The Public Joint-Stock Company is any Company whose capital is divided into equal-value negotiable shares. The shareholder is only liable inasmuch as his contribution in the capital.

Every Public Joint-Stock Company shall have a name that indicates its objectives. Its name might not be of that of a natural person unless the Company’s objective is an exploitation of a Patent registered in the name of that person, or if the Company owned a commercial establishment and used the name of that establishment as its name.

In all circumstances, the phrase: “Qatari Public Joint-Stock Company” is to be added to its name.

The Public Joint-Stock Company should be of a limited period to be mentioned in its Contract and Articles of Incorporation. The Company’s period may be extended by virtue of an extraordinary General Assembly’s resolution.

If the Company’s objective is to fulfil a certain task, the Company will expire by its completion.

The Company’s capital must be sufficient to accomplish the objective behind its establishment.

In all cases, the capital of the Company should not be less than ten million Riyals.

The resolution of establishing a Joint- Stock Company is issued by the Minister.

The Public Joint-Stock Company shall be established by not less than five founders.

The Company shall subscribe its shares for initial public offering (IPO) within sixty days as from the date of its establishment. Should the Company not offer its shares with this prescribed period, it shall be terminated by the rule of law; and it is so if its founders do not amend the Company’s Contract and Articles of Incorporation and transform it into another type of the companies provided for in the Law within thirty days as from the expiration date of the period of IPO subscription, the founders shall bear the costs of such transformation, including the fees and monetary penalties to be imposed by the Ministry. The founders shall be liable in all their monies for the Company’s liabilities for such period.

Relieved from the condition of the minimum number of the founders provided for in the Previous Article are the Public Joint-Stock Companies that are established by the government and other public organizations and establishments and the companies in which the state’s contribution is at least 51%, or by a percentage less than that upon the approval of the Council of Ministers, by itself or with collaboration of another or more Qatari or foreign founders, whether he was a natural or artificial, public or private person.

In pursuance of the provisions of Article 66 hereof, the founders should conclude, among each other, the Company’s Contract and its Articles of Incorporation in accordance of the two forms to be decreed by the Minister, and where these two forms shall not be contradicted unless for serious reasons to be sanctioned by the administration.

They should include the following information:

1- The Company’s name and headquarter thereof;

2- The Company goal of its establishment;

3- The names, nationalities, addresses, and professions of the founders and the number of shares underwritten by each of them;

4- The value of the Company’s authorised capital (if any);

5- The value of the Company’s issued capital, and the number, kind and at-par value of shares it is divided to, and the paid-up value thereof;

6- The Company’s duration;

7- A statement of each non-monetary share, and the name of its presenter, all the conditions pertaining to presenting it, and the rights in-rem imposed on this share;

8- An approximate report about the amount of expenses, fees, and costs the Company pays or is committed to pay due to its establishment.

The founders should elect amongst themselves those who undertake the establishing procedures with the concerned Administration.

The request for Company establishment is to be submitted to the Ministry attached with copies of the Company’s Contract and Articles of Incorporation drafts.

The Administration may ask for any additional statements it deems necessary, and the supporting documents of these statements; it may also request to examine the economic feasibility study of the project.

The Administration is permissible to request amendments to the drafts of Company’s Contract and Articles of Incorporation so that they comply with the provisions of this Law and the two forms indicated in Article 69 herein.

In all circumstances, the request shall be considered within ten days as from the date of its presentation after fulfilling the necessary documents.

In case of the Administration’s approval of the request submitted for establishing the Company, the founders shall sign the Company’s Contract and Articles of Incorporation in accordance with the drafts approved by the Administration, and get them legalized from the competent entity for legalization, and submit them to the Ministry so that the Minister would issue a resolution pertaining to establishing the Company within an utmost period of thirty days effective from the date of submission.

In case the request for establishment is refused or the expiration of the period stipulated in the previous article without having a reply, the founders may complain before the Minister within thirty days effective on the date of being notified about the refusal decision or the expiration of the duration indicated accordingly.

The Minister shall consider the complaint within thirty days as of the date of its submission. Those whose request is refused shall be notified via any means of knowledge. The lapse of this duration without a reply shall be deemed an implicit refusal thereof. The decision in this respect is considered peremptory.

If the request for establishing the Company is peremptorily rejected, the founders may not submit another request to establish the same Company unless after one month effective on the date of considering the refusal as peremptory.

The resolution of establishing the Company must be published in the official gazette annexed with the Company’s Contract and Articles of Incorporation. The Company does not acquire its artificial personality unless after being declared.

Declaration is completed by registration in the commercial register and publishing in the official gazette altogether.

The founders shall subscribe for shares, not less than 20%, nor more than 60% of the Company’s capital.

However, none of the founders shall have the right to subscribe for the shares being underwritten in the IPO during the establishment phase. Before calling the public to subscribe for the Company’s shares, the founders shall submit to the Administration a certificate from the bank proving that they have already deposited, in the Company’s account, the amounts equal to the percentage to be paid by the public for each share upon subscription, along with the draft subscription prospectus, which will be prepared by the founders in accordance with the provisions of Article 77 hereof.

After satisfying the above-mentioned conditions, the Administration shall authorise to publish the subscription prospectus in two daily local newspapers, where one of which shall at least be in Arabic and on the Company’s website if any.

The invitation for public underwriting will be through publishing an advertisement in two daily local newspapers, one of which shall at least be issued in Arabic before at least one week from the beginning of the underwriting. The underwriting circular should include the following information:

1- The names and nationalities of the founders;

2- The name of the Company, its objective and headquarter;

3- The value of the Company’s authorised capital (if any);

4- The value of the Company’s issued capital, the paid-in amount thereof; the kind, at-par value, and number of shares offered for the public underwriting or the amount of shares underwritten by founders and the restrictions imposed on the share trading;

5- The stocks in-rem, and related information and its decided rights if available;

6- The particular peculiarities granted to the founders or to third parties if available;

7- Mode of allocating profits;

8- Estimation of the Company’s establishment expenses;

9- The founders’ settlement of the required percentage of the value of shares they underwrote;

10- Minimum number of shares a person may underwrite in, and the maximum with what does not exceed the percentage determined for the founder;

11- Date, duration, place, and conditions of underwriting;

12- Date of issuing the resolution that permits the establishing of the Company;

13- Mode of allotment of shares on underwriters in case the underwriting exceeds the number of floated shares;

14- Any other issues that affect the rights and obligations of shareholders;

15- Any other data for the determination of which a decree by the Minister will be rendered;

The founders or their representatives shall sign the invitation to underwriting. They will be jointly responsible for the authenticity and fulfilment of the above-mentioned information.

The announcement shall be annexed with a report signed by the auditor stating that he has examined the announcement, and has reviewed and certified the information it includes.

In case of the existence of a website for the Company, the data of underwriting shall be posted thereon, where the website domain address shall be listed in the announcement provided for in this article.

The underwriting shall be undertaken at one or more banks recognized by the State, or via the companies authorised for this effect. The instalments due upon underwriting shall be paid at the bank. Paid amounts shall be deposited in a special account opened in the name of the under-establishment Company.

