Amended of Nomination and Remuneration Committee
Sr. Before Amended After Amended
Introduction:
In accordance with the requirements of the corporate governance system in the kingdom of Saudi Arabia issued by the Capital Market Authority by Resolution No. 8-16-2017 dated 16/05/1438 AH corresponding to 13/02/2017 and amended by Resolution No. 8- 05-2023 dated 25/06/1444 H corresponding to 18/01/2023 G in accordance with this regulation and the rules and standards governing the management of listed Joint Stock Companies in the market, in order to ensure the best governance practices to protect the rights of shareholders and stakeholders, Al-Babtain energy and telecommunications company has prepared this policy and the regulations of the nomination and Remuneration Committee. This regulation includes the following:
1) definition of the nomination and Remuneration Committee 2) organizing the work of the nominations and Remuneration Committee
3) responsibilities of the nominations and awards committee 4) the procedure for nominating a board member
5) board membership criteria
6) meetings and minutes of the committee 7) reporting responsibilities
8) delegation of authority
9) adoption by the General Assembly of the regulation
Introduction:
In accordance with the requirements of the corporate governance regulation in the kingdom of Saudi Arabia, issued by the Capital Market Authority by Resolution No. 8-16-2017 dated 16/05/1438 AH corresponding to 13/02/2017 and amended by Resolution No. 8-05- 2023 dated 25/06/1444 AH corresponding to 18/01/2023 ad and in compliance with this regulation and the rules and standards governing the management of listed Joint Stock Companies in the market, in order to ensure the best practice for governance to protect the rights of shareholders and stakeholders, Al Babtain energy and telecommunications company has prepared this policy and the bylaws for the nominations and remuneration committee. This regulation includes the following:
1) definition of the nomination and Remuneration Committee
2) Organization of the work of the nominations and Remuneration Committee
3) responsibilities of the committee nominations and awards 4) procedures for nominating a board member
5) board membership criteria
6) meetings and minutes of the committee 7) reporting responsibilities
8) delegation of authority
9) adoption by the General Assembly of the regulation
1. Nomination and Remuneration Committee
In accordance with the requirements of the Corporate Governance Regulation, article sixty and Article Sixty-Four, the board of Directors shall form a committee called the remuneration committee and a committee called the nominations committee.in accordance with the fiftieth article, the company has merged the remuneration and nominations committees into one committee called the nominations and Remuneration Committee. the General Assembly of the Company shall issue, at the suggestion of the board of directors, the committee's work regulations, controls and procedures, its tasks, rules for selecting its members, term of membership and remuneration.
1. Nomination and Remuneration Committee
In accordance with the requirements of the Corporate Governance Regulation, article Fifty-Seventh and Article sixty-first, the board of Directors shall form a committee called the remuneration committee and a committee called the nominations committee. Based on Paragraph (7) of Article forty-seventh, the company has merged the remuneration and nominations committees into one committee called the nominations and Remuneration Committee. the General Assembly of the Company shall issue, at the suggestion of the board of directors, the committee's working regulations, controls, procedures, tasks, rules for selecting its members, term of membership and remuneration.
2. Definition of the nomination and Remuneration Committee The nomination and Remuneration Committee (hereinafter referred to as the "committee") of Al-Babtain energy and telecommunications company (hereinafter referred to as the
"company") affiliated to the company's Board of directors (hereinafter referred to as the "board of directors" or the "board") has many competencies and tasks related to remuneration for the board, executive management and employees, as well as responsible for identifying, screening, appointing and recommending candidates for membership in the board of directors for the purpose of filling new or vacant positions on the board on a phased basis once such positions are available and nomination for membership in the board.
2. Definition of the nomination and Remuneration Committee
The nomination and Remuneration Committee (hereinafter referred to as the "committee") of Al-Babtain energy and telecommunications company (hereinafter referred to as the "company") of the company's Board of directors (hereinafter referred to as the "board of directors"
or the "board") has many competencies and functions related to remuneration for the board, executive management and employees, as well as responsible for identifying, screening, appointing and recommending nominations for membership of the board and executive management for the purpose of filling new or vacant positions in the board and executive management on a phased basis once such positions are available and nominations for membership in the board or executive management.
This regulation regulates and governs the work of the remuneration and Nominations Committee, which is a committee emanating from and subordinate to the board of directors.
This regulation regulates and governs the work of the remuneration and Nominations Committee, which is a committee emanating from and subordinate to the board of directors.
3. Organizing the work of the nominations and Remuneration Committee
(3.1) composition of the committee
The committee consists of a minimum of three members and no more than five members of the board of directors only non- executive members, preferably independent at a minimum, or members may be hired from outside the board, whether from shareholders or non-shareholders.no one has the right to attend the meetings of the committee except its members and the secretary of the committee. However, other persons, such as the director general, the director of human resources and external consultants, may be invited to attend all or part of any of the meetings of the committee at the request of the majority of the committee members and when necessary.
