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Definitions
Sukuk Using Musyarakah Structure - 1

Corporate and the Special Purpose Vehicle (SPV) enter into a Musharakah Arrangement for a fixed period and agreed profit sharing ratio and the appointment of the Corporate as an agent to develop the land. Any losses will be apportioned based on the capital contributed. The corporate undertakes to buy Musharakah shares of the SPV on a periodic basis.
 
1. Corporate (as Musharik A) contributes land or other physical assets to the Musharakah

2. (a) and (b) SPV (as Musharik B) contributes cash i.e. the issue Proceeds received from the investors to the Musharakah

3. The Corporate as an agent of the Musyarakah to develop the land (or other physical assets) with the cash injected into the Musharakah and sell/lease the developed assets on behalf of the Musharik B.

4. In return, the agent (i.e. the Corporate) will get a fixed agency fee plus a variable incentive fee payable.

5. The profits are distributed to the Sukuk holders.

6. The Corporate irrevocably undertakes to buy at a pre-agreed price the Musharakah shares of the SPV on say semi-annual basis and at the end of the fixed period the SPV would no longer have any shares in the Musharakah.