The subscription of the shareholder should be undertaken by a declaration he signs on the subscription application where he mentions the number of the shares he underwrote and his acceptance to the Company’s Contract and Articles of Incorporation and his chosen domicile in the state provided that it is in Qatar, and any other needful information as viewed necessary by the underwriter.

The underwriting should be absolute and not conditional; any condition made by the underwriter is considered invalid.

The subscriber shall submit the subscription application to the underwriting bank and pays the required instalments against a receipt signed and approved by the underwriting bank showing the name of the subscriber, his chosen address, the date of underwriting, the number of underwritten shares, and the paid instalments.

The underwriting shall be considered peremptory upon the subscriber’s takeover of this receipt.

A printed copy of the Company’s Contract is given to every subscriber and this is affixed in the receipt of underwriting.

Any concerned party may obtain during the period of underwriting a printed copy of the Company’s Articles of Incorporation free of charge, or for a reasonable fee determined by the underwriting prospectus.

In case of the existence of a website for the Company, a copy of the Company’s Contract and Articles of Incorporation shall be posted thereon.

The underwriting bank shall keep all the money paid by the shareholders in an “Under Establishment” account of the Company, and it may not be handed over except to the Board of Directors after the announcement of establishing the Company and registering it in the commercial registry.

The subscription shall remain open for a period neither less than two weeks nor more than four weeks.

In the event that no offered shares are sold within the period set for subscription, the founders shall have the right, after obtaining the Administration’s approval, to extend the period for not more than two weeks. However, in the event the offered shares are not sold at the end of the said period, the founders shall abstain from establishing the Company or reduce its capital by the amount that is not subscribed for, in compliance with the provisions of Article 65 hereof.

If the establishment of the Company does not take place, the founders have to fully pay back the money paid by the subscribers, in addition to any revenues resulted therefrom within an utmost period of one week since the date determined to accomplish the underwriting in accordance with the provisions of the previous article. They shall be jointly responsible for paying back the amounts of money and expenses paid for the establishment of the Company, and they will be jointly responsible towards third parties for the works and actions revealed thereby during the establishment period.

In case of capital reduction, the subscribers have the right to withdraw their subscription within a period not less than the first period of subscription, such period shall start from the date of announcement thereof in two daily local newspapers, one of them at least is issued in Arabic, and on the website of the Company if any. If they do not withdraw the underwriting within this period, their subscription shall be deemed peremptory.

In the event it appears, after closing the subscription period, that the number of the subscribed shares exceeded the number of the offered shares, the shares shall then be distributed to the subscribers in accordance with the content provided for in the subscription prospectus.

In all cases, the exceeding funds resulting from the subscription and the proceeds realized shall be returned to the shareholders through the underwriting banks in which they had subscribed within a period not exceeding two weeks as from the date of closing the subscription.

Any concerned party, within thirty days since the underwriting process is over, may ask for the judgment of nullifying any underwriting taking place in contradiction with the previous provisions.

Within a period of ten days since the underwriting process is over, the founders shall notify the Administration of the underwriting result, the shares value paid by the subscribers, and a statement of their names and the number of shares each has underwritten.

During the period stipulated in the previous article, the founders shall invite the subscribers to hold a Constituent General Assembly, in pursuance of the statuses established for the invitation of the General Assembly after taking the Administration’s approval, given that the date of holding the meeting shall be within thirty days as of the date of addressing the invitation. A copy of the invitation shall be sent to the Administration in order to dispatch a representative thereof to attend the meeting.

This assembly shall be appropriately held upon the presence of shareholders representing at least half of the capital. The meeting shall be chaired by the person, who is elected by the founders.

Every subscriber has the right to attend the Constituent General Assembly regardless of his quantity of shares.

The founders shall submit to the Constituent General Assembly a report that includes sufficient information about the incorporation process with all the supporting documents.

The Constituent Assembly shall look particularly into the following matters:

1- Determination of those selected from the founders about the process of incorporation and the expenses it required;

2- Ratification of the Company’s Articles of Incorporation;

3- Election of the members of the first Board of Directors and the appointment of the auditors and determining their fees;

4- Legalizing the assessment of shares in-rem if available;

5- Announcing the final establishment of the Company.

The Constituent General Assembly shall issue its resolutions by the absolute majority of the shares that are correctly represented in conformity with the provisions hereof.

The first Board of Directors shall undertake the procedures of declaring the Company in conformity with the provisions hereof. The members of the first Board of Directors shall be jointly responsible for the damages resulting from not fulfilling the procedures of declaration indicated.

As soon as it is declared, the sequels of actions done by the founders for its account before declaration shall be transferred to the Company.

The Company bears all the expenses paid by the founders in this respect.

If the Public Joint-Stock Company is illegally established, any concerned party, within six months since its establishment, may give it notice of the necessity for rectification within one month since the date of notice. If the Company has not initiated the required rectification during this period, such party may request the judgment of nullifying and liquidating the Company assuming it as a de facto Company.

However, the shareholders could not allege against third parties with the invalidity of the Company.

If the Company was illegally established, the shareholders and any other concerned party could, within the period during which a lawsuit of invalidation could be filed in conformity with the provisions of the previous article, file a joint-liability lawsuit against the founders, the members of the Board of Directors, and the auditors.

If the shares of the Public Joint-Stock Company is not listed for trading at the financial market with one year as from the date of its incorporation or transformation into a Public Joint-Stock Company, it shall automatically become a Private Joint-Stock Company, where the founders shall be jointly responsible before the Administration for all its fees to be become a Private Joint-Stock Company.

An elected Board of Directors shall manage the Public Joint-Stock Company. The Company’s Articles of Incorporation shall determine the mode of its election, the number of its members, and duration of its membership provided that the number of its members shall be not less than five and not more than eleven.

The duration of membership should not be for more than three years except for the first Board of directors, whose membership may be five years.

A member of the Board of directors may be re-elected more than once unless the Company’s Articles of Incorporation stipulate otherwise, or if the member fails to reserve any condition of those provided for in Article 97 hereof.

The member of the Board of Directors may withdraw from the Board provided that it is done in a suitable time; otherwise, he will be responsible before the Company.

The General Assembly elects the members of the Board of Directors by secret ballot. With an exception of that, the first Board of Directors may be appointed by the founders. Upon voting for the election of the Board of Directors, each share shall have one vote, which to be given by the shareholder to the favourable candidate. The shareholder may allocate his voting vis-à-vis his shares amongst more than one candidate. He may not vote vis-à-vis one share for more than one candidate. Voting for electing the members of the Board of directors in the Public Joint-Stock Companies listed in the financial market shall be conducted in accordance with the governance system drawn up by the Authority.

In case of the expiration of the duration of the Board of directors prior to ratifying the Company’s financial statements by the General Assembly, the duration of the Board shall be extended until the date whereat the ordinary general assembly is convened.

The member of the Board of Directors is conditioned:

1- to be not less than twenty-one years old, and to possess the full capacity;

2- not to be previously convicted of a criminal penalty, or in a dignity or honesty beaching crime, or any of the crimes stipulated in Articles 334 and 335 hereof, or to be adjudicated bankrupt unless he was rehabilitated;

3- to be a shareholder, and holds a number of the Company’s shares determined by its Articles of Incorporation. These shares should be deposited within sixty days since the membership, in any of the accredited banks. Its deposit should continue without being subject to trading, mortgage, or seizure until the end of the membership duration and the ratification of budget of the last fiscal year during which the member was fulfilling his work.

