1- Procedure for resolving defaults Non-settlement due to a securities shortfall Non-settlement due to a cash shortfall Non-settlement due to a securities shortfall 2- Buy-in procedure Description of the buy-in procedure Non-settlement due to a securities shortfall Settlement for a buy-in 3- Resale procedure Description of the resale procedure Settlement for a resale Resale procedure failure   1- Procedure for resolving defaults Non-settlement due to a securities shortfall Action  Deadline Theoretical settlement (S) of the movement   S   Directive sent to the defaulting brokerage firm in the event of an unsettled movement     S+1   Recycling of the unsettled movement If the unsettled movement is settled within the regulatory deadline:     The defaulting brokerage firm pays a fine calculated on the basis of 0,2% applied to the quantity of securities. The fine cannot be lower than 2000 dirhams net of tax and exceed 10.000 dirhams net of tax, by value in suspense and date of negotiation.   The defaulting brokerage pays damages and interest to the brokerage firm which is the victim, The amount of the damages cannot be lower than hundred dirhams.     No later than S+6   Buy-in procedure triggered in the event of non-settlement by S+6    S+7   Organizing a second meeting of redemption in case of failure of the first. Termination clause in case of unavailability of titles.    S+8   Non-settlement due to a cash shortfall Action  Deadline Theoretical settlement (S) of the movement    S Directive sent to the defaulting brokerage firm in the event of an unsettled movement.     S+1 If the cash amount of the unsettled movement is greater than 50% of the initial contribution   Then the Casablanca Stock Exchange makes a call for a cash amount of the unsettled movement - 0.5x the initial contribution.   In the event of non-payment, the Casablanca Stock Exchange momentarily suspends the brokerage firm.     S+2   Recycling of the unsettled movement   If the unsettled movement is settled within the regulatory deadline :    The defaulting brokerage firm pays a fine calculated on the basis of 0,2% applied to the amount in suspense. The fine cannot be lower than 2000 dirhams net of tax and exceed 10.000 dirhams net of tax, by value outstanding and date of negotiation.   The defaulting brokerage pays damages and interest to the brokerage firm which is the victim, The amount of the damages cannot be lower than hundred dirhams.     No later than S+3     Resale procedure triggered in the event of non-settlement by S+3  S+4   2- Buy-in procedure Description of the buy-in procedure Prior to the buy-in session, on S+6, brokerage firms are notified by the Casablanca Stock Exchange of the details of the buy-in. 1st buy-in session : The buy-in of securities is carried out on the following terms : The buy-in price is : - The reference price on (S+7) + (The reference price on (S+7) x maximum applicable authorised price change) Maximum authorised price change = 6% for equity securities Maximum authorised price change = 200 basis points for debt securities 1. Brokerage firms participating in the buy-in session must be custodians for the orders placed for the security in question. They are obliged to inform the Markets Division, before 09:00, of their securities account balance as at S+6 for the security in question, delivered by Maroclear. 2. Brokerage firms participating in the buy-in session must indicate the number of securities on its order which must be at least equal to the number of securities concerned by the buy-in. The price is indicated by the Casablanca Stock Exchange. 3. The Casablanca Stock Exchange provides brokerage firms with the necessary systems for participating in the buy-in session. A dedicated platform is provided for this purpose. 4. Brokerage firms are informed of the result of the buy-in on the same day (S+7).  2nd buy-in session : If, at the end of the first buy-in session, the securities have not been delivered (entirely or partially) due to a lack of supply, the Casablanca Stock Exchange organises a second and final buy-in session for the next day having informed all brokerage firms by notice on the following terms:  - The reference price on (S+8) + (2x the maximum applicable authorised change x The reference price on (S+8)) The second buy-in session will take place on the same terms as the first. In the event of partial allocation of bought-in securities, if the number of securities offered is fewer than the position to be bought-in, the Casablanca Stock Exchange may decide, depending on the number of securities in question, that the buyer awaiting delivery is partially served depending on availability. The balance will be subject to financial compensation as provided for in the  defeasance clause detailed below. In the event that the Exchange decides against partial allocation, if the securities supplied is fewer than the position to be bought-in, the Casablanca Stock Exchange will cancel the offer of securities submitted by the new buyers and will inform them immediately. Settlement for a buy-in 1. On the day of the buy-in, the Casablanca Stock Exchange informs: - The defaulting seller by a “Notice of Execution of Buy-in” - The buyer which is the victim by a copy of the OTC delivery against payment for the securities in question 2. Settlement of bought-in positions will take place on the same day by sending Maroclear instructions concerning OTC delivery against payment. These instructions concern two movements : - The buy-in of securities bringing the new seller into direct contact with the Casablanca Stock Exchange - Re-delivery of the securities received by the Casablanca Stock Exchange to the initial buyer awaiting delivery In order to ensure secure and rapid settlement, the Casablanca Stock Exchange will itself ensure delivery against payment instead of the brokerage firms. 