Fractional Real Estate Crowdfunding

Version : 1.0.1

Date :  6 April 2026

Regulatory Sandbox

Wahed X Sdn. Bhd. is participating in the Regulatory Sandbox administered by the Securities Commission Malaysia (SC) in respect of its Fractional Real Estate Crowdfunding (FREC) offering which shall also be referred to as “FREC Offering”.

The Regulatory Sandbox is a controlled and time-bound testing environment that allows innovative capital market products or services to be offered on a limited basis, subject to specific terms and conditions imposed by the SC.

The starting date of the Sandbox begins 5 March 2026 and ends on  5 March 2027

Experimental Nature of the FREC Offering

Investors are hereby notified that:

• The FREC offering is experimental in nature and is being tested under the Regulatory Sandbox framework;
• Certain regulatory requirements may be modified, exempted, or applied differently during the testing period; and
• The business model, operational processes, or product features may change during or after the sandbox testing period, subject to SC approval.

No Regulatory Endorsement or Guarantee

Participation in the Regulatory Sandbox does not constitute approval, endorsement, or recommendation by the Securities Commission Malaysia of:

• Wahed X Sdn. Bhd.;
• Any issuer hosted on the platform; or
• Any investment offered through the platform.

The SC does not guarantee the performance, returns, or success of any investment offered under the Regulatory Sandbox.

Additional Risks Associated with Investors Participating in a Sandbox Offering

As the offering is conducted under the Regulatory Sandbox:

• There may be additional operational, legal, and regulatory risks compared to fully-commercialised products;
• The sandbox testing period may be terminated, varied, or not extended by the SC;
• Wahed X Sdn. Bhd. may be required to cease the FREC Offering or implement an orderly wind-down, in accordance with SC requirements, if the sandbox participation ends or is withdrawn. Investors will be notified via written communication of such event.

Orderly Wind-Down and Cessation of FREC Offering

Potential Cessation of Participation on FREC Offering

Wahed X Sdn. Bhd.’s Fractional Real Estate Crowdfunding (FREC) offering is conducted under the Securities Commission Malaysia’s Regulatory Sandbox. As such, Wahed X Sdn. Bhd. may be required to cease the offer and/or exit the Regulatory Sandbox, including prior to the completion of the intended testing period, if:

• the sandbox test is deemed unsuccessful by the Securities Commission Malaysia (SC);
• the SC directs Wahed X Sdn. Bhd. to suspend or cease its sandbox activities and FREC Offering;
• Wahed X Sdn. Bhd. voluntarily elects to discontinue the FREC Offering with the SC’s consent; or
• other regulatory, operational, or strategic considerations arise that necessitate cessation.

In such circumstances, Wahed X Sdn. Bhd. will implement an orderly wind-down in accordance with its approved Winding Down Framework and all applicable SC requirements.

Cessation of Fundraising Activities

Upon the initiation of a wind-down of the FREC Offering:

• All new and ongoing FREC fundraising campaigns will be suspended;
• Any uncompleted or partially funded campaigns will be terminated; and
• Investor funds held in trust or escrow for uncompleted campaigns will be refunded to investors, subject to reconciliation and trustee processes.

Wahed X Sdn. Bhd. will notify affected investors and the SC promptly and provide clear instructions on refund timelines and next steps.

Treatment of Funded FREC Campaigns and SPVs

For FREC campaigns that have successfully completed fundraising and have acquired the underlying real estate assets prior to the cessation:

• The regulated crowdfunding activity concludes upon completion of capital raising; and
• The funded special purpose vehicles (SPVs), structured as limited liability partnerships (LLPs), may continue to operate in accordance with their partnership agreements and Malaysian Law, subject to guidance or directions from the SC.

Where permitted by the SC, Wahed Global Services (WGS), as the appointed General Partner of the SPV will continue to manage the SPVs, including property operations, rental income distribution, reporting to investors, and eventual asset disposal in line with the original investment mandate.

Contingency Asset Liquidation Scenario

If the SC does not permit continued management of the funded SPVs following sandbox cessation, Wahed X Sdn. Bhd. will facilitate a structured and transparent liquidation process, which may include:

• independent valuation of the underlying properties;
• orderly sale of the assets at prevailing market value;
• settlement of outstanding liabilities and costs; and
• pro-rata distribution of net proceeds to investors.

Investors should note that forced or time-bound asset liquidation may result in returns that are lower than originally anticipated, and capital losses may occur.

Governance, Oversight, and Investor Protection

An internal Wind-Down Working Committee, authorised by the Board of Directors, will oversee the wind-down process. The committee will:

• coordinate regulatory notifications and reporting to the SC;
• safeguard investor assets, records, and data;
• ensure continued compliance with AML/CFT, Shariah governance, and technology risk management obligations; and
• maintain dedicated investor communication channels throughout the wind-down period.

All wind-down activities will be conducted in a manner intended to be orderly, transparent, and fair, with priority given to the protection of investor interests, subject to regulatory directions and prevailing market conditions.

Investment Risks

All persons who register as an 'investor' on this Website should carefully read the following warnings before making any investment.