The shares mentioned earlier in the foregoing Paragraph shall be allocated for warranting the rights of the Company, shareholders, creditors and third parties for the responsibility lying on the members of the Board of Directors. If the member did not submit the guarantee in the way mentioned, his membership is invalid.

One-third of the members of the Board of directors may be amongst the experienced non-shareholding dependent members, who shall be relieved from the condition of holding the shares provided for in Clause No 3 hereof.

If the member of the Board of directors is disqualified from any of such conditions, the capacity of membership shall be deprived as from the date of the deprivation of such condition.

Except for the state representatives in the Public Joint-Stock Companies, or the persons owning capital shares of at least 10% of these companies, none in his personal capacity or in the capacity of being the representative of any artificial person, could either be a member in the Board of Directors of more than three Joint- Stock Companies whose headquarters located in the state, nor the Chairman or the deputy chairman of the Board of Directors in more than two companies whose headquarters located in the state.

In all cases, none, whether in his personal capacity or in the capacity of being a representative of any artificial person, could be a managing director to more than one Company whose headquarter located in the state; or to conjoin the membership in the Board of Directors of two companies of similar activity.

The membership of the Board of Directors of companies that exceed the quorum determined in this Article shall be invalid with respect to the historic sequence of this membership. Accordingly, the member should return all payments to the Company or companies of which his membership is invalid.

If the state is shareholding in a Joint-Stock Company, it may, instead of electing members of the Board of Directors, delegate its representatives in the Board inasmuch as the shares it owns, and their number is then deducted from the total number of members of the Board of Directors. Every one of them has solely the right of dismissing those representatives or assigning others at any time. The representatives of the state, appointed in the Board of Directors, shall enjoy all the rights and obligations of the other elected members. The state will be responsible for the works of its representatives before the Company, creditors, and shareholders thereof. The representatives of the state in the Board of Directors of the Public Joint-Stock Companies shall be relieved from offering guaranty shares for their membership.

The Board of Directors elects by secret ballot the Chairman and the deputy chairman for one year, unless the Company Articles of Incorporation determines another duration, yet the duration should not exceed three years.

The Board of Directors may elect by secret ballot a member or more managing directors, who have the right to sign for the Company jointly or severally depending on the Board resolution.

If the position of the Board of Directors member becomes vacant, it will be occupied by the person who got more of the shareholders’ votes and did not obtain the Board of Directors membership. If he had obstacles not to occupy it, then it will be occupied by the subsequent; and the new member only completes the period of the previous member.

In case there is no person to occupy the vacant position, the Board of Directors shall remain with the remaining number unless this number is less than five members.

However, if the vacant positions make up one fourth of the original positions or if the number of the remaining members is less than five ones, then the Board of Directors has to call for a meeting of the General Assembly within two months since the vacancy of the last position to elect who will occupy the vacant positions.

Each Company should annually submit to the Administration a detailed list, approved by the Chairman of the Board of Directors, including the names of the Chairman and members of the Board of Directors, their capacities, their nationalities, and how to contact them. The Company should notify the Administration of any change that might take place to such list as soon as it occurs.

The Chairman of the Board of Directors is the head of the Company, and he represents it before third parties and before the courts. He should execute the resolutions of the Board and abide by recommendations thereof. The Chairman of the Board of Directors could delegate some of his powers to another member of the Board.

At the absence of the Chairman, the deputy chairman shall substitute for him.

The Board of Directors shall meet by an invitation from its Chairman as per the conditions stipulated in the Company’s Articles of Incorporation. The Chairman has to call for a meeting upon the request of at least two of the members.

The meeting is not valid unless at least half of the members attend it, provided that the attending members should not be less than three, unless the Company Articles of Incorporation stipulate a greater number or proportion.

The Board of Directors should meet at least six times during the Company’s fiscal year unless the Articles of Incorporation stipulate a higher number of meetings. Participation in the meetings of the Board of Directors may be conducted via secured means of the generally-accepted modern technologies; that enable the participant to actively hear and take part in the Board’s agenda.

A period of more than three months may not elapse without holding the Board meeting.

Another member of the Board could represent an absent member, in writing, in presence and voting, while any member cannot represent more than one member.

The majority of the present and represented members shall make the Board resolutions. When the votes are equal, the party, which is favoured by the Chairman, shall predominate.

The member, who did not agree on any resolution made by the Board, could record his objection in the meeting minutes.

The Board of directors may, in case of exigency or urgency reasons, issue a circular resolution provided that all the members of the Board of directors approve in writing, given such resolutions shall be presented in the Board’s successive meeting and shall be noted down in the meeting minutes.

If one of the members failed to attend three consecutive meetings of the Board, or four non-consecutive meetings, without an excuse accepted by the Board, he shall be deemed resigned.

The minutes of the Board of Directors meetings shall be recorded in a particular register, and shall be signed by each of the Chairman, the managing director (if any), and the member or employee carrying out the works of the Board Secretariat.

The meetings’ minutes are regularly affixed in the register after every meeting on consecutive pages.

Taking into consideration the competencies assigned to the General Assembly hereof or in the Company’s Articles of Incorporation, the Board of Directors enjoys the absolute powers necessary to practice the works required by the Company’s objective. Within the limits of competencies thereof, the Board may authorise any of its members to perform a particular work or more or to supervise any of the Company’s activities.

Neither the Chairman nor any member of the Board of Directors has the right to participate in any competitive business to the Company or trade for his account or others’ account in any of the sub-activities practiced by the Company. Otherwise, the Company could ask him for compensation, or to consider the transactions to have been done for its benefit.

Neither the Chairman nor the Board member nor any of the directors could do a business similar to the Company’s business, or have a direct or indirect interest in the Contracts, projects, or undertakings done to the benefit of the Company.

The Company may not offer any kind of monetary loans to any of its Board members, or guarantee any loan concluded by him with third parties. Exceptionally, the banks or other trust companies have the right to lend any of the Board members or to establish a credit for him or guarantee his loans that are to be concluded with third parties, provided it is under the same circumstances and conditions determined by Qatar Central Bank. Without breaching the Company’s right to claim the violator for compensation when necessary, any act that contradicts the provisions of this Article shall be deemed invalid.

The Chairman, any Board member, and the Company’s employee shall be forbidden to make use of any information that may directly or indirectly come to their knowledge owing to their membership or job, for their benefit or the benefit of their wives, children, or relatives up to the fourth degree as results of dealing with the Company’s securities. They also may not have any direct or indirect interest with any party that execute transactions intended to influence the prices of securities issued by the Company. Such forbiddance shall be effective for a period of three years after the expiration of the person’s membership in the Board of directors or end of service in the Company.

The Company shall abide by the works done by the Board of Directors within the limits of its competencies.

The Company is accountable for compensation for damages resulting of the illegal works practiced by the Board members.

The Chairman and Board members are jointly responsible for compensating the Company, the shareholders, and third parties for the damage resulting from cheating, misusing power, or breaching the provisions hereof or the Company’s Articles of Incorporation, and for gross performance mistakes. Any contradicting condition shall be deemed invalid.

