Terms of Business Agreement
Dated
Sahm Capital Financial Company
(Sahm Capital)
And
Client
(The Client)
Contents
1 Definitions and interpretation
2 Commencement
3 Other agreements
4 Investment objectives of the client
5 Classification
6 Restrictions
7 Services
8 Advisory Services
9 Custody Services
10 Payments for services
11 Mode of payment
12 Instructions
13 Standing Authority
14 Statements, contract notes and reports
15 Accounting
16 Understanding Risk and Suitability
17 Security lending
18 Acting as a principal
19 Termination
20 Complaints
21 Right to realise client's assets
22 Contingent liability securities
23 Margin lending
24 Authority to borrow
25 Special Commission Arrangements
26 Custody
27 Pooling
28 Client assets held overseas
29 Client money
30 Cash transfers
31 Enforcement of the provisions of this Agreement against the client's heirs and his public and private successors
32 Sharia requirements
33 Electronic service
34 Electronic signature & the formats & contracts sent via electronic means
35 Suspension and deactivation of investment account
36 Confidentiality
37 Conflict of interest and fiduciary duties
38 Foreign Account Tax Compliance Act (FATCA)
39 Sahm Capital – Limitation of liability
40 Indemnification
41 Legal binding
42 Transfer of investments
43 Client undertakings
44 Severability
45 The language of the Agreement
46 Governing law and Jurisdiction
This Terms of Business Agreement (hereinafter referred to as the Agreement) is entered into by and
Between
(1)Sahm Capital Financial Company, a joint stock company with commercial registration number 1010774084, authorised by the Saudi Capital Market Authority to conduct securities business in the Kingdom of Saudi Arabia subject to CMA’s supervision and control, pursuant to its license no. 22251-25 issued by the CMA dated 23/03/1444 AH corresponding to 19/10/2022G, and having its registered office at Riyadh, Kingdom of Saudi Arabia (hereinafter referred to as Sahm Capital or we); and
(2)The party whose full name is indicated below or set out in the 'Know Your Client Form' submitted to Sahm Capital by such party (hereinafter referred to as the Client or you).
Sahm Capital and the Client hereinafter are collectively referred to as the Parties and individually as a Party.
The parties hereby agree as follows:
1Definitions and interpretation
1.1Definitions
Unless the context or meaning thereof otherwise requires, the following expressions shall have the meaning assigned to them hereunder respectively:
Applicable Laws means collectively the following:
(a)CMA Laws and Regulations, as may be amended or restated from time to time;
(b)any circulars and instructions issued by CMA; and
(c)any other applicable laws and regulations, including without limitation any laws, regulations, decrees, ministerial orders, orders and decisions of any competent authority, rules and any other instruments, having the force of law in the Kingdom of Saudi Arabia, as they may be issued and amended from time to time.
CMA means the Capital Market Authority of Saudi Arabia.
Capital Market Law means the capital market law of Saudi Arabia issued by Royal Decree no. M/30 dated 2/6/1424H, as may be amended or restated from time to time.
CMA Laws and Regulations means the Capital Market Law and its implementing regulations issued by the CMA for the implementation of the Capital Market Law, particularly the Securities Business Regulations issued by the Board of the CMA by virtue of Resolution No. 2-83-2005 dated 21/05/1426H corresponding to 28/06/2005G based on the Capital Market Law and the Capital Market Institutions Regulations issued by the Board of the CMA by virtue of Resolution No. 1-83-2005 dated 21/05/1426H corresponding to 28/06/2005G based on the Capital Market Law, as amended by Resolution of the Board of the CMA No. 2-75-2020 dated 22/12/1441H corresponding to 12/8/2020G, and as may be amended or restated from time to time.
Confidential Information means any information (whether or not marked confidential) obtained by Sahm Capital from the Client in connection with the provision of Services in whatever medium and all reports or analyses of such information or based on or derived therefrom but shall exclude:
(a)information which at the time of acquisition is or subsequently becomes readily available from publicly available sources; and
(b)information which can be demonstrated to have been lawfully in the possession of Sahm Capital prior to its acquiring it in consequence of this Agreement.
Investment Account(s) means one (1) or more accounts opened and maintained by Sahm Capital for trading of securities for the benefit of the Client from time to time pursuant to this Agreement.
Other Agreements has the meaning given to in in Clause 3 of this Agreement.
Securities means shares, debt instrument, warrants, certificates, units, options, futures, contracts for differences, long term insurance contracts; and any right to or interest in any of the aforesaid securities.
Services has the meaning given to in in Clause 7 of this Agreement.
Terms of Business means terms of business of Sahm Capital specified in this Agreement, setting out the basis on which the securities business is to be carried out with or for the Client, subject to CMA Laws and Regulations.
Sahm Capital Platform has the meaning given to it in Clause 9 of this Agreement.
1.2Interpretation
In this Agreement, except where the context otherwise requires:
(a)headings and the contents page are for ease of reference only and do not affect the interpretation of any of its provisions;
(b)a reference to a person includes a reference to individuals, firms, bodies corporate, unincorporated associations, partnerships or to individuals, executors or administrators，and that person’s legal personal representatives, successors and permitted assigns;
(c)words in the singular shall include the plural and vice versa;
(d)reference to one gender shall include all other genders;
(e)any act, regulation or other statutory provision shall be construed as referring also to any amendment or re-enactment thereof (whether before or after the signing date of this Agreement) and to any subordinate legislation made there under;
(f)if any condition, undertaking or covenant contained in this Agreement requires a Party to it not to do an act or tiring it shall be a breach of any such condition, undertaking or covenant to permit or suffer such act or thing to be done;
(g)references to the word include or including (or any similar term) arc not to be construed as implying any limitation and general words introduced by the word other (or any similar term) shall not be given a restrictive meaning by reason of the fact that they are preceded or followed by words indicating a particular class of acts, matters or things;
(h)any reference to this Agreement includes the schedules, the appendices and any exhibits to this Agreement, each of which forms part of the Agreement and has the same force and effect as if expressly set out in the body of this Agreement;
(i)references to this Agreement include this Agreement as amended or supplemented in accordance with its terms;
(j)references to clauses, sub-clauses, paragraphs, schedules or appendices arc references respectively to the clauses, sub-clauses, paragraphs, schedules or appendices of this Agreement; and
(k)if a period of time is specified as from a given day, or from the day of an act or event, it shall be calculated exclusive of that day.
2Commencement
2.1This Agreement and the Terms of Business, shall be effective as of the date of signing of this Agreement by the Parties. You hereby acknowledge and agree that any of the following acts by you shall be deemed to your acceptance of this Agreement:
(a)Signing of this Agreement; and/or
(b)Acceptance of these Terms of Business by any electronic means as may be approved by Sahm Capital.
2.2Upon your acceptance, these Terms of Business are legally binding and shall govern the Investment Account and all its operations through which Sahm Capital may provide you with the Services, the funds Sahm Capital holds for you and each transaction that is entered into between you and Sahm Capital.
2.3Sahm Capital may amend all or part of the Terms of Business, including, for the avoidance of doubt, any Other Agreements, from time to time, as Sahm Capital in its absolute discretion considers necessary. Sahm Capital will post the updated version of the Terms of Business on its website at https://www.sahmcapital.com/. Sahm Capital will aim to notify you of any material changes to the Terms of Business, although it is your responsibility to ensure that you are referring to the current version of the Terms of Business. Continued use of the Investment Account and/or the Services by you, will constitute your acknowledgment and acceptance of the revised Terms of Business. Unless otherwise agreed, no amendment will affect any outstanding orders or transactions or any legal rights or obligations which have already arisen.
2.4For the purposes of accessing or using the Services through the Sahm Capital Platform, the Client shall open an Investment Account and create his own user identification name/number and password. If the Client chooses to open an Investment Account online, the Client hereby acknowledges and agrees that Sahm Capital will use an identity and access management (IAM) solution provided by a third party IAM vendor to securely confirm your identity and may provide personal data relating to the Client as may be necessary for such verification. Where the Client has satisfied all requirements prescribed by Sahm Capital, and under the CMA Laws and Regulations, Sahm Capital may open an Investment Account for the Client. Sahm Capital reserves the right to reject any application to open an Investment Account at its absolute discretion and without providing any reason for such rejection, subject to the Applicable Laws.
3Other agreements
The Client and Sahm Capital may, from time to time, enter into one or more additional agreements for the provision of the Services by Sahm Capital (hereinafter referred to as Other Agreements). Such Other Agreements, once executed, shall be construed as an integral part of this Agreement. In case of a conflict between the Terms of Business and any term of the Other Agreements, the latter shall prevail, subject to Applicable Laws.
4Investment objectives of the client
4.1For purposes of provision of the Services and consideration of the suitability of advice or a transaction for the Client, Sahm Capital has the right to obtain the investment objectives of the Client, which shall be construed on the basis of the information provided by the Client in the “Know Your Client Form” (a copy of which is attached to this Agreement and constitutes an integral part of this Agreement).
4.2The Client has a right to adjust his investment strategy, change investment objectives and/or risk profile, and otherwise impose or remove any investment restrictions. However, any such adjustment will only become effective upon the written acknowledgement of Sahm Capital that it has received the written adjustment notification from the Client. No adjustments will affect any outstanding order or transaction or any legal rights or obligations which may already have arisen. For avoidance of doubt, any reference in this Agreement requiring the provision of a written notification, unless otherwise specified, shall also include written notifications in the form of electronically signed documents transmitted through emails or any other electronic mode of communication, as may be accepted by Sahm Capital.
5Classification
For the purpose of this Agreement, the Client is classified as a 'retail', 'qualified', or an 'institutional' client. If, at any time, the Client consider that it has been incorrectly categorised, the Client must inform Sahm Capital as soon as possible. Please note that additional terms and conditions may be applicable to the relationship with Sahm Capital based on the classification of the Client.
6Restrictions
6.1Off-exchange transactions
Sahm Capital will not deal for the Client in circumstances in which a transaction is not regulated by the rules of any stock exchange or investment exchange, unless specifically requested to do so by the Client in writing. Sahm Capital may, however, deal in units of an investment fund, a collective investment scheme or similar scheme which is not regulated by the rules of any stock exchange or investment exchange.
6.2Non-readily realisable investments
Sahm Capital will not deal for the Client in transactions in non-readily realisable investments unless the Client specifically requests Sahm Capital to do so in writing. Such investments are those in which the market is limited or is likely to become so resulting in such securities being difficult to deal in and it could be difficult to assess a proper market price for the Client.
6.3Use of Client Assets as collateral:
(a)Sahm Capital shall not directly or indirectly use the assets of the Client to secure any debt or obligation owed by Sahm Capital to any third party, save and except where such assets are required to be used as collateral in cases of margin trading carried out by Sahm Capital on behalf of the Client.
(b)The client is aware and agrees that the company may deposit any of his securities collateral in any recognized financial institution as collateral for financial accommodation provided to Sahm Capital.
(c)The client is aware and agrees that the company may deposit any of his securities collateral to any other recognized clearing house or any other registered and licensed intermediary that conducts securities transactions as collateral to discharge and satisfy Sahm Capital’s settlement obligations and liabilities.
6.4Stabilisation
Sahm Capital may not deal for the Client in investments that may have been the subject of stabilisation. Stabilisation is a price supporting process that may take place in the context of new issues. The effect of stabilisation can be to make the market price of the new issue temporarily higher than it would otherwise be if the stabilisation exercise was not conducted. The market price of investments of the same class already in issue, and of other investments whose price affects the price of the new issue, may also be affected. The process of stabilisation is undertaken in order to ensure that the issue of investments is introduced to the market in an orderly fashion and that the issue price and/or the price of associated investment is not artificially depressed because of the increase in supply caused by the new issue. Stabilisation may only take place for a limited period and there are limits on the price at which shares and certificates representing securities may be stabilised, although there are no limits in respect of loan stocks and bonds.
