Executive Council Resolution No. (79)
of 2024
Approving the Articles of Association
of
Mada Media Company PrJSC[1]
ــــــــــــــــــــــــــــــــــــــــــــــ
We, Hamdan bin Mohammed bin Rashid Al Maktoum,
Crown Prince of Dubai, Chairman of the Executive Council,
After perusal of:
Federal Law by Decree No. (32) of 2021 Concerning Commercial
Companies;
Federal Law by Decree No. (36) of 2023 Regulating Competition;
Federal Law by Decree No. (55) of 2023 Regulating Media;
Law No. (17) of 2005 Establishing the Roads and Transport Authority
and its amendments;
Law No. (25) of 2023 Establishing the Dubai Investment Fund;
Law No. (26) of 2023 Concerning the Executive Council of the
Emirate of Dubai;
Law No. (20) of 2024 Establishing Mada Media Company PrJSC;
Decree No. (6) of 2020 Regulating Advertisements in the Emirate
of Dubai;
Resolution No. (39) of 2021 Concerning the Commissioner General
for the Infrastructure, Urban Planning, and Well-being Pillar;
The Order of 1961 Establishing the Dubai Municipality; and
Ministerial Resolution No. (137) of 2024 Regulating the Work
of Registrars and Establishing the Controls Governing Private Joint Stock Companies
and the Rules of Governance,
Do
hereby issue this Resolution.
Pursuant to this Resolution,
the attached Articles of Association of Mada Media Company PrJSC, inclusive of the
rules and procedures set forth therein, are approved.
This Resolution comes into force
on the day on which it is issued, and will be published in the Official Gazette.
Hamdan bin Mohammed bin Rashid Al Maktoum
Crown Prince of Dubai
Chairman of the Executive Council
Issued in Dubai
on 4 September 2024
Corresponding to 1 Rabi al-Awwal 1446 A.H.
Articles
of Association of
Mada
Media Company PrJSC
Preamble:
After perusal of:
Law No. (20) of 2024 Establishing Mada Media Company PrJSC, a
private joint-stock company owned by the Government of Dubai, and having legal personality,
financial and administrative autonomy, and the legal capacity required to conduct
its activities and achieve its objectives under the Law and these Articles; and
Ministerial Resolution No. (137) of 2024 Regulating the Work
of Registrars and Establishing the Controls Governing Private Joint Stock Companies
and the Rules of Governance,
These Articles of Association of
Mada Media Company PrJSC are hereby issued.
The following words and expressions,
wherever mentioned in these Articles, will have the meaning indicated opposite each
of them unless the context implies otherwise:
|
UAE: |
The United Arab Emirates. |
|
Emirate: |
The Emirate of Dubai. |
|
Government: |
The Government of Dubai. |
|
Companies Law: |
Federal Law by Decree No. (32) of 2021 Concerning
Commercial Companies, or any superseding legislation. |
|
Law: |
Law No. (20) of 2024 Establishing Mada Media Company
PrJSC. |
|
Decree: |
Decree No. (6) of 2020 Regulating Advertisements in
the Emirate of Dubai. |
|
Executive Council: |
The Executive Council of the Emirate of Dubai. |
|
Commissioner General |
The Commissioner General for Infrastructure, Urban
Planning, and Well-being Pillar. |
|
Competent Authority: |
The authority in charge of licensing economic
activities in the Emirate. |
|
RTA: |
The Roads and Transport Authority. |
|
DM: |
The Dubai Municipality. |
|
Founder: |
The Government, in its capacity as the sole owner of
the Company. |
|
Advertisement: |
An announcement made to the
public, or to a segment of the public, to promote a commodity, a service, an
event, an industrial or commercial product, a device or machine, an activity,
work, or a project; whether in writing or in the form of drawings, pictures,
sounds, lights, or any other means of expression. This announcement is made
through the use of any Advertising Medium, whether made of wood, metal,
paper, fabric, glass, or any other material used for this purpose. |
|
Advertising Medium: |
Any fixed or mobile permanent or temporary medium used
for displaying Advertisements, whether a traditional, electronic, digital, or
any other innovative modern medium. This includes boards, fences, pillars,
balloons, vehicles, stickers, maps, leaflets, and any other medium falling
within the jurisdiction of the DM and the RTA pursuant to the legislation in
force; but does not include newspapers, magazines, periodicals, websites,
radio, television, cinema theatres, and billboards fixed on commercial
Establishments. |
|
Advertising Space: |
This includes, without limitation, building façades
and roofs, vacant land, Rights of Way, squares, parks, public beaches,
vehicles, and any other space in which an Advertisement can be displayed
using an Advertising Medium, and which falls within the jurisdiction of the
DM and the RTA in accordance with legislation in force in the Emirate. |
|
Permit: |
A document issued by the RTA or the DM in accordance
with the provisions of the Decree authorising the display of an Advertisement
at an Advertising Space. |
|
System: |
A central electronic platform in the Emirate that
aims at streamlining and regulating procedures for issuing Permits and for
documenting relevant data and information. |
|
Government Shareholder: |
The DIF or any entity authorised by the Founder
under the legislation in force to exercise the Government's ownership rights
in the Company. |
|
Company: |
Mada Media Company PrJSC. |
|
Governance Rules: |
A set of regulations and procedures adopted under
the applicable legislation, which ensures achievement of corporate discipline
in all the Company’s affairs, including the responsibilities and duties of
the Chairperson, the Directors, and the Executive Management. |
|
Subsidiary: |
