Article 1. Name and company type
The company name is Sadra Insurance Company, hereinafter referred to as the Company, which is of Afghan and immutable nationality.
Article 2. Company theme
The subject of company activity is:
· Direct operations in all types of non-life insurance fields based on licenses issued by the General Directorate of Insurance Affairs.
· Acceptance of reinsurance by domestic or foreign insurance institutions in accordance with relevant regulations
· Investment from capital, technical and legal reserves
Article 3. Company activity duration
The activities of the company will be limitless since the date of the foundation.
Article 4. Nationality and main branch of the company
This company has Afghanistan nationality. The main branch is located in Kabul. Moving the company's headquarters to any other city within the country is permitted. The Board of Directors may establish or dissolve a branch or agency at any time inside and outside the country
Article 5. Amount of capital and equities number
Article 6. Approval of capital changes
Any change in company capital, whether reduction or increase, is exclusively within the jurisdiction of the General Assembly.
Proviso: General Assembly may allow the board to increase the capital of a company within a specified period of time not exceeding two years by a specified amount as specified by the board.
Article 7. Approaches for the increment of capital
The capital of the company may be increased by the approval of the General Assembly and by the relevant regulations through the issuance of new shares. It is possible to pay the nominal amount of new shares through one of the following.
· Cash payment of the nominal amount of shares
· Alternation of cash demands of the company to new shares
· Transfer of unearned dividends on reserves or earnings from new equity surplus to equity
· Convert corporate bonds into shares
Proviso: transferring statutory reserves to shares is not legally allowed.
Article 8. Priority to buy new stocks
In the case of approbation of capital increment, founders of the company’s share have priority in buying new shares comparing to the owner. This right is transferable and the duration for exerting priority right is based on the suggestions of directors. This deadline is started from the day of underwriting and will not be less than 60 days.
Article 9. The duties and latitudes of the general assemblies are as follows:
Common General Assembly: this assembly must be organized at least once in a year, and during the last four months of the fiscal year, to settle the following issues.
· Using reports of directors regarding achievements of last fiscal year
· Using reports of inspectors
· Considering and approbating financial statements of last fiscal year
· Approval of divided profits
· Approval of rewards and attendance privileges for the board of directors
· Specifying main and understudy investigators of the company and their income
· Selection of directors
· Issuance of non-convertible securities to shares
· Other issues that are legally within the authority of the Common General Assembly.
Special General Assembly: this Assembly is formed at any time for the purpose of following issues:
· Alteration in content of Statute.
· Alteration in the system of capital (increment or decrement)
· Issuance of convertible securities to shares
· Disbandment of the company before the specific time with the observance of commercial regulations.
Proviso: the issue of approbation of rewards and attendance privileges for boards of directors and specifying investigators to directors of the company is not legally allowed.
Article 10: Conditions for participation in assemblies and poll
In all General Assemblies, owners of the shares can personally or through a legal representative not considering the number of shares, contingent upon presenting evidence for being representative, each shareholder only has right for one vote.
Proviso: in the case of transferring shares, a new investor has the right to participate in meetings of the Assembly through presenting a real paper of the share or temporary evidence of share transference.
Article 11: Committee of heads in General Assembly
General Assemblies is administrated by a committee of leaders composed of a head, a secretary and two observers. Administration of the assembly is executed by president or vice president of the board of directors or in the case of their absence, by one of the directors who has already been selected by a board of directors for this purpose. In such times that selection or deposal of some directors or all of them are within the agenda of assembly meeting, head of assembly will be selected amongst shareholders participated in the meeting considering a plurality of the votes. Two of absent shareholders are selected as observers of assembly and a secretary is selected from shareholder or others by assembly.
Article 12: Method of polling
Polling is done verbally by, for instance raising hands or standing as a sign of agreement. Considering the composition of shareholders, if the legal inspector of the company considers the verbal polling impossible, the voting will be done in writing.
Proviso: polling for selection of the board of directors and inspectors is necessarily in written.