All investment products carry risks. The relevant webpages and documents will cover risks specific to an individual offer. Please bear in mind the following general risks involved when investing through this Website:

REGULATORY STATUS DISCLOSURE

Wahed X Sdn. Bhd. is registered with the Securities Commission Malaysia as a Recognized Market Operator (RMO) and is participating in the Regulatory Sandbox for the testing of Fractional Real Estate Crowdfunding (FREC).

The Securities Commission Malaysia does not review, approve, or endorse any investment offered on this platform, nor does it guarantee the performance or returns of any investment.

YOUR PERSONAL DECISION TO INVEST

A decision to invest in a company is a personal decision by you and no responsibility for the consequences of that decision is accepted by Wahed X Sdn. Bhd.  ( or by any of its partners, directors, agents, employees, or other members. To invest through this Website you need to understand the following important risks:

NO CAPITAL MARKET COMPENSATION FUND PROTECTION

Investments made through Wahed X Sdn. Bhd. are not protected under the Capital Market Compensation Fund (CMCF) established under the Capital Markets and Services Act 2007. Investors may lose the entire amount invested in the event of issuer default, project failure, or platform cessation.

Market & Liquidity Risks

LOSS OF INVESTMENT

‍Investments, whether in new or existing businesses, carry high risks as well as the possibility of high rewards. Accordingly, each investor should consider very carefully whether such investments are suitable in the light of their own personal circumstances, commitments and available financial resources. Engaging in any investment activity may expose you to a significant risk of losing all of your investment. If a company fails, it is likely that you may lose all, or part, of your initial investment and receive no outstanding or future interest payments. In such circumstances neither the company nor  Wahed X will pay you back your investment.

Most of the companies which are listed are new companies with limited if any track record. These companies will provide information such as their business plan and financial forecasts. Please be warned that these documents are not guarantees that the relevant company can achieve what it is hoping to do. Equally the information provided may state certain facts and statements, and again please be warned that  Wahed X are not responsible for checking the accuracy of these facts and statements, which may not always prove to be true or complete.

LIQUIDITY

‍As an investor you should be aware that no established market exists for the trading of bonds or equity in private companies, and as such are not easily realisable. It must be appreciated that there could be difficulty in selling such investments at a reasonable price and, in some circumstances, it may be difficult to sell them at any price.

PROPERTY LIQUIDITY RISKS

Real estate is an inherently illiquid asset class. There may be delays in selling the underlying property, particularly during economic downturns or if the property is located in a low-demand area. Investors should expect their capital to be tied up until the targeted exit timeline, typically 6 years, with no guarantee of early exit or resale options.

PROPERTY VALUATION & MARKET RISKS

Property values are subject to fluctuations based on factors such as interest rate changes, economic cycles, zoning regulations, and comparable sales. Capital appreciation is not guaranteed, and investors may experience a loss in capital upon exit.

RENTAL YIELD VARIABILITY RISK AND STRATEGY ADJUSTMENT RISK

Projected rental income is not guaranteed. Variations in market rent, tenant turnover, or economic disruptions may result in lower-than-expected yields or rental income suspension.

Each property is selected, underwritten, and configured based on an intended rental strategy (including short-term rental (“STR”) or long-term rental (“LTR”)) at the outset, and a change in rental strategy is not expected and is not part of the base case investment strategy.

However, in limited and exceptional circumstances, including sustained underperformance of STR income relative to comparable market benchmarks, material changes in applicable laws or regulatory requirements, or adverse market conditions, the Issuer, acting through its General Partner in accordance with the LLP Partnership Agreement, may review and adjust the rental strategy, including a transition from STR to LTR. Any such adjustment would be undertaken primarily to protect investor capital and stabilise cash flows, rather than to enhance returns.

A change in rental strategy may result in lower potential returns but reduced income volatility, and investors may experience changes to the amount and timing of rental distributions. There is no assurance that any strategy adjustment will improve performance or prevent losses.

DIVERSIFY YOUR PORTFOLIO

‍Diversification by spreading your money across different types of investments should reduce your overall risk of financial loss. We highly recommend investors do this to maintain a balanced portfolio. Investors should also consider avoiding putting their money in the same investment as immediate family members. Investors should only invest a proportion of their available investment funds due to the high risks involved.

TAX

‍Wahed X recommends that you seek independent tax advice on any investments which you make via this Website. It is your responsibility to make sure that you have paid any and all taxes due in relation to any investment that you make through Wahed X.

RECOMMENDATION

‍Wahed X does  not provide advice or make personal recommendations. If you are in any doubt about the action you should take or the contents of a particular Offer Document, you should seek advice from an independent financial advisor authorised under the CMSA 2007 .

PAST PERFORMANCE

‍Past performance is not a reliable indicator of future performance. You should not rely on any past performance as a guarantee of future investment performance.

EXIT RISK

There is currently no secondary market for the trading of fractional interests offered on this platform. Investors should not expect to exit their investment prior to the targeted exit timeline, and any exit is subject to market conditions and successful execution of the exit strategy.