All the Board members will bear the responsibility stipulated in the previous Article if the error occurred due to a resolution made by the members’ unanimity. If the resolution is made by the majority, the demurrers, as long as they have their demur affixed in writing in the minutes of meeting, do not bear any responsibility for the resolutions. Absence from the meeting could not be considered an excuse for being relieved from responsibility unless it is certain that the absent member was not aware of the resolution, or his inability to demur it after being informed.

The Company may file the lawsuit of responsibility against the Board members due to the errors causing damages to the aggregate shareholders within a period of five years effective since the occurrence of the error. The ordinary General Assembly shall resolve filing this lawsuit and assigning the Company’s representative for pursuing the case. However, if the Company is undergoing liquidation, then the liquidating party would file the lawsuit by virtue of a resolution made by the General Assembly.

If the Company did not file the Lawsuit, then every shareholder could file it severally if the error would cause him damage as a shareholder, provided that he notifies the Company of his intention to file the lawsuit. Any contradicting condition in the Company’s Articles of Incorporation shall be deemed invalid.

Any resolution made by the General Assembly pertaining to the clearance of the Board of Directors does not dismiss the lawsuit of responsibility against the Board members for errors they caused while executing their mission. If the act causing the responsibility is submitted to the General Assembly and is approved, then the lawsuit of responsibility expires after five years as of the date whereat the Assembly is convened. Nevertheless, if the act attributed to the Board members is a criminal offense, nonsuit is conditioned by the public nonsuit.

The General Assembly may dismiss the Chairman of the Board of Directors or any of its members by virtue of a suggestion made by the absolute majority of the Board of Directors, or upon a request signed by a number of shareholders who own not less than one fourth of the capital underwritten.

In the latter case, the Chairman of the Board should call for the meeting of the General Assembly within ten days effective on the date of submitting the request for dismissal; otherwise, the Administration would call the for the meeting itself.

The Company’s Articles of Incorporation set forth the method to be adopted for determining the remunerations of the members of the Board of Directors. The remunerations could be a percentage of profit not exceeding 5% after deduction of the legal reserves and distributing a profit of not less than 5% of the Company paid capital to the shareholders.

Every fiscal year, the Board of Directors shall prepare the Company’s balance sheet and profit and loss statement and cash flow statement and the notes in comparison with the previous fiscal year: all of which shall be approved by the Company’s auditors who shall prepare a report about the Company’s activities and financial position throughout the bygone year, and the future plans for the coming year.

The Board shall prepare these reports and documentations within an utmost period of three months since the end of the Company’s fiscal year. They are to be submitted to the meeting of the shareholders’ General Assembly that should be held within an utmost period of four month since the date of the ending of the Company’s fiscal year.

The Board of directors shall invite all the shareholders to the General Assembly meeting by publication of the invitation in two local daily newspapers, one of which shall at least be issued in Arabic and on the website of the Financial Market and the Company’s website (if any).

Such invitation shall be published at least 15 days prior to the date of the General Assembly meeting. The invitation shall also contain an adequate summary of the agenda of the general assembly meeting, together with all the documents and data as set forth in the preceding Article and the auditor’s report.

A copy of the invitation shall be sent to the Administration at the same time such invitation is sent to the newspapers.

The Board of Directors annually shall put, at the shareholders’ disposal, for their own examination before the convention of the General Assembly, which is called to look into the Company’s balance sheet and the Board of Directors’ report before at least one week, a detailed statement that includes the following information:

1- All the money obtained by the Chairman and every Board member of the fees and salaries and the attendance consideration for the Board of Directors sessions and the incurred-expense allowances and any other funding with whatsoever capacity;

2- In-rem and cash perquisites for the Chairman of the Board or each Board member during the fiscal year;

3- The remunerations that the Board of Directors suggests to be distributed among the Board members;

4- Amounts to be earmarked for every present Board member;

5- Transactions in which any of the Board members or the directors have interest that opposes that of the Company;

6- Amounts actually spent for any kind of advertisement with the details related to each amount;

7- Donations with a report about the donated parties and justifications and details.

Concerning banks and other financial institutions, this statement should be annexed with the auditors’ report certifying that the monetary loans, credits, or guarantees submitted to the Chairman or Board members during the fiscal year that have been done without breaching the provisions of Article 110 of this law.

The Chairman of the Board of Directors and any of the members should sign the indicated detailed statement. The Chairman and the members of the Board of Directors are responsible for executing the provisions of this Article and for the authenticity of information mentioned in all its papers.

The General Assembly shall be held by an invitation for meeting by the Board of Directors at least once per annum at the place and date to be specified by the Board of Directors after the approval of the Administration. The meeting should be held within the four months following the end of the Company’s fiscal year.

The Board of Directors may invite for the assembly convention whenever necessary.

The Board of Directors should invite the General Assembly for convention when requested by the auditor. If the Board did not call for a meeting within fifteen days since the submission of the request, the auditor has the right to call for a meeting directly after the approval of the Administration, which shall give its say in the request within fifteen days as from the date of its receipt.

The Board of Directors also has to call the General Assembly for convention upon the request, for serious reasons, of a shareholder or shareholders who own at least 10% out of the capital within a period not less than fifteen days since the date of request submission. Otherwise, the Administration will approve the request of the shareholders through calling for this meeting on the Company’s expense within fifteen days since the date of receiving the request. In both cases, the agenda is limited to the request issue.

Taking into consideration the provisions of both Articles 88 and 124 of this law, the Administration shall call for the convention of the Company’s General Assembly in the following cases:

1- If thirty days have elapsed since the date determined in Article 123 hereof and the General Assembly has not been called for convention;

2- If the number of the Board of Directors members became less than the least number stipulated in Article 101 hereof and the General Assembly has not called for convention;

3- If it revealed at any time that the law or the Company’s Articles of Incorporation are breached or in case of a great fault is taking place in its management.<

In all these cases, all procedures required for the convention of the General Assembly should be adopted and to the Company’s expense.

Chairman shall publish the budget, profit and loss statement, comprehensive summary of the Board of Directors report, Auditors’ full report in two national (local) newspapers of which one, at least, is written in the Arabic language and on the Company’s website, if applicable; fifteen days, as a minimum, prior to the convening of the General Assembly. Copies of these documents shall be submitted to the Management prior to the publishing phase in order to determine the mechanism and method of publication.

The agenda of the annual General Assembly should include the following issues:

1- Hearing out and approving the Board of Directors’ report about the Company’s activities and its financial position throughout the year, and to the auditor’s report;

2- Discussing and approving the Company’s balance sheet and profit and loss statement;

3- Discussing and approving the governance report;

4- Considering the Board of Directors’ suggestions pertaining to the allocation of profits;

5- Considering the Board of Directors clearances and estimating their remunerations;

6- Proffering the tender and assigning the auditors and determining their fees;

7- Electing members of the Board of Directors when necessary.

1- Every shareholder has the right to attend the General Assembly meetings. He has a number of votes equivalent to the number of his shares. The resolutions are made by the absolute majority of shares represented in the meeting;

2- The minor and legally incompetent persons are represented by their legal guardians;

3- Authorisation for attendance of the meetings of the General Assembly may be granted provided that the proxy is a shareholder and the authorisation should be a written proxy. The shareholder may not authorise any of the Board members to attend the meetings of the General Assembly on his behalf. In all cases, the number of shares held by the proxy in this capacity should not exceed (5%) of the Company’s capital;

4- Excluding the artificial persons, none of the shareholders, whether being in the capacity of a constituent or on the behalf of another, could have a number of votes that exceeds (25%) of the number of votes decided for the shares represented in the meeting.