Article 13: Quorum needed for Common General Assembly
In the Common General Assembly, the participation of holders of more than 50 percent shares who have voting rights is necessary. If in the first invitation, a mentioned quorum is not completed, the Assembly will be invited for the second time and with the participation of any amount of shareholders who have voting rights, the polling is official and the decisions will be made, providing that in the second invitation, the result of the first meeting is mentioned.
Article 14: Absolute majority of polls for Common General Assemblies
In the Common General Assembly, decisions will be a valid based majority of votes plus one in the official meeting, but in the selection of directors and inspectors, the plurality will be accepted. In the selection of directors, the number of polls for each voter will be multiplied by a number of directors that are selected and the polling right of each voter will be the product mentioned multiply. Voters can convey their votes to another one or divided it with as many people as they want.
Article 15: Quorum needed for the formation of Special General Assembly and polling
In the Special General Assembly, owners of more than 50 percent of share who have polling rights should be present. If in the first meeting invitation, this quorum is not fulfilled, the Assembly will be invited for the second time and this time, with participation of owners of more than one third of shares who have polling rights, the meeting will be official and decisions will be made, provided that in the second invitation, the result of the first one is mentioned. Decisions of the Special General Assembly will be valid with a plurality of two-third of votes in the official meeting.
Article 16: Number of members in Board of Directors
The company is administrated by a board of directors composed of 3 main members that are selected by the Common General Assembly and all of them are possible to be deposed or elected.
Proviso1: Common General Assembly can proceed with the selection of two members or understudy members of the Board of Directors in addition to main members, based on priority.
Proviso2: At least one of the members of the Board of Directors or its representative should be unbound and has financial education (accounting, economics, financial management and other management fields with a concentration on finance or economics) as well as relevant experience.
Proviso3: Executive director, vice director, as well as main and understudy members of the Board of Directors, should be qualified in related conditions and have beneficial experiences in the insurance field.
Article 17: Completion of members in Board of Directors
If for any reason, members of Board of Directors are less than specific quorum and understudy members are not identified or selected, the Board of Directors is obliged to invite Common General Assembly maximally within a month for the purpose of completing members of Board of Directors.
Proviso1: Legal entities can be selected as members of Board of Directors. In this case, the legal entity should introduce a person as a permanent representative to the company in writing for running management duties.
Article 18: Resignation of members in Board of Directors
If any member of the Board of Directors wants to resign from his/her position, they must inform Board of Directors and inspectors at least 30 days before resignation.
Article 19: Absence in meetings of the Board of Directors
Absence of any members of Board of Directors or their representative for more than 4 consecutive or 6 intermittent meetings during a solar year without any valid excuse, is automatically caused by their deposal from the Board of Directors. Considering the validity of the excuse is the duty of the Board of Directors.
Article 20: Duration of directors’ mission
The duration of the directors’ assignment is 2 years. Their mission is automatically continued until the procedure for registering next directors is done. Reselection of members of the Board of Directors and understudy members for the next periods is not prohibited.
Article 21: Assurance share
Each of the directors should have at least 1 share of the company’s share, during his mission and give it as an assurance to the company. This share is a guarantee for losses that are incurred to the company by directors individually or jointly. Mentioned shares are registered and cannot be transferred.
Article 22: President, Vice president, and secretary of the Board of Directors
The Board of Directors will have their first meeting that maximally one week after a meeting of the Common General Assembly that elected Board of Directors. Amongst its members, a president and a vice president that should be legal individuals are selected. Duration of presidency and vice presidency will not exceed their membership time in Board of Directors. President and vice president can be deposed or reselected. In the case of the absence of the head, members of the Board of Directors will select a person amongst members in the meeting to continue the duties of the president. Board of Directors will select a person amongst members or outside them as secretary for a year.
