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Policy & Procedures Related to Disclosure & Transparency

Introduction

Disclosure and transparency are considered the most important Corporate Governance principles in Bupa Arabia for Cooperative Insurance Company ("Bupa Arabia Company" or the "Company"), and are aimed at enabling shareholders to transparently and fairly access information. For this purpose and to follow up the regulations of the Capital Market Authority, Article (8) of Corporate Governance Regulations, Bupa Arabia 's Board of Directors issued these regulations indicating the policies, procedures and supervisory codes of disclosure according to the Capital Market's rules and requirements.

Objectives

  • Achieving the principle of fairness and equality for all shareholders.
  • Publishing the essential information for shareholders at their fixed times and declared upon their occurrence.
  • Compliance with the policy of non-conflict of interests.
  • Following the rules and regulations of the Capital Market Authority (the Listing Rules and the Corporate Governance Regulations) related to disclosure and transparency.

Disclosure Definition

It is the process of disclosing and revealing (financial and non-financial) information of concern for the investors, performed on a periodical basis (specific financial periods) or on an immediate basis when the information occurs so that the information shall be available at the same time for all and no party shall make use of the information before other parties.

Disclosure Approach

  • Periodical Disclosure: Includes the annual financial statements and quarterly financial statements (quarterly and biannual).
  • Disclosure of essential matters and important events.

Transparency Definition

Transparency is defined as the complete disclosure of the real financial image of the Company. Transparency requires that financials statements or essential events declared shall clearly and explicitly reflect the Company's real position.

Major Developments Disclosure Obligation

A) Bupa Arabia Company shall notify the Authority and the public without delay of any major developments within the scope of its activity which are not public knowledge and which may have a material effect on Bupa Arabia Company's assets and liabilities or financial position or on the general course of its business and which may:
  • lead to substantial movements in the price of the listed securities; or
  • in case the Company has debt instruments listed, lead to substantial movement in the price of its listed securities, or significantly affect its ability to meet its commitments.

B) Major developments referred to in paragraph (A) of this Article which Bupa Arabia Company shall disclose include, but are not limited to, the following:
  • The purchase of a long term asset, at a price equal to or greater than 10% of the existing net assets of Bupa Arabia Company. Long term assets shall include assets the depreciation value of which exceeds one financial year and other assets not expected to be converted into cash within one year.
  • Any debt outside the ordinary course of business, in an amount equal to or greater than 10% of the book value of Bupa Arabia Company's net assets.
  • Any losses equal to or greater than 10% of the book value of Bupa Arabia Company's net assets.
  • Any significant change in Bupa Arabia Company's production environment or trade, including but not limited to the availability of resources and the possibility of obtaining them.
  • Any changes in the composition of the directors or senior management of Bupa Arabia Company.
  • Any significant legal proceedings (where the amount involved is equal to or greater than 5% of the book value of the existing net assets of Bupa Arabia Company).
  • The increase or decrease in the net assets of Bupa Arabia Company equal to or greater than 10%.
  • The increase or decrease in the gross sales of Bupa Arabia Company equal to or greater than 10%.
  • Any transaction between Bupa Arabia Company and a related person (outside the ordinary course of business of Bupa Arabia Company).
  • Recommendation of the Company's Board of Directors to increase the Company's capital through offering shares of priority rights.
  • Recommendation of the Company's Board of Directors to increase the Company's capital through granting shares.
  • Recommendation of the Company's Board of Directors for any reduction of Company's capital.
  • The Company signing a memorandum of understanding with non-listed company/companies for acquiring the shares thereof.
  • The Company signing an agreement for acquiring shares of non-listed company/companies through issuing shares for the owners of non-listed company/companies.
  • Acquisition of listed companies.
  • Any resolution of declaring profits, recommending the declaration thereof, paying shares thereof or making other distributions over the holders of listed securities.
  • Any resolution for not declaring profits, recommending non-declaration thereof or non-payment of shares thereof, expected to be declared, recommended to be declared or paid within the normal course of events.
  • Any resolution for calling, repurchasing, withdrawing, redeeming or offering the purchase of securities thereof and the total amount for the same.
  • Any change in the rights related to any of the classes of listed securities or securities forming listed securities convertible thereto.
  • Submitting offer liquidation, issuance of liquidation order, appointing a liquidator for the Company, its mother company or any of the affiliate companies thereto under the Companies Law, or starting any procedures under codes of bankruptcy.
  • Issuance of a resolution by the Company, parent company, or any affiliate for the winding up, liquidation thereof, occurrence of an event or end of a period of time necessitating that the Company shall be put under liquidation or winding up.
  • Issuance of a verdict, resolution, notice or order by a court or judicial authority in jurisdiction, whether in the primary or appellate stage, which can negatively affect the Company's utilisation of any part of its assets having a total value exceeding 5 % of the book value of the Company's net assets.
  • Notifying the Authority if the Company knows of the decrease of its listed shares percentage traded by the public or of the decrease in the required number of shareholders under rules of registration and listing to less than the limit provided for.

