Allianz Saudi Fransi Cooperative Insurance Co. announces to Invites its Shareholders to Attend the (First Meeting) Extraordinary General Assembly Meeting via modern

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Allianz Saudi Fransi Cooperative Insurance Co. announces to Invites its Shareholders to Attend the (First Meeting) Extraordinary General Assembly Meeting via modern

technology tools Introduction

The Board of Directors of Allianz Saudi Fransi Cooperative Insurance Company is pleased to invite the shareholders to participate in the Extraordinary General Assembly meeting (the first meeting), which will be held on Monday, 26 Safar 1445 AH corresponding to 11 September 2023 AD via modern technology tools.

General Meeting Venue Head Office - Riyadh - via modern technology means.

General Meeting Link

www.tadawulaty.com.sa

General Meeting Date Monday, 26 Safar 1445 AH corresponding to 11 September 2023 AD

General Meeting Time ^{07:00 PM}

Right to Attend Every shareholder registered in ALLIANZ SF's shareholder register at the Depository Center (Edaa) by the end of the trading session preceding the General Meeting has the right to attend the General Meeting pursuant to the laws and regulations. And the shareholder has the right to discuss the topics on the general assembly's agenda and ask questions.

Required Quorum

The extraordinary general assembly meeting shall be valid if attended by shareholders representing at least half of the capital. If the necessary quorum is not available to hold this meeting, the second meeting will be held an hour after the end of the period specified for the first meeting, and the second meeting shall be valid if attended by a number of shareholders representing at least (one-quarter) of the capital.

General Meeting Agenda 1- To vote on the Employee Stock Ownership Plan allocated to the employees and to authorize the Board of Directors to determine the terms of this program, including the allocation price for each share offered to the employees, if it is for consideration.

2- To vote on the company's purchase of a number of shares, with a

maximum of (866,000) of its shares with the aim of allocating it to the

Employee Stock Ownership Plan, and financing the purchase through the

fund available in the company, and on authorizing the Board of Directors

to complete the purchase within a maximum period of twelve months

from the date of the decision of the Extraordinary General Assembly. The

company will keep the purchased shares for a period not exceeding (10)

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years from the date of approval of the Extraordinary General Assembly as a maximum until they are allocated to the eligible employees, and after the expiration of this period, the company will follow the procedures and controls stipulated in the relevant laws and regulations.

Right to Register Attendance and Vote

Note that the right to register attendance for the General Meeting ends as soon as the Meeting is convened, and the right of the attendees to vote on the agenda items ends when the voting committee finishes counting the votes.

Online Voting Shareholders signed up in Tadawulaty services can remotely vote online on the agenda items, starting from 1 am on Thursday, Safar 22,1445 AH, corresponding to September 7, 2023 AD until the end of the Meeting.

Signing up and voting on Tadawulaty services will be available and free for all shareholders using the following link: www.tadawulaty.com.sa

Contact Method

Questions and inquiries of our valued shareholders will be received through the Shareholder Relations Department via the following e-mail:

ASFLegal@Allianzsf.com.sa Phone: 0118213093

Best Regards

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Document Name Employee Stock Options Policy & Procedure

Version 1

Date 15-06-2023

Author Head of HR and Administration Approved Board of Directors

Employee Stock Options Policy

Version 1 Effective:

15-06-2023

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Purpose

The purpose of the Allianz Saudi Fransi Employee Stock Option Plan is to strengthen our compensation strategy, an important element of our remuneration package that aims to provide means for AzSF to attract and retain capable individuals to serve as employees, managers and executives of the company or its subsidiaries, as well as to provide means for those individuals on whom the responsibilities of AzSF successful administration and management rest, and whose present and potential contributions to AzSF welfare are significant, to acquire and maintain stock options.

A further purpose of the Plan is to provide such individuals with additional incentive and reward designed to enhance our market competitiveness and the profitable growth of AzSF.

Objectives of the Policy

Main objective – lower attrition of senior levels.

Other objectives of this Policy are to:

The objectives of the Allianz Saudi Fransi Employee Stock Option are to create a variable pay structure to retain and motivate senior executives, key function holders, and key employees of Allianz Saudi Fransi and to promote loyalty to the company, incentivize them in line with AzSF performance.

