1. Handling of Unpaid Rights Central Depository System
(CDS)

2. Unpaid Rights - An Overview
Physical handling was cumbersome.
Handling of unpaid rights in CDS has resulted in managing end to end transactions and their conversion into securities electronically.
Resultantly, issuance, subscription and renunciation of rights have become virtually paperless, increasing efficiency and reliability.
It has also reduced unnecessary costs involved in printing, dispatching, and subscribing unpaid rights.

3. Unpaid Rights - Salient Features
Credit of unpaid rights to entitled accounts in book- entry form.
Settlement of unpaid rights in book-entry form.
Faster conversion of unpaid rights into shares.
Facility of Partial Subscription.

4. Unpaid Rights Announcement of Issuance of Rights
15 Days prior notice of Book Closure
Setup of unpaid rights as a separate security
Delisting
Unpaid
Rights
Allotment
Confirmation letter to CDC be sent within 14 BDs of the last payment date.
Entitlement Calculation
- Calculation of ratio a day before the BC starting date
- Entl. List & SBD after EOD of 2nd BD of BC starting date
Subscription & Cancellation
Subscription & Cancellation: Before the last payment date
Credit in Respective A/Cs
- Credit after reopening of share transfer books
- Notification to be sent within 2 business days after credit
Trading & Settlement
Settlement: After the credit into CDS
Trading: Discontinued 5 BDs prior to last payment date.
Movement: Not allowed after last trading date

5. Direct credit of Unpaid Rights to the respective accounts in CDS
Issuer to provide the confirmation to CDC for the distribution (credit) of Unpaid Rights.
The accrued entitlements are credited to the entitled accounts under active participants in CDS.
Issuer prepares and dispatches physical LOR, to the entitled accounts with suspended Participants.
Explain to the clients why LOR is not credited to suspended participants electronically.

6. Notification of Credit of Unpaid Rights
Issuer to notify the A/C holders, Sub A/C holders & IAS A/C holders, the following:
The entitlements
Last trading & payment date
Payment procedure
Circular/notice as required U/s 86 of the Companies Ordinance, 1984
Issuer also notifies the credit of Unpaid Rights into CDS with payment procedures and schedule through newspaper as well as communicate the same to the SEs.
Draft payment procedures already provided

7. Trading & Settlement Settlement of Unpaid Rights:
Unpaid rights are available for book-entry transfers immediately after the credit into CDS for settlement.
Trading Period / Last Transaction Date:
Issuer to determine the trading period and last date of payment in accordance with the regulations of the SEs.
Trading shall be discontinued five business days prior to the last payment date.
Movement of Unpaid Rights will not be allowed after the last date of trades/settlement.
Settlement through NCCPL (NCSS).

8. Subscription of Unpaid Rights
A/C holders/Participants/IAS, are required to initiate the Right Subscription Request into CDS before the last payment date after which the unpaid rights security is freezed into respective accounts in CDS.
Upon initiation, CDS will:
- Block the holding in the respective accounts as “pending for subscription”.
- Transmit the right subscription request details at Issuer/R/TAs end.
- Allow A/C holder/Participant /IAS to obtain printout of the right subscription
request.
Depositors can deposit the required amount to Issuer’s designated bank as per normal procedure.
The Participants will take a written request from Sub Account Holders for subscription request, draft of which will be provided to the participants.

9. Cancellation of Subscription
A/C Holder/Participant to submit to CDC a written request for cancellation of Right Subscription Request before the last payment date with duly marked printout “As Cancelled” on behalf of the subscriber.
CDC executes cancellation of Right Subscription Request in CDS and confirm to the concerned A/C Holder/Participant.
Standard Template for cancellation of subscription

10. Allotment of Right Shares/Certificates
Issuer uploads the data of reconciled accounts in CDS.
CDC credits the shares/certificates against upload details in CDS.
The subscribers of physical LOR gets the certificates in physical form.
The documentation required for the upload and subsequent credit will remain same as per the current procedure such as Auditor Letter e.t.c.

11. Revocation / De-listing of Unpaid Rights Security
The remaining balance of unpaid rights is considered as lapsed.
After completion of rights shares / certificates issuances in book entry form, unpaid rights security is revoked / de-listed from the CDS.

12. Issuance and Deposit of physical unpaid rights into book entry form
Physical Letter of Rights against securities held in physical form to be issued in jumbo form.
Unpaid Rights in physical form can be deposited into CDS till 7 business days prior to the last trading date.
A/C holders/Participants will send letter of rights duly signed by shareholders and renounce in favor of CDC with securities deposit form.
SDF with letter of right required for deposit in CDS.

13. Transactions Withdrawal:
Unpaid Rights in book entry form can be withdrawn from the CDS as per normal procedures within 7 days from the date of credit of unpaid rights into book entry form.

14. Thank You…