7Services
7.1Sahm Capital will provide the Client the following services (the Services):
(a)Dealing;
(b)Advisory services; and
(c)Custody services (either directly or through the utilisation of third-party custodians).
Each of the above Services have the meaning ascribed to them in Part 2, Article 2 of the Securities Business Regulations issued by the CMA (as may be amended or restated from time to time).
7.2The investments Sahm Capital will deal in are as follows:
(a)Equity shares;
(b)Units in an investment fund;
(c)Options and futures;
(d)Debt Instruments (listed Sukuks and OTC Bonds);
(e)Warrants; and
(f)Any other securities or investment that may be offered by Sahm Capital from time to time.
8Advisory Services
8.1Sahm Capital will provide and distribute research reports that include market commentary of global equity markets, research reports for individual stocks and futures markets, available to all clients but not contain buy/sell recommendations. Such reports shall provide all disclosures, information, and analysis of company fundamentals without the provision of buy/sell recommendations. The research reports and analysis will contain information of the underlying, as well as an analysis based on the information, digital advisory service, for example the electronic investment report that is to be provided to both individual and institutional clients/prospects.
8.2Other than external research reports, reports might be prepared by in-house research team, independent from the business units. The key policies and controls shall be as follows:
(a)the research team will not conduct insider dealing in all circumstances;
(b)mechanisms will be strictly followed so that research analysts trading activities or financial interests do not prejudice their investment research and recommendations;
(c)prohibitions for research analysts from purchasing securities of firms they are covering;
(d)declaration of interests by Sahm Capital and its related entities in the subject of the investment recommendations in the research report will be provided; and
(e)Chinese walls are a designed to restrict the internal flow of sensitive and confidential information from passing between staff or departments.
8.3In addition, Sahm Capital provides its Clients a community forum, in which the Client may act as a community participant to share insights, ask questions and exchange ideas, as well as participate in livestreaming where community participants are able to communicate with industry veterans and gain valuable insights from renowned stock commentators and investment institutions.
9Custody Services
(a) The Company shall act in its capacity as custodian or arrange with a third party to act as such, as per the CMA rules requirements, or if the arranging a third party to perform the tasks of a custodian, is necessary for the purposes of purchasing or keeping the financial securities outside the Kingdom.
(b) Any financial securities, investments and other assets that belong to Client, which can be deposited at the Securities Depository Centre Company in Tadawul, shall be deposited in an account in the name of the Client.
(c) The Company shall accept from the Client, the financial securities he/she wants to deposit in his / her investment account and shall be committed to deliver/send the same to the Depositary Centre at Tadawul for such purpose, unless the Depositary Centre requires them to be deposited through the Client.
Sahm Capital will be offering the following custody services:
9.1Securities trade instructions and settlement
(a)Sahm Capital shall process securities trade instructions received and settlement on a timely basis.
(b)The Client is aware and agrees that all transactions to be executed by the Company on behalf of the Client under this Agreement shall be non- discretionary, i.e., the Client shall make all decisions with respect to buying or selling of Investments, and shall instruct the Company accordingly, and the Company shall not execute any transaction without an Instruction. The Company shall have no advisory capacity when it operates the Account as per the Instructions; and any decision to buy/sell the Investments shall not be based on any recommendation by The Company.
(c)Execution by Sahm Capital of any investment transactions or any Instruction issued by the client does not imply Sahm Capital’s approval or endorsement of such transactions or Instructions.
9.2Corporate Actions
9.2.1Upon the Client's instructions and the requirements of the execution thereof, the Company shall be responsible for the following::
(a)To act as a proxy of the Client in claiming and receiving any cash profits or dividends, and depositing thereof in his/her investment account
(b)To exercise any of the rights of transfer or subscription.
(c)To deal with the acquisition offers, and capital re-structuring activities. To dealing with takeovers, other offers or capital re-organisations.
(d)To exercise voting rights.
(e)To giving and receiving of instructions by or on behalf of the client or other person accredited by the client, and any restrictions to that authority.
9.2.2Sahm Capital shall use a range of services to deal with corporate actions with the Client:
(a)Ascertain and enumerate all corporate events pertinent to the security holdings of the Client
(a)Disseminate notifications to the Client through the trading system of Sahm Capital
(b)Acknowledge and accept instructions through the trading system facilitated by Sahm Capital
(c)Sahm Capital shall judiciously process instructions in a manner deemed reasonable under the circumstances
(d)In cases where the Client has abstained from furnishing directives for an elective corporate event before the stipulated deadline, reminders shall be dispatched
(e)Following the Client's subscription, Sahm Capital will duly dispatch corporate actions instructions accompanied by an acknowledgment
9.3Income
Sahm Capital will identify income and dividend entitlements on the holdings of the Client, in Sahm Capital, and cross validate information received on such events against alternative independent sources where appropriate.
(a)Sahm Capital shall seek to validate corporate actions information received against other data sources such as Bloomberg.
(b)Sahm Capital shall notify the Client via trading system of Sahm Capital, of all income due on holdings with then following details:
(c)Dividend rates;
(d)Eligible date;
(e)Payment date; and
(f)Upon subscription by the Client, Sahm Capital will send corporate actions instructions acknowledgment.
9.4Proxy Voting
Sahm Capital shall assist the Client in proxy voting for complete or partial coverage of voting events.
10Payments for services
10.1The Client acknowledges that the Services provided by Sahm Capital shall be subject to standard fees, commissions or charges, as determined by Sahm Capital from time to time, which are available from Sahm Capital's website, or otherwise available in writing from Sahm Capital upon written request by the Client. The fees and expenses applicable to specific Services may be set out in the Other Agreement or documentation provided to the Client in relation to the Services from time to time. All such amounts would be due and payable by the Client. The Client represents and agrees that such fees, commissions or charges may be subject to change from time to time. Sahm Capital will inform the Client of such change through the means adopted by Sahm Capital, including electronic channels, and such change shall apply to all transactions and dealings from the notified effective date. By continuing to access or use the Services, the Client will be deemed to have accepted the amended fees, commission or charges. In case of objection to such change, the Client must notify Sahm Capital in writing or through electronic channels and asks Sahm Capital to discontinue the provision of the Services. In any case, Sahm Capital may discontinue the Services under this Agreement if the Client objects to such amendment.
10.2Sahm Capital shall be entitled to deduct and withhold from the funds available in the Client Investment Account or any amount payable by Sahm Capital to the Client, all fees, commissions and/or charges (including expenses or applicable taxes) in respect of Services provided by or through Sahm Capital. Sahm Capital shall be entitled to use the funds in the Client aforesaid account(s) outside normal business hours provided that such action will not jeopardise or place the assets of the Client at risk of loss or in any way inhibit or circumscribe the Client from utilising his assets at any time.
10.3In the event, the Client fails to make a payment or deliver any securities due to Sahm Capital (or agents used by Sahm Capital), in addition to any other remedies Sahm Capital may have against the Client, Sahm Capital reserves the right to retain any funds, securities or other assets due to the Client and to offset the liability against the Client.
11Mode of payment
11.1Fees will be debited to the Investment Account of the Client, on the date of execution of this Agreement.
11.2All amounts payable under this Agreement are deemed to be exclusive of value added tax payable in the Kingdom of Saudi Arabia. Sahm Capital shall add the payable amount of value added tax on the fees and amounts to be collected under this Agreement.
12Instructions
12.1The Client acknowledges and agrees that Sahm Capital is entitled to accept and to act upon instructions given by the Client in connection with the Investment Account, from time to time, through its website and/or through its automated phone system and/or other its electronic trading platform (the Sahm Capital Platform). The Client may cancel or amend the instructions in the same manner as they may be given, which, however, shall be subject to timely receipt by Sahm Capital, and shall be limited to the unexecuted portion of any prior instruction. The Client hereby acknowledges and agrees that Sahm Capital may not be able to cancel or amend an order placed by the Client including in circumstances where the cancellation or amend instruction is not received by Sahm Capital in sufficient time prior to the execution of the Client's order. Sahm Capital shall not be liable for any losses in such circumstances where it does not act on a cancellation or amendment instruction given by a Client. The Client shall assume full responsibility for all orders effected.
12.2The Client hereby confirms all instructions in connection with the Investment Account shall be deemed to be treated as fully authorised by the Client. Sahm Capital will be entitled to rely on and execute any instruction given by the Client, subject to the terms of this Agreement and/or Other Agreements. Sahm Capital will not be obliged to confirm the authenticity of such instructions and shall not be liable to the Client in respect of any loss or damage incurred as a result of the execution of such instructions. The Client shall indemnify Sahm Capital against all actions, proceedings, claims or demands which may be brought or made against Sahm Capital and all losses, costs, charges, damages and expenses which may be incurred or sustained by Sahm Capital arising out of or related to such transactions. In no event shall Sahm Capital be responsible for any loss (direct, indirect, consequential or otherwise) incurred as a result of acting or declining to act by Sahm Capital (wholly or in part) on instructions which Sahm Capital believes to have been given by the Client. The fact that any instruction may later be shown to be in any way false, inaccurate, unauthorised or otherwise not authentic shall not be an impediment to the rights of Sahm Capital.
12.3Please note that telephone conversations between the Parties will be recorded and the Client expressly agrees that such recordings may be used in any dispute resolution proceedings, as proof of the contents of such instructions.
12.4At the discretion of Sahm Capital, Sahm Capital may accept "limit order" instructions. Sahm Capital will generally hold such instructions for the day on which the order is placed, however, Sahm Capital stresses that such instructions are accepted on a best endeavours basis and Sahm Capital cannot guarantee that a limit order will be executed. If a limit order is not reached by close of business on the day in question, it will be discarded without further notice. In case of the aforementioned the Client should therefore renew the order on a subsequent day. If such an order is executed, Sahm Capital will endeavour to contact the Client to inform the Client that the limit order has been executed.
12.5For the avoidance of doubt, Sahm Capital hereby states that Sahm Capital will never transact any order unless Sahm Capital has clear funds available to complete the transaction.
12.6At the absolute discretion of Sahm Capital, Sahm Capital may accept instructions from third parties who Sahm Capital believes to be acting on behalf of the Client, and with the authority of the Client in relation to any aspect of Services including the transfer of cash and/or stock, a change of investment objective or risk profile or a change to the investment portfolio. However, in certain circumstances Sahm Capital may, in its sole discretion, require certain documentation before accepting instructions from third parties.
12.7Without prejudice to the above, Sahm Capital will act upon the instructions of the Client, unless the Client is advised that Sahm Capital believes such compliance may not be practicable or might involve either party in a contravention of any applicable law, rule or regulation. Sahm Capital reserves the right to refuse to comply with any instructions if it believes that an instruction or its execution may contravene the Capital Market Law and/or any of its implementing regulations or the laws of any applicable country (including in circumstances where Sahm Capital has reasonable grounds to believe that the Client is engaging in market manipulation or insider trading). If Sahm Capital is unable to comply with such instructions, the Client will be informed of this within a reasonable period. Sahm Capital shall not be liable for any loss arising from any delay while it obtains clarification or confirmation of instructions, or from exercising its right to decline to act in the absence of such clarification or confirmation provided that it shall have acted in a timely manner.