Any corporation or company whose majority shares are
owned directly or indirectly by the Company. |
|
Board of Directors: |
The board of directors of the Company. |
|
Chairperson: |
The chairperson of the Board of Directors. |
|
Director: |
A member of the Board of Directors. |
|
CEO: |
The chief executive officer of the Company. |
|
Executive Management: |
The executive management of the Company, comprising
the CEO; his assistants; and the administrative, finance, and technical
employees of the Company. |
|
Secretary: |
The secretary of the Board of Directors or any of
its committees. |
|
Auditor: |
An auditor of the Company. |
|
Concession Agreement: |
An agreement concluded by the Commissioner General,
on behalf of the RTA and the DM, with the Company, under which the Company is
authorised to perform the functions related to Advertisements and issuance of
Permits, stipulated in the Decree, the resolutions issued in pursuance
thereof, and other legislation in force in the Emirate, in return for the
payment by the Company of the concession fee. |
The name of the Company is “Mada Media Company
PrJSC”.
The head office of the Company
will be located in the Emirate. The Board of Directors may establish branches and
offices of the Company within and outside of the UAE.
The term of the Company is forty-nine
(49) Gregorian years, automatically renewable for the same period unless the Government Shareholder decides
to modify the term of the Company or dissolve the Company before the end of its
term.
a.
Without prejudice to its objectives and powers under the Law, the Company
will:
1.
provide promotional and Advertisement
services through various Advertising Media, as well as advertising and media studies
services;
2.
provide Advertisement and marketing services
through websites, smart applications, and social media platforms, including the
design and production of Advertisements;
3.
act as a broker in the provision of Advertisement
services through the System, and conduct the activities of professional advertising
agency;
4.
manage and process Permits through the
System;
5.
provide classification and analysis services
for data pertaining to Advertisements; and
6.
achieve any other objectives and provide
any relevant services determined by the Board of Directors and approved by the Commissioner
General.
b.
For the purpose of achieving the objectives and providing the services
mentioned in paragraph (a) of this Article, the Company is authorised to exercise
any of the functions specified in the Decree that are outsourced to it pursuant
to the Concession Agreement. The Company may also undertake any other business or
activities that are relevant to the achievement of its objectives, subject to compliance
with the provisions of the Law; the Decree, the Companies Law, the above-mentioned
Federal Law by Decree No. (36) of 2023, and the resolutions issued in pursuance
thereof; these Articles; and other legislation in force in the Emirate.
a.
The issued capital of the Company is fifty
million dirhams (AED 50,000,000.00), divided into fifty million (50,000,000) shares.
The nominal value of each share is one dirham (AED 1.00).
b.
All the shares of the Company will be nominal and equal in rank and
rights in all aspects.
The percentage of Government
shareholding in the Company must not, in any event, be less than seventy-five percent (75%) of the share
capital of the Company.
Subject to the provisions of
Article (7) hereof, the shares of the Company may be offered for subscription in
accordance with the relevant percentages prescribed by the Chairman of the Executive
Council.
The Government Shareholder, the RTA, and the
DM will be responsible for the Company’s liabilities and losses only to the extent
of any amount unpaid in respect of the shares held by them. The liabilities of the
Government Shareholder may be increased only with their unanimous consent.
The
Government Shareholder is entitled to:
1.
the ownership of the assets of the Company,
upon its liquidation, in proportion to the value of the shares it holds;
2.
the profits of the Company, in proportion
to the value of the shares it holds; and
3.
any other rights stipulated in the legislation
in force.
a.
The Company may list its shares on any Financial
Market licensed in the Emirate. In issuing, registering, trading in, transferring,
and creating rights in the Company’s shares, the Company will comply with the rules
provided for in the Companies Law, the resolutions issued in pursuance thereof,
these Articles, and other legislation in force in the Emirate.
b.
The Company's shares may be sold, transferred,
pledged, or otherwise legally disposed of, in accordance with the provisions of
the Law and these Articles; and all such dispositions must be registered in a special
register referred to as the “Shares Register” to be maintained by the Company. Upon
listing the Company’s shares on a Financial Market, all dispositions related to
these shares, including any set-off or settlement, will be registered in accordance
with the regulations applicable to that Financial Market.
When the Company completes the
listing of its shares on a Financial Market, it will establish an electronic system,
in lieu of its Shares Register and ownership transfer system, for the registration
and transfer of ownership of the shares, which is compatible with the system adopted
by the Financial Market. The information recorded in that electronic system will
be final and binding, and may not be challenged, transferred, or altered except
in accordance with the legislation, regulations, and procedures applicable to the
Financial Market.