(3.2) chairman of the committee
The members of the commission choose from among themselves the chairman "chairman" for the term of membership of the commission. The chairman of the committee may be appointed by the board of directors on the recommendation of the members of the board. The chairman decides the agenda, the number and duration of the meetings of the committee, and the chairman of the committee, as its representative, should have access to all the information and data required by the scope of the committee's
3. Organizing the work of the nominations and Remuneration Committee
(3.1) composition of the committee
By a decision of the board of directors, a committee called the nominations and Remuneration Committee shall be formed. the committee shall consist of a minimum of three members and no more than five non-executive board members, provided that at least one of them is an independent member, or members may be recruited from outside the board, whether shareholders or non-shareholders.no one has the right to attend the meetings of the committee except its members and the secretary of the committee. However, other persons, such as the chief executive officer, the human resources manager and external consultants may be invited to attend all or part of any of the meetings of the committee at the request of the majority of the committee members and when necessary. The General Assembly of the Company shall, upon a proposal from the board of Directors, issue the committee's Work list, provided that this list includes the controls and procedures of the committee's work, its tasks, the rules for selecting its members, the term of their membership, and their remuneration.
(3.2) chairman of the committee
The members of the commission choose from among themselves the chairman "chairman" for the term of membership of the commission.
The chairman of the committee may be appointed by the board of
work, as well as the possibility of meeting with the administration and officials if necessary. The chairman shall establish procedures, not contrary to these rules, as may be required from time to time to assist the committee in carrying out its work. The chairman represents the committee before the board of directors or any other body that so requires. In the absence of the chairman of the committee, another member is delegated to replace him at the meeting or the remaining members present choose a chairman from among themselves to preside over the meeting.
(3.3) Secretary of the committee
The committee may appoint its secretary, whether a member of the committee or not, who shall be responsible for keeping complete records of the Proceedings of the committee's meetings for the purposes of reporting on the committee's activities to the board of directors and performing all other tasks that may be assigned to him from time to time by the committee or under the direction of one of its members. The secretary is not required to be a member of the board of directors and the secretary of the board of Directors may be the secretary of the committee .
(3-4) duration of the commission
The term of the committee shall be three years, renewable for other periods. The entire committee or one of its members may be dismissed with or without reason during the term of office of the board and its members may be reconstituted by a vote of approval by a majority of the members of the board of directors. Each
directors on the recommendation of the members of the board. The chairman decides the agenda, the number and duration of the meetings of the committee, and the chairman of the committee, as its representative, should have access to all the information and data required by the scope of the committee's work, as well as the possibility of meeting with the administration and officials if necessary.
The chairman shall establish procedures, not contrary to these rules, as may be required from time to time to assist the committee in carrying out its work. The chairman shall represent the committee before the board of directors and the Shareholders ' Assembly or any other body that so requires. In the absence of the chairman of the committee, another member is delegated to replace him at the meeting or the remaining members present choose a chairman from among themselves to preside over the meeting.
(3.3) Secretary of the committee
The committee may appoint its secretary, whether a member of the committee or not, who shall be responsible for keeping complete records of the Proceedings of the committee's meetings for the purposes of reporting on the committee's activities to the board of directors and performing all other tasks that may be assigned to him from time to time by the committee or under the direction of one of its members. The secretary is not required to be a member of the board of directors and the secretary of the board of Directors may be the secretary of the committee .
(3-4) duration of the commission
member of the committee may resign by delivering a written notice to the chairman of the board of Directors of the company, and the resignation becomes effective at the time of delivery of the notice (unless the notice specifies a later time for the resignation to take effect). The board of directors appoints a replacement member of the committee for the resigned member, provided that he shall exercise his activity as soon as the resignation takes effect.
The term of the committee shall be three years, renewable for other periods. The entire committee or one of its members may be dismissed with or without reason during the term of office of the board and its members may be reconstituted by a vote of approval by a majority of the members of the board of directors. Each member of the committee may resign by delivering a written notice to the chairman of the board of Directors of the company, and the resignation becomes effective at the time of delivery of the notice (unless the notice specifies a later time for the resignation to take effect). The board of directors appoints a replacement member of the committee for the resigned member, provided that he shall exercise his activity as soon as the resignation takes effect.
(3-5) bonuses and attendance allowances
(A) remuneration of the members of the board of directors:
The member of the committee shall receive a reward commensurate with the time and effort he expends and based on the regulations approved by the Capital Market Authority for the remuneration of board members, and the reward shall be in the form of an attendance allowance for each meeting of the committee or an annual bonus, the member may receive a reward for his membership in the A group may not exceed what the member receives from bonuses and benefits Financial or in kind for what has been approved in accordance with Article (76) of the companies law. Accordingly, the member of the board of Directors is granted an annual bonus of 500 thousand riyals, including attendance allowance (3000 riyals per session), provided that the
(3-5) bonuses and attendance allowances
(A) remuneration of the members of the board of directors:
Based on Article (76) of the companies’ law and the corporate governance regulations, and in accordance with the proposal of the board of directors to the General Assembly, the member of the committee shall receive a reward commensurate with the time and effort he exerts and based on the controls approved by the Capital Market Authority for the remuneration of board members. The remuneration shall be in the form of an attendance allowance for each meeting of the committee or an annual bonus, the member may receive a reward for his membership in the council or any technical or consulting work under a professional license, as well as an attendance allowance, a certain amount for each of the hours spent by the member outside the council meetings for work related to the work of the council, and compensation for the actual expenses incurred for
percentage of the member's attendance at board meetings is not less than 75% of the total sessions during the financial year.
