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Logo of Salama Cooperative Insurance Co.
Salama Cooperative Insurance Co. will take the required legal procedures after its accumulated losses reached SAR 158.54 million, representing 63.42% of its SAR 250 million capital, according to a bourse statement.
The deadline for the board of directors to invite shareholders for an extraordinary general meeting (EGM) will be March 13, while the deadline for holding the EGM to discuss the accumulated losses will be April 12.
The company will face termination by Aug. 25, under the Saudi Companies Law, if it fails to hold an extraordinary general meeting (EGM) within 45 days from the date its board of directors was informed of accumulated losses, or if shareholders fail to pass a resolution.
In addition, the Royal Order no. 15016, Article 150/2 of the Companies’ Law dictates termination in case the EGM was not held within 180 days from the date the board of directors was notified of accumulated losses.
As per Royal Decree on suspending some Clauses of the Companies’ Law, Article No. (2/150) of the Companies’ Law was suspended, which indicates that in case of not holding the EGM within 180 days from the date of notifying the board of directors of the accumulated losses, which will expire on Aug. 25, or if the EGM fails to take a relevant decision, the company will be terminated by the force of the law.
The company attributed the losses mainly to higher net claims and other benefits incurred, technical reserves and unearned insurance premiums.
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