Major Developments Disclosure Procedures

The notification referred to in paragraph (A) of this Article shall be made at least two hours before the first trading period in the exchange following the occurrence of the developments.

Disclosure of Financial Information

  • The interim and annual financial statements of Bupa Arabia Company shall be approved by the Board of Directors and signed by a director authorised by the Board of Directors, by the CEO and the CFO prior to their issuance and distribution over shareholders and third parties.
  • The interim and annual financial statements and the Board of Director's report shall be submitted to the Authority immediately upon approval thereof by the Board of Directors.
  • The Company shall announce, through the electronic applications specified by the Authority, its interim and annual financial statements immediately upon approval by the Board of Directors and such statements shall not be published to the shareholders or third parties prior to their announcement in the market.
  • Bupa Arabia Company shall provide the Authority with and announce to the shareholders its interim financial statements (which shall be prepared and reviewed in accordance with the accounting standards issued by Saudi Organization for Certificate Public Accountants (SOCPA)) as soon as they have been approved and within a period not exceeding 15 working days after the end of the financial period included by such financial statements.
  • The Company shall provide the Authority and announce to the shareholders its annual accounts (which shall be prepared and audited in accordance with the accounting standards issued by Saudi Organization for Certificate Public Accountants (SOCPA)) as soon as they have been approved and within a period not exceeding 40 working days after the end of the annual financial period included by such financial statements. The Issuer shall provide the Authority and announce to the shareholders these annual financial statements not less than 25 days before the date of the Issuer's annual general meeting (AGM).

Disclosure Procedures of Financial Information (Interim Financial Statements)

First: The Company shall send a draft of its interim financial statements and the form of announcement prepared about such results to the Saudi Arabian Monetary Agency at least three working days prior to the date of publishing, provided that the same shall not be published except after obtaining the approval of the Agency for the form of the announcement prepared and for the interim financial statements.

Second: After obtaining the written non-objection of the Agency for the form of announcement prepared and for the interim financial statements, the financial results shall be published on the website of the Capital Market Authority (Tadawul) at least two hours prior to the first trading term in the market following the approval of the Agency.

Third: The interim financial statements approved by the external auditor, Board Chairman, Managing Director and Chief Financial Officer shall be sent to the Capital Market Authority, Department of Continuous Disclosure. The Disclosure Form No. (2) shall be attached therewith signed by the Board Chairman and the Managing Director, and sealed by the Company's seal.

Fourth: The financial statements (statement of financial position, income statement, and statement of cash flows) shall be downloaded using the electronic application software on Tadawul website. The same shall be done on a date not exceeding the second day as of the date of announcement.

Fifth: The announcement and the interim financial statements shall be published over the official website of Bupa Arabia Company.

Sixth: The Company shall send an official letter having the interim approved financial statements attached therewith to the Saudi Arabian Monetary Agency and to the Capital Market Authority via overnight courier.

Disclosure Procedures of Financial Statements (annual) and Board Report

First: The Company shall send a draft of the annual Board Report, its annual financial statements and the form of announcement prepared about such results to the Saudi Arabian Monetary Agency at least five working days prior to the date of publishing, provided that the same shall not be published except after obtaining the approval of the Agency for the form of the announcement prepared and for the interim financial statements.

Second: After obtaining the written non-objection of the Agency for the form of announcement prepared and for the interim financial statements, financial results shall be published on the website of Capital Market Authority (Tadawul) at least two hours prior to the first trading term in the market, following the approval of the Agency.

Third: The Board Report and the audited financial statements approved by the Auditor, Board Chairman, Managing Director and Chief Financial Officer shall be sent to the Department of Continuous Disclosure a the Capital Market Authority. The Disclosure Form No. (2), Disclosure Form No. (8), related to compliance with the Corporate Governance Regulations, shall be attached therewith and signed by the Board Chairman and the CEO, and sealed by the Company's seal.