(B) remuneration of a committee member
Subject to the relevant regulations and controls approved by the Capital Market Authority, a member of the nomination and Remuneration Committee from outside the membership of the board is granted an annual bonus of SR 50 thousand in addition to the allowances paid to the member of the board of directors, provided that the attendance rate of the committee meetings is not less than 75% of the total Committee Sessions.
The remuneration and other benefits paid to the members of the committee, as well as the policies and mechanisms related to the remuneration of the board of directors and committees shall be disclosed in the report of the board of directors to the General Assembly.
work related to the exercise of his duties as a member of the.
Accordingly, the board member is granted an annual bonus and attendance allowances according to the following:
1 Chairman remuneration SR 650,000
2 Board Member remuneration SR 500,000 3 Attendance remuneration of board member SR 3,000 4 Attendance remuneration of Committee member SR 3,000
In case the member is from outside the city where the company's headquarters or meeting place is located, the company will issue a first- class air ticket and a five-star hotel stay in the case of an overnight stay for a member from outside the city or meeting place.
In the case of a member of the nomination and Remuneration Committee from outside the members of the board, he will be granted an annual bonus of 50 thousand riyals inclusive of Attendance Allowance
In all cases, the total amount received by the chairman of the board of directors, a member of the board of directors, or a member of the committee shall not exceed the values specified in the above table, including the attendance allowance, provided that the member's attendance at board meetings is not less than 75% of his total sessions during the financial year.
(B) remuneration of a committee member-delete paragraph
The remuneration and other benefits paid to the members of the committee, as well as the details of the policies and mechanisms related to the remuneration of the board of directors and committees,
shall be disclosed in the report of the board of directors to the General Assembly.
(3-6) independence
Each member of the committee must enjoy independence within the context of the meaning contained in any of the applicable regulations or in the standards, rules and regulations of listing Joint Stock Companies in the stock market and the corporate governance regulations issued by the Capital Market Authority.
(3-6) independence
Each member of the committee must enjoy independence within the context of the meaning contained in any of the applicable regulations or in the standards, rules and regulations of listing Joint Stock Companies in the stock market and the corporate governance regulations issued by the Capital Market Authority.
4. Responsibilities and powers of the nomination and Remuneration Committee
The following are the main responsibilities and tasks of the nomination and Remuneration Committee, which include tasks and responsibilities for remuneration and tasks and responsibilities for nominations as follows:
(4.1) tasks and responsibilities of remuneration
1) perform other tasks and responsibilities according to the details contained in these regulations and in accordance with them.
2) develop clear compensation and remuneration policies for the members of the board of directors, the management, and senior executives of the company. when developing these policies, the use of performance-related standards, disclosure and verification of their implementation shall be taken into account.
3) clarify the relationship between the bonuses awarded and the applicable bonus Policy and indicate any material deviation from this policy.
4) periodic review of the remuneration policy, assessing its effectiveness in achieving the goals envisaged by it.
4. Responsibilities and powers of the nomination and Remuneration Committee
The following are the main responsibilities and tasks of the nomination and Remuneration Committee, which include tasks and responsibilities for remuneration and tasks and responsibilities for nominations as follows:
(4.1) tasks and responsibilities of remuneration
1) perform other tasks and responsibilities according to the details contained in these regulations and in accordance with them.
2) develop clear compensation and remuneration policies for the members of the board of directors, the committees emanating from the board of directors, the management, and senior executives of the company. when developing these policies, the use of performance-related standards, disclosure and verification of their implementation shall be taken into account.
3) clarify the relationship between the bonuses awarded and the applicable bonus Policy and indicate any material deviation from this policy.
5) reviewing the compensation and bonuses of senior executives and board members of the company and preparing (or reviewing) the annual report on it to be included in the company's annual report.
6) recommending to the board of directors the remuneration of the members of the board of directors, its committees and senior executives of the company in accordance with the approved policy
4) periodic review of the remuneration policy, assessing its effectiveness in achieving the goals envisaged by it.
5) reviewing the compensation and bonuses of senior executives and board members of the company and preparing (or reviewing) the annual report on it to be included in the company's annual report.
6) recommending to the board of directors the remuneration of the members of the board of directors, its committees and senior executives of the company in accordance with the approved policy (4.2) bonus policy
Taking into account the corporate governance regulation and the controls for the remuneration of board members and executive management issued by the Capital Market Authority, the policy and mechanism of remuneration of board members shall be based on the following:
1) Consistent with the company's strategy and objectives.
2) Provide bonuses for the purpose of motivating the members of the board of directors and executive management for the success and long-term development of the company, such as linking the variable part of the bonuses to long-term performance.
3) The remuneration should be reasonably sufficient to attract, motivate and retain board members with appropriate competence and experience.
4) The remuneration should be determined based on the level of the job, the tasks and responsibilities assigned to the incumbent, scientific qualifications, work experience, skills, and performance level.
(4.2) bonus policy
Taking into account the corporate governance regulation and the controls for the remuneration of board members and executive management issued by the Capital Market Authority, the policy and mechanism of remuneration of board members shall be based on the following:
1) Consistent with the company's strategy and objectives.
2) Provide bonuses for the purpose of motivating the members of the board of directors and executive management for the success and long-term development of the company, such as linking the variable part of the bonuses to long-term performance.
