A shareholder who appears in the Company's shareholder register at the end of the second trading day after the Extraordinary General Meeting. The rights will be deposited in the same portfolio in which the Company shares associated with the rights are deposited.
History of the company and the most significant developments of its capital structure 25
Company’s strengths and competitive advantages 29
Mandatory positions in board of directors 33
Compensation and Remuneration of Board Members and Senior Executives 38 5
Directors’ Declarations on Financial Statements 40
Results of operations for the years ended December 31, 2019G, 2020G and 2021G 49
Introduction to and highlights of changes in the company 72
Licenses and permits obtained by the company 81
Continuing Obligations imposed by the Governmental Authorities on the Company
Material information changed since the Authority’s approval of the last share prospectus 98
How to Apply for Subscription in Rights shares (New Shares) 101
A statement of any arrangements in place to prevent the disposal of certain shares 107
Brief about the subscription application and undertakings 109
Documents for incorporation and Articles of Association of the company 111
Number of audit committee meetings in the last three years up to the date of this prospectus 79 Table NO. Number of meetings of the Development and Investment Committee in the last three years to date.
DEFINITIONS AND TERMS
Fractional shares are added to minor shares and treated in the same manner. With available experience and skills, he manages accounting, auditing and control in KSA.
RISK FACTORS
Risks relating to the issuer
- Risks relating to the company’s inability to implement the strategy
- Risks Relating to Liquidity
- Risks relating to the concentration of the company’s revenues
- Credit Risk
- Risks relating to the provision of financing in the future
- Risks relating to rented sites
- Risks Relating to Trademarks
- Risks Relating to Contingent Liabilities
- Risks Relating to Reliance on Key Employees and Executive Management
- Risks Relating to the Application of Developments in International Financial Reporting Standards or the Application of New International Financial Reporting
- Risks Relating to Employee Mistakes and Misconduct
- Risks Relating to Operating Systems and Information Technology
- Risks Relating to Proper Maintenance of the Company’s Assets, Systems and Infrastructure
- Risks Relating to Non-Compliance with the Regulations of the Regulatory Authorities
- Risks Relating to Non-Compliance with Quality Standards Required By Customers
- Risks Relating to Litigation and Lawsuits
- Risks Relating to Potential Shariah Zakat Entitlements and Additional Claims
- Risks Relating to Contracts with Third Parties
- Risks Relating to New Projects
- Risks Relating to the Spread of the Coronavirus Pandemic “Covid-19”
- Risks of not obtaining or not renewing licenses, permits and certificates
- Risks relating to inadequate insurance coverage
- Risks Relating to Non-Compliance with Rules, Regulations and Policies Related to Companies Law and Corporate Governance
- Risks Relating to Saudization of Jobs
- Risks Relating to the Absorption of Fixed Costs
- Risks Relating to Accumulated Losses
- Risks Relating to the Increase in the Company’s Obligations
- Risks relating to accounting errors and deficiencies in financial reports
- Risks Relating to the Increase in Capital
The total number of employees in the company on the date of this prospectus reached (51) workers, among them (17) Saudi workers and (34) non-Saudi workers. That which can negatively affect the company's business results, its future prospects and its financial position in general.
- Risks relating to political and economic instability in the Middle East
- Risks relating to the movement of domestic and international flights
- Risks relating to seasonal factors and climatic conditions
- Risks relating to non-compliance with existing regulations and laws or the issuance of new regulations and laws
- Risks relating to changes in relevant laws and regulations
- Risks Relating to Growth Opportunities
- Risks Relating to the Competitive Environment
- Risks Relating to the Application of Value-Added Tax (VAT)
- Risks Relating to Changing the Mechanism for Calculating Zakat and Income Tax
- Risks Relating to Government Fees Applicable to Non-Saudi Workers
- Risks Relating to the Imposition of New Duties or Taxes
Competition occurs when there are other companies operating in the same business sector of the company and providing similar or competing services. At a rate of four hundred (400) Saudi Riyals per month for each non-Saudi Arabian worker for the year 2018G, it increased to six hundred (600) Saudi Riyals per month for the year 2019G and then to eight hundred (800) Saudi Riyals. month for the year 2020G, and this has led to an increase in the company's costs in general. In the event that additional fees are imposed on non-Saudi workers in the future, this will lead to a further increase in costs, which will adversely affect the Company's business, financial performance and results of operations.