No person may, for any reason
whatsoever, request the attachment of the Company’s property, nor may he request
to subdivide or sell this property, nor request to interfere in any way in the management
of the Company. This person must, when exercising
his rights, rely on the Company’s inventories and financial statements for the last
financial year of the Company.
The Company will pay dividends
on each share to the Government Shareholder on the date it specifies. The Government Shareholder will
have the right to the profits due on those shares, whether these profits represent
dividends or entitlements to a part of the Company’s assets in the event of its
liquidation.
a.
Subject to the provisions of the Companies Law, the resolutions issued
in pursuance thereof, and other legislation in force in the
Emirate, the share capital of the Company may be increased by issuing new shares
of the same nominal value as the original shares or of the same nominal value plus
a premium, or with granting a discount on the nominal value of the share. The share
capital of the Company may also be reduced in accordance with the provisions of
the Companies Law, the resolutions issued in pursuance thereof, and other legislation
in force in the Emirate.
b.
An increase or a reduction of the Company’s share capital must be made
pursuant to a resolution issued by the Government Shareholder,
based on a proposal of the Board of Directors after reviewing the Auditor’s report.
In the case of increase of the share capital, the resolution must state the amount
of the increase and the value of the shares to be issued. In the case of reduction
of the share capital, the resolution must state the amount to be reduced and the
method of reduction.
c.
Subject to the provisions of the Companies Law, the resolutions issued
in pursuance thereof, and other legislation in force in the Emirate, the Company’s
share capital may, after the issuance of the relevant Government Shareholder resolution,
be increased in any of the following cases:
1.
entry of a strategic partner in the Company;
2.
capitalising the Company’s debts;
3.
converting any bonds or sukuk issued
by the Company into shares; or
4.
acquiring an existing company and issuing
new shares of the Company to the partners or shareholders of that acquired company.
a.
Subject to the provisions of the Companies Law and the resolutions
issued in pursuance thereof, the Board of Directors may, subject to obtaining the
Government Shareholder's approval, issue tradable or non-tradable bonds, sukuk,
or other securities of equal value per issue, whether they are convertible
into shares in the Company or otherwise. This resolution must determine the value
of the bonds, securities, or sukuk; the terms of their issuance; their tradability,
and their convertibility into shares. The Government Shareholder may delegate to
the Board of Directors the power to determine the date of issuance of such bonds
and sukuk, pursuant to the relevant rules prescribed by the relevant applicable
legislation.
b.
Any bonds or sukuk issued by the Company will remain at nominal
value until fully paid up. The Company may not issue bearer bonds
or sukuk. Bonds or sukuk issued in connection with a single loan will give equal
rights to the holders of such bonds or sukuk. Any condition to the contrary will
be invalid.
The Commissioner General will undertake
the general supervision of the work of the Board of Directors and the performance of its duties and functions,
as well as the implementation by the Company of its objectives, development plans,
and associated priorities. For this purpose, the Commissioner General will have
the authority to:
1.
review the periodic reports of the Company and
its performance outcomes;
2.
issue the required directives and instructions
that ensure effective management and governance of the Company’s affairs and operations;
and
3.
exercise
any other duties assigned to him under the Law, these Articles, and other legislation in force in the Emirate; or
assigned to him by the Chairman of the Executive Council.
a.
Subject to the provisions of Article (11) of the Law, the Company will
be managed by a Board of Directors comprising the Chairperson,
the vice chairperson, and other experienced and specialised Directors. The number
of the Directors, including the Chairperson and the vice chairperson, may not be
less than five (5). These Directors will be appointed by a resolution of the Chairman
of the Executive Council.
b.
The Company will abide by the Governance
Rules with respect to membership of the Board of Directors. A candidate for membership
of the Board of Directors must provide the following documents and information:
1.
a curriculum vitae stating his academic
qualifications and work experience, and the type of the membership;
2.
a written undertaking to abide by the
Law and the Companies Law, and the resolutions issued in pursuance thereof, as well
as these Articles; and to observe the due diligence a prudent person would exercise,
throughout the term of his membership in the Board of Directors;
3.
a list of the companies and entities
for which he works, or in which he is a director, at the time of candidacy, as well
as any other activity he carries out, directly or indirectly, which may constitute
Competition with the Company;
4.
in case of representatives of corporate
bodies, a letter from the corporate body stating the name of its candidate for the
Board of Directors membership; and
5.
a list of the commercial companies in
which he is a partner or a shareholder, as well as the number of shares or stakes
he owns.
a.
Membership of the Board of Directors will be for a term of three (3)
years. At the end of this term, the Board of Directors will
be reconstituted by appointing new Directors or reappointing former Directors pursuant
to a resolution of the Chairman of the Executive Council, unless the shares of the
Company are offered for Subscription. In this case, the Directors will be appointed
or elected in accordance with the relevant applicable legislation.
b.