3) The remuneration should be reasonably sufficient to attract, motivate and retain board members with appropriate competence and experience.
4) The remuneration should be determined based on the level of the job, the tasks and responsibilities assigned to the incumbent, scientific qualifications, work experience, skills, and performance level.
5) The sector in which the company operates, its size and the experience of the board members and senior executives are taken into account.
6) Its consistency with the size, nature and degree of risk of the company.
7) Taking into account the practices of other companies in determining bonuses, while avoiding the resulting unjustified rise in bonuses and compensation.
8) To aim at attracting, maintaining and motivating degrading competencies, while not exaggerating them.
9) This policy should be taken into account when making new appointments.
10) Cases of suspension of bonus disbursement or refund if it turns out that it was decided based on inaccurate information provided by a member of the board of directors or executive management; in order to prevent the exploitation of the job situation to obtain undeserved bonuses.
11) It is permissible to organize the granting of shares in the company to members of the board of directors and executive management, whether it is a new issue or shares purchased by the company.
12) The reward may be of varying amount and proportional to the percentage of the member's attendance for the total sessions of the council so that the reward is calculated for the member based on a set of criteria and interrelated factors.
5) The sector in which the company operates, its size and the experience of the board members and senior executives are taken into account.
6) Its consistency with the size, nature and degree of risk of the company.
7) Taking into account the practices of other companies in determining bonuses, while avoiding the resulting unjustified rise in bonuses and compensation.
8) To aim at attracting, maintaining and motivating degrading competencies, while not exaggerating them.
9) this policy should be taken into account when making new appointments.
10) cases of suspension of bonus disbursement or refund if it turns out that it was decided based on inaccurate information provided by a member of the board of directors or executive management; in order to prevent the exploitation of the job situation to obtain undeserved bonuses.
11) It is permissible to organize the granting of shares in the company to members of the board of directors and executive management, whether it is a new issue or shares purchased by the company.
12) The reward may be of varying amount and proportional to the percentage of the member's attendance for the total sessions of the council so that the reward is calculated for the member based on a set of criteria and interrelated factors .
13) The remuneration of independent board members should not be a percentage of the profits made by the company or be based directly or indirectly on the profitability of the company.
The reward is determined based on the member's evaluation, participation and effectiveness during the total sessions, based on the form approved by the board..
14) The rules for the remuneration of the members of the board of Directors shall be complied with in accordance with the executive regulations of the companies’ law for listed Joint Stock Companies.
The reward is determined based on the member's evaluation, participation, and effectiveness during the total sessions, based on the form approved by the board.
(4.3) tasks and responsibilities for nominations
1) Propose clear policies and criteria for membership in the board of directors and executive management.
2) Recommending to the board of directors the nomination and re- nomination of its members in accordance with the approved policies and criteria, taking into account the non-nomination of any person previously convicted of a crime against the secretariat. The committee takes into account many factors, including, without limitation, the following:
(a) Integrity, honesty and responsibility ،
(b) Successful leadership experiences and business insight ، (c) Depth of future vision and strategic focus،
(d) The ability to work collectively within the council system ، (e) Independence and absence of conflicts of interest ،
(f) The ability to devote the necessary time to carrying out the responsibilities dictated by his membership in the council.
3) Preparing a description of the required abilities and qualifications for board membership and filling executive management positions.
4) Determine the time that the member has to allocate for the work of the board of directors.
(4.3) tasks and responsibilities for nominations
1) Propose clear policies and criteria for membership in the board of directors and executive management.
2) Recommending to the board of directors the nomination and re- nomination of its members in accordance with the approved policies and criteria, taking into account the non-nomination of any person previously convicted of a crime against the secretariat. The committee takes into account many factors, including, without limitation, the following:
(a) Integrity, honesty and responsibility ،
(b) Successful leadership experiences and business insight ، (c) Depth of future vision and strategic focus،
(d) The ability to work collectively within the council system ، (e) Independence and absence of conflicts of interest ،
(f) The ability to devote the necessary time to carrying out the responsibilities dictated by his membership in the council.
3) Preparing a description of the required abilities and qualifications for board membership and filling executive management positions.
4) Determine the time that the member has to allocate for the work of the board of directors.
5) Annual review of the necessary skills or experience requirements suitable for board membership and executive management functions
6) Review the structure of the board of directors and the executive management and make recommendations on changes that can be made.
7) Annual verification of the independence of independent members according to specific models, and the absence of any conflict of interests if the member is a member of the board of Directors of another company.
8) Develop a job description for executive members, non-executive members, independent members and senior executives.
9) Review the candidates for board membership, including those recommended by the chairman of the board and other board members and the recommendations submitted by shareholders according to the "procedures for nominating a board member" described in Part (6) of these regulations.
10) Submit its recommendations for the final nomination of potential members that the committee believes will enhance the ability of the board to effectively manage and direct the affairs and business of the company.
11) The establishment of special procedures in the event of the vacancy of the position of one of the board members or senior executives.
12) Identify weaknesses and strengths in the management area, and propose solutions to address them in accordance with the company's interest.
5) Annual review of the necessary skills or experience requirements suitable for board membership and executive management functions
6) Review the structure of the board of directors and the executive management and make recommendations on changes that can be made.
