Whereas Article (117) of the Securities Law No. (76) of 2002 requires shares issuers to submit the shareholders’ registers issued by them and any data related to those registers and the shares owners to the SDC, in accordance with the instructions issued by the SDC.
 

Whereas, the SDC has been provided with copies of the shareholders’ registers of all public shareholding companies since February 5, 2002 in accordance with specific technical specifications and the registers were subjected to the inspection and cleansing process by the SDC. The registers were also daily updated in accordance with trades executed at the Amman Stock Exchange (ASE) and transfers exempted from trading; in addition to ownership restrictions including liens and pledges upon notification of the issuers and upon their responsibility.
 

And after the issuance of the Instructions of Registration, Deposit and Settlement of Securities For the Year 2004 which outlined all the provisions related to registering, depositing shares and transferring their ownership; in addition to a special chapter on ownership restrictions on shares. All these constitute the preliminary measures for transferring shareholders’ registers and depositing them at the SDC.
 

And in accordance with the decisions of the Jordan Securities Commissions’ Board of Commissioners and SDC’s board of directors, the shareholders’ registers will be officially transferred and deposited at the SDC as of the beginning of next year and in two stages:

Stage One:

By November 18, 2004, public shareholding companies will be provided with a copy of their shareholders’ registers on a CD as of November 11, 2004 containing the authenticated and non-authenticated shareholders’ register according to the following details:

Sequence No.

SDC No.

Shareholder No

Shareholder Name.

Shareholder Nationality

Ownership details, including the whole balance, number of shares subject to lien and pledge (if available) and the free balance.

Sequence No.

Shareholder No.

Shareholder Name

Shareholder Nationality

Ownership details, including the whole balance, number of shares subject to lien and pledge (if available) and the free balance.

By January 6, 2005, public shareholding companies will be provided with the final CD of their shareholders’ registers as of December 31, 2004 containing the deposited and non-deposited shareholders registers, in addition to a printed hard copy of the deposited register. It is worth noting that joint ownership of margin accounts will be transferred to the name of the concerned client independently.

Consequently, and since the SDC will deposit shares starting the beginning of 2005:

The certificates of the ownership of shares shall be deemed cancelled upon the depositing of shares at the SDC.

The records and registers of shares deposited at the SDC will substitute the records and registers of the shares’ issuers and the entry records and the accounts maintained by the SDC, whether manually or electronically, constitute legal evidence of ownership of deposited shares.

The ownership of shares deposited at the SDC and the transfer of ownership will be authenticated in the concerned accounts as records in the SDC’s database.

The SDC will no longer issue statements of transfer deeds for shares deposited at the SDC.

No sale, transfer of ownership or pledge will be allowed for shares that have not fulfilled their depositing process with the exception of the transfers stated in Article (19/C) in the Instructions of Registration, Deposit and Settlement of Securities For the Year 2004.

The SDC will place ownership restrictions on shares deposited in its registers upon their deposit.

Shares deposited at the SDC can only be pledged and the pledge shall not be effective unless registered and authenticated in the registers of the owners of deposited shares at the SDC.

The SDC places ownership restrictions on deposited shares after their deposit according to the documents presented to the SDC and in accordance with the measures specified in the Instructions of Registration, Deposit and Settlement of Securities For the Year 2004.

Notify the SDC in writing of any ownership restrictions upon depositing shares.

Ownership restrictions referred to in paragraph (1) above shall remain imposed in the SDC registers until the company requests their release in writing.

Companies will be responsible for placing and releasing ownership restrictions stated in (1,2) above.

The relationship shall be directly between the pledgor, pledgee or the entity that imposed the lien and the company in relation to the release of ownership restrictions referred to in (1) above.

The company remains responsible for placing ownership restrictions in its registers by virtue of decisions issued by courts, execution departments and official authorized entities in relation to non-deposited shares until they are deposited.

Companies may not place pledges on non-deposited shares if any part of the shares is deposited at the SDC.

Companies will remain responsible for placing and releasing liens on non-deposited shares.

Companies will remain responsible for liens on shares before their deposit at the SDC.

Companies shall keep all documents supporting ownership restrictions that occurred before depositing the shares at the SDC.

Companies shall maintain the addresses of all deposited and non-deposited shareholders for the purpose of future correspondences, such as invitations to the general assembly meetings, distribution of cash dividends and balance statements.

Companies shall complete the procedures for depositing the non-deposited part of the shares and provide the SDC with the necessary information and data to complete its deposit.

Transfer of shareholders’ registers to the SDC requires the application of Article (5/D) of the Internal By-Law of the SDC’s Proceeds for the Year 2004. The SDC will collect the annual membership fee of (0.0005) five per ten thousand of the subscribed capital with a minimum of (1250) one thousand two hundred and fifty Dinars and a maximum of (10000) ten thousand Dinars.
 

All public shareholding companies were requested to adjust their conditions according to Article (150) of the Instructions of Registration, Deposit and Settlement of Securities For the Year 2004 and sign the acknowledgment form regarding the public shareholding companies’ commitment to abide by the SDC’s By-Laws and Instructions as stated in Article (82/H) of the Securities Law for the year 2002, where only an authorized person may sign on behalf of the company. The acknowledgement should be stamped and returned to the SDC by December 22, 2004.
 

In the end, we would like to emphasize the importance of accuracy when checking the contents of the CDs which will be provided to you in the next two stages. Public shareholding companies will be fully responsible for any incompleteness, inaccuracy or incorrectness of the information and data of each deposited shareholder or any error that occurred before depositing the shares that affects any shareholder balance of deposited shares. The company will also be responsible for any information that was not provided to the SDC regarding ownership restrictions on deposited shares. The contents of the shareholders’ registers in stage two will be considered final and obligatory to public shareholding companies.
 

The SDC has performed further developments to the “Issuers System” by adding reports that enable public shareholding companies to view the deposited part of their shareholders’ register and view ownership restrictions electronically. Public shareholding companies who access this system may also refer to the SDC’s website on the intranet http://10.5.1.100 as of November 12, 2004 to download the latest updates.
 

Thank you for your cooperation for the benefit of the Jordan capital market.

Samir Jaradat

Chief Executive Officer