Risks Related to the Offered Securities
- Risks Relating to Possible Fluctuation in the Price of the Rights Issue
- Risks Relating to Potential Fluctuations in the Share Price
- Risks Relating to Non-Profitability or Sale of Rights Shares
- Risks Relating to the Decrease in the Demand for Rights Shares and Company shares
- Risks Relating to Speculation in Rights Shares
- Risks Relating to Low Ownership Percentage
- Risks of Not Exercising the Subscription Rights in a Timely Manner
- Risks Relating to Dividend Distribution to Shareholders
- Risks Relating to Selling Large Number of Shares
- Risks Relating to the Possibility of Issuing New Shares
- Risks Relating to Future Data
- Risks Relating to Suspending Trading or Canceling the Company’s Shares as a Result of not Publishing its Financial Statements During the Statutory Period
There is also no guarantee that there will be sufficient demand for the Company's shares by institutional investors during the remaining offering period. Dividend distribution is subject to certain conditions and controls set out in the company's articles of association. In addition, the Capital Markets Authority can cancel the offering of the company's rights shares in the event that it considers that the offering may not be in the interest of the shareholders.
OVERVIEW OF THE COMPANY AND NATURE OF ITS BUSINESS
- Overview
- History of the company and the most significant developments of its capital structure
- The company’s principal activities
- Tourism business
- Investment activity
- Company’s branches
- Company's Major shareholders
- Company vision
- Company mission
- Company strategy
- Company’s strengths and competitive advantages
- Business interruption
- Employees and saudization
Thus, the Company's shares were reduced from ten million one hundred fifty thousand shares to five million two hundred fifty six thousand six hundred ninety three shares with the cancellation of four million eight hundred ninety three thousand three hundred seven shares . In accordance with Article (4) of the Company's Articles of Association, the Company may establish, on its own, other limited liability or closed joint stock companies, provided that their capital is not less than five (5) million Saudi Riyals. Changes in the number of employees are due to the modernization of the company's records with various government agencies.
COMPANY’S ORGANIZATIONAL STRUCTURE
- Organizational structure
- Board of directors
- Mandatory positions in board of directors
- Board committees
- Audit committee
- Nominations and remunerations committee
- Development and investment committee
- Executive Management
- Compensation and Remuneration of Board Members and Senior Executives
The board's secretary handles the tasks and powers entrusted to him by the board. To propose clear policies and criteria for membership of the board and the executive board. The Development and Investment Committee expires at the end of the current board session on 19/11/1445H (equivalent to 27/05/2024G).
EMPLOYEES
FINANCIAL INFORMATION AND DISCUSSION OF THE MANAGEMENT ANALYSIS
Introduction
Directors’ Declarations on Financial Statements
The Company does not have positions in contractual securities or other assets whose value is subject to fluctuations or whose value is difficult to determine, which could adversely affect the assessment of its financial position, except as described in this section Prospectus. The Company is not aware of any seasonal factors or activity-related economic cycles that may have an impact on the business and financial condition of the Company, except as described in subsection (2.1.20) “Risks related to the outbreak of the coronavirus (Covid- 19)” in Chapter (2) “Risk factors” and subsection (3.10) “business interruption” of Chapter (3) “Overview of the Company and the nature of its activities” of this Prospectus. The Company also acknowledges that there are no collateral obligations (including personal or non-personal security or pledged or unsecured) or contingent obligations or obligations under any underwriting, underwriting credit or lease purchase obligations, except as described in this section and section (10 ) “Legal information” of this Prospectus.
Significant Accounting Policies
The reversal of the impairment loss is recognized as direct income in the statement of profit or loss. In the course of the Company's normal activities, the Company is exposed to a number of financial risks: credit risk, liquidity risk, (including foreign exchange risk, interest rate risk, commodity price risk and share price risk). Financial assets are initially recognized when the company becomes a party to the contractual terms of the instrument.