7) Annual verification of the independence of independent members according to specific models, and the absence of any conflict of interests if the member is a member of the board of Directors of another company.
8) Develop a job description for executive members, non-executive members, independent members and senior executives.
9) Review the candidates for board membership and interview the candidates – if possible-and evaluate them based on the membership criteria set out in these regulations, including those recommended by the chairman of the board and other board members and the recommendations submitted by shareholders according to the "procedures for nominating a board member"
described in Part (6) of these regulations.
10) Submit its recommendations for the final nomination of potential members that the committee believes will enhance the ability of the board to effectively manage and direct the affairs and business of the company.
11) The establishment of special procedures in the event of the vacancy of the position of one of the board members or senior executives.
13) submit its recommendations to the council to nominate the members to be selected in the various committees emanating from the council, taking into account the following:
(a) The necessary qualifications for membership of each of the committees, in particular the Audit Committee, one of whose members should be knowledgeable in financial affairs.
(b) To what extent there should be a policy of changing members between committees periodically.
(c) Restrictions on the number of consecutive years for which a committee member may retain his or her seat on that committee.
14) Recommending an induction program for new members and providing continuous education and training programs for all members of the board and executive management in order to develop their skills and knowledge in areas related to the company's activities as required by the corporate governance regulations, in particular the following:
(a) The company's strategy and objectives.
(b) Financial and operational aspects of the company's activities.
(c) The obligations, tasks, responsibilities and rights of the members of the board of directors.
(d) the functions and terms of reference of the company's committees
15) assist the board in selecting and developing potential candidates for senior management positions in the company and the long-term succession plan.
12) Identify weaknesses and strengths in the management area, and propose solutions to address them in accordance with the company's interest.
13) submit its recommendations to the council to nominate the members to be selected in the various committees emanating from the council, taking into account the following:
(a) The necessary qualifications for membership of each of the committees, in particular the Audit Committee, one of whose members should be knowledgeable in financial affairs.
(b) To what extent there should be a policy of changing members between committees periodically.
(c) Restrictions on the number of consecutive years for which a committee member may retain his or her seat on that committee.
14) Recommending an induction program for new members and providing continuous education and training programs for all members of the board and executive management in order to develop their skills and knowledge in areas related to the company's activities as required by the corporate governance regulations, in particular the following:
(a) The company's strategy and objectives.
(b) Financial and operational aspects of the company's activities.
(c) The obligations, tasks, responsibilities and rights of the members of the board of directors.
(d) the functions and terms of reference of the company's committees
16) identify the strengths and weaknesses in the performance of the council and the proposed solutions to address any shortcomings, including nominating members for training courses to enhance their knowledge and managerial and strategic ability.
17) the approval of the committee must be obtained before the board members, who are not employees of the company, enter into arrangements related to the provision of consulting services to the company.
18) reviewing the periodic reports submitted by the company's management on matters related to the nomination or selection of board members at the company.
19) periodic review of the performance of the committee and its regulations. In the event of material changes to the bylaws, the committee shall request the board to recommend them to the General Assembly of shareholders for adoption.
20) ensure compliance with the disclosure rules related to the compensation and remuneration of board members and senior management members in accordance with the requirements of the Capital Market Authority.
22) perform other tasks or responsibilities that the board of directors assigns to the committee from time to time.
23) the committee shall have the necessary resources and powers to perform its tasks and responsibilities, including the power to use external opinion, experts or other consultants as it deems appropriate.
15) assist the board in selecting and developing potential candidates for senior management positions in the company and the long- term succession plan.
16) identify the strengths and weaknesses in the performance of the council and the proposed solutions to address any shortcomings, including nominating members for training courses to enhance their knowledge and managerial and strategic ability.
17) the approval of the committee must be obtained before the board members, who are not employees of the company, enter into arrangements related to the provision of consulting services to the company.
18) reviewing the periodic reports submitted by the company's management on matters related to the nomination or selection of board members at the company.
19) periodic review of the performance of the committee and its regulations. In the event of material changes to the bylaws, the committee shall request the board to recommend them to the General Assembly of shareholders for adoption.
20) ensure compliance with the disclosure rules related to the compensation and remuneration of board members and senior management members in accordance with the requirements of the Capital Market Authority.
21) delete the paragraph
22) perform other tasks or responsibilities that the board of directors assigns to the committee from time to time.
23) the committee shall have the necessary resources and powers to perform its tasks and responsibilities, including the power to use
24) ensure that proper attention is given and provide accurate answers to shareholders ' questions and inquiries about corporate governance regarding the selection of board members and determining their remuneration.
external opinion, experts or other consultants as it deems appropriate.
24) ensure that proper attention is given and provide accurate answers to shareholders ' questions and inquiries about corporate governance regarding the selection of board members and determining their remuneration.
6. Procedures and conditions of nomination for a board member (6-1) a shareholder may nominate a member of the board of directors according to the following procedures:
After the announcement to apply for membership of the board of directors and committees before the end of the meeting of the board of directors, a notice is sent to the chairman of the remuneration and Nominations Committee, the notice includes the following:
1) The candidate submits the application for candidacy within the period specified in the company's announcement, provided that the nomination door remains open for a month from the date of announcement. the company works to publish the announcement for candidacy on the company's website and the website of the market or in any other means determined by the authority.