Fourth: The financial statements (statement of financial position, income statement, and statement of cash flows) shall be downloaded using the electronic application software on the Tadawul website. The same shall be done on a date not exceeding the second day after the date of announcement.

Fifth: The announcement, annual financial statements and Board Report shall be published over the official website of Bupa Arabia Company.

Sixth: The Company shall send an official letter having the interim approved financial statements attached therewith to the Saudi Arabian Monetary Agency and to the Capital Market Authority via overnight courier.

Board of Directors' Annual Report

Bupa Arabia Company must include with its annual financial statements a report issued by the Board of Directors, including a review of the operations thereof during the last fiscal year and of all relevant factors affecting Bupa Arabia Company's business which an investor requires to assess the assets, liabilities and financial position of the Bupa Arabia Company. The Board of Directors' report must contain the following:

1- Description of the principal activities of the company and its group. If two or more activities are described, a statement must be included giving for each activity the turnover and contribution to trading results attributable to it;

2- A description of Bupa Arabia Company's significant plans and decisions (including any corporate restructuring, business expansion or discontinuance of operations), the future prospects of the company's business and any risks facing it;

3- A summary, in the form of a table or a chart, of the assets and liabilities of Bupa Arabia Company and of Bupa Arabia Company's business results for the last five fiscal years or as of incorporation, whichever is shorter;

4- A geographical analysis of Bupa Arabia Company's consolidated turnover and of the consolidated turnover of its subsidiaries outside the Kingdom;

5- An explanation for any material differences between the operating results of the last year and the operating results of the previous year or any announced forecast made by Bupa Arabia Company;

6- An explanation for any departure from the accounting standards issued by SOCPA;

7- The name of every subsidiary, its main business, its principal country of operation and its country of incorporation;

8- The particulars of the issued shares and debt instruments of every subsidiary;

9- A description of Bupa Arabia Company's dividend policy;

10- A description of any interest in a class of voting shares held by persons (other than the Company's directors, senior executives and their spouses and minor children) that have notified Bupa Arabia Company of their holdings, together with any change to such interests during the last fiscal year;

11- A description of any interest, options, and subscription rights of Bupa Arabia Company's directors, senior executives and their spouses and minor children in the shares or debt instruments of the issuer or any of its subsidiaries, together with any change to such interest and rights during the last fiscal year;

12- Information relating to any borrowings of the issuer (whether repayable on demand or otherwise), and a statement of the aggregate indebtedness of the Company and its group, together with any amounts paid by the company as a repayment of loans during the year. In case there are no loans outstanding for the Company, it shall provide an appropriate statement;

13- A description of the classes and numbers of any convertible debt instruments, options, warrants or similar rights issued or granted by the Company during the fiscal year, together with the consideration received by Bupa Arabia Company;

14- A description of any conversion or subscription rights under any convertible debt instruments, options, warrants or similar rights issued or granted by Bupa Arabia Company;

15- A description of any redemption or purchase or cancellation by the Company of any redeemable debt instruments and the amount of such securities outstanding, distinguishing between those listed securities purchased by Bupa Arabia Company and those purchased by a subsidiary;

16- The number of meetings of the Board of Directors held during the last fiscal year and the attendance record of each meeting;

17- Information relating to any contract to which Bupa Arabia Company is party and in which a director of Bupa Arabia Company, the Chief Executive Officer, the Chief Financial Officer or any associate is or was materially interested, or if there are no such contracts, the Company must submit an appropriate statement;

18- A description of any arrangements or agreement under which a director or a senior executive of Bupa Arabia Company has waived any emolument or compensation;

19- A description of any arrangements or agreement under which a shareholder of Bupa Arabia Company has waived any rights to dividends;

20- A statement of the amount of any outstanding statutory payment on account of any zakat, taxes, duties or other charges with a brief description and the reasons therefore;

21- A statement as to the value of any investments made or any other reserves set up for the benefit of the employees of Bupa Arabia Company;

22- Statements that:
  • proper books of account have been maintained;
  • the system of internal control is sound in design and has been effectively implemented;
  • there are no significant doubts concerning the issuer's ability to continue as a going concern;
If any of the statements above cannot be made, the report shall contain a statement clarifying the reasons why;

23- If the external auditors' report on the relevant annual accounts is qualified, and the Authority requires additional information, the directors' report shall include such information as has been provided to the Authority.