 Employees will directly benefit from the success of a company and will feel a sense of ownership.

 Increase in productivity and an overall performance improvement for companies with employee stock plans.

 Attracting top talent and support employee retention.

 Improved compensation and benefits strategy.

Stock Options

The proposed employee stock plan envisages company giving out stocks purchased by the company through share buy back as treasury stocks.

 Governed by CMA and SAMA regulations.

 Approval from Auditors, Audit Committee, Board and General Assembly.

 Proposed to buy shares of SAR 10M from total equity of SAR 710M, out of which paid up capital of SAR 600M.

Definitions

Board Member

A member of the Board of the Company, whether elected or nominated.

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Employee Stock Option Plan

Stock grant or incentive provided to senior executives, key function holders, and key employees of Allianz Saudi Fransi.

Nomination and Remuneration Committee

Means the Committee (NRC) constituted by the Board from time to time, to administer and supervise the Employee Stock Incentive Options and other employee benefit plan/

schemes.

Eligibility

Means the criteria as determined by the Nomination and Remuneration Committee for granting the incentives to the senior executives, key function holders, and key employees of Allianz Saudi Fransi.

Eligible Employee

 A permanent and full-time employee of the company working in Allianz Saudi Arabia.

 A senior executive, key function holders, or key employees.

 List of employees duly approved by the Nomination and Remuneration Committee and on company payroll on the data of grant.

Grant

Means issue of stocks to the Employees under the Employee Incentive plan from the treasury stocks of the company.

Grant Date

Means the date in which stock grant incentive to the Employees is approved. This is expected but not necessary to be 30^th June of the year.

Misconduct

Means any of the following acts or omissions by an Employee in addition to any provisions prescribed in the offer or terms of employment amounting to a violation or breach of terms of employment as determined by authorized AzSF bodies after giving the employee and opportunity of being heard, wherever required:

 Committing any act warranting summary termination under Saudi law or Regulations; or

 Conduct that amounts to a serious breach by an Option Grantee of the obligation of trust and confidence to his employer; or

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 A finding that an Employee has committed any material or consistent breach of any of the terms or conditions of employee contract and AzSF policies including any willful neglect of or refusal to carry out any of his duties or to comply with any instruction given to him by the Management; or being convicted of any criminal offence; or being disqualified from holding office in any Allianz OE or any other company under any legislation or being disqualified or disbarred from membership of, or being subject to any serious disciplinary action by, any regulatory body within the industry, which undermines the confidence of AzSF in the individual’s continued employment; or

 Breach or violation of any Company Policies/ Terms of Employment; and

 Any other act or omission not included above, but defined as misconduct in the Saudi labor law, Saudi Central Bank (SAMA), AzSF policies, and Employment contract.

Shares

Means equity shares of the Company of face value at market price as at date of grant.

Vesting

Means earning by the option grantee, of the right to exercise the options granted to him in pursuance of the Employee Stock Incentive of 2022.

Vesting Condition

Means any condition subject to which the options granted would vest in an Option Grantee as approved by the Nomination and Remuneration Committee for each ESOP scheme.

Vesting Period

Means the period during which the vesting of the option granted to the Employee, in pursuance of the Employee Stock Incentive of 2022, takes place.

Vesting Schedule

The timeline over which the options become wholly owned and exercisable by the employee.

Vested Option

Means an option in respect of which the relevant vesting conditions have been satisfied and the option grantee has become eligible to exercise the Option.

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Administration and Governance

The Employee Stock Option shall be administered by Finance and Human Resources under the governance of the Nomination and Remuneration Committee. All questions of interpretation of the Employee Stock Option Plan or any option shall be determined by the Chief Executive Officer and Nomination and Remuneration Committee and such determination shall be final and binding upon all persons having an interest in the Employee Stock Option Plan or in any option issued thereunder. Changes on the Bylaw, Corporate Governance, and Remuneration has been applied through the approval of SAMA and General Assembly.

The Nomination and Remuneration Committee shall in accordance with this plan and applicable Laws determine the following:

 The option to be granted under the Nomination and Remuneration Committee per Employee, subject to the ceiling as specified in this policy.

