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40.05 SAR
All rights related to the General Assemblies shall be guaranteed to the shareholder as provided in the Company’s Bylaws, Companies Law and the relevant Implementing Regulations.
a. Extraordinary General Assembly’s Powers:
The Extraordinary General Assembly shall have the power to amend the Company’s ByLaws with exception of matters which the law prohibits to be amended. Furthermore, the Extraordinary General Assembly may pass resolutions on matters principally falling within the competence of the Ordinary General Assembly, subject to the same requirements applicable to the Ordinary General Assembly.
The Extraordinary General Assembly shall have the following Competencies:
1) amending the Company’s bylaws, except for amendments which are deemed null and void pursuant to the provisions of the Companies Law;
2) increasing the Company’s share capital in accordance with the situations provided by the Companies Law and Its Implementing Regulations;
3) decreasing the Company’s share capital if it exceeds the Company’s needs or in the event the Company incurs financial losses, in accordance with the situations provided by the Companies Law and Its Implementing Regulations;
b. Ordinary General Assembly’s Powers
Except for the competencies reserved to the Extraordinary General Assembly, the Ordinary General Assembly shall have competencies in all affairs of the Company, and particularly the following:
1) appointing and dismissing Board members;
2) permitting a Board member to have direct or indirect interest in the business and contracts that are executed for the Company’s account, in compliance with the provisions of the Companies Law and Its Implementing Regulations;
3) permitting a Board member to take part in any activities that may lead to competition with the Company, or competition in any of its activities, in compliance with the provisions of the Companies Law and its Implementing Regulations;
4) monitoring the compliance of the Board members with the provisions of the Companies Law and Its Implementing Regulations and other relevant laws and the Company’s bylaws; inspecting any damage that may occur as a result of their violation of such provisions or mismanagement of the affairs of the Company; determine the liability resulting therefrom and undertaking the procedures it deems proper in this regard pursuant to the Companies Law and Its Implementing Regulations;
5) forming the audit committee pursuant to the provisions of the Companies Law and Its Implementing Regulations;
6) approving the Company’s financial statement ;
7) approving the Board report;
8) deciding on the proposals of the Board with respect to the method of distributing the net profits;
9) appointing the external auditors of the Company, specifying their remunerations, reappointing them, replacing them and approving their reports;
10) looking into the violations and errors committed by the external auditors of the Company when performing their duties and any difficulties, reported by the Company’s external auditors, regarding their empowerment by the Company’s Board or Management to review the books, records and other documents, statements and clarifications required to perform their duties, and respond to that as it deems appropriate in this regard;
11) resolving to withhold from setting aside statutory reserve when it reaches an amount equal to (30%) of the Company’s paid share capital, and resolving to distribute the surplus of such percentage to the Company’s shareholders in financial years where the Company does not generate net profits;
12) using the Company’s consensual reserve, if such has not been set aside for a specific purpose, provided that using such reserve shall be based on a proposal submitted by the Board and used in ways that benefit the Company or the shareholders;
13) forming other reserves besides the statutory reserve and consensual reserve and disposal of the same;
14) setting aside amounts from the Company’s net profits to set up social organisations for the benefit of the Company’s employees or to assist any such existing establishments in accordance with Article (129) of the Companies Law; and
15) approving the sale of more than (50%) of the assets of the Company, whether in one or several transactions within a period of 12 months from the date of the first selling transaction. In case selling these assets includes what falls within the powers of the Extraordinary General Assembly, the approval of the said Assembly is required.
1. With the necessity of strict adherence to the provided provisions in the Chapter nine in the Regulatory Rules and Procedures issued pursuant to the Companies Law relating to Listed Joint Stock Companies, titled (Proxy Procedures for Attending General and Special Assemblies), each shareholder has the right to attend the shareholders general assemblies. A shareholder may appoint a third party other than a member of the board of directors or an employee of the Company as proxy to attend the general assembly on its behalf;
2. The ordinary or extraordinary general assembly shall convene in accordance with the situations and circumstances stated in the Company’s Bylaws, Companies Law and the relevant Implementing Regulations;
3. The ordinary general assembly shall convene at least once per year within the six months following the end of the Company’s financial year;
4. Shareholders General or special Assembly meetings shall be convened at the invitation of the board of directors. The board of directors shall call for a meeting of the Ordinary General Assembly if requested to do so by the auditors, by audit committee or by a number of shareholders representing at least five percent (5%) of the Company’s capital. The auditors may call for an Assembly meeting in case the board of directors did not call the Assembly meeting within thirty (30) days from the date of the auditor’s request;
5. The date, place and agenda of the general assembly shall be announced at least twenty one (21) days prior to the date thereof; the invitation shall be published on the website of Tadawul and the Company’s website and a daily newspaper distributed in the province where the Company’s Head Office is located. The Company may also announce such date through methods of contemporary technologies;
6. Shareholders shall be granted the opportunity to effectively participate and vote in the general assembly meetings. The general assembly meetings of shareholders may be convene and a shareholder may participate in their deliberations and vote on their resolutions using methods of contemporary technologies;
7. The board of directors shall work on facilitating the participation of the largest number of shareholders in the meeting of general assembly, such as: choosing the appropriate place and time of such meeting; and
8. The shareholders wishing to attend a General or Special Assembly may register their names in the Company’s head office or at any other place or manner specified by the board of directors prior to the time specified for such meeting.
1. Shareholders who own no less than five (5) percent of the Company’s shares are entitled to add one or more items to the agenda of the general assembly upon its preparation;
2. The board of directors, upon preparing the agenda of ordinary general assembly, shall take into consideration the matters that shareholders wish to add;
3. The board of directors shall separate each of the matters listed in the agenda of the general assembly meeting as an independent item, and not combine significantly different matters under one item, and not combine the businesses and contracts in which board members have a direct or indirect interest under one item, for the purpose of obtaining the shareholders’ vote for the item as a whole; and
4. The shareholders shall be allowed through the Company’s website and Tadawul’s website, when the invitation for the convention of the general assembly is published, to obtain the information related to the items of the general assembly’s agenda, particularly the reports of the board of directors and external auditor, the financial statements and the audit committee’s report.
1. The shareholders’ General Assembly meetings shall be presided over by the chairman or, in his absence, by his deputy, or a member delegated by the board of directors in the absence of the chairman and his deputy;
2. The chairman of the shareholders’ assembly shall commit to grant the shareholders the opportunity to effectively participate and vote in the meetings of general assembly, and to avoid any procedure that may preventing their attendance to the assemblies or the exercise of the voting rights;
3. Each shareholder shall have the right to discuss the items listed in the General Assembly’s agenda and to direct questions to the members of the board of directors and the auditors in relation to such matters. The board of directors or the auditors shall answer the shareholders’ questions to the extent that it does not jeopardize the interests of the Company. Should a shareholder consider the reply unsatisfactory, he/she may appeal to the General Assembly whose resolution will be considered final in this respect;
4. Shareholders shall be granted access to the minutes of the general assembly meeting; and the Company shall provide CMA with a copy of such minutes within (10) days of the date of such meeting; and
5. The Company shall announce to the public and inform CMA of the results of a general assembly meeting immediately following its conclusion.