2) The application must contain his CV, in addition to all supporting documents, which are received in Arabic, and certified by the official authorities . The candidate must also attach a declaration stating that he has never been convicted of a crime against honor.
6. Procedures and conditions of nomination for a board member (6-1) a shareholder may nominate a member of the board of directors according to the following procedures:
After the announcement to apply for membership of the board of directors and committees before the end of the meeting of the board of directors, a notice is sent to the chairman of the remuneration and Nominations Committee, the notice includes the following:
1) The candidate submits the application for candidacy within the period specified in the company's announcement, provided that the nomination door remains open for a month from the date of announcement the company works to publish the announcement for candidacy on the company's website and the website of the market or in any other means determined by the authority.
2) The application must contain his CV in Arabic and English, in addition to all supporting documents received in Arabic and English, and certified by the official authorities . The candidate must also attach a declaration stating that he has never been convicted of a crime against honor (delete paragraph).
3) Fill in the CV form issued by the Capital Market Authority in Arabic and English and signed on it and be responsible for the correctness of all the information contained therein.
3) Fill in the CV form issued by the Capital Market Authority and signed on it and be responsible for the correctness of all the information contained therein.
4) The name and address of the shareholder who wishes to be nominated and the name of the person or names of the persons he wishes to nominate.
5) An offer clarifying that the shareholder making the nomination is registered in the company's records as a shareholder and has the right to vote and wishes to attend either in person or through an authorized agent to nominate the person (s) specified by him in his notice.
6) Submit a written report on the arrangements and any points agreed upon between the shareholder and the party nominated for membership of the board of directors.
7) Other information about each candidate proposed by that shareholder, which must be included in the power of Attorney statement in accordance with the instructions of the agency, in case the candidate is nominated or will be nominated by the board.
8) Written consent of each candidate to serve as a member of the company's Board of directors in case of his / her selection. In recognition of his independence, which qualifies him to be a member of the board of directors.
9) Preferably, the number of applicants to run for membership of the board of directors should be more than the available seats on the board so that the General Assembly has the opportunity to choose from them.
4) The name and address of the shareholder who wishes to be nominated and the name of the person or names of the persons he wishes to nominate.
5) .(Delete paragraph) 6) (delete paragraph) 7) (delete paragraph)
8) Provide a declaration of independence from the candidate in case he / she applies as an independent member in accordance with the regulations of the independent member as stipulated by the Corporate Governance Regulation
9) Preferably, the number of applicants to run for membership of the board of directors should be more than the available seats on the board so that the General Assembly has the opportunity to choose from them.
10) The board-based Committee is presented for deliberation and voting to select the final candidates ،
11) The committee may meet the candidates – if possible – to discuss the conditions of candidacy for membership of the board of directors as stated in this regulation.
12) The opinions of those selected by the board for presentation to the General Assembly of the company are surveyed to determine the extent of their acceptance of membership once selected by the General Assembly.
13) the chairman of the Ordinary General Assembly may reject the nomination of the member proposed by the shareholder in case the nomination does not comply with the above procedures.
10) The board-based Committee is presented for deliberation and voting to select the final candidates ،
11) The opinions of those selected by the board for presentation to the General Assembly of the company are polled to determine the extent of their acceptance of membership once selected by the General Assembly
12) The chairman of the Ordinary General Assembly may reject the nomination of the member proposed by the shareholder in case the nomination does not comply with the above procedures.
(6.2) criteria for board membership
In line with Article (12) of the corporate governance regulation issued by the Capital Market Authority, the board member is required to:
1. Must have an appropriate level of education, preferably one who has completed a University study.
2. It is preferable that he has practical experience in a business field related to the company's activities and the nature of the industry in which it operates.
3. Preferably, those who have held or are still holding a leadership position in which they have practiced strategy development and decision-making.
4. It is preferable for those who have outstanding experience in a certain area of interest to the company, such as financial matters, Human Resources Management, Strategic Planning and other topics that the company is interested in and needs renewed expertise in.
(6.2) criteria for board membership
In line with Article (18) of the corporate governance regulation issued by the Capital Market Authority, in addition to the provisions of the corporate governance regulation, the board member is required to:
To be a person of natural character
1. Must have an appropriate level of education, preferably one who has completed a University study, and must be at least 30 years old when running for membership in the Board
2. It is preferable that he has practical experience in a business field related to the company's activities and the nature of the industry in which it operates.
3. Preferably, those who have held or are still holding a leadership position in which they have practiced strategy development and decision-making at the corporate level.
4. It is preferable for those who have outstanding experience in a certain area of interest to the company, such as financial matters, Human Resources Management, Strategic Planning and other
5. Be familiar with the economic situation in general and in the kingdom in particular and follow the general changes and their effects on Business Activity and the national economy in general.
6. He prefers to be fluent in a foreign language, have foreign contacts and be aware of the developments of the political and economic situation in the region and the world.
7. The candidate must be of an appropriate age and state of Health that allows intellectual giving, exerting effort and time in studying the topics presented to the council and actively contributing to its events.
8. To enjoy a good reputation, good talking and good socializing.
9. Be willing to accept membership and willing to commit to his duties as a member of the board.
10. Must not be a member of more than five listed Joint Stock Companies at the same time – including the company.
In general, it is taken into account that the members of the board have the combined experience and capabilities that qualify them to work as a coordinated team to achieve the company's goals and objectives and enable them to lead the company towards continuous growth and prosperity.
topics that the company is interested in and needs renewed expertise in.