13Standing Authority
13.1Clients understand that you may revoke this Standing Authority by giving written notice to Sahm Capital by your registered email in account opening form. The effective date of the revocation shall be 30 days from the date of Sahm Capital’s receipt of the written notice.
13.2This Standing Authority shall remain effective until the Standing Authority is revoked by Sahm Capital.
13.3This Standing Authority covers money held or received by Sahm Capital in Saudi and overseas (including any interest derived from the holding of the money which does not belong to Sahm Capital) in one or more segregated account(s) on your behalf (“Monies”). Clients hereby authorize Sahm Capital to handle the Monies on your behalf.
13.4Regarding the Monies held in Comprehensive Account in Saudi, Cash or Margin Account in US, Clients hereby further authorize Sahm Capital to
(a)Combine or consolidate any or all segregated accounts, of any nature whatsoever and either individually or entities with others, maintained by Sahm Capital from time to time, and Sahm Capital may transfer any sum of Monies to and between such segregated account(s) to satisfy our obligations or liabilities to Sahm Capital, whether such obligations and liabilities are actual or contingent, primary or collateral, secured or unsecured, joint or several; and
(b)Set-off or transfer any sum of Monies interchangeably between any of the segregated accounts maintained at any time by Sahm Capital towards satisfaction of any of our liabilities to Sahm Capital; and
(c)Exchange our Monies into any other currency(ies) at the rate of exchange conclusively determined by Sahm Capital
(d)Use all or part of the Monies at its discretion without prior notice, confirmation and/or instructions for the purposes of sale and purchase of overseas securities and/or compliance with settlement and/or deposit requirements; and/or
(e)Pay/transfer any sum of Monies to your securities account held with Sahm Capital, the securities account(s) of any overseas financial institution(s) and/or overseas clearing firm(s) and their successors for the purpose of trading or meeting the settlement or margin requirement (if applicable) of your overseas securities transactions;
(f)Transfer the Monies interchangeably between the segregated account(s) opened and maintained by Sahm Capital in Saudi and the segregated account(s) opened and maintained by Sahm Capital with any overseas financial institution(s) and/or overseas clearing firm(s) outside Saudi.
13.5For Comprehensive Account in Saudi or Margin Account in US, Client confirms to authorize Sahm Capital to:
(a)Apply any of your securities or securities collateral pursuant to a securities borrowing and lending agreement
(b)Deposit any of your securities collateral in any recognized financial institution as collateral for financial accommodation provided to Sahm Capital
(c)Deposit any of your securities collateral to Muqassa and Edda to discharge and fulfil your liquidation obligations and liabilities.
(d)Deposit any of your securities collateral to any other recognized clearing house or any other registered and licensed intermediary which conducts securities transactions as a collateral to discharge and satisfy Sahm Capital’s settlement obligations and liabilities;
(e)If Sahm Capital provides financial accommodation to the client during the course of the securities transaction and any other approved or registered regulated activities, Sahm Capital may conduct actions stated in (a), (b), (c) and/or (d) above to transfer or store any of your securities collateral as described in the paragraph.
(f)Client understands that this Standing Authority does not affect Sahm Capital's right to dispose of your securities collateral for the purposes of discharging your legal obligations or liability to Sahm Capital or any other third party.
13.6Client understands that Sahm Capital can take any of the above actions without giving notice to you
13.7Client understands that this Standing Authority is given to Sahm Capital in consideration of Sahm Capital’s agreement in opening and continuous maintaining Securities Comprehensive/Cash/Margin Account for you.
13.8Client acknowledges and confirm that your assets (including the Monies) received or held by Sahm Capital overseas are subject to applicable laws and regulations of the relevant overseas jurisdiction which may be different from the Capital Market Law or CMA Laws and Regulations, and the rules made thereunder. Consequently, such assets may not enjoy the same protection as that conferred on your assets received or held in Saudi.
14Statements, contract notes and reports
All statements, contract notes and reports shall be published and dispatched to the Client electronically at their registered e-mail address. The Client may ask for paper copies of the aforementioned documents or any additional documents which sent by Sahm Capital through any electronic means, and Sahm Capital shall be entitled to reserves its full right to charge a fee for the same in accordance with the rate sheet provided by Sahm Capital. Client statements will provide information about the client's assets held by The Sahm Capital.
15Accounting
15.1Sahm Capital shall make satisfactory arrangements for accounting for any transaction executed on behalf of the Client.
15.2Sahm Capital shall keep proper records to enable entitlements of the Client, to be promptly and accurately determined. Sahm Capital, however, will not be obliged to retain such records for more than ten (10) years from the date of closing of the Investment Account.
16Understanding Risk and Suitability
16.1The Client understands and fully accepts the following risk warnings given in compliance with the CMA Laws and Regulations, as well as a matter of best practice, the following:
(a)The price of securities fluctuates, sometimes dramatically. The price of a security may move up or down and may become valueless. It is as likely that losses will be incurred rather than profit made as a result of buying and selling securities.
(b)Where a security is denominated in a foreign currency other than Saudi Riyals, changes in the currency rates of exchange may have an adverse effect on the value, price or income of the security, which may diminish or increase and as such the Client may not get back the amount invested.
(c)Unregulated collective investment schemes may have infrequent valuation points and may be relatively illiquid.
(d)Higher volatility funds may be subject to sudden and large falls in value and the Client could get nothing back at all.
(e)Except where instructed by the Client, Sahm Capital will only effect transactions in readily realisable investments.
(f)Investments via an Electronic Service (as defined below) provided by Sahm Capital, is prone to risks inherent in this mode of investment including theft of identity, power outage, delays in executing orders arising out of slow connections as well as a host of other risks associated with computer security/technology.
16.2In the case of option trading, the Client acknowledges that he has read and fully understood the risk warnings provided below and agrees to the following:
(a)trading equity options is highly speculative in nature and involves a high degree of risk;
(b)the current Risk Disclosure Clause (as defined below);
(c)to seek clarification of any term, condition or risk contained in either of these documents prior to making such acknowledgment to Sahm Capital;
(d)the Client is financially able to undertake the risks associated with trading equity options and withstand any losses incurred in connection with such trading (including the total loss of premiums paid by the Client for long put and call options, margin requirements for short put and call options, and transaction costs);
(e)among the risks the Client acknowledges are:
(i)option contracts are traded for a specified period of time and have no value after expiration;
(ii)trading halts in the underlying security, or other trading conditions (for example, volatility, liquidity, systems failures) may cause the trading market for an option (or all options) to be unavailable, in which case, the holder or writer of an option would not be able to engage in a closing transaction and an option writer would remain obligated until expiration or assignment of the option contract,
(iii)the Client has read and understood the applicable regulatory requirements for trading equity options.
16.3The Client understands and fully accepts any steps required by Sahm Capital to ensure the client is suitable for the transactions, such as suitability assessment.
16.4Other Risks of Trading Equity Options:
16.4.1Risk-Reducing Orders or Strategies
The placing of certain orders (e.g., ‘stop-loss’ orders, where permitted under local law, or ‘stop-limit’ orders) which are intended to limit losses to certain amounts may not be effective because market conditions may make it impossible to execute such orders. Strategies using combinations of positions, such as ‘spread’ and ‘straddle’ positions may be as risky as taking simple ‘long’ or ‘short’ positions.
16.4.2Variable Degree of Risk
Transactions in options carry a high degree of risk. Clients dealing with the purchasing or selling of options should familiarise themselves with the type of option (i.e., put or call) which they contemplate trading and the associated risks. The Client should calculate the extent to which the value of the options must increase for the position of Client to become profitable, taking into account the premium and all transaction costs.
16.4.3Selling (‘writing’ or ‘granting’)
An option generally entails considerably greater risk than purchasing options. Although the premium received by the seller is fixed, the seller may sustain a loss well in excess of that amount. The seller will be liable for additional margin to maintain the position if the market moves unfavourably. The seller will also be exposed to the risk of the purchaser exercising the option and the seller will be obligated to either settle the option in cash or to acquire or deliver the underlying interest. If the option is on a future, the seller will acquire a position in a future with associated liabilities for margin. If the position is ‘covered’ by the seller holding a corresponding position in the underlying interest or a future or another option, the risk may be reduced. If the option is not covered, the risk of loss can be unlimited.
16.4.4Suspension or Restriction of Trading and Pricing Relationships
Market conditions (e.g., illiquidity) and/or the operation of the rules of certain markets (e.g., the suspension of trading in any contract or contract month because of price limits or ‘circuit breakers’) may increase the risk of loss by making it difficult or impossible to effect transactions or liquidate/offset positions. If the Client has sold options, this may increase the risk of loss. Further, normal pricing relationships between the underlying interest and the future, and the underlying interest and the option may not exist. This can occur when, for example, the futures contract underlying the option is subject to price limits while the option is not. The absence of an underlying reference price may make it difficult to judge ‘fair’ value.
16.4.5Commission and Other Charges:
Before the Client begins to trade, the Client should obtain a clear explanation of all commissions, fees and other charges for which it will be liable. These charges will affect net profit (if any) or increase loss of the Client.
16.4.6Currency Risks
The profit or loss in transactions in foreign currency-denominated contracts (whether they are traded in the jurisdiction of the Client or any another jurisdiction) will be affected by fluctuations in currency rates where there is a need to convert from the currency denomination of the contract to another currency.
16.4.7“Risk Disclosure Clause”
This Clause cannot disclose all the risks and other significant aspects of trading in options. The Client should not deal in options unless the Client understands their nature and the extent of the exposure to risk to the Client. The Client should also be satisfied that option trading is suitable for the Client in light of the circumstances, financial position and investment objectives of the Client. Therefore, the products will not be suitable for all investors and may involve risks that are not acceptable to the Client.
17Security lending
Sahm Capital will not undertake security lending activity with or for the Client except to the extent permitted by the CMA Laws and Regulations and the client agrees Sahm Capital to use your securities in accordance with the securities lending agreement.
18Acting as a principal
Sahm Capital (or its officers or employees) may act as a principal in a transaction with the Client subject to managing any conflicts of interest in accordance with Clause 29 of this Agreement.
19Termination
19.1Method of termination
This Agreement may be terminated by:
(a)the Client in writing by sending to Sahm Capital a termination notice, at its registered office as given at the beginning of this Agreement; or
(b)Sahm Capital in writing by sending to the Client a termination notice, at the correspondence address of the Client set out in the attached 'Know Your Client Form' or as subsequently notified by the Client in writing.
Notice given by either Party under this Agreement shall be in writing and may be delivered by post or sent by facsimile transmission or e-mail. The notice shall be deemed to have been duly given:
(i)if sent by post, on the seventh (7th) day after the day it was sent; or
(ii)if by facsimile or e-mail transmission, twenty-four (24) hours after the time it was sent.
In the case of a body corporate or partnership, notice shall be deemed to have been duly given automatically upon dissolution of the body corporate or partnership. Sahm Capital may at its sole discretion and without giving any reason or being liable for any loss that may be occasioned thereby, refuse to conduct investment business or provide the Services for the Client. No penalty will become due either from the Client or from Sahm Capital in respect of the termination of these arrangements. However, Sahm Capital may require the Client to pay any charges for transferring the investments of the Client to the Client or to another capital market institution upon the order of the Client in accordance with rates of charges, given by Sahm Capital. Any termination of these arrangements will not affect any outstanding order or transactions in progress at the date of termination which will be completed by Sahm Capital as soon as practicable.
(c)Upon the conclusion of the activities delineated in Clause 18. Sahm Capital is obligated to effectuate the termination within a period of seven (7) business days. Subsequently, Sahm Capital shall issue written notice to the Client by email.