Where the position of a Director falls vacant, the Board of Directors
may appoint a new Director to fill that position within thirty (30) days from the
date of vacancy. The new Director must be appointed pursuant to a resolution of
the Chairman of the Executive Council and must complete the term of his predecessor.
Where no new Director is appointed within the aforementioned period, the Government
Shareholder must nominate a new Director to fill the vacancy on the Board of Directors.
c.
If the vacant Director positions reach or
exceed twenty-five percent (25%) of the number of Directors, the Board of Directors
will be reconstituted in accordance with the provisions of paragraph (a) of this
Article.
a.
Upon expiry of the tenure of the first Board of Directors formed pursuant
to the provisions of paragraph (a) of Article (11) of the
Law, the new Board of Directors will be appointed by the Chairman of the Executive
Council pursuant to these Articles.
b.
Where the shares of the Company are offered for subscription, the Board
of Directors will be appointed or elected in accordance with applicable legislation.
The Board of Directors will elect, by secret ballot, from among the Directors a
Chairperson and a vice chairperson, who will act as the Chairperson in case of his
absence or vacancy of his position.
c.
The Chairperson will be responsible for supervising
the Board of Directors and for ensuring the performance of its functions under the
Law, these Articles, and the Companies Law; and the resolutions issued in pursuance
thereof.
d.
The Board of Directors will appoint its
Secretary in accordance with the relevant rules prescribed by the legislation in
force in the Emirate. The Secretary will be responsible for preparing the agendas
of the Board of Directors; sending invitations to Directors to attend its meetings;
recording, following up the implementation of, maintaining, and archiving its minutes
of meetings, resolutions, and recommendations; and performing any other duties assigned
to him by the Chairperson or the Board of Directors.
e.
The Secretary must satisfy the conditions and requirements stipulated
in the Governance Rules. The Secretary will report directly to the Board of Directors,
and may only be dismissed by a resolution of the Board of Directors.
f.
The Board of Directors may, in accordance with the Law, the Governance
Rules, and other legislation in force in the Emirate, form
one or more committees from among its members, and delegate to such committees any
of the duties and powers assigned to the Board of Directors.
a.
The Board of Directors will undertake the general supervision of the
Company and its performance of all the functions and activities required to achieve
its objectives. The Board of Directors will also act on behalf of
the Company within the scope of the functions assigned to it under the Law and the
Companies Law, and the resolutions issued in pursuance thereof; these Articles;
and the Government Shareholder’s resolutions. In particular, the Board of Directors
will have the duties and powers to:
1.
conclude loan agreements for periods
in excess of three (3) years;
2.
sell or mortgage the Company’s real property,
assets, or other movable and immovable property. In this regard, the Board of Directors
will draft the rules and regulations related to concluding loan agreements and to
the sale and mortgage of the Company’s real property, assets, or other property;
and will present the same to the Government Shareholder for approval;
3.
agree to discharging the Company’s debtors
from liabilities; engage in conciliation and arbitration; stipulate arbitration
terms in contracts and disputes to which the Company is a party; agree to the application
of foreign laws to any of its agreements; and establish, invest in, sell, dissolve,
or liquidate fully or partially owned companies and Subsidiaries;
4.
approve the terms of reference of the
Board of Directors and all other relevant matters, including the delegation of authority
and assignment of responsibilities to Directors;
5.
approve the financial, administrative,
and technical bylaws of the Company, including the delegation of authority matrix;
the bylaws governing its procurements and asset management; and the bylaws governing
its human resources;
6.
appoint or remove the CEO;
7.
determine the duties and powers of the
Executive Management;
8.
review and evaluate the performance of
the Executive Management and its implementation of the approved plans, strategies,
and policies;
9.
approve the rules for awarding incentives,
bonuses, and other benefits to the Directors and the Executive Management; and submit
the same to the Government Shareholder for final approval;
10. approve
the draft annual budget and financial statements of the Company; and
11. exercise
any other duties or powers aligned with the objectives of the Company as required
to serve its interests, subject to compliance with the provisions of the Law, these
Articles, and other legislation in force in the Emirate.
b.
The Board of Directors may delegate any of its powers under paragraph
(a) of this Article to the Chairperson, a Director, a committee formed by the Board
of Directors, or the CEO, provided that such delegation
is specific; in writing; and consistent with the delegation of authority matrix,
the Law and Companies Law, and the resolutions issued in pursuance thereof, and
the Governance Rules.
a.