 The Eligibility Criteria for grant of option to the employees;

 The specified time period within which the employee shall exercise the vested option in the event of termination or resignation or other cases of separation of an Employee;

 The right of an employee to exercise all the options vested in him at one time or at various points of time within the exercise period;

The procedure for making a fair and reasonable adjustment to the number of option and to the exercise price in case of corporate actions such as rights issues, bonus issues, merger, sale of division and others. In this regard following shall be taken into consideration by the Committee:

 The number and the price of Option shall be adjusted in a manner such that total value of the Option remains the same after the corporate action; and

 The Vesting period and the life of the option shall be left unaltered as far as possible to protect the rights of the Option Grantees.

 The conditions under which Option vested in employees may lapse in case of termination of employment for misconduct.

Amendment and Termination of Plan

Termination of Plan

The Nomination and Remuneration Committee in its discretion may terminate the plan at any time with respect to any shares of stock for which awards have not theretofore been granted.

There may be exceptional circumstances where business economics dictate that no payment is prudent. If this is the case, the company may suspend the plan's normal

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rules. The ESOP award will be contingent on the CEO and NRC being satisfied that it is justified based on the company's underlying financial performance.

Amendment of the Plan

It is within the discretion of the Chief Executive Officer The Nomination and Remuneration Committee to amend the Plan or any part of the Plan from time to time;

they also retain the right to suspend current or future plans through appropriate notice in writing provided that no change in any award theretofore granted may be made that would impair the rights of the holder without the consent of the holder; and provided, further, that the Board may not, without approval of the stockholders, amend the Plan to increase the maximum aggregate number of shares that may be issued under the Plan, change the class of individuals eligible to receive awards under the Plan, or otherwise modify the Plan in a manner that would require shareholder approval under applicable exchange rules.

Eligible Employees

An employee may be eligible to receive employee stock incentives on the following conditions:

 Full time employee with at least 1 year tenure, with an appraisal result of target and above target score. Whereas employee must fall under the job category of;

 A Senior Executive, Key Function holder (Heads/ Managers of Departments), or identified Key employee by the Executive Management.

 Is not on Performance Improvement Plan.

Membership and Confidentiality

Membership in the plan is contingent on continued strong personal performance; it is limited to those who are considered critical to Allianz Saudi Fransi's future success at the time of invitation.

Membership follows the recommendation of Head of HR and Administration and the Chief Executive Officer.

Participation does not confer any right of automatic continuance of plan, continuity is conditional on participants’ high performance and deliverance of outstanding contribution to Allianz Saudi Fransi.

This plan is limited to a number of people, strict confidentiality must be maintained.

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Resignation/ Termination

An executive, key function holder or key employee who resigns or leaves for involuntary reasons, or is under notice prior to the payment date, will not be eligible for the payment.

For executive, key function holder or key employee is leaving for normal retirement, early retirement if pre-agreed in advance (12 months), on the grounds of ill health or redundancy will be eligible to receive a proportional amount.

In case of death, the Chief Executive Officer will have the discretion to make payments.

Scheme and Vesting

Level Scheme Vesting

C-Suite Based on year-end appraisal Example :

Max bonus 100 Bonus granted 60

Long term incentive 30 (50% of bonus)

Stock of AZSF with Current market value granted to employee

Period:

 1/3 after 24 months

 1/3 after 48 months In case of exit during interim period only vested shares are available

Key Function holders and Key Employees

Based on year end appraisal Example :

Max bonus 100 Bonus granted 60

Long term incentive available 25%

of bonus = 15

Opportunity to purchase shares at 20% discount from current market value

Period:

 1/3 after 42 months In case of exit during interim period only vested shares are available

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Payment of Incentive

Payout Delivery - Deferred

As illustrated above, the next potential payout would occur in June.

31^st December 2020

30^th June 2021 Granting based on bonus/ letter

 1/3 30^th June 2022

 1/3/ 30^th June 2023

 1/3/ 30^th June 2024 Scheme Example:

Scheme 1

Announced in December 2023

Nomination and Remuneration list of eligible employee with:

 LTIP in contract

 Key employees

In June 2024, the amount to be calculated and ESOP’s to be issued with letters.

