Instruction No. 30/2001 on the Registration Conditions for Private Placement Corporate Bonds on the UMOA Regional Financial Market

WEST AFRICAN MONETARY UNION

REGIONAL COUNCIL FOR PUBLIC SAVINGS AND FINANCIAL MARKETS INSTRUCTION NO. 30/2001 RELATING TO THE CONDITIONS FOR THE REGISTRATION OF PRIVATE PLACEMENT CORPORATE BONDS ON THE UMOA REGIONAL FINANCIAL MARKET

Having regard to the Convention of July 3, 1996 creating the Regional Council for Public Savings and Financial Markets, hereinafter referred to as the Regional Council,

Having regard to the General Regulation Relating to the Organization, Operation and Control of the UMOA Regional Financial Market, particularly Article 134, adopted by Decision No. 001/97 dated November 28, 1997 by the Council of Ministers of the West African Monetary Union,

Having regard to the Decision of the Council of Ministers of the UMOA dated June 28, 2000 determining the identification criteria for private placement corporate bonds issued on the UMOA Regional Financial Market,

Having regard to the Decision of the Council of Ministers of the UMOA dated June 28, 2000 establishing a Commission for the Registration of Private Placement Corporate Bonds Issued on the UMOA Regional Financial Market,

Having regard to the deliberations of the Regional Council in its session of March 27, 2001

The Regional Council adopts:

Article 1:
The private corporate bond on the UMOA financial market consists of:

• The issuance of bonds carried out without publicity and whose securities will not be listed on the quotation of the Regional Stock Exchange;
• The issuance of bonds placed through a circle of no more than one hundred (100) qualified investors acting for their own account. A qualified investor is a legal entity capable of understanding the merits and risks inherent in operations on financial instruments;
• The issuance of bonds with a nominal value of 50 million CFA francs;

The aforementioned conditions are cumulative.

Article 2
In accordance with Article 780 of the OHADA Uniform Act on Commercial Companies and Economic Interest Groupings, the issuance of bonds by private placement is permitted only to Anonymous Companies and Economic Interest Groupings composed of Anonymous Companies that have existed for two years and have prepared two balance sheets regularly approved by shareholders.

Article 3:
In accordance with Article 781 of the OHADA Uniform Act on Commercial Companies and Economic Interest Groupings, the issuance of bonds is prohibited for companies whose share capital is not fully paid up.

Article 4:
Any entity intending to issue a private placement corporate bond on the UMOA financial market is required to designate a Securities Management and Intermediation Company (SGI) which will be responsible under its liability for the execution of the operation. The designated SGI must carry out the placement of the securities exclusively, excluding any other distribution network.

Article 5:
The application for registration addressed to the Regional Council must be accompanied by the following documents and information:

• The list of prospective investors. After registration by the Regional Council, this list cannot be subsequently modified by replacement or addition of subscribers,
• The name of the bond issue
• The amount of the operation
• The nominal interest rate and duration
• The repayment terms and schedule
• The effective date
• The articles of association and constitutive acts of the company,
• The resolution of the General Assembly authorizing the issuance or the decision of the body having authorized the issuance,
• The simplified information note intended for the information of declared subscribers.

The Regional Council may request any additional information within the framework of the examination of the file.

Article 6:
The simplified information note referred to in the previous article must contain the following mandatory mentions:
A- Mentions relating to the issuer a) the name or corporate name; b) the address of the registered office; c) the corporate object; d) the names of the main executives; e) the amount and breakdown of share capital f) financial statements of at least two fiscal years, certified by an auditor accredited by the Regional Council; g) projected income statements for the three fiscal years following the year for which the file was submitted; B- Mentions relating to the operation:
h) the terms of the security issuance; i) the indicative placement duration; j) the name of the bond issue; k) the interest rate, nominal value and duration of the bond; l) the repayment terms and schedule m) the effective date n) the amount of the operation; o) the number of securities issued p) the nature of the securities issued (bonds, convertible bonds); q) the form of the securities which must be dematerialized r) the nominal value and issue price of the security

Article 7
The SGI responsible for the execution of the operation is required to transmit to the Regional Council on behalf of the issuer, an issuance report upon the completion of subscriptions.

Article 8
The Regional Council may at any time, after the registration of the operation, interrupt the realization thereof for any reason likely to harm the proper functioning of the financial market. During the entire duration of the bond, the Regional Council may carry out controls to ensure compliance by the issuer with the provisions governing private placement bonds.

Article 9
The Regional Council collects a commission for the registration of private placement corporate bonds realized on the regional financial market.

Article 10
The registration commission for private placement corporate bonds is based on the amount of capital.

Article 11
The fee scale applicable by the Regional Council for the registration of private placement corporate bonds is fixed as follows:
3% for issuances between 1 and 10 billion CFA francs.
2.5% for issuances between 10 and 20 billion CFA francs.
2% for issuances greater than 20 billion CFA francs.
3% for issuances less than or equal to one billion CFA francs.

Article 12:
This instruction shall be published wherever necessary.
Done at Abidjan on March 27, 2001
For the Regional Council
Lassana M. SACKO