Board of Directors in the Joint Stock Company:

(Composition and members):

  1. The joint stock company shall be managed by a board of directors consisting of at least 3 members and no maximum.
  2. The Chairman of the Board of Directors or a member or a managing director may be a non-shareholder appointed by the General Assembly.
  3. The Board of Directors shall be chosen by the General Assembly and shall be for a period of three years and in exception, the founders shall appoint the first board meeting and shall be five years.
  4. The membership period shall be calculated from the date of registration of the company in the Commercial Register for the First board meeting and from the date of the General Assembly’s decision to discuss the budget for the fiscal year in which the end of the term of membership is due.
  5. The reserve members may be appointed in the Company’s Articles of Association to replace the original in the event of their absence or the occurrence of an impediment.
  6. The representative of the legal person concerned may be a member of the Board of Directors or the director of the Board. The representatives of the legal person could be multiple. The legal person may at any time dismiss his representative and notify the company in writing or in a letter recommended by his successor.

(General Conditions of Directors):

  1. A member of the board of directors of any joint stock company shall not be sentenced to a criminal penalty or a misdemeanor penalty for theft, erection, breach of trust, forgery, negligence or penalty of the penalties provided in Articles 162,163,164 of the Companies Law No. 159 of 1981.
  2. To be fully competent.
  3. The member of the Board of Directors shall release a written acknowledgment of the appointment.
  4. Not be a public servant unless he is subject to the approval of the competent minister.

(Jurisdiction of the Board of directors):

  1. The Board of Directors shall have all the powers related to the management of the Company and shall carry out all the necessary work to achieve its purpose except as specified in the Law or the Company’s Articles.
  2. The director of the board shall represent the Company before the courts and others.
  3. To delegate one or more members to the actual management work. The Board shall determine the authorities of the managing director and shall require the managing director to be full time for the administration.
  4. He may appoint a general manager of the company from non-members and may be invited to attend its meetings without having a numbered vote.
  5. The board of directors shall appoint from among a director and a term of appointment not exceeding the term of his membership in the board.
  6. The implementation of decisions issued by the General Assembly and has no right to amend or cancel them.

(How to convene a board meeting):

(Who has the right to call for a meeting of the Board of Directors)

  1. the invitation of the board director.
  2. A third of the members of the Board of Directors may submit a written request to the director of the board to hold a meeting. If the director of the Board fails to submit a motion within ten days from the date of the request, a third of the members shall invite the Board to the meeting and notify the General Authority for Investment.

 (Notation sessions):

The minutes of the Board meetings shall be recorded regularly after each session. A summary of all the discussions of the Board shall be recorded in the minutes.

(Meeting validity and voting on decisions):

The meeting shall not be valid unless there is at least a majority of its members. The members of the council may be appointed to each other provided that this does not prejudice the quorum of the meeting and requires that it be written and certified by the director.

The majority vote shall be in the case of equal votes.

(Removal of the director of the board or one of its members):

The director shall be removed by the members of the board because and The Ordinary General assemble may dismiss the director or one of its members at any time, even if this is not on the agenda.

Exempt members may not be re-elected before the expiry of five years from the date of issuance of the dismissal decision.

(Invalidation of board decisions):

  1. If the quorum is not correct.
  2. In the event that the decisions are not issued by the prescribed majority.

3.Every decision is contrary to the Companies Law No. 159 for the year 1981.

(Board members’ reward):

The reward of the Board of Directors may not be estimated at a certain percentage of the profits by more than 10% of the annual profit. The Ordinary General Assembly shall determine the amount of reward and salaries of the members of the Board and approved by the General Assembly. The members of the Board of Directors may not vote on their reward and salaries in the General Assembly and the voting shall be secret.

 (Resignation of members of the Board):

The members of the Board of Directors may resign at a time does not harm the interests of the company.

(Board of Directors’ sanctions):

Law No. 159 of 1981 provides for the penalties for the Board of Directors in the following articles:

1.Article (160) stipulates that the General Assembly shall decide to dismiss the members of the Board of Directors and bring the claim of responsibility to them. The decision shall be valid when the partners holding the half of the capital agree upon it.

The dismissal members may not be re-elected before the expiry of five years from the date of the issuance of their dissolution.

2.Article 161 provides that without prejudice to the right to claim compensation, any action, transaction or decision contrary to the rules set out in this Law or issued by the Board of Directors of the joint stock companies shall be null and void, in a manner not prejudicial to the right of others. Six months to correct the invalidity if possible.

In the case of a multiplicity of those who cause of invalidity they shall be jointly liable for compensation.

The persons concerned may not file a claim for invalidity after three years passed from the date of their knowledge of the contrary decision. If this decision has not been issued by fraud or cheat, the right to file a claim in this case shall not be waived unless fifteen years passed from the date of the decision.

3.Article (162) stipulates that without prejudice to the most severe penalties provided for in other laws, a penalty of not less than two years’ imprisonment and a fine of not less than LE 1000 and not more than LE 10,000 shall be imposed by the violator personally or by one of these two penalties.

Each Board Member shall distribute dividends or benefits contrary to the provisions of this Law or the Company’s Articles of Association.

Any person who is falsified in the Company’s records or has intentionally proved incorrect facts or prepared or presented reports to the General Assembly containing false or incorrect statements that would have influenced the decisions of the Assembly.

  1. Article (163) stipulates that without prejudice to the most severe penalties provided for in other laws, a fine of not less than LE 1000 and not more than ten thousand shall be paid personally by the violator.

Any person who appoints a member of the board of directors of a joint stock company or a managing member to manage it or remains a member in violation of the prohibitions stipulated in this law and any member of the management of a company in which there is a violation of these violations.

Any member of the Board of Directors shall fail to provide the shares allocated to ensure management of the face prescribed in this law within sixty days from the date of notifying him of the appointment decision, as well as failing to submit the statements required to submit them, making false statements or intentionally omitting data from the statements that the Board of Directors As well as any board member who has proved incorrect or intentionally omitted data in company reports.

Any person who contravenes any of the provisions of the law.

Any member of the board who deliberately caused disrupt to the General Assembly’s invitation.

By. Dr. Mahmoud Mostafa 

From the best corporate law firm in Egypt

CategoryCorporate Law
Write a comment:

Your email address will not be published.

seven − three =

Copyright © 2016 MM Law Firm, All Rights Reserved. Powered by Open Scope

logo-footer

Sitemap