19.2Action upon termination
19.2.1On termination by either of the Parties, Sahm Capital will:
(a)be entitled to receive from the Client all fees, costs, charges, expenses and liabilities accrued or incurred under these arrangements up to the date of termination including any additional expenses or losses reasonably and properly incurred in terminating this Agreement and any charges for transferring the assets of the Client to the Client or to another capital market institution upon the orders of the Client;
(b)as soon as reasonably practicable after that, subject to: (a) above, deliver or cause the assets of the Client to be delivered to the Client or to another capital market institution upon the orders of the Client provided that Sahm Capital shall be entitled to withhold and retain a sufficient part of the assets of the Client to discharge any outstanding liens in favor of Sahm Capital, nominees or third parties of Sahm Capital, and any costs, remuneration or indemnifications due to Sahm Capital and/or nominees or third parties of Sahm Capital. If Sahm Capital is unable to obtain instructions from the Client as to such delivery and transfer, Sahm Capital shall be entitled upon giving notice in writing to the Client sent to the last known address of the Client pursuant to paragraph (b) of Clause 15.1 above, to deliver and transfer all the assets of the Client to such delegate, transferee or assignee and on such terms as Sahm Capital may in its discretion appoint;
(c)liquidate at the expense of the Client any of the investments of the Client, held by Sahm Capital in omnibus or similar accounts and pay to the Client the balance of such liquidated investments; and
(d)subject to paragraph (a) above, refund any fees the Client may have paid in advance.
19.2.2Any termination of these arrangements will not affect any outstanding order or transaction or any legal rights or obligations which may have already have arisen. Transactions in progress at the date of termination will be completed by Sahm Capital as soon as possible.
Please note that in the event of the death of the Client, Sahm Capital will not be in a position to acknowledge the demise until it receive formal written notice and that in any event these terms will remain binding on the personal representatives of the Client.
20Complaints
Sahm Capital has established procedures in accordance with the requirements of the CMA Laws and Regulations for the effective consideration of complaints by the Client. All formal complaints should in the first instance be made by contacting Sahm Capital’s call centre. If the complaint has not been resolved to the satisfaction of the Client, the complaint should be directed in writing to nominated Compliance Officer of Sahm Capital, who is responsible for complaints procedures, at the registered address of Sahm Capital.
21Right to realise client's assets
21.1Without prejudice to any of the Company's entitlements in face of the Client under this Agreement or any other relevant agreements or contracts, the Client hereby authorizes the Company to debit your investment account or any other account of the Client it keeps on behalf of your, with any amount or indebtedness that may be due to it by the Client.
21.2The Client acknowledges that the Company shall be entitled, without any need to refer to your or to serve a prior notice to your, to collect all its due amounts from you by clearing through deduction from any credit balances in your accounts starting from the account that contains the commitment currency (Saudi Riyals) and then the accounts in other currencies as per exchange rate at the data of clearing.
21.3The Client is aware that all accounts at Sahm Capital, of different types and names, shall be deemed as one investment account. Client further acknowledges that Sahm Capital shall be entitled to merge and unify all your money and assets at the Company as well as any of your sub accounts to pay and collect any debts due for it by you. In case of insufficiency of the cash balances in client accounts to pay such debts, the Company shall be entitled to collect the same from any other assets of the Client at the Company for such purpose, including selling financial securities that belong to you without any need for serving prior notice to you or get prior permission from competent or concerned authorities. Granting this right to the Company, does not mean that it must use it, but the commitment primarily rests on the Client who must pay the due amounts and cover any of his indebted balances.
21.4The Company shall have the right, based on instructions from the CMA, or any other competent body, to execute the orders for seizure and freezing of the Client’s monies and / or assets with the Company, immediately, without any obligation on the Company to notify the Client, and the Client has no right to ask the Company to disclose the details of the seizure and/or the freezing of monies, and if he is interested to know these details, he should communicate with the body which issues the seizure or freezing of monies decision. The Client shall have no right, to claim from the company, any indemnity or expenses or liabilities for any losses or damages that he is exposed to, or may be exposed to, because of the Company’s commitment to execute these instructions.
21.5Right to liquidate Client's assets: if the Client fails to pay when due all sums due to The Company or any third party related to The Company, The Company shall have the right, immediately, and without notice to the Client, to take any action on the investments or securities positions of the Client, and to pay for the account of The Company from the proceeds of the action which have been applied to the Client, all sums due to The Company.
22Contingent liability securities
The Client may instruct Sahm Capital to invest in forward dealings and options or structured products for the purpose of hedging interest rates and asset price risks incurred by the Client, or for speculative purposes. These types of investments may cause the Client to incur a contingent liability. The Client declares that he is aware of the risks related to an investment in contingent liability transactions as well as the particular risk of loss involved in speculative dealings. The Client shall enter into a separate 'Contingent Liability Contract' with Sahm Capital including agreements for margin lending and pledge.
23Margin lending
Securities Margin Financing (SMF) will only be provided to the clients who have established and maintained margin securities trading accounts with Sahm Capital. Sahm Capital shall ensure that a written separate margin agreement(s), along with prescribed forms, is entered into with a client before margin lending is provided to that Client.
23.1Sahm Capital will not lend money or extend credit to any client, unless:
(a)Sahm Capital has made and recorded an assessment of the financial standing of the Client and is satisfied that the amount and the arrangements for the loan or credit are suitable for the Client;
(b)the Client gives his written consent to the lending or credit facility, specifying the maximum amount of the loan or credit together with details of the amount and of any charges to be levied; and
(c)the lending of money or extension of credit facilities to the Client shall not be linked to derivative contracts.
23.2The above points do not apply where Sahm Capital:
(a)settles a transaction in the event of a default or late payment by the Client;
(b)pays an amount to cover a margin call made for a client for a period no longer than five (5) days; and
(c)effects margined transactions.
Where a client operates both a cash and a margin account, Sahm Capital will ensure that transactions and assets booked under one account are not commingled with those booked under the other.
23.3Sahm Capital will not effect a margin transaction with or for a client unless the client enters into margin agreement(s) specifying the following:
(a)the circumstances under which the client can be required to provide margin;
(b)particulars of the form in which the margin will be provided;
(c)particulars of the steps which Sahm Capital will be entitled to take if the Client fails to provide the required margin, including the communication method(s) by which the margin call will be made on the Client;
(d)that failure by the Client to meet a margin call can lead to Sahm Capital closing out the position of the Client after a time limit specified by Sahm Capital, and that Sahm Capital is entitled to close out the position in any event after a period of five (5) days from such failure; or
(e)any circumstances, other than failure to provide margin, which may lead to the position of the Client being closed without prior reference to him.
23.4Sahm Capital when it effects a margin transaction with or for the Client will also perform the following:
(a)take reasonable steps to ensure that the Client is aware of the risks of margin transactions;
(b)in relation to affecting a margin transaction on shares of companies listed on the exchange, require the Client to provide a minimum margin not less than fifty percent (50%) of the transaction value prior to effecting the transaction;
(c)in relation to affecting a margin transaction on shares of companies listed on the exchange, monitor the margin provided by the Client daily, and ensure that the margin is not less than twenty-five percent (25%) of the current value of each applicable security position;
(d)the margin payable by the Client in respect of a margin transaction on a regulated exchange or market will be of an amount or value at least equal to the margin requirements of the relevant exchange, market or clearing centre;
(e)margin will be in the form of cash, fully paid security positions or other acceptable collateral by the Sahm Capital;
(f)Sahm Capital will not affect a margin transaction on shares of listed companies whose accumulated loss reaches fifty percent (50%) or more of its capital, according to the disclosures issued by the listed companies; and
(g)Sahm Capital will not affect a margin transaction with the Client or its own account on a derivative contract.
23.5Sahm Capital can make a secured or unsecured loan or grant credit to a client for a period of more than five (5) days for the purpose of making a deposit of margin or required margin payment if the following two (2) conditions are met:
(a)an independent client credit assessment is made by employee of Sahm Capital who is independent of the trading or marketing functions; and
(b)the Client has given his prior written consent to the lending or credit facility, and such consent specifies the maximum amount of the loan or credit together with details of the amount and of any charges to be levied.
23.6The CMA may prescribe a higher rate of margin to be provided for transactions in any security or category of securities, and Sahm Capital shall inform and require the Client to provide any such prescribed rate of margin. The CMA may prohibit margined transactions in relation to any security or category of securities.
24Authority to borrow
Sahm Capital do not have authority to borrow or raise money on behalf of the Client. The Client hereby consents, however, to the creation of an overdraft, repayable by the Client immediately on demand, to cover settlement and fees and charges obligations. Or the client agrees Sahm Capital to use your securities in accordance with the securities lending agreement.
25Special Commission Arrangements
'Special Commission Arrangement' means an arrangement where an investment manager receives goods or services in addition to trade execution services from an intermediary in return for the commission paid on transactions directed through that intermediary. Sahm Capital shall not enter into a Special Commission Arrangement, however, for avoidance of doubt, Sahm Capital may receive a commission from a product provider in respect of any deals that Sahm Capital executes concerning that product provider’s financial products.
26Custody
26.1Registration of Client Assets if Clients Assets are not registered in the Client’s name
The Client authorises Sahm Capital to maintain his assets at such licensed institutions as may be decided by Sahm Capital in its sole discretion. Sahm Capital will take normal precautions for the safe custody of all assets and investments in its own name, and shall make it clear that the account assets belong to a client or several clients. The Client, however, shall at all times remain beneficially entitled to such securities.
26.2Receiving dividends and voting rights
On behalf of the Client and in respect to his investment, Sahm Capital shall be entitled to:
(a)claim and receive dividends, commission payments and other entitlements;
(b)exercise conversion and subscription rights; and
(c)exercise any voting rights.
26.3Liability in the event of a default by an eligible custodian
26.4Sahm Capital shall not be liable for any damages in the event of default by an eligible custodian unless it is proven that Sahm Capital acted in bad faith or in gross negligent.
26.5Sahm Capital shall be entitled to rely on any communication, authority or documents believed by Sahm Capital to be genuine and correct or to have been signed, sent, made or given by the Client and shall be entitled to consult legal advisers selected by Sahm Capital in respect of the nominee/custody arrangements and to rely on their advice and to appear in any legal proceedings affecting these arrangements and the assets of the Client, to which Sahm Capital may be made a party.
26.6Nevertheless in all matters relating to the assets of the Client, in the absence of instructions from the Client, in cases where action is required to safeguard or to preserve the transferred holdings and it is impracticable to obtain such instructions, Sahm Capital may act at its absolute discretion, without reference to or instructions from the Client and shall not be liable or accountable for loss to the Client occasioned by any exercise or non-exercise of rights attaching to the assets of the Client in the absence of gross negligence, wilful default or fraud on the part of us or our nominee or agent.
26.7Whilst Sahm Capital will use reasonable endeavours to comply with any instructions given by the Client and accepted by Sahm Capital concerning notices and other communications relating to the assets of the Client, Sahm Capital shall not be liable for loss, damage or cost arising from any failure or omission to forward or report to the Client the receipt of any such notice or communication effectively, sufficiently promptly or at all (including any failure in transmission of reports or documents outside our control) save whereby reference to any such instructions such failure or omission to forward or report shall constitute negligence, wilful default or fraud on the part of Sahm Capital or any of its nominees or agents.