24- If the Board of directors recommends that the external auditors shall be changed before the elapse of three consecutive fiscal years, the report shall contain a statement to that effect and the reasons for such recommendation.

Notice and Procedures related to Title of Bupa Arabia Company's Shares

Buying, selling or disposing of the shares of Bupa Arabia Company by one of the Board members or senior executives is always subject to the periods of prohibition, provided for in Article (33) of the Rules of Registration and Listing, which states the following:

The Company's Board members, senior executives or any related person may not transact in any of the Issuer's securities during the following periods:
  • A period of ten working days prior to the end of the financial quarter and till the date of announcement and publishing of the Company's interim results.
  • A period of twenty working days prior to the end of the fiscal year and till the preliminary announcement of annual results of the Company or the final announcement of the annual results of the Company, whichever is shorter.

In application of the provisions of Article (30) of the Rules of Registration and Listing, issued by the Saudi Capital Market Authority regarding notice related to the title of Company's shares, provided that the person related to the incident shall notify the Authority and the Company at the end of the trading day on which any of the following events occurred:

A) When the person becomes owner of or interested in 5 % or more of any of the classes of shares, having the right to vote or debt instruments convertible to shares, the following procedures shall be followed:
  • When the person purchases shares of Bupa Arabia Company, becomes owner or interested in 5% or more, Form No. (7/A), shall be completed.
  • After completing Form No. (7/A) and signing it, it shall be sent to the General Administration of Trading Supervision and Control at the Capital Market Authority.
  • After ensuring that the form is sent to the Capital Market Authority, a copy of the form shall be sent to the Department of Shareholders Affairs in Bupa Arabia Company for follow-up and filing.
  • The evidential document proving that the form was sent to the Authority shall be kept

B) When increase or decrease occurs in the title or interest of the person referred to in Paragraph (A) above at 1% or more of the shares of Bupa Arabia Company, the following procedures shall be followed:
  • When a change occurs in the title of the person in the shares of Bupa Arabia Company (increase/ decrease) at 1% or more, Form No. (7/B), shall be completed.
  • After completing Form No. (7/B) and signing it, it shall be sent to the Capital Market Authority, General Administration of Trading Supervision and Control.
  • After ensuring that the form is sent to the Capital Market Authority, a copy of the form shall be sent to the Department of Shareholders Affairs in Bupa Arabia Company for follow-up and filing.
  • The evidential document proving that the form was sent to the Authority shall be kept.
  • When a change occurs in the objective of title, Form No. (7/b), shall be completed, and then shall be sent to the Capital Market Authority, General Administration of Trading Supervision and Control and to the Department of Shareholders Affairs in Bupa Arabia Company for follow-up and filing

C) When a Board member or senior executive (or any of its affiliates) in Bupa Arabia Company becomes owner of or interested in the Company's shares, he/she shall follow the following procedures:

First: In the case of purchasing for the first time and not having previously acquired shares in Bupa Arabia Company:
  • He/she shall not sell, purchase or dispose of the shares during the prohibition periods of transactions of Board members and senior executives (or any affiliate thereof) as aforementioned.
  • After ensuring that the prohibition period for the transactions of Board members and senior executives (or any affiliate thereof) came to an end, he/she shall purchase at the end of the trading during which title or interest is achieved and complete Form No. (7/A) along with ensuring the following information has been furnished:
  • Name of person, Civil ID number and capacity of the related person;
  • Name of the Company, number of shares/ debt instruments owned thereby or having interest therein, and the percentage of each thereof.
  • The total percentage of shares/debt instruments owned thereby or having interest therein, and the date of owning this percentage.
  • When calculating the total number of shares the person has interest therein, the person shall be considered a stakeholder in any share owned or controlled by any of the persons stated below:
    1- The person's spouse or their minor children;
    2- A company controlled by such person (by owning 30% or more, or when the company or its board of directors are acting according to the instructions of such person).
    3- Any other persons such person agreed therewith to obtain an interest in the Company's shares.
  • State purpose of acquisition (short-term or long-term).
  • Indicate source of financing, whether it is financing from another person (name of person), loan or another source.
  • Provide details and signature of related person and date of notice.
  • After completing and signing Form No. (7/A), it must be sent to the General Administration of Trading Supervision and Control at the Capital Market Authority.
  • When ensuring that the form is sent to the Capital Market Authority, a copy of the form shall be sent to the Department of Shareholders Affairs in Bupa Arabia Company for follow-up and filing.
  • The evidential document proving that the form was sent to the Authority shall be kept.

