Gulf Union Al Ahlia Cooperative Insurance Co. announces the reduction in its Accumulated Losses to reach 12.14 % of the Capital, after using the entire balance of the share premium amounting to (89,488,445 Saudi Riyals) to reduce part of the accumulated losses of the company which reached (before the reduction) 117,338,700 Saudi Riyals which represents 51.13% of the capital according to the financial statement as at 31 March 2021 AD. Accumulated losses of the company after the reduction amounted to 27,850,255 Saudi riyals which represents 12.14% of the capital, based on the approval of the Company’s Ordinary General Assembly in its meeting held on June 29, 2021 AD, to use the entire balance of the share premium to reduce part of the accumulated losses.
Date of accumulated losses decrease
2021-06-30 Corresponding to 1442-11-20
Amount of the Accumulated Losses
Measures Taken by the Company to Decrease Accumulated Losses
The entire balance of the share premium amounting to (89,488,445 Saudi Riyals) was used to reduce part of the accumulated losses of the company
Auditor’s Report showing the Financial Position of the Company after the Decrease of the Accumulated Losses
Using the entire balance of the share premium will not have an impact on the Cash position of the company, in addition to that there will be no impact on the net shareholders’ equity and no impact on the company’s liabilities.
The company announced on 18-05-2021 AD the measures to be Taken and Time Frames after the Accumulated Losses Thereof Reached 51.13 % of the Capital, and the company set the last date of the period upon which the Board of Directors must invite the Extraordinary General Assembly to be held within 60 days from the date of the Board’s knowledge of the losses (which ends on 08-07-2021 AD), Also the company set the last date of the period during which the Extraordinary General Assembly to be held within 180 days from the date of the Board’s knowledge of the losses (which ends on 05-11-2021 AD)
According to The Royal Decree No 15016 on 16/03/1442H, regarding Suspending some provisions of the Companies’ Law issued by Royal Decree No. (M/3) on 28/01/1437 H. And according to decision no. (348) issued by His Excellency the Minster of Commerce dated 04/10/1442 H based on the said Royal Decree, paragraph No. two (2) of article No 150 of Companies’ Law, has been suspended, which dictates The company shall be deemed terminated by the operation of law if the extraordinary general assembly fails to meet during the period set forth according to the decision issued by His Excellency the Minster of Commerce (180 days from the date of the Board of Directors Knowledge of the accumulated losses which ends on 05/11/2021 ; or if the assembly convenes but fails to issue a decision on the matter).
And based on the above-mentioned procedures, this announcement takes the company out of the implementation scope of Article 150 and does not oblige the company to follow what mentioned above, due to the reduction of its losses to less than 50% of the share capital.
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