3. If the number of securities to be bought-in is greater than the cash amount of the unsettled movement, the negative buy-in differential will be borne by the defaulting seller. If the defaulting seller is unable to pay the buy-in differential, the built-up margin (initial contribution) is used as a substitute. The brokerage firm remains suspended from carrying out its business activity until it rebuilds its initial margin. The Casablanca Stock Exchange may automatically liquidate, partially or entirely, the positions instead of the defaulting party at the expense of the latter, as defined by the procedure for resolving cash shortfalls.  4. If the number of securities to be bought-in is fewer than the cash amount of the unsettled movement, the positive buy-in differential will be returned to the defaulting seller.  3- Resale procedure Description of the resale procedure 1st  resale session : The resale of securities is carried out on the following terms :  - The reference price of S+4 – maximum applicable authorised price change x The reference price of S+4. This is currently 6% for equity securities and 200 basis points for debt securities. 1. The seller awaiting payment must provide the Casablanca Stock Exchange on S+3 at the end of the business day with an account balance certifying that the securities initially sold do indeed appear in its account held at Maroclear. 2. Brokerage firms participating in the resale session must indicate the number of securities on its order. The price is indicated by the Casablanca Stock Exchange. 3. The Casablanca Stock Exchange provides brokerage firms with the necessary systems for participating in the resale session. 4. Brokerage firms are informed of the result on the same day. 2nd resale procedure : If, at the end of the first resale session, the number of securities requested is fewer than the number of securities to be resold, the Casablanca Stock Exchange organises a second resale session for the next day. It informs brokerage firms that the resale will take place on the following terms : The reference price on (S+5) - ( 2x the maximum applicable authorised change x The reference price on (S+5)). The session will take place on the same terms as the first. If demand for securities is less than the position to be resold, the Casablanca Stock Exchange may decide, depending on the number of securities in question, to cancel the requests made by the new buyers. Settlement for a resale On the day of the resale, the Casablanca Stock Exchange informs : - The defaulting buyer whose order has been executed in the resale market by a “Notice of Resale” ; - The seller, whose movement has been blocked, is informed by a copy of the OTC delivery against payment of the securities in question. Settlement of resold positions will take place on the same day by sending Maroclear instructions concerning OTC delivery against payment. These instructions concern two movements: - The resale of securities bringing the new buyer into direct contact with the Casablanca Stock Exchange ; - The payment of cash for securities received to the seller awaiting delivery. In order to ensure secure and rapid settlement, the Casablanca Stock Exchange will itself ensure delivery against payment instead of the brokerage firms. An additional cash payment is made if the resale amount is different from the unsettled cash amount. If the resale amount is less than the unsettled cash amount, the negative resale differential will be borne by the defaulting buyer. The Casablanca Stock Exchange will advise of the resale result as soon as it knows it. A wire transfer order corresponding to the negative sale differential: - Debits the defaulting buyer’s account for an amount equal to the resale differential and credits the Casablanca Stock Exchange's account for the same amount. If the defaulting buyer is unable to pay the resale differential, the Casablanca Stock Exchange may automatically draw from its contribution to the guarantee fund. The brokerage firm remains suspended from carrying out its business activity until its regulatory margin is rebuilt. If the amount is greater than the unsettled cash position, the positive resale differential will be returned to the defaulting buyer. Resale procedure failure If the securities have not been able to be resold after both resale sessions, the guarantee system uses the defaulting brokerage firm’s margin to pay the seller awaiting payment. The brokerage firm remains suspended from carrying out its business activity until its regulatory margin is rebuilt.