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The Standby Equity Distribution Agreement (SEDA) is a strategic financing tool used by UAE listed companies to access capital markets flexibly and efficiently. This document is particularly relevant when companies need an alternative to traditional financing methods, providing them with the ability to raise funds by issuing new shares at their discretion. The agreement is structured to comply with UAE Federal Law No. 32 of 2021, SCA regulations, and relevant capital market rules, incorporating necessary provisions for foreign ownership limits and local market practices. It typically includes detailed mechanisms for share issuance, pricing formulas, regulatory compliance procedures, and investor protections. The SEDA offers advantages over traditional equity lines of credit by providing more certainty and flexibility in timing and amount of capital raises, making it particularly attractive for companies with varying capital needs or those operating in volatile markets.

1. Parties: Identification of the company and the investor, including full legal names, registration details, and addresses

2. Background: Context of the agreement, including company's listing status and purpose of the SEDA

3. Definitions: Detailed definitions of key terms used throughout the agreement, including financial and technical terms

4. Facility Amount and Term: Total commitment amount, duration of the facility, and any extension provisions

5. Draw Down Mechanism: Procedures for requesting advances, including notice requirements and pricing mechanisms

6. Conditions Precedent: Conditions that must be satisfied before the agreement becomes effective and before each draw down

7. Pricing and Settlement: Formula for determining share price, discount rates, and settlement procedures

8. Representations and Warranties: Standard and specific representations by both parties, including authority, compliance, and disclosure

9. Covenants: Ongoing obligations of both parties during the term of the agreement

10. Events of Default: Circumstances constituting default and consequences thereof

11. Termination: Grounds for termination and post-termination procedures

12. Confidentiality: Obligations regarding confidential information and announcements

13. Governing Law and Jurisdiction: UAE law as governing law and jurisdiction for disputes

14. General Provisions: Standard boilerplate provisions including notices, amendments, and assignment