26.8Sahm Capital shall use reasonable efforts to ensure that the custodian shall exercise all reasonable care and diligence in its choice of sub-custodians. In the event that any sub-custodian should fail to account to the custodian for any transaction or securities for whatever reason, Sahm Capital shall use reasonable efforts to ensure that the custodian endeavours to pursue on behalf of the Client all appropriate legal remedies against such sub-custodian to recover such securities or any sums due or compensation in lieu thereof but, subject thereto, neither Sahm Capital nor the custodian will accept any liability for any such failure to account. The costs and expenses properly incurred by the custodian in connection with the pursuit of such remedies shall be debited to the Client. On the instructions of Sahm Capital, the custodian may realise any securities held by it under the terms of this Agreement for the purposes of meeting any liability of the Client for which such securities are held as collateral or to meet any liability incurred by the Client with respect to the Agreement. The custodian may retain or make deductions from amounts the custodian owes to the Client in order to settle any outstanding obligations arising from this Agreement.
27Pooling
27.1The Client agrees that his assets may be pooled with one or more other clients and therefore the assets of the Client or entitlements may not be separately identifiable by certificates, other physical documents of title or electronic record. In the event of any irreconcilable shortfall resulting from the default of Sahm Capital, the Client may participate pro rata in that shortfall. On any retransfer to the Client, Sahm Capital shall not be bound to return the identical assets, however, the Client shall accept stocks, shares or securities of the same class and denomination or any other stocks or securities which represent the assets.
27.2The Client acknowledges that Sahm Capital may be able to offset the orders of different clients. Such an offset shall not affect any payment due from such clients in relation to their orders and all such payments shall belong to and shall be for the account and benefit of Sahm Capital.
28Client assets held overseas
Where Sahm Capital, in accordance with CMA Laws and Regulations, arranges for the assets of the Client to be held overseas, the Client understands and acknowledges that there may be different settlement, legal and regulatory requirements in the relevant overseas jurisdictions than those applicable in the Kingdom of Saudi Arabia, and such requirements will be applicable to the assets held overseas.
29Client money
29.1Subject to CMA Laws and Regulations, "Client money" herein shall mean all money that Sahm Capital receives from or on behalf of the Client in the course of carrying out securities business. Sahm Capital shall comply with the 'Client Money Rules' set out in the CMA Laws and Regulations. The Client hereby agrees and accepts that Client money will be segregated and may be held by Sahm Capital in a different currency, in a separate account for the benefit of the Client with a local bank from the money of Sahm Capital, or with more than one bank when Sahm Capital, at its discretion, considers it necessary. Furthermore, Client money may also be held by Sahm Capital with an overseas bank if required for the settlement of a transaction in securities outside the Kingdom of Saudi Arabia, where the laws may have different settlement, legal and regulatory requirements in relation to the Services and Client money. Sahm Capital shall have the right to determine in whatever currency may be appropriate for Client money from time to time. Client accounts shall be maintained with and operated by Sahm Capital in accordance with this Agreement and the Client shall not be entitled to give instructions in relation to the operation of such Client accounts (except as may otherwise be agreed by Sahm Capital in exceptional circumstances). The operation of any Client accounts, which Sahm Capital may establish for the Client to hold the Client money, shall be kept separate from any other bank account, which the Client may maintain with Sahm Capital.
29.2All banks used to hold the Client money must have first confirmed to Sahm Capital that:
(a)Amounts standing to the credit of the account are held by such bank as trustee or equivalent.
(b)Proceeds earned on such accounts will be credited to the account or to an account of that type.
(c)The bank is not entitled to combine the account with any other account or to exercise any right of set off or counterclaim against money in that account in respect of any sum owed on any other account of Sahm Capital.
(d)The title of the account will sufficiently distinguish the account as an account containing the Client money from any other account which belongs to Sahm Capital.
29.3In certain circumstances Sahm Capital may not obtain such an undertaking from a bank used to hold the Client money. However, Sahm Capital shall be obliged to explain the nature of the risks to the Client in these circumstances. Provided that Sahm Capital is able to take reasonable care in the selection of such a bank, Sahm Capital shall not be liable for any default by it.
29.4All Client money received by Sahm Capital or on behalf of Sahm Capital shall be paid into such a Client account (wherever situated) as soon as possible and in any event no later than the next business day.
29.5Sahm Capital may use Client money held on behalf of one Client to fulfil obligations and settle transactions for another Client free of charge or for a fee. Any commission, profit or return earned on Client money held with Sahm Capital will be retained by Sahm Capital for its own use, unless otherwise agreed in writing with the Client.
29.6By signing or accepting this Agreement, the Client agrees that Sahm Capital gets returns over his money, for its benefit; credited in an omnibus account with one of the authorised banks in the Kingdom of Saudi Arabia. The signature or acceptance by the Client will be considered an approval of that and complying with point (3) of Annex 5-4 of the Authorised Persons Regulations (issued by the Board of the Capital Market Authority Pursuant to its Resolution Number 1-83-2005 Dated 21/05/1426H Corresponding to 28/06/2005G Based on the Capital Market Law issued by Royal Decree No. M/30 dated 2/6/1424H Amended by Resolution of the Board Of the Capital Market Authority Number 3-85-2017 Dated 27/12/1438H Corresponding to 18/9/2017G) and CMA circular (03638/6) dated 05/08/1432H - 06/07/2011.
29.7Where Sahm Capital holds Client money, we shall send statements of your account to the Client not less than quarterly unless a nil balance is held throughout the quarter, or an alternative arrangement has been agreed between the Parties. It is the against policy of Sahm Capital to permit physical cash withdrawals or payments to Sahm Capital or to make third party payments, unless in exceptional circumstances. A third party payment is a payment to be a beneficiary other than the account holder(s).
29.8In case of outgoing transfers, the Client is responsible for choosing an appropriate account to deposit his/her money in.
30Cash transfers
30.1The Client shall have the right to ask the Company to transfer any amount from his/her investment account to his / her current account linked to the portfolio using printed forms prepared for this purpose and can further carryout this action directly by himself via the Internet or any of the other electronic channels authorized by the Company.
30.2In order to execute the cash transfer from the investment account to the current account, the remaining balance in the account must be sufficient to cover any existing transaction that has not yet been settled.
30.3The Company shall have the right to refuse the execution of any operations or instructions of the Client if it finds, as per its own and absolute discretion, that the credit balance in his/her investment account is not sufficient or will not be sufficient at the date of executing of the operation.
30.4Where appropriate, the Company shall have the right to transfer any currency from the Client’s account, without notifying him / her, to execute any transaction, as per the provisions of this Agreement, and to pay his/her subsequent financial obligations. And any transfer of this kind, shall be made in the same method and rates determined by the Company upon its own discretion (taking into consideration the currency exchange rates prevailing at the date of exchange).
30.5In the event that the account is opened in a foreign currency certified by the Company, all operations performed on it or through it shall be in the same currency. And in case that it is not possible to perform the operation in the same currency of the account, it shall be performed in Saudi Riyal as per the exchange rate prevailing in the same date.
30.6The Client is aware that opening the account in a foreign currency makes it subject to exchange rate fluctuations and that it is possible to be exposed to a big loss upon exchange into local currency and vice versa. The Client further acknowledges that in his/her capacity as owner of this account, he /she shall solely incur all consequences without any minimal liability on the Company.
30.7The Company undertakes to transfer the financial securities, from the Client's portfolio with the Company, to the Client's portfolio maintained with another Capital Market institution, after verifying all the confirmatory documents required for accomplishing the transfer process. As the transfer operation is done through, (Tadawul), the Company shall not bear any responsibility for any delay in the execution of transferring the financial securities, that is attributed to insufficient documents, or to additional orders from Tadawul, or to any other reasons which are beyond the control of Sahm Capital.
31Enforcement of the provisions of this Agreement against the client's heirs and his public and private successors
31.1The Individual Client (natural person) acknowledges hereby that this Agreement shall not end with his / her death and that it shall be binding upon his/her heirs and successors as well as executors of his/her wills and liquidator of his/her succession.
31.2The body corporate Client, each as per his / her title and capacity, acknowledges that this Agreement shall not be terminated upon the death of the partner in the company, or the liquidation of the corporation or vanishing of the capacity of the person authorized by him / her, and that it shall be applicable to the successors without prejudice to the company’s articles of association or articles of incorporation, or the Companies Act, or the resolutions, licenses and deeds, which establish the artificial body which hold the account, such as the public organizations, endowments, charitable associations, etc.
31.3The Company shall be entitled, upon its own discretion, to suspend dealing in financial securities and to refrain from accepting any instructions related to them or to any other investment that is governed by the provisions of this Agreement, until it receives an order from the competent and authorized body, or receives instructions from the private and public successors of the Client, each in his / her own area of concern, issued in such appropriate format and convincing manner to the Company, and shall be enforceable.
32Sharia requirements
32.1The client is aware that the products and services subject to Sharia provided by the company to its clients and those who deal with it, inside and outside the Kingdom, are subject to the Islamic Sharia provisions as per the controls and resolutions issued in this regard by the company's Sharia Board.
32.2The client acknowledges that the company will not pay Zakat for monies in his investment account, as well as for investments in the portfolios& funds, and he will pay the Zakat of his monies, by himself.
33Electronic service
33.1As a client of Sahm Capital, the Client will be permitted to utilise Electronic Services provided by Sahm Capital, to effect and execute orders. By signing or accepting this Agreement, the Client hereby acknowledges, agrees and confirms as follows:
(a)This Agreement states the terms and conditions regarding the use of any electronic services offered by Sahm Capital, by Sahm Capital, including the use of such services to enter transactions in the Investment Account of the Client (hereinafter referred to as Electronic Services). The usage of Electronic Services provided by Sahm Capital, by the Client, will indicate the acceptance by the Client of the following terms and conditions. The terms and conditions set forth herein supplement the terms and conditions contained in any other agreement with Sahm Capital and, by using any of the Electronic Services, the Client confirms his agreement to comply with the terms and conditions set forth therein.
(b)The Client is of legal age and no one except signatory of this Agreement has any interest in his Investment Account with Sahm Capital.
(c)All transactions for his Investment Account shall be subject to the constitution, rules, regulations, customs, and usages of the exchange or market (and the firm, if any) where executed.
(d)Reports of the execution of orders and statements of the Investment Account of the Client shall be conclusive if not objected to within five (5) days, respectively, after transmittal to the Client, electronic mail or otherwise.
(e)At any time and from time-to-time Sahm Capital may, at its discretion, without notice to the Client, apply and/or transfer any securities, commodities, contracts, relation thereto, or any other property or equity therein, interchangeably between any of the Investment Account of the Client, whether individual or joint and from any of his Investment Account to any account guaranteed by the Client.
(f)In order to protect against identity theft and fraudulent activity in the Investment Account of the Client, the Client agrees to be responsible for the protection of his username and password. Sahm Capital will not be held responsible for any liability resulting from identity theft or fraudulent activity relating to the Investment Account of the Client.
(g)The Client shall be the only authorised user of Electronic Services provided by Sahm Capital, for his Investment Account. The Client will be fully responsible for the confidentiality and use of his usernames and passwords and the Client agrees that he will be fully and solely responsible for all activities, including brokerage transactions, which arise from the use of your usernames or passwords. The Client also agrees that he will be fully and solely responsible for all activities, including brokerage transactions, which arise from his authorisation to link his Investment Account. The Client acknowledges that Sahm Capital may tape record conversations with him, whether in person or by telephone, for purposes of verification, and he consents to such recording.