Subject to the provisions of paragraphs (c) and (d) of Article (11)
of the Law, the CEO will have the duties and powers to:
1.
represent the Company before all entities
within and outside of the Emirate, including judicial authorities and government
and non-government entities;
2.
implement all resolutions issued by the
Commissioner General, the Government Shareholder, and the Board of Directors;
3.
manage the day-to-day work of the Executive
Management and operations of the Company, and ensure the performance of the duties
assigned to it under the Law and the Companies Law, and the resolutions issued in
pursuance thereof; these Articles; other legislation in force in the Emirate; and
the bylaws applicable to the Company;
4.
conclude contracts, agreements, and memoranda
of understanding, and sign documents of whatever nature and type, within the powers
vested in him under these Articles and the delegation of authority matrix;
5.
issue policies, decisions, and internal
bylaws in connection with the affairs of the Company, the companies it owns, and
the Subsidiaries, except for the bylaws which the Board of Directors is exclusively
authorised to approve pursuant to sub-paragraph (a)(5) of Article (21) of these
Articles;
6.
undertake all financial and banking functions,
and make the decisions related thereto, in accordance with the powers assigned to
him under the bylaws adopted by the Company and the delegation of authority matrix;
7.
perform all the functions assigned to
him under the legislation applicable to the Company, its internal bylaws, and other
legislation in force in the Emirate;
8.
supervise the Executive Management and
all matters related to its human resources, including approval of the appointment
of employees, determination of their salaries and remuneration, their transfer and
dismissal, and all other relevant matters, in accordance with the powers stipulated
in the relevant human resources regulations adopted by the Company;
9.
recommend to the Board of Directors the
nomination of Company representatives to serve on the boards of directors of the
companies the Company owns or the Subsidiaries. The appointment of representatives
to the boards of directors of these companies and Subsidiaries must be approved
by a resolution of the Board of Directors;
10. form
permanent and temporary committees and work teams, and determine their functions
and the remuneration of their members, in line with the regulations adopted by the
Company, the Companies Law and the resolutions issued in pursuance thereof; and
the Governance Rules;
11. appoint
persons to represent the Company in respect of any matter related to serving its
interests and protecting its rights;
12. conclude
conciliation and settlement agreements on behalf of the Company; agree to the application
of foreign laws to any of the contracts and agreements concluded by the Company,
the companies it owns, and the Subsidiaries; file lawsuits; appoint attorneys; and
conclude judicial and legal settlements and releases, in accordance with the Board
of Directors resolutions and with a view to serving the Company's interests; and
13. exercise
any other duties or powers delegated or assigned to him by the Chairperson, the
Board of Directors, the Commissioner General, or the Government Shareholder.
b.
The CEO will exercise the duties and powers assigned to him under paragraph
(a) of this Article in accordance with the relevant delegation of authority matrix
approved by the Board of Directors.
c.
In accordance with work requirements, the CEO may delegate any of his
powers under paragraph (a) of this Article to any of the Company’s employees, with
a view to serving the interests of the Company, the companies it owns, and the Subsidiaries.
Such delegation must be specific, in writing, and consistent
with the delegation of authority matrix approved by the Board of Directors, the
provisions of the Law, these Articles, and the Companies Law, and the resolutions
issued in pursuance thereof; and the Governance Rules.
a.
The Board of Directors will be convened, at least four (4) times a
year and where necessary, at the invitation of its Chairperson, or vice chairperson
in case of absence of the Chairperson, at the time and place he determines. The
meetings of the Board of Directors may be held through audio or video means of communication.
b.
Invitations to the meetings of the Board of Directors will be sent,
together with the approved agenda, at least one (1) week before the date scheduled
for the meeting. A Director may request adding any items to the agenda to be discussed
at the meeting subject to approval of the request by the chair of the meeting.
a.
A meeting of the Board of Directors or any of its committees will be
valid if attended by the majority of its members, provided that
the Chairperson or vice chairperson is in attendance. Attendance will be in person,
by being physically present or through audio means of communication, videoconferencing,
or any other audio-visual media as may be approved by the Board of Directors or
its committee.
b.
A Director may grant a written proxy to
another Director to attend a meeting of the Board of Directors or any of its committees
and vote on his behalf. In this case, the Director will have one (1) vote out of
the votes of attending members. A Director may not hold more than one proxy at any
meeting, and no Director may vote by way of correspondence.
c.
The resolutions of the Board of Directors or any of its committees
will be passed by majority vote of its attending members or their representatives.
In case of a tie, the chair of the meeting will have a casting vote.
a.
All topics and issues considered and discussed, and all decisions made,
will be recorded in the minutes of meetings of the Board of Directors or its relevant
committee. Any reservations made by a Director or any dissenting opinions will also
be recorded in these minutes.
b.
The attending Directors and the Secretary
will sign the minutes of meetings of the Board of Directors, or its committee, whether
by hand or electronically. Once approved, copies of these minutes will be distributed
to the Directors for their record.
c.
The minutes of meetings of the Board of
Directors and its committees will be maintained by the Secretary. Where a Director
refuses to sign any minutes of meeting, this will be recorded in the minutes together
with any reasons provided for the refusal.
a.
Without prejudice to the quorum required for convening the Board of
Directors, the Board of Directors may issue certain resolutions by circulation,
subject to the following:
1.
The majority of the Directors must acknowledge
the existence of an emergency that requires issuing resolutions or recommendations
by circulation to address urgent matters of the Company.
2.
