Entire Section | Rulebook

Back

Custom print

Link

Text Only

Rich Text

Print

Location:

OFS-5.3 OFS-5.3 Additional and Specific Content for Debt Securities

OFS-5.3.1
An offering document in respect of debt securities must contain the minimum content requirements of this section and be prepared in accordance with Appendix 3.

January 2014

Front Cover Page

OFS-5.3.2

Front cover page:

The cover page of the debt securities offering document must contain the following particulars:

(a) Full name and registration number of the issuer;

(b) Full name and registration number of the originator;

(c) Logo and full name of the guarantor, if any;

(d) Type and amount of debt securities;

(e) Date of the offering document;

(f) Date of the expiry of the validity of the prospectus;

(g) Logo and full name of each advisor;

(h) Logo and full name of the lead manager, primary dealer, issuing house;

(i) Logo and full name of co-managers;

(j) Logo and name of the underwriter, if any;

(k) Logo and full name of the trustee;

(l) Rating of debt securities, if any;

(m) Face or par value;

(n) Offer price;

(o) Premium (if applicable);

(p) Placement fee or charge (if applicable);

(q) Minimum subscription limit (if applicable);

(r) Maximum subscription limit (if applicable);

(s) Eligible subscribers (general classification by nationality or region); and

(t) Standard disclaimer statement, written in capital letters and box framed, as follows:

THE CENTRAL BANK OF BAHRAIN AND [NAME OF LICENSED EXCHANGE] ASSUME NO RESPONSIBILITY FOR THE ACCURACY AND COMPLETENESS OF THE STATEMENTS AND INFORMATION CONTAINED IN THIS DOCUMENT AND EXPRESSLY DISCLAIM ANY LIABILITY WHATSOEVER FOR ANY LOSS HOWSOEVER ARISING FROM RELIANCE UPON THE WHOLE OR ANY PART OF THE CONTENTS OF THIS DOCUMENT.

January 2014

Inside Cover Page

OFS-5.3.3

The offering document must include on the inside cover page the standard prominent and legible declaration and responsibility statement within a box frame:

THE DIRECTORS OF THE COMPANY, WHOSE NAMES APPEAR HEREIN, ACCEPT RESPONSIBILITY FOR THE INFORMATION CONTAINED IN THIS DOCUMENT. TO THE BEST OF THEIR KNOWLEDGE AND BELIEF, THE DIRECTORS, WHO HAVE TAKEN ALL REASONABLE CARE TO ENSURE THAT SUCH IS THE CASE, THE INFORMATION CONTAINED IN THIS DOCUMENT IS IN ACCORDANCE WITH THE FACTS AND CONTAINS NO OMISSIONS LIKELY TO AFFECT THE IMPORTANCE AND COMPLETENESS OF THE DOCUMENT.

January 2014

OFS-5.3.4
The abovementioned standard responsibility statement must be duly signed by the issuer's/originator's board of directors.

January 2014

OFS-5.3.5
The standard responsibility statement must be produced in the offering document and the same must be submitted to the CBB.

January 2014

OFS-5.3.6
The CBB will not normally accept any board of directors' responsibility statement unless it is duly signed by all directors. In cases where one or more of the directors cannot provide their signature on such statement, the issuer is required to provide to the CBB and disclose in the offering document itself, the actual reasons and justifications.

January 2014

OFS-5.3.7
In addition to the information required to be included on the front and inside cover pages of the prospectus or offering documents, the offering documents of debt securities must contain, at the minimum, the following sections of information:

(a) Important Notice - which may include:
(i) Important notice to subscribers;

(ii) Due diligence statements;

(iii) Forward looking statements; and

(iv) General risk statement;

(b) Applicants Identification and Anti-Money Laundering requirement;

(c) Table of contents;

(d) Glossary of the defined terms and abbreviations;

(e) Offering timetable;

(f) Resolutions and approvals;

(g) Summary of the offering;

(h) Offering statistics and expected timetable;

(i) Structural overview of the securitisation transaction:
(i) Summary of transaction;

(ii) Transaction overview diagram;

(iii) Cash flow description;

(iv) Cash inflow;

(v) Monthly instalment;

(vi) Cash outflow;

(vii) Issuance cost;

(viii) Annual expenses;

(ix) Delinquencies and defaults;

(x) Investment parameters for the investment of temporary liquidity surpluses;

(xi) Source of payments;

(xii) Order of priority of payments;

(xiii) Fees payable;

(xiv) Sale of the underlying assets;

(xv) Nature of the sale;

(xvi) Terms of the sale;

(xvii) Underlying assets;

(xviii) Purchase consideration;

(xix) Cancellation;

(xx) Debt securities issuance;

(xxi) Partial early redemption;

