2 — 2 — General Assembly
A — A — Ordinary General Assembly
Article (198)
The ordinary general assembly of the shareholders shall convene at an invitation by the chairman of the board of directors at the time and place designated in the company's articles of association. The general assembly shall convene at least once a year during the six months following the end of the company's financial year.
The board of directors may invite the ordinary general assembly to convene upon a justified request by the auditor or by a number of shareholders representing at least 10% of the company's capital. The auditor may invite the ordinary general assembly to convene in the cases specified in article (218) of this law.
The Ministry of Commerce and Industry may invite the general assembly to convene if a period of one month has lapsed from the date appointed for its meeting without it convening, or if the number of the board members becomes less than the minimum number required for the meeting to be valid, or if a number of shareholders representing at least (10%) of the company's capital so requests for serious reasons.
The Minister of Commerce and Industry may invite the general assembly to convene if he deems the meeting necessary.
Article (199)
i— The invitation to the shareholders shall be published in at least two daily Arabic newspapers; one of them at least must be local. The publication shall be made at least 15 days before the meeting and shall include the agenda of the meeting.ii— Copies of the invitation documents shall be sent to the Ministry of Commerce and Industry at least (10) days before the general assembly meeting.Article (200)
The founders shall prepare the agenda for the constituent general assembly, and the board of directors shall prepare the agenda for the ordinary or extraordinary general assembly.
If the general assembly convenes at an invitation by the shareholders, the auditors or the Ministry of Commerce and Industry, the agenda shall be prepared by whoever requests the meeting. The general assembly shall not consider any matters not listed on the agenda.
Article (201)
The chairman of the board of directors or his deputy or whoever is delegated by the board of directors or by the general assembly shall preside over the general assembly meeting.
The meeting shall not be valid unless it is attended by a number of shareholders representing more than half the capital. If this quorum is not available, an invitation shall be sent for a second meeting to be held for the same agenda within 7 to 15 days from the date fixed for the first meeting. The second meeting shall not be valid unless it is attended by a number of shareholders representing more than 30% of the capital at least. The third meeting shall be valid regardless of the number of attendees. Sending a new invitation for the last two meetings may not be necessary if the dates thereof have been fixed in the invitation for the first meeting, provided that publication shall be made in at least two daily Arabic newspapers, at least one of them shall be local, that none of these two meetings has been held.
Article (202)
The Ministry of Commerce and Industry may appoint a representative to attend the general assembly meetings. The representative shall not have the right to vote on the deliberations and shall submit a report thereon to the Ministry.
Article (203)
Each shareholder, regardless of the number of the shares he owns, shall have the right to attend the general assembly, and shall have a number of votes equal to the number of shares he owns in the company. Any provision or decision to the contrary shall be null and void. Any shareholder may delegate a person, from among the shareholders or from among non-shareholders to attend the general assembly on his behalf, provided that this person shall not be the chairman of the board or from among the members of the board of directors or from among the members of the company's staff. However, this shall not prejudice the right to delegate a first-degree relative. The company shall prepare a special written form for this purpose. The delegate shall not represent in this capacity a number of votes exceeding 5% of the issued capital in the general assembly meetings. Legal representatives of the members lacking capacity or under legal incapacity shall represent them in the meetings. The company shall prepare special cards for the shares owned by the shareholder and for the shares he represents on behalf of other shareholders. Delegation shall be made, and delegation capacity shall be shown to the company, twenty-four hours at least before the general assembly meeting. No member shall vote for himself or for whomsoever he represents in matters in which he has a direct interest or on an unsettled dispute between him and the company.
Article (204)
Voting at the general assembly shall be conducted in the manner specified in the company's articles of association. Voting must be conducted by secret ballot if the resolution is related to the election or dismissal of the members of the board of directors or to filing liability action against them or if the chairman of the board or a number of members representing at least one-tenth of the present votes at the meeting so requests.
Article (205)
The members of the board of directors shall not vote on the general assembly's resolutions relating to the determination of their salaries and remuneration or to discharging them or exempting them from liability for their management.
Article (206)
Except for what the law has reserved for the extraordinary general assembly, the ordinary general assembly shall be competent to consider all matters relating to the company and pass the appropriate resolutions thereon. In particular, it shall consider the following:
i— Election and dismissal of members of the board of directors.ii— Determination of the board members' remunerations.iii— Consideration and approval of the board's report on the company's activities and financial position during the ended financial year.iv— Discharging or refusing to discharge the members of the board from any liability.v— Appointment of an auditor or more for the following financial year and determination of his/their fees or authorizing the board to do the same.vi— Consideration of the auditor's report on the financial statements of the company for the ended financial year.vii— Approval of the profit and loss account and the balance sheet and the statement allocating the net profits and determining dividends.viii— Consideration of recommendations relating to bond issue, borrowing, mortgaging and issuing guarantees and deciding thereon.Article (207)
The general assembly shall not consider matters not listed on the agenda, unless they are urgent and have occurred after the agenda has been prepared or during the meeting. If the competent government body or a shareholding public entity or a number of shareholders representing at least 10% of the company's capital requests the board of directors to include a certain subject in the agenda but the board did not do so, the general assembly shall have the right to consider this subject at the request of the interested party. If, in the course of the discussion, it becomes clear that the information relating to some agenda items is not adequate, the meeting shall be adjourned for no more that ten days if so requested by a number of shareholders representing one-fourth of the shares present in the meeting.