5. Be familiar with the economic situation in general and in the kingdom in particular and follow the general changes and their effects on Business Activity and the national economy in general.
6. He prefers to be fluent in a foreign language, have foreign contacts and be aware of the developments of the political and economic situation in the region and the world.
7. The candidate must be of an appropriate age and state of Health that allows intellectual giving, exerting effort and time in studying the topics presented to the council and actively contributing to its events.
8. To enjoy a good reputation, good talking and good socializing.
9. Delete paragraph
10. Must not be a member of more than five listed Joint Stock Companies at the same time – including the company.
In general, it is taken into account that the members of the board have the combined experience and capabilities that qualify them to work as a coordinated team to achieve the company's goals and objectives and enable them to lead the company towards continuous growth and prosperity.
(6.3) ownership of shares in the company by the candidate for board membership
To ensure the seriousness of the candidate for membership of the board of directors, the candidate for membership of the board must be the owner of a number of shares of the company whose nominal
Canceled
value is not less than ten thousand riyals when applying and stating his ownership of the shares when submitting the application.
(6.4) non-executive and independent members
The majority of the board members shall be non-executive members, and the number of independent members shall not be less than two members, or one third of the board members, whichever is more.
(6.5) appointment by the General Assembly
The recommendations of the board of directors on the candidates shall be presented to the Ordinary General Assembly, clarifying the reasons for the nomination for each candidate. The Assembly selects the candidate / candidates who meet the conditions and consider the fairness of minority representation, as well as the balance and integration of expertise in the council.
(6.6) the need for disclosure by candidates for membership of the board
Upon acceptance of the principle of membership, the candidate for membership of the board must disclose his external obligations and their duration and indicate whether he has any obligations that may cause a conflict of interests with the interests of the company.
(6-7) membership reporting
The chairman shall contact the member/ members to inform them of the decision of the General Assembly. The chairman also directs the Technical Secretariat to provide the member or new members with a complete file on the company and invite them to attend the first upcoming meeting of the board.
(6.4) non-executive and independent members
The majority of the board members shall be non-executive members, and the number of independent members shall not be less than two members, or one third of the board members, whichever is more.
(6.5) appointment by the General Assembly
The recommendations of the board of directors on the candidates shall be presented to the Ordinary General Assembly, clarifying the reasons for the nomination for each candidate. The Assembly selects the candidate / candidates who meet the conditions and consider the fairness of minority representation, as well as the balance and integration of expertise in the council.
(6.6) the need for disclosure by candidates for membership of the board
Upon acceptance of the principle of membership, the candidate for membership of the board must disclose his external obligations and their duration and indicate whether he has any obligations that may cause a conflict of interests with the interests of the company.
(6-7) membership reporting
The chairman shall contact the member/ members to inform them of the decision of the General Assembly. The chairman also directs the Technical Secretariat to provide the member or new members with a complete file on the company and invite them to attend the first upcoming meeting of the board.
(6-8) duration of membership and number of cycles of membership
The term of membership is three years, and the members of the council - all or some of them - may be reappointed for other terms based on a decision of the General Assembly, in the light of evaluating the performance of the council.
(6-9) introducing new members to the company.
New members are introduced to the company as follows:
(a) The Technical Secretariat shall prepare an integrated file containing sufficient information about the company, its history and activities, the composition of the board and a copy of the "board of directors regulations" ؛
(b) new members will be received at the company's headquarters, where a meeting will be held between them and the president, CEO and senior executives.
(C) a quick tour of the main factories and departments is organized to familiarize new members with the company's activities and capabilities.
(6-8) duration of membership and number of cycles of membership The term of membership is three years, and the members of the council - all or some of them - may be reappointed for other terms based on a decision of the General Assembly, in the light of evaluating the performance of the council.
(6-9) introducing new members to the company.
New members are introduced to the company as follows:
(a) The Technical Secretariat shall prepare an integrated file containing sufficient information about the company, its history and activities, the composition of the board and a copy of the
"board of directors regulations" ؛
(b) new members will be received at the company's headquarters, where a meeting will be held between them and the president, CEO and senior executives.
(C) a quick tour of the main factories and departments is organized to familiarize new members with the company's activities and capabilities.
(6-10) Termination of the membership of a member of the board of directors and the procedure for appointing a vacancy
1) In accordance with the company's articles of association, which specifies how the membership of the board of directors ends, the Ordinary General Assembly may at all times dismiss all members of the board or some of them, even if the company's articles of association stipulate otherwise, without prejudice to the right of the dismissed to compensation if the dismissal occurred for an unacceptable reason or at an inopportune time.
(6-10) Termination of the membership of a member of the board of directors and the procedure for appointing a vacancy
1) In accordance with the company's articles of association, which specifies how the membership of the board of directors ends, the Ordinary General Assembly may at all times dismiss all members of the board or some of them, even if the company's articles of association stipulate otherwise, without prejudice to the right of the dismissed to compensation if the dismissal occurred for an unacceptable reason or at an inopportune time. The General
The General Assembly May (on the recommendation of the board of directors) terminate the membership of any member absent from attending (three) consecutive meetings without a legitimate excuse accepted by the board of directors.
