| 1- | The following terms and phrases, wherever mentioned herein, shall have the same meanings stated in the Finance Companies Control Law.
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| 2- | For the purpose of applying the provisions hereof, the following terms and phrases, wherever mentioned herein, shall have the meanings assigned thereto, unless the context otherwise requires.
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| | 2.1 | Rules: the Rules for Engaging in Debt-Based Crowdfunding.
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| | 2.2 | Debt-Based Crowdfunding: raising funds from finance Participants through a debt-based crowdfunding Platform to be granted to an Institutional Beneficiary in accordance with a loan contract.
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| | 2.3 | Debt-Based Crowdfunding Company: a joint-stock company licensed to engage in Debt-Based Crowdfunding activity.
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| | 2.4 | Debt-Based Crowdfunding Company: A web-based platform or any other digital means, including websites and mobile applications, used and run by a Debt-Based Crowdfunding Company to carry out DebtBased Crowdfunding activity.
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| | 2.5 | Institutional Beneficiary: a micro, small or medium-sized enterprise registered in the Kingdom of Saudi Arabia that has obtained or seeks to obtain financing through a Debt-Based Crowdfunding Platform.
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| | 2.6 | Participant: a natural or legal person who provides finance to an Institutional Beneficiary through a Debt-Based Crowdfunding Company.
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| | 2.7 | Eligible Participant: a natural or legal person to whom one or more of the following applies:
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| | | a. | Has assets with a net value of at least SAR 3,000,000 (three million Saudi riyals).
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| | | b. | Currently working or has worked for at least three years in the financial sector in a position related to finance or investment.
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| | | c. | Has a professional certificate in finance or investment approved by an internationally or locally recognized establishment.
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| | | d. | Has an annual income or profits of at least SAR 600,000 (six hundred thousand Saudi riyals) in the past two years.
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| | 2.8 | Finance Amount: funds raised from Participants via a Debt-Based Crowdfunding Platform to be provided for an Institutional Beneficiary.
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| | 2.9 | Collection Accounts: Bank accounts that are subject to the Rules for Bank Accounts and used only for the collection and management of the Finance Amount.
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| | 2.10 | Default: Default occurs only if one or more of the following criteria are met: |
| | | 2.10.1. The Debt-Based Crowdfunding Company concludes that the Institutional Beneficiary is unable to repay the full Finance Amount after seizing the provided collaterals. |
| | | 2.10.2. The Institutional Beneficiary fails to pay any of the installments agreed upon with the Debt-Based Crowdfunding Company, either in whole or in part, for a period exceeding (90) consecutive days. |
| | 2.11 | Significant Shareholders: Anyone who owns five percent (5%) or more of the Debt-Based Crowdfunding Company’s shares or voting rights. |