Without prejudice to the provisions of Article 137 hereof, the General Assembly shall be competent, in particular, for the following:

1- Discussing the Board of Directors’ report about the Company’s activities and financial position during the year and the future plan of the Company. The report should include adequate explanation of the income and expense items, detailed statement about the method suggested by the Board of Directors for annual net profit allocation and assigning the date of profits disbursement;

2- Discussing the auditors’ report about the Company’s balance sheet and end-period accounts submitted by the Board of Directors;

3- Discussing and approving the annual balance sheet and the profit and loss statement and adopting the profits to be allocated;

4- Considering and approving the governance report;

5- Considering the clearance of the Board members;

6- Electing the Board members and assigning the auditors and determining the fees intended for the coming fiscal year in case it is not determined in the Company’s Articles of Incorporation;

7- Discussing any other proposal the Board of Directors includes in the agenda to be decided upon. The General Assembly may not discuss any other issues not listed in its agenda. Nevertheless, the Assembly has the right to discuss serious issues revealed during the meeting.

If a number of the shareholders which represent at least 10% of the Company’s capital request listing specific issues in the agenda, the Board of Directors should abide to the request; otherwise, the Assembly has the right to decide discussion of these issues.

The Chairman of the Board, his deputy or whoever is delegated by the Board of directors for this purpose shall chair the General Assembly, If those mentioned fails to attend the meeting, the Assembly assigns, from among the members of the Board of Directors and the shareholders, who chairs this meeting and a rapporteur of this meeting.

If the Assembly is discussing an issue related to the chairman of the meeting, it should choose the meeting chairman from the shareholders.

The General Assembly’s meeting validity is conditioned as follows:

1- Sending an invitation to the Administration to delegate its representative in the meeting;

2- The quorum shall be present if a number of shareholders representing at least 50% of the share capital of the Company are present in the meeting, unless the Articles of Incorporation of the Company provides otherwise. If such quorum is not present at such meeting, a second general assembly meeting shall be invited to be held within fifteen days from the date of the first meeting, in accordance with the provisions of Article 121 of this Law;

3- The Company’s auditor shall attend the meeting.

The invitation to the meeting shall be sent at least three days prior to the date of the meeting. The second meeting shall be deemed valid irrespective of the number of the shares represented thereat.

The General Assembly shall issue its resolutions by the absolute majority of the shares that are correctly represented unless the Company’s Articles of Incorporation stipulate a higher percentage.

Every shareholder has the right to discuss the issues listed in the General Assembly’s agenda and to submit questions to the members of the Board of Directors, and the members of the Board of Directors should answer the questions as long as this does not inflict any damage to the Company’s interest.

The shareholder has the right to appeal to the General Assembly if he deems the response to his question is insufficient, and the execution of the General Assembly’s decision is obligatory.

Any contradicting condition in the Company’s Articles of Incorporation is void.

Voting in the General Assembly shall be conducted with the method specified in in the Company’s Articles of Incorporation.

Votes shall be cast through secret ballot if the resolution pertains to electing, dismissing or taking legal action against Board members or if the Chairman of the Board or a number of the shareholders that represent at least one tenth of the votes present in the meeting. The members of the Board could not participate in voting for the resolutions of the General Assembly pertaining to their clearance from responsibility.

The resolutions issued by the General Assembly in conformity with the provisions of law and the Company’s Articles of Incorporation shall be binding to all shareholders whether they were present or absent in the meeting during which those resolutions were made and whether they approve or disapprove those resolutions. The Board of Directors should execute the resolutions as soon as they are made and notify the Administration with a copy of them within fifteen days since their issuance.

The minutes of the General Assembly is drafted which includes the name of the shareholders present or their representatives, the number of shares in their possession personally or by proxy, the number of votes determined for it, the issued resolutions, the number of approving and disapproving votes, and a sufficient summary of the discussions that took place in the meeting. The minutes shall be signed by the Assembly chairman, the rapporteur, the vote tellers, and the auditors where all who sign shall be responsible for the authenticity of the information included.

The minutes of the General Assembly meetings shall be recorded in a special register.

The provisions stipulated in Article 106 hereof shall apply to the registers and minutes of meetings of the Board of Directors shall also be applied to the registers and minutes of meetings of the General Assembly.

A copy of the minutes of meeting of the Company’s General Assembly is to be sent to the Administration within an utmost period of one month since the date of its convention.

Without prejudice to the rights of those well intentioned, any resolution issued in violation to the provisions hereof or the Company’s Articles of Incorporation shall be void.

Any resolution made for the benefit of or against a specific category of the shareholders or that brings benefits to the Board members or others without taking into consideration the benefit of the Company can be nullified.

Nullifying the resolution shall entail the resolution before all shareholders as if not issued. The Board of Directors should publish the verdict of nullity in two local daily newspapers, one of which shall be at least published in Arabic, or shall be posted on the Company’s website (if any). The nullity claim shall not be heard out after the lapse of one year since the issuing of the contested verdict. Filing the lawsuit does not result in halting the executing of the resolution unless the court adjudicates otherwise.

The nullity could only be requested by shareholders who objected the resolution and affixed their objection in the minutes of meeting or those who did not attend the meeting for an acceptable reason.

The following matters are only resolved by the General Assembly held as an Extraordinary Assembly:

1- Amending the Company’s Contract or Articles of Incorporation;

2- Increasing or decreasing the Company’s capital;

3- Extending the duration of the Company;

4- Dissolving, liquidating, transforming, acquiring or merging the Company with another Company;

5- Selling or disposing the entire project for which the Company was established. In case any of these issues were adopted, it has to be indicated in the commercial register.

Nevertheless, this assembly may not make amendments to the Company’s Articles of Incorporation that would increase the burdens of the shareholders, amend the main objective of the Company, change its nationality, or translocate the headquarter of the Company established in the state to another country. Any other contradicting clause is considered invalid.

The Extraordinary General Assembly shall be held only by virtue of an invitation for convention from the Board of Directors. The Board has to address such invitation if this is requested by a number of shareholders representing at least 25% of the Company’s capital.

If the Board of Directors does not address for the Extraordinary General Assembly convention within fifteen days since the submission of the request, the requestors may request from the Administration to call for a meeting on the Company’s expense.

The Extraordinary General Assembly meeting shall be valid only if shareholders representing at least 75% out of the Company’s capital attend it.

If this quorum is not achieved, the assembly shall be called for another meeting to be held within the thirty days following the first meeting.

The second meeting shall be deemed valid if shareholders, representing 50% out of the Company’s capital, attend it.

If this quorum is not achieved in the second meeting, the assembly has to be called for a third meeting to be held after the lapse of thirty days since the date has been determined the second meeting. The third meeting shall be deemed valid regardless of the number of attendants.

If the matter pertains to taking the resolution concerning any of the issues mentioned in Clause (4) & (5) of Article 137 hereof, the meeting shall be considered valid only if it is attended by shareholders representing at least 75% out of the Company’s capital.