The resolutions adopted by the general assembly on the urgent matters, shall be submitted for approval by the Ministry of Commerce and Industry, otherwise they shall be null and void.
Article (208)
Adequate minutes of the meeting shall be prepared, reporting deliberations, proceedings, the quorum, the resolutions adopted, the number of "Yes" and "No" votes and all such matters as the shareholders may request to enter into the minutes.
The names of the attendees, whether for self or by proxy, shall be entered in a special register, to be signed before the meeting by the auditor, the vote counter and the chairman of the meeting. The company shall maintain all documents and instruments evidencing the contents of the minutes and send a copy of the minutes to the competent government authority within fifteen days from the date of the meeting. Each interested shareholder may have a copy of the minutes.
B — B — Extraordinary General Assembly
Article (209)
The provisions applicable to the ordinary general assembly shall apply to the extraordinary general assembly, subject to the provisions of the following articles.
Article (210)
The following matters shall be reserved for the extraordinary general assembly:
i— Amending the company's memorandum or articles of association and extending the company's term.i— Increasing or reducing the company's capital.i— Selling the entire project carried out by the company or disposing of it in any other manner.iv— Winding up the company or merging it with another company.The company's nationality shall not be changed, nor its Head Office be transferred outside Bahrain, nor the obligations of the shareholders be increased, and any provision to the contrary shall be null and void.
Article (211)
The extraordinary general assembly shall convene at an invitation by the board of directors or a written request to the board of directors by a number of shareholders representing 10% at least of the company's shares.
In these cases the board of directors shall invite the general assembly to convene an extraordinary meeting within a month from the date of the request. Otherwise, the Ministry of Commerce and Industry shall send the invitation within fifteen days from the date of expiry of that period, subject to the provisions of article (199) of this law.
Article (212)
The extraordinary meeting of the general assembly shall not be valid unless it is attended by shareholders representing at least two thirds of the company's capital. If this quorum is not available, an invitation shall be sent for another meeting to be held within fifteen days from the date of the first meeting. The second meeting shall be valid if attended by shareholders representing more than one-third of the capital. If the quorum is not available for the second meeting, an invitation shall be sent for a third meeting to be held within fifteen days from the date of the second meeting. The third meeting shall be valid if attended by one-fourth of the shareholders.
A new invitation for the last two meetings may not be sent if the dates thereof have appeared in the invitation for the first meeting, provided that publication shall be made in at least two daily Arabic newspapers, one of them is local, that none of these meetings has been held.
The extraordinary general assembly's resolutions shall be passed by a two-thirds-majority vote of the shareholders represented in the meeting. However, if the resolution relates to increasing or reducing the company's capital, extending the company's term, winding it up, converting or merging it with another company, the resolution shall not be valid unless adopted by a three-fourths majority of the shares present at the meeting and with whose attendance the meeting is considered valid. The extraordinary general assembly's resolutions shall not become effective except after they are approved by the Ministry of Commerce and Industry.
Article (213)
The extraordinary general assembly may pass a resolution falling within the powers of the ordinary general assembly provided that the quorum and majority required for the ordinary general assembly meeting are available and that the matters subject of the resolution are included in the agenda.
C — C — Common Provisions
Article (214)
i— The resolutions passed by the general assembly in accordance with the provisions of the law and the company's articles of association shall bind all the shareholders whether they attended the meetings at which the resolutions are passed or not and whether they voted for or against them.ii— The board of directors shall implement the general assembly's resolutions.Article (215)
Without prejudice to the rights of bona fide third parties, any resolution passed by the general assembly in contravention of the provisions of the law, the company's memorandum of association or articles of association shall be null and void. The court may overrule any resolution passed to the advantage or disadvantage of a certain class of shareholders or to the benefit of the members of the board of directors or others without taking the company's interests into account. In this case, only those shareholders whose objection to the resolution has been put in the meeting's minutes or failed to attend the meeting for acceptable reasons may file the nullity action. The Ministry of Commerce and Industry may act on behalf of the said shareholders in filing the nullity action if serious reasons are given.
A resolution adjudged by the court as null and void shall be deemed inexistent for all the shareholders, and the board of directors shall publish the judgment in a daily local newspaper. Filing the nullity action shall not entail suspension of the implementation of the resolution unless otherwise ordered by the court. A nullity action shall be barred after the lapse of one year from the date of the resolution.
Article (216)
The names of the shareholders shall be entered in a special register to be prepared for this purpose at the company's head office at least twenty-four hours before the meeting. This register shall include the names of the shareholders, the number of shares they own, the number of shares they represent and the names of their owners together with letters of attorney. The shareholder shall be given an attendance card in which the number of votes he is entitled to either in person or by proxy is written.