Results of operations for the years ended December 31, 2019G, 2020G and 2021G
- Income Statement
- Key Performance Indicators (KPIs)
- Statement of Financial Position
- Statement of Cash Flows
This decrease is mainly due to the decrease in the annual rental of the chalets. Government fees fell by 16.9% to 0.3 million Saudi Riyals in the year 2021G, also due to the absence of the above-mentioned value added tax penalty. The decrease in the net book value is due to the continuous depreciation of the assets according to the company's policy.
USING THE PROCEEDS OF THE OFFERING AND FUTURE PROJECTS
Net Offering Proceeds
In addition, there are many investment opportunities in the hospitality sector that are presented to the Company and the Company continuously evaluates these opportunities. If the Company reaches a definitive agreement with Shuaa Capital PJSC to purchase the aforementioned hotels, the Company will use the amount of Saudi Riyals set forth in the table below (“Table No. 47) Use of Offer Proceeds”) to finance the acquisition portion of the amount. In the event that the Company is unable to reach an agreement with Shuaa Capital to purchase these hotels or obtain the necessary amount of financing, the Company will continue to seek and evaluate other investment opportunities in this sector in accordance with the amount allocated for the purchase of the SAR.
EXPERT STATEMENTS
DIRECTORS REPRESENTATIONS
LEGAL INFORMATION
Introduction to and highlights of changes in the company .1 Trade name
- Company organization and stages of development of its capital
- Major SHAREHOLDERS
- Head Office
- Company Duration
- Articles of Association
- Company activity
- Management
- Formation of the Board of Directors
- Appointment to mandatory positions (Chairman of the Board of Directors, Deputy Chairman, Secretary and Managing Director)
- Board of Directors’ Remuneration
- Board of Directors’ Meetings
- Board of Directors’ Committees
Abdullah Omar Al-Suwailem as Deputy Chairman of the Board of Directors and as General Manager and Mr. 17/10/1442H (corresponding to 29/05/2021G) Deputy Chairman of the Board of Directors Abdullah Omar Al-Suwailem Minutes of the meeting of the Board of Directors on. 17/10/1442H (corresponds to 29/05/2021G) Director General Ali Abdullah Al-Salham Minutes of the board meeting issued in circulation.
Licenses and permits obtained by the company
- Licenses, certificates and approvals related to the company headquarter
- Licenses, certificates and approvals related to the company branches
The company is bound by the security conditions of the Directorate General for Civil Defence. As of the date of this prospectus, the company has obtained the following certificates and licenses*:. After perusing all the company's documents, and according to its declarations, the company's branch "Palm Beach Resort, which is a branch of Tourism Enterprise Company (TECO)" is located in the same headquarters as the main branch, so that the company's headquarters and its branch operate in the same headquarters , which means that the branch does not need to obtain a membership certificate from the Chamber of Commerce and Industry.
Subsidiaries
However, until the date of this prospectus, the certificate of cancellation for the commercial register of the aforementioned branches has not been reviewed. The commercial register is currently being renewed and application no. 31358) was submitted to the Ministry in February 2022G and is still in the process until the date of this prospectus. The company has also informed us that the branch does not have any registered employees, which means that the branch does not need to obtain a certificate of Saudiization, social insurance and a certificate of engagement in accordance with the wage protection system (WPS) and other certificates. regarding the legality of employing workers in the company under Saudi law.
Continuing Obligations imposed by the Governmental Authorities on the Company in its Capacity as a Licensee
- The Continuing Obligations as per the requirements of the Ministry of Commerce
- The Continuing Obligations as per the requirements of Zakat, Tax and Customs Authority
- The Continuing Obligations as per the requirements of the Ministry of Human Resources and Social Development
- The Continuing Obligations as per the requirements of the General Organization for Social Insurance
- The Continuing Obligations as per the requirements of the CMA
- The Continuing Obligations as per the requirements of the Ministry of Municipal, Rural Affairs and Housing
- The Continuing Obligations as per the requirements of the Ministry of Tourism*
Accordingly, (the brand) has been removed from the company's name on the Capital Market Authority's website. The clause was included in the Corporate Governance Regulations as one of the tasks of the board of directors. Non-compliant - the company publishes the reports of the board of directors and the annual accounts.