The resolution to be circulated to Directors
must be in writing and accompanied by all related documents.
b.
Where the shares of the Company are fully owned by the Founder and
are not yet offered for subscription, a written resolution of the
Board of Directors which is signed or agreed upon by the majority of Directors will
be deemed valid and enforceable as if adopted in a duly convened meeting of the
Board of Directors.
The Chairperson, the CEO, the
Secretary, and the Company’s legal advisor are authorised, jointly or severally,
to provide certified copies of the minutes of meetings of the Board of Directors
or its committees, to sign these copies, to confirm that they are true copies of
the original minutes, and to date the same. Any party dealing with the Company may
rely on any of the certified copies as a true copy of the original document.
a.
The Chairperson and Directors must avoid any
conflict of interest that may arise as a result of their membership in the Board
of Directors or any of its committees, avoid any act that may raise any suspicions
of conflict of interests, and disclose any conflicts of interest or any suspicion
thereof. In particular, they must refrain from the following:
1.
participating in any discussion or vote
on, or impacting in any way whatsoever, any decision, recommendation, or procedure
in which they or their spouses or relatives up to the fourth degree have any direct
or indirect interest;
2.
exploiting their memberships in the Board
of Directors or its committees, or disclosing any information they obtain as a result
of these memberships in order to achieve specific objectives or receive a special
service or treatment;
3.
participating in any process, procedure,
or decision that may affect their objectivity, impartiality, or independence in
performing their duties; and
4.
being involved in any of the conflicts
of interest stipulated in the Companies Law and the resolutions issued in pursuance
thereof, and in any other legislation in force in the Emirate.
b.
Any resolutions issued, or measures taken, in violation of paragraph
(a) of this Article will be null and void.
a.
Conflicts of interests must be disclosed by the concerned Director
in the minutes of meeting of the Board of Directors or its relevant committee. The
Secretary must record that disclosure in a register maintained for
this purpose, update this register on a regular basis, and present the register
to the Chairperson and Directors for perusal.
b.
The Board of Directors will have the right to consider any conflict
of interest a Director may have, in which case the relevant decision must be made
by majority vote of attending Directors. The Director who has a conflict of interest
may not vote on the relevant decision.
c.
Where a Director fails or refuses to disclose to the Board of Directors
a conflict of interest related to a dealing or transaction to which the Company
is a party, the Company or the Government Shareholders may request the
Board of Directors, the Competent Authority, or the competent court to rescind such
dealing or transaction and require the violating Director to return to the Company
any profit or benefit derived from the same.
Membership of the Board of Directors
will terminate in any of the following cases:
1.
death, legal incapacity, or inability
to carry on duties;
2.
conviction of any crime affecting honour
or trustworthiness;
3.
resignation pursuant to a written notice
served on the Board of Directors;
4.
dismissal by a resolution of the Chairman
of the Executive Council; or
5.
absence, during the tenure of the Board
of Directors, for three (3) successive or five (5) non-successive meetings of the
Board of Directors, without an excuse acceptable to the Chairperson.
Subject to the provisions of
Article (33) of these Articles, a Director may not be held personally liable for
any obligations of the Company as a result of performing his duties as a Director,
provided that he does not exceed his authority.
a.
The Board of Directors and the Executive Management will be held liable
towards the Company, the Government Shareholder, and third parties for any acts
of fraud or abuse of power, and for any violation of the legislation in force or
these Articles. Any provision to the contrary will be invalid.
b.
The liability of Directors referred to in paragraph (a) of this Article
will be joint liability if it arises from a unanimous resolution of the Board of
Directors. Alternatively, where the relevant resolution is adopted by majority vote,
the Directors who have objected to the resolution or made reservations thereon will
not be held liable for the same, provided that they record their objection or reservation
in writing in the minutes of the meeting in which the resolution is adopted. A Director
who has been absent from the meeting in which the resolution is adopted will not
be relieved from liability unless it is proven that he had no knowledge of the resolution
or that he knew about the resolution but had not been able to object to it. The
Executive Management will bear the liability specified in paragraph (a) of this
Article if the relevant violation results from a decision issued by it.
c.
The Company will, to the extent of the value of its assets, indemnify
the Directors and the members of the Executive Management against any liability,
with the exception of criminal liability, incurred by them as a result of or in
connection with the performance of their duties in the Company, provided that these
Directors or members have been acting in good faith and in a manner they have reasonably
believed to be in the best interests of the Company. Nonetheless, no indemnification will be made for
any claim or matter in respect of which that Director or member has been finally
adjudged by a competent court to be liable towards the Company. In all events, the
Company will maintain the necessary insurance coverage in respect of the Board of
Directors and Executive Management liability.
Subject to the provisions of
Article (32) of these Articles, civil liability claims against the Directors may
not be barred by reason of any resolution issued by the Government Shareholder.