Article 23: Board of Directors meeting arrangements
Meetings will be specified by the Board of Directors. In the case of need that does not exceed one month and with the written invitation of the president or vice president or two members of Board of Directors, and also in the case of need, with an invitation of executive director, will conduct a meeting. The duration of sending an invitation and the meeting must be considered. If in any meeting of the Board of Directors, the date of the next meeting is defined and is set on the agenda, sending the invitation to those directors who were present in the mentioned meeting will not be necessary. The Board of Directors meeting will be conducted in the main office of the company or any other location that is defined in an invitation letter.
Article 24: Quorum and majority required for formal meeting of the Board of Directors
Meetings of the Board of Directors are official only if more than half of its members are present in the meetings. Decisions of the Board of Directors will be valid considering consensus among members.
Article 25: Meeting agendas of Board of Directors
For each of the meetings in the Board of Directors, an agenda must be arranged that is signed by all present directors in the meeting. Name of absent and present directors and a summary of discussions as well as made decisions in the meetings must be mentioned in the agenda alongside the date. The opinion of each director which is against some or all decisions mentioned in the agenda must be written at the end of the agenda.
Article 26: Latitude in Board of Directors
Board of Directors has limited latitudes regarding any operation with the name of the company or any activity and dealings related to the company that the decisions and achievement of them are not within the authority of the Common General Assembly. It includes:
· Representing the company against shareholders of all governmental and non-governmental organizations, general institutions, juridical sources, and other legal entities and individuals.
· Approbation of Statute Documents of the company, suggesting an executive director
· Making decisions regarding to foundation or disbandment of branches or agencies inside or outside of the country
· Approval of organizational structure, recruitment conditions and amount of salaries and wages
· Predicting and approbating the annual budget of the company
· Opening different types of accounts and using them on behalf of the company in banks and other legal organizations
· Receiving claims and payment of debts of the company
· Issuing, endorsing, acceptance, payment and receiving commercial papers
· Signing any type of contract, alteration, changes, and cancelation of them regarding movable and immovable properties that are relevant to the scope of activities in the company as well as executing all operations and dealings
· Making decisions regarding issues related to recording and dealing all incorporeal rights including any invention right, commercial or industrial name or symbol, copyrights, goodwill, and all potential credits.
· Lending any kind of document, evidence, company money or securities and reclaiming them.
· Receiving facilities from banks and official organizations with the observance of regulations in the current Statute Document.
· Mortgages of company property, whether movable or immovable and mortgages.
· Conducting any kind of legal and criminal cases and defending them in any court, judicial and other sources either private or public and supreme court, on behalf of company; defending the company against any criminal or legal cases in any private or public judicial or non-judicial sources, supreme court, with having the right to be present to disciplinary authorities and receiving all necessary latitudes from beginning up to end, including participating in meetings, objecting to votes, claim for revisions, conclusion and consideration, agreement, retracting documents or cases, claiming forgery or having doubt about other documents and retracting them, identifying forger, right for signing contracts including subrogation and referring claims to them and selecting subrogates(with or without having right for settlement); implementing final order of subrogate, claiming for issuing executive sheets and following its procedure as well as, defining expert, selecting and ousting representatives with having right for being selected as representative repeatedly, confessing nature of case, claiming for third party and defending him, claiming against them and defending, presence of third person and defending this presence, accepting or rejecting oath, providing losses derived from crimes and other similar issues. Arranging annual financial statements and reporting activities of the Board of Directors and presenting them to inspectors and auditors.
· Preparing midterm financial statements in the quarter based and presenting six-month financial statements to inspector and auditor
· Inviting common and Special General Assemblies and defining the agenda
· Suggestions regarding any reserves except statutory ones as well as technical reserves
· Suggestions regarding the division of interests amongst shareholders.
Suggesting the reformation of Statute Document to the Special General Assembly, after receiving the written consent of the General Directorate of Insurance Affairs.
Article 27: Rewards for members of the Board of Directors
Each year, based on the decision of the General Assembly, it is possible that a specific portion of net income is rewarded to the Board of Directors. This proportion should not exceed 5 percent of the profit that is allocated to shareholders in the same year.