Summary of Material Contracts
- Contracts and Transactions with Related Party
- Lease Contracts
- Supply Contracts
- Contracts and agreements for services and consulting
- Loans and credit facilities
As of the publication date of this prospectus, the company has not yet certified the two lease agreements. As of the date of this prospectus, the company has not concluded any supply contracts, as it stated that it does not have any long-term contracts or written agreements with any of the suppliers, where it deals with them through purchase orders. Accordingly, there are no long-term or short-term contracts and agreements, and all ongoing business is conducted through purchase and sale orders with all of the company's customers.
Memorandum of understanding (MOU)
Properties of the company
Litigation
As a result of finding material financial obligations owed by Hemaia Security and Safety Equipment and Trading Co. Hemaia) which were not previously disclosed to TECO by the company's owners and were not declared in the company's audited financial statements and due financial analysis examination report, the Board of Directors of "TECO" decided to withdraw from Hemaia Security and Safety Equipment and Trading Co. Consequently, the company has filed a lawsuit in the Riyadh Commercial Court against the founders of Hemaia Security and Safety Equipment and Trading Co. Further, on 04.03.2021 G., the first-instance judgment was pronounced, with which the case was closed and the company submitted a request, which has not been examined until the date of preparation of this report.
Trademarks
Abdul Hamid bin Abdullah Al-Tareef (Former Board Member - Former CEO) has filed a labor lawsuit against the company to demand the payment of wages and allowances for all contract clauses for the entire remaining period with a total claimed amount of Saudi Riyals due to termination of services following the suit the plaintiff. The company appealed the judgment within the legal deadline and on 29/03/1443AH (corresponding to 04/11/2021G) an appeal judgment was issued in favor of the company, which did not order it to pay the aforementioned financial claim.
Insurance
Material information changed since the Authority’s approval of the last share prospectus
Declarations of Board Members in relation to Legal Information
UNDERWRITING
Underwriter
Summary of the underwriting agreement
EXEMPTIONS
DETAILS RELATING TO SHARES AND TERMS AND CONDITIONS OF THE OFFERING
- Offering
- How to Apply for Subscription in Rights shares (New Shares)
- Subscription Application
- Trading and Subscription stage Remaining Offering Period
- Eligible Persons Not Participating in the New Shares Subscription
- Allocation and refund of the Excess
- Payment of compensation amounts
- Supplementary prospectus
- Offering cancellation or suspension
- Restrictions on trading in pre-emptive rights
- Frequently Asked Questions (FAQ) About Pre-emptive rights
- Decisions and approvals under which the shares will be offered
- Miscellaneous provisions
- A statement of any arrangements in place to prevent the disposal of certain shares
How the investor is notified of the right of first refusal by depositing the rights in the portfolio. The preferred rights will be deposited in the same portfolio in which the shares of the company related to the rights are deposited. After the completion of the rights purchase settlement (which is two business days), the priority rights must be entered during the subscription period.
CHANGES IN THE SHARE PRICE AS A RESULT OF AN INCREASE
Calculating the market value of the company at closing on the day of the Extraordinary General Assembly (EGM)
Calculating the share price on the opening day of the day following the day of the Extraordinary General Assembly (EGM)
UNDERWRITING COMMITMENTS
- Brief about the subscription application and undertakings
- Allocations
- Saudi Stock Exchange Company (Tadawul)
- Trading the company’s shares in the Saudi stock market
An application was made to the Authority for the registration and offering of the rights shares on the Saudi Stock Exchange, and another application was made to the Tadawul Stock Exchange (Tadawul) for their listing. It is expected that the registration and commencement of trading of the Rights Shares on the Saudi Stock Exchange will be approved after the completion of the final allocation of the Rights Shares and will be published on the Tadawul website at that time. Although the existing shares are registered on the Saudi Stock Exchange and the Company's shares are listed on the Stock Exchange (Tadawul), the new shares cannot be traded until the final allotment of shares has been approved and deposited among the subscribers. ' portfolios.
DOCUMENTS AVAILABLE FOR REVIEW
Documents for incorporation and Articles of Association of the company
Approvals relating to Offering
Reports, letters, and documents
Financial Statements