The Board of Directors should declare the resolutions of the Extraordinary General Assembly if it included the amendment to the Company’s Articles of Incorporation.

Without prejudice to the provisions set forth in this Section, the same provisions pertaining to the General Assembly shall be applied on the Extraordinary General Assembly.

Every Public Joint-Stock Company shall have an auditor or more appointed, for one year, by the General Assembly, which determines his fees, and may reassign him provided that his period would not exceed five consecutive years. The Board of Directors may not be authorised in this respect. Nevertheless, the Company founders shall have the right to temporarily appoint an auditor that performs his tasks until the convention of the first General Assembly.

The auditor’s name must be recorded in the auditors’ register in conformity with the rules and regulations in force.

The Company’s auditor may not, in any capacity, participate in the Company’s establishment or its Board of Directors membership, or perform any of its technical, administrative, or advisory works. Moreover, he may not be a partner, a proxy, or an employee of any of the Company’s founders or Board members, or any of their relatives up to the fourth degree.

Any contradicting appointment shall be considered invalid.

In case of multiple auditors, they will be jointly responsible for the auditing works.

The auditor shall be responsible to carry out the following:

1- Auditing its accounts according to the adopted auditing rules, the requirements of the profession and its scientific and technical principles;

2- Examining the balance sheet and the profit and loss statement;

3- Observing the compliance with the law and the Company’s Articles of Incorporation;

4- Examining the Company’s financial and administrative regulations and the internal financial surveillance, checking its appropriateness for the good running of the Company’s business, and preserving its money;

5- Examining the Company’s assets and its ownership and the lawfulness and validity of the Company’s liabilities;

6- Examining the resolutions of the Board of Directors and the instructions issued by the Company;

7- Any other tasks assigned to the auditor by virtue of this law and the law of organizing the profession of auditing and other common regulations applied to auditing.

The auditor raises a written report to the General Assembly about his job, and he or whoever is delegated thereby, recite the report before the General Assembly. The auditor has to send a copy of the report to the Administration.

The auditor’s report mentioned in the previous Article shall include the following:

1- That he obtained the information, statements, and declarations he deems necessary to perform his job;

2- That the Company keeps regular accounts and registers with respect to common international standards, which could reveal the financial position of the Company and the outcome of its work; and that the balance sheet and the profit and loss statement comply with the registers and books;

3- That, in his opinion, the auditing procedures he carried out on the Company’s accounts make a sufficient basis to express his opinion about the Company’s financial position, the outcome its works, the Company’s cash flow, in conformity with common international standards;

4- That the financial statements mentioned in the Board of Directors’ report addressed to the General Assembly comply with the registers and records of the Company;

5- That the stocktaking was made with respect to the operative principles;

6- The breaches to the provisions hereof and of the Company’s Articles of Incorporation that took place during the year and that are under examination and have an essential influence on the outcome of the Company’s works and its financial position, and whether these breaches still exist, and that is within the limits of the information available to him.

If, for any reason, the Company’s auditor could not perform the tasks and obligations, assigned to him by virtue of the provisions hereof, he has to submit a written report to the Administration, a copy thereof to the Board of Directors including the reasons that hinder or stand against performing his jobs, before excusing himself for not auditing the Company’s accounts. The Administration shall discuss these reasons with the Board of Directors. In case of default within thirty days as from the date of receiving the Company’s auditor’s report referred to in this Article, the Administration shall call General Assembly for the convention to discuss the issue.

If the Administration is able to deal with the reasons for the auditor’s excuse, the Company shall incorporate with its annual report a description of the issues, on which the auditors has relied in asking for excuse.

If the Company has two or more auditors, they shall submit one report which is to be recited before the General Assembly. If the Assembly resolves to adopt the Board of Directors’ report without hearing out the auditor’s report, such resolution shall be invalid.

Being the representative of all the shareholders, the auditor shall be responsible for the authenticity of the statements included in his report. During the General Assembly meeting, any shareholder may debate the auditor and inquire about the content of the report.

The auditor and his employers are forbidden to speculate in the shares of the Company, the accounts of which he audits, whether this transaction of shares is done directly or indirectly. Otherwise, he should be investigated and dismissed. He will also be liable for compensation for any damage resulting from breaching the provisions of this Article.

The auditor should keep the Company’s secrets. He may not disclose to the shareholders, except during the General Assembly or to third parties, any of the Company’s secrets he obtained due to his performance of tasks; otherwise, he shall be investigated and dismissed.

The auditor shall be liable for compensating the damage inflicted on the Company, shareholders, or third parties, due to his mistakes. If multiple auditors committed such mistakes, they will be jointly responsible.

The Lawsuit of the responsibility mentioned in the previous paragraph will not be accepted after one year since the convention of the General Assembly during which the auditor’s report was recited. If the act attributed to the auditor is a criminal offense, the Responsibility Lawsuit exists as long as the public summons exist.

The Company’s capital shall be divided into equal shares where the nominal value of each shall be not less than one riyal and not more than one-hundred riyals. The issuance charges shall not exceed (1%) of the share nominal value.

The shares of the establishing Company in Qatar should be nominal.

The share of the Joint-Stock Company is indivisible while confronting the Company. If multiple persons own the share, they have to select one of them to act on their behalf in using the rights pertaining to the share.

Those persons will be jointly responsible for the liability resulting from the ownership of the share.

The shares may not be issued for less than their nominal value; however, they may be issued for a higher value if this was stipulated by the Company’s Articles of Incorporation or approved by the Extraordinary General Assembly. In this case, the difference in value shall be added to the legal reserve.

The share value is paid in cash, by full amount or in instalments; and the instalment to be paid upon underwriting shall not be less than 25% of the share value.

At any case, the entire value must to be paid within five years since the date of publishing the Resolution of Establishment in the official gazette. If the remaining instalments were not paid, the capital shall be decreased without prejudice to the provisions of Article 65 hereof.

Upon underwriting, the Company shall issue interim certificates in which the name of the shareholder, the number of shares he underwrote, the money paid, and the remaining instalments are written down. These certificates shall substitute for the common shares until they are exchanged after paying up all the instalments.

If the shareholder failed to settle the due instalment of share value at maturity, the Board of Directors could levy execution on the share by warning the shareholder to pay the due instalment by a registered letter or via any means of acknowledgment approved by the Administration. If he does not make the settlement within thirty days, the Company could sell the share in the public sale or in the financial market. The Company could collect from the sale price what has been unpaid of the overdue instalments and expenses and return the remaining to the shareholder. If the sale outcome is insufficient for paying this money, the Company could claim the shareholder from his money, and cancel the share executed upon and gives the buyer a new share that has the number of the cancelled share, and endorses officially in the share register about the event of sale and the name of its new holder. Nevertheless, the behindhand shareholder could, until the date of sale, settle the value due and the other expenses paid by the Company.

If there are in-rem stocks or perquisites, which are belonging to the founders or others, the Administration shall appoint, on the request of the founders, an expert or more from those certified thereat or from those bodies that have technical and financial knowhow vis-à-vis the matters of evaluation and that are certified by the Ministry in order to verify that such stocks or perquisites are duly evaluated.