Article 28: Dealings of directors with the company
If members of the Board of Directors, executive director of the company are a partner with the executive director or board of directors of other organizations and companies or are members of their Board of Directors, they can’t be directly or indirectly engaged with dealings with them without the approbation of Board of Directors.
Article 29: Granting debts and/or credits to directors
The executive director of the company and members of the Board of Directors excluding legal entities, do not have the right to receive any debt or credit from the company and the company cannot guarantee their debts either. Such operations are automatically invalid.
Article 30: Executive manager
Board of Directors must select an individual entity amongst its members or out of it as executive director and define his/her latitude, duration of position, rights and other recruitment conditions. Board of Directors can assign some parts of latitudes to the executive director. Based on defined latitudes, the executive director of the company is representative of the company and has the signing right on behalf of the company. If the executive director is not a member of the Board of Directors, the period of his/her position as executive director will not exceed the duration of his/her membership in the Board of Directors.
Article 31: Vacant Executive director position
If due to resignation, dismissal, death or any other reason, the position of executive director falls vacant, Board of Directors must select another person for this position with the observance of Statute Document maximally within 1 month. If the selection of executive director lasts more than one week, the Board of Directors must select another person as a representative who has all duties and responsibilities of the executive director within the defined authority, until the actual executive director is selected.
Proviso: Until the appointment of executive director, all duties and responsibilities related to the executive director are assigned to head of the Board of Directors or vice executive director.
Article 32: Authorized signature owners
All papers, contracts and binding documents of the company are signed by those who are selected by the Board of Directors.
Article 33: Selection of inspector
Common General Assembly in each year should define a real and understudy auditor from liable organizations for the purpose of performing defined duties and responsibilities based on relevant regulations and Statute Document of the company for a year.
Article 34: Duties of inspector
Auditor has following responsibilities too:
1. Commenting regarding financial statements based on accounting, national auditing, regulations, and executive directions
2. Presenting reports to the General Assembly regarding observance or non-observance of rules by directors.
Article 35: Salary of inspector
The salary of the inspector is defined by Common General Assembly. Auditors, managers, employees, and others do not have the right to receive any money, property and other privileges from the company excluding the ones that are approbated by the General Assembly. Also, they do not have the right to be engaged in dealings with the company or on behalf of the company directly or indirectly.
Article 36: Fiscal year
The fiscal year of the company is started from the first day of the first month of the solar year (Hamal) and will end on the last day of the last solar year moth (Hut).
Article 37: Annual accounts
Maximally during 3 months after the end of each fiscal year, the Board of Directors must prepare and present financial statements of the company as well as a report regarding activities and general status of the company during the mentioned year to the auditor.
Article 38: Financial statements
Audited financial statements of the company each year must be presented to Common General Assembly for being approbated for 4 months after the end of the fiscal year of the company.
Article 39: Arbitrary and statutory reserves
Ordaining statutory reserves from a profit of the company is done based on insurance rules. With the suggestion of the Board of Directors and approbation of the Common General Assembly, it is possible that a portion of net income is set aside for other reserves. In addition to the mentioned reserves, technical and necessary reserves should be approved based on directions of the General Directorate of Insurance Affairs.
Article 40: Optional cases for the disbandment of the company
Special General Assembly of the company, based on a suggestion of the Board of Directors, can vote for the disbandment of the company. Report on this suggestion must include reasons and factors that caused members of the Board of Directors to decide on the disbandment of the company. This report must previously be presented to the auditor of the company and after being commented, it should be sent to Assembly. Making a decision regarding the suggestion of the Board of Directors is not possible unless the auditor read the report in the Assembly. Special General Assembly will be considered official for the purpose of disbanding the company with the participation of at least 75 percent of shareholders.
Article 41: Articles of Statute Document
This Statute Document contains 41 articles and 23 provisos and has been approved by the General Assembly on March 21st, 2018.