Scheme 2

Announced in December 2022

a) List of eligible employees for LTIP from Key, Executive and Management b) Amount to be decided in June 2023 in e.g. SAR 300

c) Letter issued in June 2023 with no. of stock and vesting Price as of 31^st May is SAR 15

Therefore no. of stocks is issued LTIP divided by current stock price (SAR 300/ SAR 15) is 20 stocks.

The Vesting for 20 stocks will follow and scheduled as follows:

 1/3^rd on 30^th June 2024 is 7

 1/3^rd on 30^th June 2025 is 7

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 1/3^rd on 30^th June 2026 is 6

On the vesting date, the vested share are transferred in the share register under his/ her name.

Calculation Example

Please note: The table above are for illustrative purpose only, results may vary based on target achievements.

Level of achievement and payment

When the audited accounts for the financial year become available, the nomination and remuneration committee will meet to agree the level of achievement against the pre-agreed measure. These are communicated to participants in writing.

Payment details

Once the results are known and the proportion of the incentive to be paid out has been established, the award will be paid on xx-xxx-xx.

Payment eligibility criteria

To be eligible for a payout from the plan, the Senior Executive, Key Function holder (Heads/

Managers of Departments), or identified Key employee by the Executive Management must be employed by AzSF at the date of payment.

Payment under the rules of the plan are subject to final review by the CEO and NRC whose decision is final. If the executive, key function holder, key employees does not meet the expected level of performance for the period AzSF may reduce or withhold payment under the plan.

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Forfeiture

When the Senior Executive, Key Function holder (Heads/ Managers of Departments), or identified Key employee by the Executive Management

Approvals

Document Name Employee Stock Options Policy

Version 1

Date 15-06-2023

Author Head of HR & Administration Checked and Authorized Board of Directors

Nomination and

Remuneration 30^th of May, 2023

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LIMITED ASSURANCE REPORT

To the Shareholders of

Allianz Saudi Fransi Cooperative Insurance Company (the “Company”) (Saudi Joint Stock Company)

Riyadh, Kingdom of Saudi Arabia

We have carried out a limited assurance engagement in order to state whether anything has come to our attention that causes us to believe that the subject matter detailed below (“Subject Matter”), has not been reported and presented fairly, in all material respects, in accordance with the applicable criteria mentioned below.

SUBJECT MATTER

The subject matter of the limited assurance engagement relates to the Company's assessment of the financial solvency requirements (mentioned below) and the accompanying schedule of the proposed buy-back of shares (“The Schedule”) expected on 30 September 2023 prepared by the management of the Company as attached to this report as Annexure A and submitted to us.

The aforementioned financial solvency requirements are in accordance with the Applicable Criteria mentioned below. Requirements must be complied with, unless expressly exempted by the CMA.

APPLICABLE CRITERIA

The criteria are the applicable requirements of Part Six, Chapter One, Article 17.3 of the Implementing Regulations of the New Companies Law for Listed Joint Stock Companies issued by the Capital Market Authority ("CMA") of the Kingdom of Saudi Arabia dated 18 January 2023 (as amended) ("the Implementing Regulations", the “Criteria”).

MANAGEMENT RESPONSIBILITY

The management is responsible for preparing the subject matter of assurance and presenting it as appropriate in accordance with applicable criteria while ensuring its completeness and accuracy. The Company’s management is also responsible for the design, implementation, and maintenance of an adequate internal control system for the preparation and presentation of the subject matter of assurance that are free of material misstatements, whether arising from fraud or error, choosing and applying appropriate controls, maintaining adequate records, and making reasonable estimates according to the circumstances while ensuring proper calculation of the subject matter in accordance with the applicable criteria.

OUR RESPONSIBILITY

It is our responsibility to express the conclusion of a limited assurance on the subject matter of assurance based on the limited assurance engagement that we have performed in accordance with the International Standard for Assurance Engagements 3000 “Assurance Engagements Other Than Audits or Reviews of Historical Financial Information” that is endorsed in the Kingdom of Saudi Arabia and the terms and conditions of this engagement as agreed with the Company's management.

Our procedures were designed to obtain a limited level of assurance on which to base our conclusion, and as such do not provide all of the evidence that would require to provide a reasonable assurance. The procedures performed depend on our professional judgment, including the risk of material misstatement of the subject matter, whether due to fraud or error. While, we considered the effectiveness of management's internal control when determining the nature and extent of our procedure, our engagement was not designed to provide assurance on the effectiveness of those controls.