If the act giving rise to the liability is presented to the Government Shareholder
in a Board of Directors’ report or Auditor’s report and is
ratified by the Government Shareholder, any civil claims in respect of that act
will be barred upon the expiry of one (1) year from the date on which the report
is presented to the Government Shareholder. However, where the act attributed to
the Directors constitutes a criminal offence, the civil liability claim will be
barred only if the criminal proceedings are barred.
a.
The remuneration of Directors will be calculated
as a percentage of the net profits for the financial year then ended, and may not
exceed ten percent (10%) of the net profits for the relevant financial year after
deducting the depreciation allowance and reserves. The duties of the Chairperson
must be taken into consideration when determining his remuneration. The Company
may reimburse any Director for the expenses he incurs.
b.
Subject to obtaining the approval of the Government
Shareholder, the Board of Directors may pay a Director his remuneration as a lump
sum not exceeding two hundred thousand dirhams (AED 200,000.00) at the end of the
financial year, in the following cases:
1.
if the Company does not make profits; or
2.
if the Company makes profits but the Director’s
remuneration, calculated as a share of these profits, is less than two hundred thousand
dirhams (AED 200,000.00). In this case, the Director may not receive more than one
remuneration in relation to making profits.
Without prejudice to the provisions
of Article (19) hereof, the Chairman of the Executive Council may dismiss all or
any of the appointed Directors, and appoint new Directors to replace them in accordance
with the Governance Rules. A dismissed Director may not be appointed or reappointed
as a Director for at least three (3) years from the date of dismissal.
The following matters will be presented to the
Government Shareholder, within the time frames it prescribes, for determination:
1.
the report of the Board of Directors on the
activities of the Company and its financial position throughout the year; and the
report of the Auditor, for approval;
2.
the balance sheet and profit and loss
account, for discussion and approval;
3.
approval of the appointment of Auditors
and their remuneration; and
4.
the proposals of the Board of Directors
concerning the distribution of profits, whether as cash dividends or bonus shares;
5.
any case of discharge or non-discharge
of liability, dismissal, establishment of the accountability, or suing of Directors
where necessary; and
6.
any case of discharge or non-discharge
of liability, dismissal, establishment of the accountability, or suing of Auditors
where necessary.
Subject to the Companies Law and the resolutions
issued in pursuance thereof, and other legislation in force in the Emirate, the
Government Shareholder will have the authority to:
1.
increase or reduce the share capital
and of the Company in any way;
2.
sell or dispose of, in any legal
manner, all or any part of the business, projects, or assets of the Company;
3.
modify or terminate the term of the Company;
4.
approve the issuance of bonds, sukuk,
or any other financial instruments; and
5.
allocate, in accordance with the legislation
in force in the Emirate, a percentage of the Company’s annual profits or accumulated
profits for social responsibility purposes. In that case, the Company must disclose
its social responsibility contribution on its website upon the end of the financial
year. The Auditor must include in his report and in the Company’s annual financial
statements the names of the beneficiary(ies) of the social responsibility contribution
of the Company.
a.
The Company will have one or more Auditor(s)
appointed, based on nomination by the Board of Directors and subject to the approval
of the Government Shareholder, for a renewable term of one (1) year. The fees and
remuneration of the Auditor will be determined by the Government Shareholder.
b.
The Auditor must be registered and licensed
to practise the audit profession in the UAE in accordance with the applicable legislation.
c.
The Auditor will assume his duties from
the date determined by the Government Shareholder and until the end of the contractual
year.
d.
The period of appointment of an Auditor
may not exceed the term specified in the Companies Law and the resolutions issued
in pursuance thereof.
a.
An Auditor must be independent from the
Company and the Board of Directors and may not be a business partner, agent of the
Government Shareholder or of any of the Directors, or a relative up to the fourth
degree to a Director. The Auditor may not be a Shareholder or a member of the Board
of Directors or occupy any technical, administrative, operational, or executive
position at the Company.
b.
The Company must take practical steps
to ensure the independence of the Auditor and that he has no Conflict of Interest.
a.
An Auditor will have the duties and powers
provided for in the Companies Law and the resolutions issued in pursuance thereof,
and in these Articles. In particular, the Auditor will, at all times, have the right
to access all the books, records, and documents of the Company and to request clarifications
as he deems necessary for the performance of his duties. The Auditor will have the
right to verify the assets and liabilities of the Company. If the Auditor is unable
to exercise these powers, he must document this in a written report submitted to
the Board of Directors. If the Board of Directors fails to enable the Auditor to
perform his duties, the Auditor must present the report to the Government Shareholder
and forward a copy thereof to the Commissioner General and the Competent Authority.
b.
The Auditor will audit the accounts of
the Company, examine the balance sheet and the profit and loss account, review the
Company’s transactions and dealings with Related Parties, and ensure the implementation
of the provisions of the Companies Law and the resolutions issued in pursuance thereof
as well as these Articles. The Auditor must submit a report on the results of such
examination and audit to the Commissioner General and the Government Shareholder,
and forward a copy thereof to the Competent Authority. In preparing his report,
the Auditor must verify the following:
1.
the accuracy of the accounting records kept
by the Company; and
2.
the extent of conformity of the Company
accounts with the accounting records.
c.
