchange controls

      Describe any governmental laws, decrees, regulations or other legislation of the home country of the issuer that may affect:
      31.3.1 The import or export of capital, including the availability of cash and cash equivalents for use by the issuer's group.
      31.3.2 The remittance of dividends, interest or other payments to non-resident holders of the issuer's securities.
      31.4 Taxation

      The issuer shall provide information regarding taxes (including withholding provisions) to which shareholders in the Kingdom of Bahrain and in the host country(s) may be subject. Information should be included as to whether the issuer assumes responsibility for the withholding of tax at source and regarding applicable provisions of any reciprocal tax treaties between the home country and the host countries or a statement, if applicable, that there are no such treaties.
      31.5 Dividends and Paying Agents.

      Disclose any dividend restrictions, the date on which the entitlement to dividends arises, if known, and any procedures for non-resident holders to claim dividends. Identify the financial organizations, which at the time of admission of shares to the official listing are the paying agents of the issuer in the countries where admission has taken place, or is expected to take place.
      31.6 Statement by Experts

      Where a statement or report attributed to a person as an expert is included in the document, provide with that person's consent, their name, address and qualifications and a statement to the effect that such a report is included, the form and context in which it is included, and who authorized the contents of that part of the document.
      31.7 Documents on Display

      The issuer shall provide an indication of when the issuer's documents (referred to in the report) may be inspected. Exhibits and documents on display should generally be translated into Arabic and/or English. Such documents, as well as the prospectus, must be made available by the issuer in the Kingdom of Bahrain simultaneously with the public offering or listing.
      31.8 Subsidiary Information

      Information relating to the issuer's subsidiaries eligible for consolidation under IAS must be provided, if such information is not otherwise called for by the International Accounting Standards used in preparing the financial statements.
      31.8.1 Provide information in respect of the matters mentioned below, relating to unconsolidated subsidiaries that are not held for resale and that are likely to have a significant effect on the assessment of the issuer's own assets and liabilities, financial position or profits and losses:
      (a) the name and address of the registered office;
      (b) the principal activities;
      (c) the proportion of capital held;
      (d) the issued capital;
      (e) the reserves;
      (f) the profit or loss arising out of ordinary activities after tax (if any), for the last three financial years,
      (g) the value at which the issuer shows in its accounts the interest held;
      (h) any amount still to be paid up on shares held;
      (i) the amount of dividends received in the course of the last three financial years in respect of shares held; and
      (j) the amount of the debts owed to and by the issuer, with regard to the undertaking .
      31.8.2 The items of information listed above must be given in any event, for every undertaking in which the issuer has a direct or indirect participating interest, if the book value of that participating interest represents at least 20% of the consolidated net assets (or capital and reserves of the company's own accounts, if required to be provided), or accounts for at least 20% of the consolidated net profit or loss of the group (or the issuer's own accounts, if required to be provided). The information required by (e) and (f) above may be omitted where the undertaking in which a participating interest is held does not publish annual accounts.
      31.8.3 With the permission of the Agency, the information required by (d) to (i) above may be omitted if the annual accounts of the undertakings in which the participating interests are held are consolidated into the group's annual accounts, or if the value attributable to the interest under the equity method or its fair value evaluation is disclosed in the annual accounts, provided that the omission of the information is not likely to mislead the public with regard to the facts and circumstances, knowledge of which is essential for the assessment of the security in question. With the permission of the Agency, the information provided for under points (g) and (j) may be omitted, if such omission does not mislead investors.
      31.8.4 Provide individual details relating to the undertakings not referred to in Article 31.8.1 above, in which the issuer holds at least 20% of the share capital. The name and registered office of the undertaking and the proportion of the capital held may be omitted when they are of negligible importance.
      31.8.5 When the document includes consolidated annual financial statements, provide disclosure:
      (a) of the consolidation principles applied (which must be described in detail); where such principles are not consistent with International Financial Reporting Standards;
      (b) of the names and registered offices of the undertakings included in the consolidation, and where this information is important for the purpose of assessing the assets and liabilities, the financial position and the profits and losses of the issuer. It is sufficient to distinguish them by a symbol in the list of undertakings of which details are required in item Article 31.8.1 above; and
      (c) for each of the undertakings referred to in 31.8.5 above:
      (i) the total proportion of third-party interest, if annual accounts are wholly consolidated;
      (ii) the proportion of the consolidation calculated on the basis of interests, if consolidation has been effected on a pro rata basis.

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