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LIMITED ASSURANCE REPORT (Continued)

INDEPENDENCE AND QUALITY CONTROL

We have complied with the independence and ethical requirements in accordance with the professional code of conduct and ethics that are endorsed in the Kingdom of Saudi Arabia. We are independent of the Company in accordance with professional code of conduct and ethics endorsed in the Kingdom of Saudi Arabia that are relevant.

Our firm applies International Standard on Quality Control (ISQC) 1, Quality Control for Firms that Perform Audits and Reviews of Financial Statements, and Other Assurance and Related Services Engagements, that is endorsed in the Kingdom of Saudi Arabia and accordingly, maintains a comprehensive quality control system, including documented policies and procedures regarding compliance with ethical requirements, professional standards, and applicable legal and regulatory requirements.

SUMMARY OF PROCEDURES PERFORMED

The procedures performed in the Limited Assurance Engagement differ in nature and timing and are less in scope than the Reasonable Assurance Engagement. Consequently, the level of assurance obtained in the limited Assurance Engagement is much less than the assurance that would have been obtained if we had performed the reasonable Assurance Engagement.

As part of this engagement, we have not performed any procedures of reviewing, examining, or verifying the subject matter of assurance, nor of the records or other sources from which the subject in question was extracted. Accordingly, we will not express such an opinion.

Our procedure includes:

• Obtaining the Schedule which details the Company's workings and calculations that support the requirements specified in the Implementing Regulations relating to the proposed shares buy-back expected on 30 September 2023;

• Reviewing minutes of the meeting of the Nomination & Remuneration Committee of the Company, in which the resolution relevant to the proposed shares buy-back was approved;

• Comparing the proposed number of shares for buy-back by the Company as set out in the Schedule with the number of shares approved in the resolution passed in the meeting of the Nomination &

Remuneration Committee of the Company.

• Obtaining the Statement of Solvency prepared by management providing financial information, as at December 31, 2022, based on the audited financial statements of the Company for the year then ended, and as at September 30, 2023, based on financial forecasts prepared by the management; and

• Agreeing the financial information related to current liabilities, contingent liabilities, total liabilities, current assets, and total assets in the Statement of Solvency with the audited financial statements for the year ended December 31, 2022, and with the financial forecasts prepared by the management.

• Checking the arithmetical accuracy of the amount in the statement of solvency to check the sufficiency of working capital for the twelve months following the date of completion of the shares buy-back transaction, the value of the Company's assets was not less than the value of its liabilities (including contingent liabilities), prior to and immediately upon payment of purchase price, according to latest reviewed financial statements i.e. as at March 31, 2023, and the amount of treasury shares was not more than retained profits of the Company as of the expected date of the proposed share buy-back.

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LIMITED ASSURANCE REPORT (Continued)

CONCLUSION

Based on the limited assurance procedures implemented and the evidence we have obtained, nothing has come to our attention that causes us to believe that the subject matter above has not been reported and presented fairly, in all material respects, in accordance with applicable criteria.

OTHER MATTER

The proposed shares buy-back transaction by the Company will be reflected in the accounting records of the Company after obtaining approval from the Shareholders of the Company in an Extraordinary General Assembly Meeting and all necessary regulatory approvals including approval from CMA. At any given time, the amount of share buy-back shall not exceed the amount of retained earnings.

RESTRICTIONS ON THE USE OF OUR REPORT

Our report, including our conclusion, has been solely prepared upon the request of the Company’s management to assist the Company in fulfilling its reporting obligations to the CMA in accordance with the Implementing Regulations, and it should not be used for any other purpose or published except as permitted under the terms of our agreement. To the fullest extent permitted by law, we do not accept or assume responsibility to any third party.

For Al-Bassam & Co.

Ibrahim Ahmed Al-Bassam Certified Public Accountant License No. 337

10 July 2023

Corresponding to: 22 Dhu’l Hijjah 1444H Riyadh, Kingdom of Saudi Arabia

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Allianz Saudi Fransi Cooperative Insurance Co. announces to Invites its Shareholders to Attend the (First Meeting) Extraordinary General Assembly Meeting via modern