(xxii) Mandatory redemption in full;

(xxiii) Formula for optional/mandatory redemption in full;

(xxiv) Debt securities redemption table;

(xxv) Servicing function;

(xxvi) Servicing by the originator;

(xxvii) Servicing of the debt securities by the issuer; and

(xxviii) Utilisation of proceeds;

(j) The following minimum information must be provided for:
(i) Details of the issuer (for all issues);

(ii) Details of the originator (if different from the issuer);

(iii) Details of the guarantor (for all guaranteed issues):
•   Background and history;

•   Principal activities;

•   Business strategy;

•   Organisational structure;

•   Corporate governance practices;

•   Board of Directors

•   Board of Directors practices;

•   Senior management team;

•   Employees;

•   Compensation;

•   External auditor;

•   Legal advisor and other advisors;

•   Major shareholders and transactions;

•   Related party transactions;

•   Interests of experts and counsel;

•   Material contracts;

•   Business overview;

•   Key financial information;

•   Operating and financial review and prospects;

•   Significant assets and liabilities;

•   Property, plant and equipment;

•   Research and development, patents and licenses;

•   Liquidity and capital resources;

•   Consolidated financial statements;

•   Material changes to financial statements;

•   Restatement of financial statements;

•   Ratios and analysis;

•   Projections of financial statements; and

•   Subsidiary's separate financial statements;

(k) Industry analysis which may include:
(i) Economic overview;

(ii) Sectoral performance and overview; and

(iii) Sub-sectoral performance and overview;

(l) Investment considerations, which may include:
(i) Limited recourse;

(ii) The debt securities;

(iii) No prior market for the debt securities;

(iv) Market value of the debt securities;

(v) Fluctuation of interest rates;

(vi) Inflation risks;

(vii) Partial early redemption of the debt securities;

(viii) Legal investment considerations;

(ix) Investment in the debt securities may not be suitable for all investors;

(x) The underlying assets;

(xi) Timeliness of collections;

(xii) Conditions of the sector/sub-sector/market;

(xiii) Obligor's obligations;

(xiv) No perfection of the issuer's interests in the underlying assets;

(xv) No assurance on conformity with eligibility criteria;

(xvi) Reliance on the servicer;

(xvii) Rescheduling of payment obligations;

(xviii) Replacement of servicer and transaction administrator;

(xix) The issuer;

(xx) Bankruptcy risk;

(xxi) Dependence on key personnel;

(xxii) No recourse to shareholder;

(xxiii) No operational history;

(xxiv) Limitation on enforcement of security and foreclosure;

(xxv) Tax risks;

(xxvi) Absence of independent valuation of the underlying assets;

(xxvii) General risk associated with emerging markets; and

(xxviii) Political, economic and social consideration relating to home market;

(m) Risk factors, which may include:
(i) Credit risk;

(ii) Legal risk;

(iii) Interest rate risk;

(iv) Operational risk;

(v) Currency risk;

(vi) Liquidity risk;

(vii) Maturity risk;

(viii) Other risks;

(n) Disputes, litigations and court orders;

(o) Subscription terms and conditions, which may include:
(i) Type and nominal amount of debt securities;

(ii) Ranking of debt securities;

(iii) Issue price;

(iv) Interest/coupon/profit rate/ income;

(v) Minimum subscription required of the debt securities in order to satisfy the objectives of the issue, offer or invitation (to include procedures for refund if this requirement is not met);

(vi) Tenor (nature) of the debt securities;

(vii) Form and denomination of debt securities on issuance;

(viii) Underwriting arrangements;

(ix) Events of default;

(x) Details of any security for the debt securities;

(xi) Rating assigned to debt securities (together with a description of the rating);

(xii) Type of listing that is sought;

(xiii) Summary of rights conferred upon the holders of debt securities;

(xiv) Governing law — any special legislation under which the debt securities have been created and the choice of jurisdiction in the event of litigation;

(xv) Repayment terms and frequency of interest/profit/income payments;

(xvi) Shari'a principle and concept adopted (for Islamic debt securities);

(xvii) Types of underlying assets of the transaction;

(xviii) Details of any sinking fund requirement; and

(xix) Regulatory approvals required including dates of approval;

(p) Announcements and acknowledgements;

(q) Additional information, which may include:
(i) Share capital structure;

(ii) Memorandum and Articles of Association;

(r) Applicable law;

(s) Documents available for inspection; and

(t) Appendices.

January 2014

Location:

OFS-5.3 OFS-5.3 Additional and Specific Content for Debt Securities

OFS-5.3.1

Front Cover Page

OFS-5.3.2

Inside Cover Page

OFS-5.3.3

OFS-5.3.4

OFS-5.3.5

OFS-5.3.6

OFS-5.3.7