Second: Change of Shares Title (Increase/ Decrease)
  • He/she shall not sell, purchase or dispose of shares during the prohibition periods of the transactions of Board members and senior executives (or any affiliate thereof) as aforementioned.
  • After ensuring that the prohibition period for the transactions of Board members and senior executives (or any affiliate thereof) came to an end, the process shall be carried out in increase (purchase) or decrease (sale). At the end of the trading day on which change of title or interest is achieved, the person should complete Form No. (7/B) and furnish the following information:
  • Name of person, Civil ID number and capacity of the related person.
  • Name of the company.
  • The number of shares/ debt instrument having an interest therein, their percentage before and after change and date of change.
  • Total percentage of acquisition or interest after change.
  • When calculating the total number of shares the person has interest therein, the person shall be considered a stakeholder in any share owned or controlled by any of the persons stated below:
    1. The person's spouse or their minor children.
    2. A company controlled by such person (by owning 30 % or more, or when the company or its Board of Directors is acting according to the instructions of such person).
    3. Any other persons such person agreed therewith to obtain an interest in the Company's shares.
  • Indication of whether the change forms more than 50% of what was previously owned by the related person.
  • Details and signature of related person and date of notice.
  • After completing Form No. (7/B) and signing it, it shall be sent to the Capital Market Authority, General Administration of Trading Supervision and Control.
  • When ensuring that the form was sent to the Capital Market Authority, a copy of the form shall be sent to the Department of Shareholders Affairs in Bupa Arabia Company for follow-up and filing. • The evidential document proving that the form was sent to the Authority shall be kept.
    D) When a Board member or one of the senior executives ( or any affiliate thereof) in Bupa Arabia Company becomes owner or interested in the Company's shares at 10% or more and is willing to sell or dispose of the same in any part thereof, he/she shall obtain prior written approval from the Capital Market Authority before the process of sale or purchase through following the following procedures:
  • He/she shall not make any sales, purchases or disposals during the prohibition period of Board members and senior executives' transactions (or any affiliate thereto) mentioned above.
  • After that, Form No. (7/C) shall be completed and signed, dates of sale or disposition shall be determined, and then shall be sent to the Capital Market Authority, General Administration of Trading Supervision and Control, along with ensuring that the following details are completed:
  • Name of person, Civil ID number and capacity of the related person.
  • Name of the company.
  • The number of shares/ debt instrument having an interest therein, and their percentage before change.
  • The number of shares/ debt instrument having an interest therein, their percentage he/she is willing to sell/ mortgage/convert.
  • The period during which he/she is willing to sell or dispose of shares.
  • When calculating the total number of shares the person has interest therein, the person shall be considered a stakeholder in any share owned or controlled by any of the persons stated below:
    4. The person's spouse or their minor children;
    5. A company controlled by such person (by owning 30 % or more, or when the company or its Board of Directors are acting according to the instructions of such person).
    6. Any other persons such person agreed therewith to obtain an interest in the Company's shares.
  • When ensuring that the form was sent to the Capital Market Authority, a copy of the form shall be sent to the Department of Shareholders Affairs in Bupa Arabia Company for follow-up and filing and the reply shall be awaited from the Capital Market Authority.
  • The evidential document proving that the form was sent to the Authority shall be kept.
  • After receiving the approval from the Capital Market Authority for sale or disposition, the sale period shall be complied with as determined in Form No. (7/C) approved by the Authority. If sale or disposition is not effected within the period previously determined in Form No. (7/C), sale or disposition shall be discontinued and again the approval of Capital Market Authority shall be obtained.

Third: Change of Title Objective

When a change occurs in the title objective of shares of Bupa Arabia Company previously disclosed, Form No. (7/B), shall be completed, along with ensuring the following information:
  • Name of person, Civil ID number and capacity of the related person.
  • Name of the company.
  • Any change occurring in the objective of title (from long term to short term, or short term to long term).
  • Details and signature of related person and date of notice.
  • After completing Form No. (7/ B) and signing it, it shall be sent to the General Administration of Trading Supervision and Control of the Capital Market Authority.
  • When ensuring that the form was sent to the Capital Market Authority, a copy of the form shall be sent to the Department of Shareholders Affairs in Bupa Arabia Company for follow-up and filing.
  • The evidential document proving that the form was sent to the Authority shall be kept.

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