(h)The Client agrees that as a condition of being approved to use Electronic Services, provided by Sahm Capital, the Client will immediately notify Sahm Capital if:
(i)the Client has placed an order using Electronic Services, provided by Sahm Capital, and the Client did not receive an order number;
(ii)the Client has placed an order using Electronic Services provided by Sahm Capital, and the Client did not receive an accurate written confirmation of the order, its execution or cancellation within five business days;
(iii)the Client has received confirmation of an order or orders which the Client did not place or any similar conflicting report; or
(iv)the Client becomes aware of any unauthorised use of username(s), password(s), the username(s) and password(s) of any sub-user appointed by the Client or any product or service related to the Investment Account(s) of the Client.
33.2If the Client fails to notify Sahm Capital immediately upon the occurrence of any of the above events, the Client agrees that Sahm Capital will not have any responsibility or liability to the Client or any other person whose claim may arise through the Client for any claims relating to the handling, mishandling or loss of any order. Any liability of Sahm Capital arising out of any action or omission by Sahm Capital with respect to the handling, mishandling or loss of an order shall be limited to an amount equal to the loss incurred due to the action or omission during the five business days after the date on which the Client first became obligated to give Sahm Capital notice with respect to such transaction(s) pursuant to this Clause. The Client agrees that Sahm Capital and/or any of its officers, directors, employees, agents or affiliates will not have any other liability to the Client or any other person whose claims may arise through the Client for any consequential, incidental, special or indirect damages, even if Sahm Capital has been advised of the possibility of such damages. Sahm Capital shall not be responsible for or deemed to be in default under this Agreement due to any delay or failure in performance resulting directly or indirectly from any cause beyond reasonable control of Sahm Capital.
33.3The Client acknowledges that for the purpose of this Agreement that Electronic Services provided by Sahm Capital will be defined as any interactive product or service offered by Sahm Capital which allows the Client to communicate with Sahm Capital, to obtain information or quotations from Sahm Capital, or to enter into brokerage transactions with Sahm Capital through the use of electronic data communications. This includes, but is not limited to, electronic data communications transmitted by the Client to Sahm Capital through the use of personal, home or business computers connected by a modem or other device to an authorised telecommunications network designated by Sahm Capital. The Client acknowledges that this Agreement also governs usage by the Client of automated touch-tone telephone services through which the Client can obtain account information and quotations and enter brokerage transactions. The Client acknowledges that Sahm Capital may modify, add to, rename or discontinue the Electronic Services offered pursuant to this Agreement without prior notice to the Client.
33.4the Client agrees to be fully liable for any and all brokerage commissions, fees, margin interest charges and payments due to Sahm Capital in connection with trades effected by the Client in his Investment Account through the use of Electronic Services provided by Sahm Capital. Such brokerage commissions, fees, margin interest charges and payments will be paid directly to Sahm Capital in accordance with the terms and conditions specified by Sahm Capital. The Client agrees that Sahm Capital may require a deposit before the Client can begin trading using the Electronic Services (deposited funds can be used toward payment of the first transaction). The Client agrees to pay all fees and charges associated with his/her use of any Electronic Services provided by Sahm Capital, including, without limitation, those of any third-party information providers offered through Sahm Capital and all costs associated with communication between the Client and the internet brokerage hub (if applicable).
33.5With respect to those Electronic Services for which software (the Software) has been provided, the Client acknowledges that Sahm Capital hereby grants to the Client a non-exclusive, non-transferable, revocable limited right and license during the term of this Agreement to receive and use the Software provided herewith solely in conjunction with the personal use of Electronic Services provided by Sahm Capital in accordance with the terms of this Agreement. The Client acknowledges and agrees that Sahm Capital or its licensors or data providers have exclusive proprietary rights in the Software and the systems used in connection with Electronic Services with Sahm Capital. The Client further acknowledges and agrees that third-party information providers of Sahm Capital have exclusive proprietary rights in their respective information transmitted and/or furnished via Electronic Services provided by Sahm Capital. In the event of any misappropriation or misuse of any Electronic Services provided by Sahm Capital, the Software or the market data transmitted and/ or furnished via Electronic Services provided by Sahm Capital, Sahm Capital and/ or its third-party information providers or licensors shall have the right to obtain injunctive relief with respect to the use of its respective materials. The Client further acknowledges and agrees that:
(a)the Client may use the Software only in conjunction with Electronic Services provided by Sahm Capital;
(b)the Client shall not make any alteration, change or modification to the Software and shall not recompile, decompile, disassemble, reverse engineer, or make or distribute any other form of, or derivative work from, the Software;
(c)the Client shall use Electronic Services provided by Sahm Capital, the Software and/or the market data provided thereby only for the personal use of the Client; and
(d)the Client shall not furnish the Software, Electronic Services provided by Sahm Capital or any other information or messages disseminated by Sahm Capital hereunder to any person or entity.
33.6the Client agrees that the usage of Electronic Services provided by Sahm Capital to effect securities transactions will be limited in all respects to the terms and conditions of this Agreement and any other agreement between the Client and Sahm Capital. Sahm Capital will have no liability to the Client with respect to any transaction or attempted transaction by the Client which is not in accordance with the terms and conditions specified herein or in such other agreement, and the Client will indemnify Sahm Capital from any claim of a third party related to any such transaction or related transaction.
33.7The Client agrees that Sahm Capital may change the terms and conditions of this Agreement, in whole or in part, upon notice to the Client; no provision of this Agreement may be amended in any other manner. The Client agrees to use Electronic Services provided by Sahm Capital and any additional services offered through Sahm Capital in the future only in accordance with the terms and conditions specified in this Agreement as amended from time to time by Sahm Capital, and that any amendments to the terms and conditions will be deemed effective upon dissemination by Sahm Capital. The Client agrees usage of the Electronic Services provided by Sahm Capital after receipt of such amendments will be deemed to be acceptance of such amendments.
33.8The Client acknowledges that any order placed by the Client which Sahm Capital, at its sole discretion, deems to be disruptive to the securities markets, unusual in size, type or credit risk, or which exceeds usual authorised limits, provided by Sahm Capital, may be subject to rejection, cancellation or modification. The Client acknowledges that market orders cannot always be cancelled, because they are subject to immediate execution and the order may be executed before the request for cancellation is received by Sahm Capital. The Client acknowledges and agrees that the Client is fully responsible for determining the suitability of orders placed by the Client and the investment decisions of the Client. The Client acknowledges that Sahm Capital may, in its sole discretion, place trading restrictions on the Investment Account of the Client.
33.9The Client agrees that Sahm Capital reserves the right in its sole discretion to suspend or terminate access of the Client, to any or all of the Electronic Services provided by Sahm Capital for any reason and without prior notice to the Client. The Client agrees not to hold Sahm Capital, its licensors, information providers or any third party involved in the provision of the Electronic Services provided by Sahm Capital responsible or liable for any disruptions in service due to telephone network, computer network or other system problems beyond the control of Sahm Capital, its licensors, information providers or any third party involved in the provision of the Electronic Services, provided by Sahm Capital, system maintenance or system upgrades; or any other event or circumstance beyond the control of Sahm Capital, its licensors, information providers or any third party involved in the provision of Electronic Services, provided by Sahm Capital to the Client.
33.10The Client agrees that the market data, news and other information provided to the Client through the Electronic Services, (directly or indirectly through an authorised third-party information provider) is for the personal use of the Client only and the Client will not retransmit or republish these data in any form. The Client acknowledges that the data provided to him/her are obtained from sources believed to be reliable, are provided solely on a best-efforts basis for his/her convenience, and that no guarantees are made by Sahm Capital, its licensors, any information provider or any third party involved in the provision of the Electronic Services provided by Sahm Capital to the Client as to their accuracy, completeness, timeliness or correct sequencing. The Client acknowledges that while access to investment recommendations, advice, opinions or judgments may be available through Electronic Services, provided by Sahm Capital nor do they constitute any recommendations or solicitations to purchase or sell any security by Sahm Capital. The Client agrees not to hold Sahm Capital or its licensors, information providers or any third party involved in the provision of the Electronic Services, provided by Sahm Capital liable for any investment decision the Client may make based upon reliance on or use of such data or recommendations, advice, opinions, or judgments or any liability which may arise due to inaccuracies, errors or omissions in such data or due to delays, omissions, errors, or interruptions in the delivery or transmission of such data for any reason.
33.11The Client agrees that there are no warranties, express or implied, with respect to the Electronic Services provided by Sahm Capital, or the software or the market data provided, including, but not limited to, any implied warranties of merchantability, reasonable care, fitness for a particular purpose or against intellectual property infringement, made by Sahm Capital, its licensors, information providers or any third party involved in the provision of Electronic Services to the Client. The Client further agrees that the sole liability of Sahm Capital, or its licensors, information providers or any third party involved in the provision of the Electronic Services provided by Sahm Capital for any claims, notwithstanding the form of such claims (e.g., contact, negligence or otherwise), arising out of errors or omissions in the Electronic Services provided by Sahm Capital and/or the software and/or market data provided or to be provided hereunder shall be to furnish the correct report or data provided that he/she promptly advise the data provider thereof. The Client further agrees that the Client shall not hold Sahm Capital, its licensors, information providers or any third party involved in the provisions of the Electronic Services, provided by Sahm Capital, liable in any way for any loss or damage arising from or occasioned by any force majeure (e.g., flood, extraordinary weather conditions, earthquake or other act of god, fire, war, insurrection, riot, labour dispute, accident, action of government, communications or power failure, equipment or software malfunction) or by any other cause beyond such party's reasonable control. In no event will Sahm Capital, its licensors, information providers or any third party involved in the provision of the Electronic Services provided by Sahm Capital (or any of their respective officers, directors, employees, agents or affiliates) be responsible for special, indirect, incidental or consequential damages, including but not limited to trading losses or lost profits, whether or not reasonably foreseeable, and even if advised of the possibility or such damages, which the Client may incur or experience on account of entering into or relying on this Agreement or as a result of his/her use or reliance on the market data, the services or the software.
34Electronic signature & the formats & contracts sent via electronic means
34.1The client is aware, acknowledges and agrees that he/she can sign manually on papers, or through any electronic means, on any agreements or formats that are required by the company, and the company may make the electronic signature mandatory at any time. Moreover, the client acknowledges and agrees that the manual and/or the electronic signature is obligatory to him/her when dealing with the Company and against any other bodies. The client acknowledges that by signing or agreeing through any means whatsoever, he/she shall abide by all the terms and conditions stipulated in the Agreement, or in the signed Format, and the terms and conditions it contains. The client also, acknowledges and agrees that he /she will not put as a condition or ask for a tally certificate on the electronic signature, or endorsement from a third party, to verify the correctness of the signature or the identity of the signatory, and that the non-existence of any of the, will not affect proving the validity of the signature or the client's undertaking to the company. In addition, The client agrees and acknowledges that he/she will be satisfied with the ID verification means applied at Sahm Capital Financial Company, and also he/she, acknowledges that he/she is authorized to sign this Agreement and any other formats annexed to it, currently or in future, and that any person, whether he is the actual owner of the account, or a person authorized from the account owner to manage the account, shall be bound by all the terms and conditions stipulated in the Agreement, or in any one of its annexed forms and documents.
34.2The client acknowledges and agrees that any agreements, documents, forms that are signed manually or electronically by the Client, or/and any other notifications or advice, to be sent to the company or to the client via any means, whether being electronic (e-mail, or through the company's internal system, as examples only) shall be deemed obligatory and convincing. Moreover, he/she acknowledges and agrees that any notifications or advice, to be sent by the Company via any electronic means, represent a complete and acceptable compliance by the client with any regulatory or contractual obligation, which requires a written notification.
34.3The Client shall have the right to ask for paper copies of any additional documents, required by him more than the jurisdiction bodies requirements, which are sent to him or sent by him to the Company, through any electronic means, and the Company reserves its full right, to charge and/or obtain, fees for the same.