The expert shall submit his report to the Administration within thirty days as from the date of his deputation. The Administration may, upon the expert’s request, grant him another grace period not exceeding thirty days.

The Administration shall send a copy of the expert’s report to the founders after being approved thereby, given they distribute such copies on the subscribers before the convention of the Constituent Assembly by at least ten days. The said report shall be kept at the Company’s headquarters where every stakeholder shall have the right to review it.

The said report shall be propounded onto the Constituent Assembly for deliberation. If the Assembly resolved the decrease of the consideration designated for the in-rem stocks or reduction of the special perquisites, the in-rem stocks presenters and the special perquisite beneficiaries shall approve such decrease or reduction during the convention of the assembly. Upon disapproval thereby, the stock presenters may withdraw from the Company.

The in-rem stocks may be represented only by fully paid shares.

The shares representing the in-rem stocks shall be handed in only after the ownership of these stocks is fully transferred to the Company.

The Company shall keep a special register called the “shareholders’ record” that includes the names, nationalities, and addresses of shareholders and the shares owned by each shareholder and the paid-in amount of the share value. The Administration and the Authority may review such information and obtain a copy thereof.

Promptly after the Company has its shares listed in the financial market, the Company shall keep a copy of this register with a depositary, licensed by the Authority, for the sake of following up the shareholders’ affairs, and to authorise it to keep and organize this register. Any shareholder may review this register free of charge.

Every stakeholder has the right to ask for correcting the information included in the register, particularly when a person is registered therein, or erased therefrom without justification.

A copy of the information included in the register and any changes that takes place shall be sent to the Administration before two weeks at most since the date determined to disburse profits to the shareholders.

For the sake of having the Public Joint-Stock Company’s shares listed in the financial market, the procedures and rules stipulated in the laws, regulations, and instructions organizing the transactions of the listing and trading in the securities in the state shall be followed, especially those pertaining to handing the register, provided for in the previous Article, to the body determined by these laws, regulations, and directions.

The ownership of the Company’s listed shares is to be transferred in accordance with the controls in force at the Authority, the financial market wherein such stocks are listed.

The ownership of the Company’s unlisted shares shall be transferred by registration in the shareholders’ record where the share registration is officially endorsed. Demurring against the Company or third parties could not take place until the date of its registration in the register. Nevertheless, the Company may not restrict freehand disposal of the shares in the following cases:

1- If the disposal breaches the provisions hereof or the Company’s Articles of Incorporation;

2- If the shares are mortgaged or seized by court order;

3- If the shares are missing and in-lieu replacements were not issued.

The shares may be mortgaged, and this takes place by handing them in to the mortgagee creditor who has the right to collect the profits and use the rights pertaining to the share unless it is agreed upon otherwise in the Contract of Mortgage. In case of having the Company’s shares listed, the mortgage shall be endorsed in the shares register kept with the shareholders’ record depositary.

The Company’s money could not be seized to pay the debts of any of the shareholders. However, the debtor’s shares and dividends could be seized. Seizure shall be officially endorsed along with other particular information in the shareholders’ record stipulated in Article 159 hereof.

The General Assembly’s resolutions shall be applicable to the seizer and the mortgagee creditor in the same way they are applicable to the shareholder, whose shares are seized, or the mortgager.

Nevertheless, the seizer or the mortgagee creditor could not attend the General Assembly, participate in its discussions, or ratify its resolutions; he has no membership rights in the Company.

The founders may not dispose of their shares unless after two years since the Company is categorically founded.

During the close period, such share may be mortgaged, or the ownership thereof may be transferred from one of the founders to another founder, or to the government, or from a one heir of the founder in case of his heath to third parties or from the bankrupt’s estate to third parties or as per a final court judgment.

Any resolution issued by the Ordinary or the Extraordinary General Assembly, that prejudice the shareholder’s rights derived from the terms of this law or the Company’ Articles of Incorporation, or to increase his obligations, shall be invalid.

The Company’s Articles of Incorporation may stipulate any restrictions related to the share dealings provided that such restrictions should not prohibit the share dealings.

The Company shall be entitled to buy its shares for the purpose of sale in accordance with the rules set by Qatar Financial Markets Authority.

After the General Assembly’s approval, the Company may issue tradable bonds, whether they are transformable or not to shares in the Company with equal values for each issuance. The General Assembly has the right to entitle the Board of Directors in determining the loan amount and conditions.

No bonds may be transformed into shares unless provided for in the prospectus. If transformation is endorsed, the bondholder in solo shall have the right to accept such transformation or collect the nominal value of the bond.

The bonds or any other instruments shall be issued in compliance with the regulations and rules rendered by the Authority.

The bonds shall be nominal, and shall remain nominal until its value is fully paid.

The bonds could not be issued unless under the following conditions:

1- It is permitted by the Company’s Articles of Incorporation;

2- The Company’s capital is fully paid;

3- The value of the bonds shall not exceed that of the available capital with respect to the last approved balance sheet, unless the bonds were not guaranteed by the state or any of the banks operating therein.

The bonds issued by virtue of one loan shall give equivalent rights to their owners. Any contradicting condition shall be invalid.

If the bonds are underwritten for IPO, this shall take place through one or more of the banks accredited in the state, or through the companies being licensed for this respect. The public shall be called for subscription prior to the lapse of fifteen days at least through publishing the invitation in two local daily newspapers, one of which shall at least be issued in Arabic, or through posting it on the Company’s website (if any). It shall be signed by the members of the Board of Directors, and shall include the data resolved by Administration’s decision. Such data shall include the following information:

1- The General Assembly’s resolution of issuing the bonds and the date of resolution;

2- Number and value of bonds resolved to be issued;

3- The subscription beginning and ending dates;

4- The Bonds maturity date and settlement conditions and guarantees;

5- Value of bonds previously issued and their guarantees and its unpaid value at the time of issuing the new bonds;

6- The Company’s capital;

7- The Company’s headquarter, its date of establishment and duration;

8- The value of the in-rem stocks;

9- A summary of the last balance sheet of the Company certified by the auditor.

No new bonds may be issued unless the subscribers paid up the entire value of the old bonds where the sum of remainder of that value added to the value of the new bonds does not exceed the Company’s capital with respect to the last certified balance sheet.

Within one month since the date of the subscription closure, the Board of Directors should submit to the Administration a statement of the subscription process, the names and nationalities of the subscribers, and what each underwrote.

The shareholders’ General Assembly resolutions shall be applicable to the bondholders. Nevertheless, the General Assembly may not rectify the rights determined to bondholders unless with their consent issued in their ad hoc assembly in conformity with the provisions determined by the shareholders’ Extraordinary General Assembly.

The bonds may not be transferred to shares unless stipulated by the loan conditions and by following the conditions stated in the previous Article. If transfer is decided, the bond owner may choose either accepting the transfer or receiving the bond’s nominal value.

If a certificate of shares or bonds is lost or ruined, its holder may request the Company for a new certificate in lieu of the lost or ruined certificate.

The holder should publish the numbers of the shares’ certificates or the lost or ruined bonds in one local daily newspaper issued in Arabic.

If no objection is submitted to the Company within thirty days since the publishing date, it has to publish a new certificate citing it is in lieu of the lost or ruined certificate. This certificate grants its holder all rights and imposes on him all the obligations related to the lost or ruined certificate.

