Title: Announcement regarding issuance of Disciplinary Board Resolution No. (07/2025 Disciplinary Board) (95, 107, and 114/2024 Authority) and imposition of a fine against: 1- Arabi Holding Group Company, 2- The Company’s Chairman and Vice Chairman of the Board of Directors, 3- Non-Executive Board Members (2 members), 4- Independent Board Members (2 members), 5- CEO, 6- Financial Manager, for violating the Rules of Disclosure and Transparency and Corporate Governance

Announcement regarding issuance of Disciplinary Board Resolution No. (07/2025 Disciplinary Board) (95, 107, and 114/2024 Authority) and imposition of a fine against: 1- Arabi Holding Group Company, 2- The Company’s Chairman and Vice Chairman of the Board of Directors, 3- Non-Executive Board Members (2 members), 4- Independent Board Members (2 members), 5- CEO, 6- Financial Manager, for violating the Rules of Disclosure and Transparency and Corporate Governance.

For the following reasons:
1) Arabi Holding Group Company violated the following:
1. Violation of the provision of Items (10) and (17) of Article (4-1-1) of Module Ten (Disclosure and Transparency) of the Executive Bylaws of Law No. 7 of 2010 and their amendments. It was proven to the CMA that the Company did not disclose at Boursa Kuwait the settlement of the full outstanding balance to related parties (major shareholders) in the amount of KWD 7,430,316 (seven million, four hundred and thirty thousand, three hundred and sixteen Kuwaiti Dinars only).

2. The provision of Article (4-6-3) of Module Ten (Disclosure and Transparency) of the Executive Bylaws of Law No. 7 of 2010 and their amendments. It was proven to the CMA that the Company did not properly disclose at the Exchange, due to publishing a supplementary disclosure that included misleading comment with no clear grounds for its disclosure of the judgement of the Court of Appeal regarding the lawsuit of cancelling the registration of the commercial register and the request of invalidation of the constituent assembly of a company, which it disclosed on November 4, 2024 at 8:00 a.m. The Company’s supplementary disclosure dated November 4, 2024, at 9:09 a.m. did not state any new development or material information over its previous disclosure; however, it expressed the Company’s opinion towards contentious issues that are still pending before the court and no final judgments were made thereon, which misleads the shareholders.

3. The provision of Article (1-14) of Module Twelve (Listing Rules) of the Executive Bylaws of Law No. 7 of 2010 and their amendments. It was undoubtedly proven to the CMA that the Company continued violating the provision of Article (1-14) previously mentioned in its financial statements that ended on 31/12/2023, as follows:

1- The Company did not comply with the requirements of Paragraph No. (28) of the International Accounting Standard “IAS 2 – Inventories”, and did not meet Paragraph No. (4/5) of the Conceptual Framework for Financial Reporting, as the Company continued listing an asset of an inventory in the value of KWD 22,594,301  (twenty-two million, five hundred and ninety four thousand, three hundred and one Kuwaiti Dinars only) and proving it in its financial statements without having control over this asset or having benefits thereof.

2- The Company did not implement the International Financial Reporting Standard (9) “Financial Instruments”, as the Company continued its failure to build up allocations for entitlements listed within the Item of “Contract Receivables”, which exceeded 365 days according to the standard’s requirements.

2) Members of the Board of Directors of Arabi Holding Group Company:
1- Chairman of the Board of Directors of Arabi Holding Group Company.
2- Vice Chairman of the Board of Directors of Arabi Holding Group Company.
3- Non-Executive Member of the Board of Directors of Arabi Holding Group Company.
4- Independent Member of the Board of Directors of Arabi Holding Group Company.
5- Independent Member of the Board of Directors of Arabi Holding Group Company.
6- Non-Executive Member of the Board of Directors of Arabi Holding Group Company.

They violated the provision of Item No. (5) of Article (3-7) of Module Fifteen (Corporate Governance) of the Executive Bylaws of Law No. 7 of 2010 and their amendments. It was undoubtedly proven that the aforementioned did not perform the role assigned to them according to the Article mentioned above through ensuring the Company’s compliance with provision of article (1-14) of Module Twelve (Listing Rules) of the Executive Bylaws of Law No. 7 of 2010 and their amendments, as previously described.

3) Members of the Executive Management of Arabi Holding Group Company:
1- Chief Executive Officer.
2- Financial Manager.

They violated the following:
1. The provision of Article (2-5) of Module Fifteen (Corporate Governance) of the Executive Bylaws of Law No. 7 of 2010 and their amendments.
2. The provision of Item (4) of Article (10-3) of the same Module.

It was undoubtedly proven that the aforementioned did not perform the role assigned to them according to the Article mentioned above through ensuring the Company’s compliance with provision of Article (1-14) of Module Twelve (Listing Rules) of the Executive Bylaws of Law No. 7 of 2010 and their amendments, as previously described

The Resolution included the infliction of the following penalty: -
“First: Levying a fine on Arabi Holding Group Company in the amount of KWD 5,000 (five thousand Dinars) for the first and third (in its two parts) violations, and the amount of KWD 10,000 (ten thousand Dinars) for the second attributed violations.
Second: levying a fine on each of:
1- Chairman of the Board of Directors of Arabi Holding Group Company.
2- Vice Chairman of the Board of Directors of Arabi Holding Group Company.
3- Independent Member of the Board of Directors of Arabi Holding Group Company.
4- Independent Member of the Board of Directors of Arabi Holding Group Company.
5- Non-Executive Member of the Board of Directors of Arabi Holding Group Company.
6- Financial Manager of Arabi Holding Group Company.
in the amount of KWD 5,000 (five thousand Dinars) on each one of them for the attributed violations.
Third: Levying a fine on Member of the Board of Directors of Arabi Holding Group Company in his capacity as the Company’s CEO in the amount of KWD 10,000 (ten thousand Dinars) for the attributed violation due to correlation”.

In this regard, the CMA emphasizes the implementation of CMA Law and its Executive Bylaws on all persons dealing in securities activities, and urges them to comply with these Laws in order to promote investors' confidence, create a sound investment environment, and implement the Law according to the principles of fairness, transparency, and integrity in line with the best international practice.