Fractional Real Estate Crowdfunding (FREC) Operational and Management Risks

Vacancy Risk and Temporary Income Suspension Risk

The property may experience prolonged periods of vacancy due to market conditions, property quality, or poor tenant demand. During this time, no rental income will be generated, but fixed operational costs (e.g., maintenance, insurance, property management) will continue to accrue.

Where STR occupancy levels are consistently below prevailing market comparables, or where regulatory, zoning, or operational constraints adversely affect STR viability, the Issuer, acting through its General Partner and in accordance with the LLP Partnership Agreement, may temporarily suspend rental activities to facilitate a review or implementation of an alternative rental strategy, including LTR.

During any such transition period, rental income distributions may be reduced or suspended, and investors may experience temporary interruptions to cash flows. Any suspension or adjustment would be implemented with the objective of preserving asset value and improving income sustainability, but there is no guarantee that such measures will result in improved returns or mitigate losses.

Maintenance and Unexpected Repair Risk

The property may incur unexpected repairs or maintenance issues (e.g., HVAC failure, water damage, pest infestation) that increase operational expenses. These costs may reduce distributable income or deplete cash reserves.

Capital Reserve Depletion Risk

Each Issuer maintains a cash reserve intended to cover 6 months of operating costs. However, in the event of prolonged vacancies or large unforeseen expenses, this reserve may be depleted. Replenishment will be made from future rental proceeds, potentially delaying distributions.

Operational and Management Risk

The success of the investment depends on the capabilities of appointed third-party property managers. Failures in service delivery, negligence, or misconduct may impact the property’s income potential and compliance status.

No Investor Control

Investors participate as Limited Partners and do not hold voting rights or decision-making authority regarding operations, rental strategy, or exit except for the provisions made under ‘reserved matters’ in the LLP Partnership Agreement. All decisions are managed by the General Partner in accordance with the LLP Partnership Agreement.

Fractional Real Estate Crowdfunding (FREC) Legal, Regulatory & Compliance Risks

Regulatory and Legal Risk

Changes in property, tax, housing, land, or crowdfunding regulations may adversely affect the structure or performance of the investment. In addition, enforcement actions, compliance lapses, or contractual disputes may result in delays or losses.

Shariah Non-Compliance Risk

While the product is designed to adhere to Shariah principles, there remains a risk that certain elements (e.g., tenant behavior, decorations, insurance products) may unintentionally breach compliance. Shariah audits and controls are in place, but residual risks remain.

Force Majeure & Natural Disaster Risk

Events such as natural disasters, pandemics, war, or government-imposed restrictions may negatively impact the property’s condition, rentability, or ability to exit the investment.

Regulatory and Statutory Disclaimers

• This issue, offer or invitation for the offering is a proposal not requiring authorisation of the Securities Commission Malaysia under section 212(8) of the CMSA 2007.
• This document has not been reviewed by the Securities Commission Malaysia. The Securities Commission Malaysia does not recommend nor assume responsibility for any information including any statement, opinion or report disclosed in relation to this fundraising exercise and makes no representation as to its accuracy or completeness. The Securities Commission Malaysia expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the information disclosed.
• The designation of this product as Shariah-compliant is based solely on the advice of our appointed Shariah adviser, Shariyah Review Bureau. This designation does not constitute, and should not be construed as, an endorsement or approval by the Shariah Advisory Council of the Securities Commission Malaysia.

Waitlist and Acceptance of Investors

Waitlist and Admission of Investors

1. By submitting an application or indication of interest to invest in any offering on the Platform, you acknowledge and agree that you are being placed on a waitlist and are not guaranteed participation in such offering.
2. Admission of investors into any offering shall be determined by the Platform (or the Issuer, where applicable) on a first-come, first-served basis, subject to availability of allocation and satisfaction of all applicable eligibility, regulatory and due diligence requirements.
3. The Platform and/or Issuer reserves the absolute discretion to accept or reject any application, in whole or in part, including but not limited to circumstances where:

• the offering is fully subscribed;
• the applicant does not meet eligibility or onboarding requirements;
• there are regulatory, compliance, or risk considerations; or
• any other reason deemed appropriate by the Platform or Issuer.

d. Placement on the waitlist does not create any right, entitlement or expectation to participate in an offering or to receive any allocation of investment units.

e. The Platform shall not be liable for any losses, costs or damages arising from an applicant’ failure to be admitted into an offering.

Investor Risk Acknowledgement

By investing through the Wahed X platform, investors acknowledge and confirm that:

• they are participating in a capital market product offered under the Regulatory Sandbox administered by the Securities Commission Malaysia;
• they understand that the offering is experimental in nature and may involve heightened operational, legal, and regulatory risks compared to fully commercialised products;
• they acknowledge that the sandbox participation may be varied, suspended, terminated, or not extended by the Securities Commission Malaysia;
• they accept that Wahed X Sdn. Bhd. may be required to cease the offering or implement an orderly wind-down, in accordance with regulatory requirements; and
• they understand and accept that their investment is subject to the terms, conditions, limitations, and directions imposed by the Securities Commission Malaysia, and that they may lose all or part of their invested capital.

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