He who objects the issuance of a new certificate in lieu of the lost or ruined one shall file his claim before the competent court within fifteen days since the date of submitting his objection, or it will be deemed as if it were not.

The Company has to issue a new certificate in lieu of the lost or ruined to the right owner when being notified with the peremptory judgment.

After the General Assembly’s approval, the Company may issue tradable deeds, which is in conformity with the sharia, and that which are subject to all the conditions, terms and provisions provided for in this Section that are not in inconsistency with their idiosyncratic nature.

The Company shall have a fiscal year determined by its Articles of Incorporation provided that it is not less than twelve months except the first fiscal year.

Every fiscal year, the Board of Directors shall present to the auditor, at least two months before the convention of the General Assembly, the Company’ balance sheet and the profit and loss statement and a report about the Company’s activities during the ending fiscal year and its financial position.

The Chairman of the Board of Directors or any of its members shall sign all these documents.

The Company should publish semi-annual financial reports in the daily local newspapers issued in Arabic and on the Company’s website (if any) to be reviewed by the shareholders provided that these reports are to be audited by the auditor, and they may not be published unless after taking the approval of the Administration.

Annually, a 10% of the Company’s net profits is deducted to form the legal reserve unless the Company’s Articles of Incorporation does not determine a higher percentage.

The General Assembly may stop this deduction as soon as this reserve reaches half of the paid capital.

The legal reserve may not be distributed on shareholders, yet what is in excess of half the paid capital could be used in allocating dividends on shareholders up to 5%, and that in the years when the Company would not accomplish net profits sufficient to allocate this percentage.

Based on the proposal of the Board of Directors, the General Assembly may resolve to cut-down part of the net profits for the optional reserve account.

The optional reserve shall be used in the ways resolved by the General Assembly.

A percentage determined by the Company’s Articles of Incorporation or Board of Directors is annually cut from the gross profit for the Company’s assets depreciation or the compensation for its drop in value. This money is used to fix or buy the materials and machines needed by the Company, yet that money may not be distributed on the shareholders.

The General Assembly should decide to cut a part of the profits to meet the requirements imposed on the Company by virtue of the Labour Law.

The Company’s Articles of Incorporation may stipulate the foundation of a fund for the assistance of the Company’s personnel.

The Company’s Articles of Incorporation shall determine the minimum percentage of dividends to be distributed on shareholders after the deduction of the legal and optional reserves.

The shareholder shall be entitled to his dividends in pursuance of the laws, regulation being applicable for the Authority and the financial market, in which the shares are listed.

The Company’s capital may not be increased unless after paying up the full value of the share.

By virtue of a resolution of the Extraordinary General Assembly and after the approval of the Administration, the capital of the Company may be increased. The resolution shall reveal the amount of increase and the issue price of the new shares.

The Extraordinary General Assembly may authorise the Board of Directors in determining the date of executing this resolution, provided that it does not exceed one year since the date of issuance.

The capital shall be increased in any of the following ways:

1- Issuance of new shares;

2- Capitalization of the reserve or a part thereof or the profits;

3- Transference of the bonds into shares;<

4- Issuance of new shares in return for the in-rem shares or assessed rights.

The rules of subscription in the original shares shall be applicable in subscription in new shares.

The new shares shall be issued for a nominal value equivalent to the original shares. Nevertheless, the Extraordinary General Assembly may resolve the addition of a premium to the nominal value of the share and determine its magnitude provided that it is to be approved by the Administration. This premium shall be added to the legal reserve. The Administration shall determine the request of the addition of the share premium within fifteen days as from the date of the request submission after fulfilling all the required data and documentations

The shareholders enjoy the right of priority of subscribing in the new shares. The priority right may be waived to third parties through a resolution by the Company’s Extraordinary General Assembly with the three-fourth majority of Company’s capital, given such waiver takes place after the Administration’s approval.

The Board of Directors shall publish a statement in two local daily newspapers, one of which shall at least be issued in Arabic, wherein the shareholders announce their priority in subscription, the dates of its opening and closing, and the price of the new shares.

The distribution of the new shares among subscription-applying shareholders shall be in the rate of shares held by each provided that this does not exceed what each applied for. The remainder of shares is to be distributed among the shareholders that applied for shares more than the rate of what they hold, and the remaining shares are underwritten for the IPO, or would be disposed of by the approval of the Administration.

If the increase in the capital includes offering in-rem stocks, then the provisions pertaining to the in-rem stocks’ evaluation shall be applied, while the Extraordinary General Assembly acts as the Constituent Assembly.

If new shares were floated for the public underwriting, an underwriting should be issued containing in particular the following:

1- Reasons of increasing the capital;

2- The Extraordinary General Assembly’s resolution concerning the increase of capital;

3- The Company’s capital at the time of issue of the new shares, the amount of the suggested increase, the number of new shares, and the share premium if available;

4- A list of the in-rem stocks or the assessed rights, if available;

5- A report of the dividends the Company allocated during the past three years with respect to the resolution of increasing the capital;

6- The auditor’s consent to the authenticity of the information included in the prospectus.

The prospectus shall be signed by the Board Chairman and the auditor who are jointly responsible for the authenticity of the information included.

In the case of increasing the capital by capitalizing the distributable reserves, free shares will be issued and distributed among the shareholders at the rate of shares each holds, or by increasing the nominal value of the share at the rate of the contingent increase in capital, the fact that this does not result in the shareholders’ incurrence to any financial burdens.

Transferring of bonds to shares is through calling back the bonds, cancelling them, and granting their owners shares in return, and adding its value to the capital.

The capital may not be reduced unless by a resolution issued by the Extraordinary General Assembly after recital of the auditor’s report; provided that the approval of the Administration is obtained and this would be in one of the following two cases:

1- The capital is in excess of the Company needs.

2- If the Company was afflicted with loss.

The capital shall be decreased in one of the following ways:

1- Decreasing the shares’ number in order to cancel a part thereof, being equivalent to the value to be decreased;

2- Decreasing the shares’ number by an amount equal to the loss that afflicted the Company;

3- Buying and cancelling a number of shares equivalent to the amount of decrease;

4- Reducing the nominal value of each share.

The Board of Directors shall publish the issued resolution pertaining to decreasing the capital in two daily local newspapers, one of which shall at least be issued in Arabic, or on the Company’s website if any. The creditors shall submit to the Company the documents evidencing their debts within sixty days since the date of publishing the resolution so that the Company pays up their debts and offer sufficient guarantees to pay up the deferred debts.

If the capital is decreased through buying and cancelling a number of the Company’s shares, an invitation should be addressed to all the shareholders to set forth their shares for sale. The invitation should be published in two daily local newspapers, one of which shall at least be issued in Arabic, or on the Company’s website if any.

The shareholders could be notified by registered letters of the Company’s intension to buy the shares. If the number of shares presented for sale is more than the amount the Company decided to buy, the sale requests should be scaled down accordingly. The provisions stipulated in the Company’s Articles of Incorporation shall be adopted in the determination of the shares’ purchase price. If the Articles of Incorporation did not include a clause in this respect, the Company has to pay the fair price determined by the Company’s auditor set as per the applicable assessment rules or the market price, whichever is higher.