34.4The client acknowledges and agrees that his/her e-mail provided to the company, shall be considered a main and essential part of the Client's personal information, and represents part of his/her address, which the Company will rely on in communicating electronically with the client, and in sending any advice, notifications or copies of the client's electronically or manually signed agreements or forms. The client pledges to notify the company immediately upon the loss of his/her e-mail, whether this occurs through hacking, forgetting the password and failure to retrieve it, or due to stopping the provision of the e-mail service to the Client by the service provider or for any other reason. Moreover, the client pledges to provide the company immediately, with an alternative e-mail. All the advice and notifications, sent to the client's e-mail, shall be deemed correct and valid, before the client notifies the Company of his/her loss of his/her e-mail and providing the company with an alternative e-mail.
35Suspension and deactivation of investment account
35.1Sahm Capital shall be entitled to restrict or suspend the use of the Investment Account of the Client and/or to block or liquidate the credit, cash or investments balance therein at any time if it becomes aware of conflicting claims of ownership to the account or its funds or otherwise as required by applicable law and regulations. The liquidated credit, cash and investments balance shall be paid to the Client (if appropriate) as soon as practicable, provided that the cause of the suspension or restriction was not conflicting claims of ownership to the account and otherwise as required by applicable laws and regulations.
35.2Sahm Capital may, at its sole discretion, by providing written notice to the Client, deactivate or close the Investment Account of the Client if the account balance is zero or if there has not been any activity in the Investment Account of the Client for a consecutive period of six (6) months.
36Confidentiality
36.1Confidentiality
Confidential Information shall be treated as confidential, and may not be disclosed except where:
(a)its disclosure is based on the any applicable laws, regulations or code of conduct; or
(b)by order of a court of law; or
(c)in response to an inquiry by an exchange or any regulatory or other governmental authority concerning information reasonably required by them in the course of their official duties, and subject to assurances that such information will be used only for the purposes specified and will otherwise be kept confidential; or
(d)its disclosure is reasonably necessary to perform a particular service for the Client, or the information is no longer confidential.
36.2Processing of Personal Information
“Personal Information” in respect of a Client, shall mean any personal information that can be used to identify that individual, including without limitation information such as full name, date and place of birth, residential address, mailing address, email address, contact information (including telephone and mobile phone numbers), any identification number, passport number, TIN(s) or functional equivalent, social security number (if applicable), nationality(ies), citizenship(s), standing instructions to transfer funds to an account, and such other information as we may require regarding such client. By signing or accepting this Agreement, the Client acknowledges and agrees that Sahm Capital may collect, store, use and process Personal Information related to the Client for the following purposes:
(a)providing the Services;
(b)meeting the requirement pursuant to any applicable laws (including to a regulatory authority whether within the Kingdom of Saudi Arabia or outside it);
(c)complying with any obligations, requirements, policies, procedures, measures or arrangements for sharing data and information within Sahm Capital and/or other use of data and information in accordance with any programmes for compliance with sanctions or prevention or detection of money laundering, terrorist financing or any other activities; or
(d)all other purposes ancillary or relating thereto and such other purposes to which the Client may from time to time agree in relation to the Services or these Terms of Business. The Client further expressly acknowledges and agrees that Sahm Capital may disclose to or share with any of the subsidiaries of Sahm Capital or subsidiaries of any holding company of Sahm Capital, affiliates, or any of the representatives of Sahm Capital, or to third parties such personal information provided by the Client with data held, or hereafter obtained, as reasonably necessary to comply with legal or business obligations of Sahm Capital's, for the purposes of the Services or in relation to these Terms of Business and agrees such disclosure shall not constitute a breach of any obligations of confidentiality or privacy (whether under any data protection law or otherwise) owed to you.
37Conflict of interest and fiduciary duties
37.1Subject to the CMA Laws and Regulations, Sahm Capital ensures that it safeguards at all times the interests of its clients and deal with the conflicts of interest fairly. Where Sahm Capital has an actual or a potential conflict of interest in relation to a transaction or advising, except in the case that the information of such conflict of interest would constitute provision of inside information, Sahm Capital agrees to disclose that conflict of interest in writing relating to the Client and the Client shall provide a written acknowledgment that the Client understands and is fully aware of the actual or potential conflict of interest. In the event of a conflict-of-interest situation, Sahm Capital agrees to ensure that the transaction is affected in the best interests of the Client and does not result in a materially less favourable position for the Client than if the conflict of interest had not existed. Where Sahm Capital does not consider that the arrangements under its conflicts of interest policy are sufficient to manage a particular conflict, it will inform the Client of the nature of conflict so that it can decide how to proceed. Sahm Capital agrees to act in a manner consistent with its fiduciary obligation to the Client as set out in Annex 5.4 of the Capital Market Institutions Regulations of the CMA, which includes managing conflicts of interest fairly with all clients when taking investment actions.
37.2Sahm Capital shall not be liable for any losses caused thereby in a conflict-of-interest situation provided that Sahm Capital has disclosed the conflict of interest to the client in accordance with this clause the client has agreed in writing that Sahm Capital can proceed notwithstanding the conflict.
38Foreign Account Tax Compliance Act (FATCA)
The Foreign Account Tax Compliance Act (FATCA) means the legislation promulgated by the United States Department of Treasury (Treasury) and the US Internal Revenue Service (IRS) to counter tax evasion in the US, as amended supplemented, revised, substituted or re-enacted from time to time, including without limitation, (i) Section 1471 to 1474 of the United States Internal Revenue Code of 1986, as amended or any associated regulations or other official guidance; (ii) any treaty, law, regulation or other official guidance enacted in any other jurisdiction, or relating to an intergovernmental agreement between the U.S. and any other jurisdiction, which (in either case) facilitates the implementation of the legislation or guidance referred to in (i) above; and (iii) any agreement pursuant to the implementation of the legislation or guidance referred to in (i) or (ii) above with the U.S. Internal Revenue Service, the U.S. government or any governmental or taxation authority in any another jurisdiction. Sahm Capital is committed to being fully FATCA compliant in all territories where Sahm Capital operates, in accordance with the legislative timeline. In this regard:
(a)the Client hereby agree to comply with FATCA, and irrevocably and unconditionally agree to and waive, and confirm, represent and warranty that the Client has obtained the requisite consent from each of his direct and indirect beneficial owners (if any) to agree and waive that, any otherwise applicable restrictions on the collection, use, disclosure, processing and/or transfer by Sahm Capital of the Information relating to the Investment Account, tax Information and/or Personal Data relating to the Client or any and all of the direct and indirect beneficial owners of the Client (if any) to the competent authorities whether within or outside the Kingdom of Saudi Arabia, or any provision of law of any jurisdiction would prevent compliance on the part of Sahm Capital with its obligations under FATCA, including under any FFI Agreement, and hereby consents to the disclose to Sahm Capital any information regarding you and your beneficial owners (if any) as Sahm Capital determines is necessary or advisable to comply with FATCA (including the terms of any FFI Agreement);
(b)the Client agrees to provide Sahm Capital with valid, accurate, correct and complete FATCA/Withholding certificates (which may be on form W-8BEN, W-8BEN-E, W-8IMY or others), Personal Data, tax Information, Information relating to the Investment Account and/or documentation in relation to the Client and any and all beneficial owners of the Client (if any) in such form and within such timeline as may be prescribed by Sahm Capital and shall formally notify us promptly in the event of any change. The Client further acknowledge and agree that we have the right to require you, from time to time at the sole discretion deems it necessary and reasonable to ensure our compliance with the tax obligations under FATCA, to provide or to procure the direct and indirect beneficial owners of the Client (if any) to provide the information, the details and supporting materials which may include, but is not limited to: (i) information and/or documentation relating to or concerning the identity, residence (or jurisdiction of formation) and income tax status of Client and its direct and indirect beneficial owners (if any), and (ii) provide or disclose any such information and documentation to governmental agencies of the United States or other jurisdictions (including the U.S. Internal Revenue Service) and persons from or through which Sahm Capital may receive payments or proceeds, or with which Sahm Capital may have an account (within the meaning of FATCA);
(c)the Client acknowledges and agrees that, if the Client withdraws agreement to Sahm Capital disclosing the Investment Account Information of the Client, tax information, and/or Personal Data to any government or the competent authorities under FATCA, or the Client fails to timely provide and/or update the requested information and/or documentation or waiver, as applicable, Sahm Capital may, in its sole and absolute discretion and in addition to all other remedies available at law, in equity or under this Agreement, terminate the Client's Investment Account and discontinue to provide its Services. In the event of a failure to comply with FATCA, Sahm Capital shall be entitled to presume that Client is a person subject to U.S. federal withholding tax under FATCA unless and until such failure is resolved to the satisfaction of Sahm Capital in its sole discretion. The Client shall indemnify and hold Sahm Capital harmless from and against any withholding taxes, interest, penalties or other expenses or costs with respect to the such failure by the Client;
(d)the Client irrevocably and unconditionally authorise Sahm Capital to withhold and deduct any amounts applicable to Client under FATCA (FATCA Deductions), and to remit such amounts to the U.S. Internal Revenue Service or other applicable governmental authority in accordance with applicable law. Any such FATCA Deductions shall be considered amounts paid to or for account of Client for purposes of this Agreement. In no event shall Sahm Capital be required to increase any payment in respect of which it makes such a FATCA Deduction;
(e)the Client acknowledges and agrees that Sahm Capital may in its absolute discretion do or refrain from doing anything that Sahm Capital deems necessary and desirable for the purposes of ensuring the compliance with FATCA and/or prevent or remedy a breach thereof, neither Sahm Capital nor any of the affiliates of Sahm Capital shall be liable for any claims, losses or damages arising directly or indirectly out of or in connection with any such actions.
39Sahm Capital – Limitation of liability
39.1Liability for gross negligence or wilful default only
Neither Sahm Capital nor any of its affiliates, nor any of its or its affiliates’ respective directors, officers, employees or agents shall be liable to the Client for any loss, damages, costs, expenses or other liabilities (including taxation) suffered by the Client, unless such outcome is directly caused by gross negligence of such person provided that the Client shall not be able to take any action against the directors, officers, employees or agents of either Sahm Capital or its affiliates and the ability of the Client to recover any amounts shall be limited to action against Sahm Capital only.
39.2No liability for consequential damages
Under no circumstances shall Sahm Capital or any of its affiliates, or any of its or its affiliates’ respective directors, officers, employees or agents, be liable to the Client for indirect or consequential losses, including any failure to realise any profit, advantage or opportunity.
39.3Express disclaimers
Without prejudice to any provisions of this Agreement, and for the avoidance of doubt, the Client expressly acknowledges and agrees that:
(a)Sahm Capital makes no representation or warranty as to the performance or profitability of any investments made by the Client and Sahm Capital shall have no liability or responsibility for any decline in the value of any such investments;
(b)Sahm Capital shall not be in breach of its obligations under this Agreement and shall not be liable to the Client for any loss caused directly or indirectly by Force Majeure, including, without limitation, acts of God, acts of government, war (whether declared or undeclared), civil commotion, insurrection, embargo, exchange or market rulings, suspension or trading, inability to communicate with market makers for whatever reason, breakdown of the computer systems of third parties or other machine failure, labour disputes, impediments to the supply of goods or equipment, or any other cause or conditions beyond the control of Sahm Capital;
(c)Sahm Capital shall not be responsible for the solvency or the due and proper performance of the obligations of any third party bank, clearing organisation, broker, intermediary, custodian, trustee, contractor or other service provider appointed or employed by Sahm Capital in good faith hereunder, but Sahm Capital shall, at its discretion, make available to the Client such rights as Sahm Capital may have against any such persons in relation to the Client account;
(d)Sahm Capital shall be entitled to rely, in the performance of its obligations hereunder, on the opinion and statements of third party professional advisors which it will select with reasonable care and instruct in good faith and shall not be liable to the Client for any adverse effect of having relied thereon; and
(e)Sahm Capital is not responsible for advising the Client in respect of the tax position or affairs of the Client, or for investigating the application of any taxation law, regulation, treaty or practice to the Client.