The companies owned by the Company, the Subsidiaries, and their auditors
must provide any information or clarifications requested by the Auditor for the
purposes of audit.
a.
The Auditor will submit to the Government Shareholder a report containing
all the information prescribed in Article (252)
of the Companies Law. The Auditor’s report must clarify any difficulties or interference
by the Board of Directors encountered during the performance of his duties.
b.
The report of the Auditor must be independent
and unbiased and must include the opinion of the Auditor concerning all matters
related to his duties, particularly the Company’s balance sheet; his notes on the
Company’s accounts and financial position; and any relevant violations.
c.
The Auditor must note in his report and in the balance sheet of the
Company any charitable and community contributions made by the Company
during the relevant financial year, and must name the beneficiaries of such contributions.
d.
The Auditor will be liable for the accuracy of the information stated
in his report. The Government Shareholder may discuss the
report of the Auditor and request clarifications on the matters included therein.
a.
The Board of Directors must maintain duly organised accounting books
which reflect the accurate and fair representation of the Company’s
business and dealings in accordance with internationally recognised accounting standards.
b.
The financial year of the Company will commence on 1 January and will
end on 31 December of each year.
a.
The balance sheet for a financial year must be audited on the date
to be determined by the Government Shareholder. The Board of Directors must prepare
a report on the Company's activities and financial position at the end of the financial
year, and that report must state its recommendations on the distribution of net
profits. Copies of the annual financial statements, the profit and loss account,
the Auditor’s report, the Board of Directors’ report, and the governance report
must be sent to the DIF and other entities specified by the legislation in force
in the Emirate.
b.
The annual financial statements of the Company will be published pursuant
to the relevant rules prescribed by the applicable legislation.
A copy of these statements will be lodged with the Competent Authority and other
entities specified by the legislation in force in the Emirate.
The Company will be dissolved
pursuant to a resolution of the Chairman of the Executive Council in any of the
following cases:
1.
expiry of the Company’s term as prescribed
in these Articles;
2.
fulfilment of the objectives for which
the Company is established;
3.
termination of the term of the Company
pursuant to a resolution issued by the Government Shareholder;
4.
merger of the Company into another company;
or
5.
destruction of all or most of the Company’s
property, making it unfeasible to invest the remainder thereof, as established by
a resolution issued by the Government Shareholder in this respect; and
6.
in any other case determined by the Companies
Law.
If the Company’s accumulated
losses reach fifty percent (50%) of its issued share capital and, the Board of Directors
must, within thirty (30) days of the date of disclosure of the Company’s periodic
or annual financial statements pursuant to applicable legislation, notify the Commissioner
General and the Government Shareholder of these losses to take the necessary action
by dissolving the Company before the expiry of its term or deciding that it continue
its business activities.
At the end of the term of the
Company or in the event of its dissolution before the expiry of that term, the Government
Shareholder will, upon the request of the Board of Directors, determine the method
of liquidation of the Company, and appoint one or more liquidator(s) and determine
their duties. As of the date of appointment
of the liquidator(s), the Board of Directors will cease to perform its duties. However,
the Commissioner General and the Government Shareholder will continue to exercise
their duties and powers throughout and until the end of the liquidation process.
a.
The Company will, throughout the period during which its shares are
fully owned by the Founder, be exempt from compliance with the provisions of Articles
(11), (12), (18), (20), (23), (28), (30/5), (36), and (48) of these Articles.
b.
The Company will, throughout the period during which its shares are
fully owned by the Founder, be exempt from compliance with
the provisions of Articles (6), (7), (8), (11) to (20), (22), (24), (26/3), (30),
(31), (32), (36), (37), (105) to (160), (162), (164) to (241), (243), (244), (245),
(247), (248), (251), (252), (253), (254/2), (268) to (273), (275) to (301), (306),
(309), (311), (314) to (334), (340) to (348), (350) to (359), and (361) to (363)
of the Companies Law.
c.
Once the Company's public offering and registration in accordance with
the applicable legislation is finalised, the Company will be governed
by the Companies Law and the resolutions issued in pursuance thereof and by these
Articles. In this case, the Company will, pursuant to a resolution issued by the
Cabinet in this respect, be exempt from compliance with the provisions of Articles
(117/2), (118), (119), (121), (143/2), (149), (152), (199), (217), and (221) of
the Companies Law.
Subject to the provisions of
these Articles, the Company will be governed by all the resolutions regulating corporate
governance approved under the legislation in force in the Emirate. These resolutions
constitute an integral and complementary part of these Articles.
These Articles of Association will be lodged and
published in accordance with the Companies Law.
©2024 The Supreme Legislation Committee in the
Emirate of Dubai
[1]Every effort has been made to produce an
accurate and complete English version of this legislation. However, for the
purpose of its interpretation and application, reference must be made to the
original Arabic text. In case of conflict, the Arabic text will prevail.