The above limitations on liability of Sahm Capital apply in so far as they are not inconsistent with the obligations of Sahm Capital under the CMA Laws and Regulations.
40Indemnification
40.1Obligation to indemnify Sahm Capital
The Client shall indemnify Sahm Capital on demand (whether before or after termination of this Agreement) against any liability, loss, charge, demand, proceedings, cost or expense, including legal fees, that Sahm Capital may suffer, pay or incur as a result of or in connection with the performance by Sahm Capital in good faith of its obligations and services under this Agreement, including (without limitation) entering into any transaction with or for the Client, or acting upon any instructions received from the Client, in respect of which the Client or any counterparty or bank do not make good and timely delivery or payment, except if such costs, etc, are attributable to the gross negligence or wilful default or the person claiming indemnification. For the purpose of indemnification as aforesaid, references to Sahm Capital include its affiliated companies and any director, officer, employee or agent of Sahm Capital or of an affiliated company.
40.2Notice of claims or demands
Promptly after receipt by Sahm Capital of notice of the commencement of any action of proceeding or threatened action or proceeding in connection with any claim or demand that might give rise to the obligation of indemnity hereunder, Sahm Capital shall give written notice thereof to the Client, provided that the failure to give such notice shall not relieve the Client of the obligation of indemnity hereunder, except to the extent that the Client is actually prejudiced by such failure to give notice. Prior to entering into any agreement or settlement which would result in an obligation of the Client to indemnify Sahm Capital as aforesaid, Sahm Capital shall obtain the written consent of the Client, which shall not be unreasonably withheld.
41Legal binding
This Agreement and all the terms herein shall be binding upon both Parties and their respective heirs, estate, executors, representatives, successors and permitted assigns, but the Client shall not assign, delegate transfer or otherwise dispose of the benefits and obligations of the Client under this Agreement without the prior written consent of Sahm Capital.
42Transfer of investments
Where the Client decides to transfer his investments from Sahm Capital to another capital market institution, Sahm Capital shall, in accordance with the CMA Laws and Regulations, liquidate the portfolio of the Client at the expense of the Client and pay to the Client the balance of such liquidated investments.
43Client undertakings
By signing or accepting this Agreement, the Client:
43.1Undertakes that the Client has signed this Agreement in his full eligibility and legal and legitimate capacities and that he is not under any legal or legitimate prohibition that prevents from signing this Agreement.
43.2Undertakes that the Client had received, read and understood the terms and conditions of this Agreement and having been given the opportunity to ask questions relating hereto. The Client agrees that this Agreement will govern the relationship of the Parties.
43.3Undertakes that all data and information provided to Sahm Capital are correct, comprehensive, valid and non-misleading and the Client is entirely responsible for them in all aspects. The Client is committed to updating his data and information where there is any change or confirming that there are no changes to the data or information, either when asked by Sahm Capital at the end of each period set by Sahm Capital. The Client is further committed to provide renewed versions of identification documents of the Client after their expiry.
43.4The Client is aware and acknowledges that according to the instructions governing the investment accounts, issued by the CMA, the Client may not authorizes any person to manage his investment accounts, unless the agent is a relative of the Client on his parents' side, or the offspring, ascending or descending (father, mother, grandfather, grandmother, son, daughter, grandson, or granddaughter) or the husband and the wife, or the brother and the sister, or otherwise being a proxy who is appointed by heirs to liquidate the investment account of their testator, and then close the account.
43.5If Client is a company (unless the company is listed in an exchange), undertakes to immediately notify Sahm Capital when a change of any of the following documents occurs:
(a)Commercial register certificate issued by the competent authority.
(b)The articles of association, bylaws, and their annexes and amendments.
(c)The identification document of the manager in charge.
(d)The resolution appointing the board of directors.
(e)The resolution of the board of director of the Client approving the opening of the Investment Account and nominating individuals authorised to operate the Investment Account.
(f)List of authorised individuals to operate the Investment Account in accordance with the commercial register, articles of association, bylaws of the Client, the resolution of the board of directors of the Client (as applicable) and the valid identification documents for such individuals.
(g)Any licenses issued for the Client by any governmental agency to conduct certain activities.
43.6Undertakes that the Client is aware that Sahm Capital will freeze the investment account of the Client when this commitment set forth in this Clause is breached.
43.7Undertakes to adhere to the Capital Market Law and its implementing regulations, and other applicable laws and regulations within or outside the Kingdom of Saudi Arabia, in particular the Anti-Money Laundering Law (issued by Royal Decree No. M / 31 dated 11/05/1433H) and its Implementing Regulation issued under the Decision of the Presidency of State Security No. (14525) dated 19/02/1439H and the Law on Combating Terrorism Crimes and Financing, issued by Royal Decree No. (M/21) dated 12/02/1439H, and its Implementing Regulations, issued pursuant to the Council of Ministers’ Resolution No. (228) dated 02/05/1440H.
43.8If the Client is a foreigner residing in the Kingdom of Saudi Arabia:
(a)Declaration of knowledge that a valid residence permit (Iqama) is a precondition for his/her investment in securities in the Kingdom of Saudi Arabia and his residence permit (Iqama) shall remain valid during his investment.
(b)Undertakes to provide Sahm Capital with the renewed residence permit (Iqama) upon its validity expiry, or when Sahm Capital requested an update of the Investment Account’s information, otherwise Sahm Capital shall be entitled to freeze the Investment Account of the Client.
(c)Declares that the Client acknowledges and agrees Sahm Capital may not close his Investment Account upon the request of the Client, if his/her residence permit (Iqama) is expired, until such Client has provided the renewed residence permit (Iqama) or a final exit visa, unless the Capital Market Authority instructs otherwise.
(d)Declares that the Client acknowledges and agrees Sahm Capital has the right to liquidate the securities in the portfolio linked to the Investment Account, transfer its cash to the bank account of the Client, linked to the Investment Account, and then close the Investment Account, if the Investment Account was frozen for more than twelve (12) months.
43.9If the Client is a blind or illiterate person:
(a)Undertakes that the personal reference must be a natural person with full legal capacity who personally knows the blind or the illiterate person, holds a valid national identification card, and able to explain and read to the blind or the illiterate person the investment account opening procedures and terms and conditions of the Investment Account opening agreement.
(b)Undertakes that the Client must not use any Services provided by telephone or electronic services for operating the Investment Account until one of employees of Sahm Capital or his personal reference explain to him the terms and conditions related to such Services, and Sahm Capital to inform the blind or illiterate Client that such Services are provided to him based on his desire, choice and awareness of the risks associated with using such Services, and his legal responsibility of all transactions executed through such Services.
43.10Undertakes to submit a written request to Sahm Capital when the Client desires to close the Investment Account.
43.11Undertakes that if the Investment Account is in the name of the Client, but to be operated by the guardian or the custodian or the legal representative of the Client, such guardian or the custodian or the legal representative shall bear all legal responsibilities by operating the Client personal Investment Account. The Client undertakes and agrees that Sahm Capital shall have the right to obtain similar undertaking from such guardian or the custodian or the legal representative.
43.12Declares that the Client acknowledges and agrees that Sahm Capital shall have the right in inquiring about the Client at local banks and financial institutions the Client deals with as well as at the concerned control authorities in order to verify the validity of information and data stated by the Client pursuant to Agreement or under any previous agreement or contract that has not yet expired.
43.13Acknowledges and confirms that the Client has read, understood and agreed this Agreement as well as its attachments or formats, and the Personal Data Protection provided by Sahm Capital and has acknowledged that, the Client is aware that, all these documents mentioned above including their formats and attachments, are subject to be modified or omitted or added to, wholly or partially, from time to time, and has understood them perfectly, and accepted them as part and parcel of this Agreement. The Client further acknowledges and agrees that the Client shall be responsible for the validity and accuracy of the data of his/her fields as well as the information included therein and for attaching and submitting the proving and supporting documents thereof.
43.14Undertakes to abide by the Capital Market Law and its implementing regulations, as well as the other regulations and rules applicable in the Kingdom of Saudi Arabia, especially, the Terrorism Crimes & Financing Act, and the Anti-Money Laundering Act, and its Executive Rule, as well any updates affecting the aforementioned, from time to time.
43.15Acknowledges and agrees that any agreements, documents, forms that are signed manually or electronically by the Client, or/and any other notifications or advice, to be sent to Sahm Capital or to the Client via any means, whether being electronic (electronic mail, or through the internal system of Sahm Capital, as examples only), shall be deemed obligatory and convincing. Moreover, the Client acknowledges and agrees that, any notifications or advices, to be sent by Sahm Capital via any electronic means, represent a complete and acceptable compliance by the Client with any regulatory or contractual obligation, which requires a written notification.
43.16Acknowledges and agrees that, the Client e-mail provided to Sahm Capital, shall be considered a main and essential part of the personal information of the Client, and represents part of the Client address, which Sahm Capital will rely on in communicating electronically with the Client, and in sending any advices, notifications or copies of the electronically or manually signed agreements or forms of the Client. The Client pledges to notify Sahm Capital immediately upon the loss of such e-mail, whether this occurs through hacking, forgetting the password and failure to retrieve it, or due to stopping the provision of the e-mail service to the Client by the service provider or for any other reason. Moreover, the Client pledges to provide Sahm Capital immediately, with an alternative e-mail. All the advice and notifications, sent to the e-mail of the Client, shall be deemed correct and valid, before the Client notifies Sahm Capital of the loss such e-mail and providing Sahm Capital with an alternative e-mail.
43.17Acknowledges and agrees that, Sahm Capital shall be entitled to make any tax deduction from assets of the Client at Sahm Capital subject to foreign countries tax if required by the applicable laws. In the event that, some changes in legislation have been made by the organising bodies which stipulate that, the capital market institutions must make the tax deduction, Sahm Capital shall have the right to perform the same. Sahm Capital shall not be liable for any legal consequences, responsibility or indemnity incurred in the event that the Client e concealed any information or documents, or in case of submitting them in improper manner, which may lead to failure in determining whether assets of the Client with Sahm Capital, are subject to foreign countries tax, or not.
44Severability
If any provision of this Agreement shall be held invalid, illegal or unenforceable, the validity, legality or enforceability of the other provisions of this Agreement shall not be affected and there shall be deemed substituted for the provision or provisions at issue a valid, legal and enforceable provision as similar as possible to the provision at issue.
45The language of the Agreement
45.1This agreement has been executed into the Arabic language, and in case that it is translated into the English language, the Arabic language text shall prevail against the text of any other language.
46Governing law and Jurisdiction
46.1This Agreement shall be governed by, interpreted and construed in accordance with the laws of the Kingdom of Saudi Arabia, including the CMA Laws and Regulations issued thereunder.
46.2The Parties will seek to resolve any dispute arising out of or in connection with this Agreement and the matters contemplated herein amicably. In the event that a dispute cannot be settled amicably within thirty (30) days of notice being given by and to any Party, the Parties hereby agree that such dispute shall be settled by the Committee for the Resolution of Securities Disputes in the Kingdom of Saudi Arabia.