2) Upon the termination of the membership of a member of the board of directors by one of the methods of termination of membership, the Company shall notify the authority and the market immediately with an indication of the reasons that called for this.
3) If a member of the board of directors resigns, and he has notes on the company's performance, he must submit a written statement with them to the chairman of the board of directors, and this statement must be presented to the members of the board of directors.
4) The outgoing member shall be notified to the remuneration and nominations committee to submit the application to the board of directors
5) The board of Directors shall accept the resignation request and immediately announce to the financial market the change that has occurred in the board of directors.
6) Instruct the nominations committee to recommend the nomination of a new member in the place of the vacant member of the board of directors, who appoints him to complete the new member's term of his predecessor and the announcement to the Capital Market Authority.
7) This appointment is presented at the nearest meeting of the General Assembly for approval.
Assembly May (on the recommendation of the board of directors) terminate the membership of any member absent from attending (three) consecutive meetings or (five) separate meetings during his term of membership without a legitimate excuse accepted by the board of directors.
2) Upon the termination of the membership of a member of the board of directors by one of the methods of termination of membership, the Company shall notify the authority and the market immediately with an indication of the reasons that called for this.
3) If a member of the board of directors resigns, and he has notes on the company's performance, he must submit a written statement with them to the chairman of the board of directors, and this statement must be presented to the members of the board of directors.
4) The outgoing member shall be notified to the remuneration and nominations committee to submit the application to the board of directors
5) The board of Directors shall accept the resignation request and immediately announce to the financial market the change that has occurred in the board of directors.
6) Instruct the nominations committee to recommend the nomination of a new member in the place of the vacant member of the board of directors, who appoints him to complete the new member's term of his predecessor and the announcement to the Capital Market Authority.
7) This appointment is presented at the nearest meeting of the General Assembly for approval.
8) The board of Directors may accept the resignation of a member of the board of directors and appoint another member at the same meeting and announce to the Capital Market Authority the changes that have occurred in the board of directors in accordance with the procedures followed in announcement.
9) The remuneration and Nominations Committee shall consider that the member appointed to the vacant position on the board of Directors shall, as far as possible, meet the conditions of membership of the board of directors set out in these bylaws.
8) The board of Directors may accept the resignation of a member of the board of directors and appoint another member at the same meeting and announce to the Capital Market Authority the changes that have occurred in the board of directors in accordance with the procedures followed in the corporate governance regulations and the announcement accompanying the event.
9) The remuneration and Nominations Committee shall consider that the member appointed to the vacant position on the board of Directors shall, as far as possible, meet the conditions of membership of the board of directors set out in these bylaws.
7. Compensation and remuneration policy for board members and senior executives
▪ The Nomination Committee shall hold a periodic meeting or as required by the need to review and approve the compensation and remuneration policy for the members of the board of directors in a manner that does not contradict with the company's bylaws and the company's articles of association and taking into account the evaluation criteria to be related to performance and recommend the results to the board of directors, which submits them to the Ordinary General Assembly for approval and approval.
▪ The Nomination Committee also approves the system and policy of compensation and remuneration for senior executives and determines their salaries according to the performance assessment and the company's positive results.
▪ To ensure that when the company or any of its subsidiaries wishes to pay compensation or bonuses to a current or
7. Compensation and remuneration procedures for board members and senior executives
▪ The Nomination Committee shall hold a periodic meeting or as required by the need to review and approve the compensation and remuneration policy for the members of the board of directors in a manner that does not contradict with the company's bylaws and the company's articles of association and taking into account the evaluation criteria to be related to performance and recommend the results to the board of directors, which submits them to the Ordinary General Assembly for approval and approval.
▪ The Nomination Committee also approves the system and policy of compensation and remuneration for senior executives and determines their salaries according to the performance assessment and the company's positive results.
▪ To ensure that when the company or any of its subsidiaries wishes to pay compensation or bonuses to a current or
proposed board member of the company, one of the senior executives of the company, or any current or proposed board member of any subsidiary, it should be related to the evaluation of performance and results achieved.
▪ The approval of the terms of compensation and remuneration in advance from the shareholders of the company entrusted to the nominations and Remuneration Committee in a General Assembly ,in which the relevant board member or one of the senior executives, as the case may be, has the right to vote on these terms .
▪ The committee recommends to the board of directors the annual remuneration of board members, taking into account that it is based on the percentage of attendance of board members at board meetings during the year in which the decision is taken and in accordance with the companies ' bylaws and regulations for the remuneration of board members issued by the Capital Market Authority and the company's articles of association .
▪ The nomination committee recommends to the board of directors the remuneration of senior executives based on the established remuneration policy related to the performance rate.
The Company shall disburse expenses in lieu of attendance at the meetings of the board of directors, the committee member and the secretary of the board at each meeting, and the remuneration of the members of the board of directors in accordance with what was approved by the board of directors at a meeting of the annual
proposed board member of the company, one of the senior executives of the company, or any current or proposed board member of any subsidiary, it should be related to the evaluation of performance and results achieved.
▪ The approval of the terms of compensation and remuneration in advance from the shareholders of the company entrusted to the nominations and Remuneration Committee in a General Assembly ,in which the relevant board member or one of the senior executives, as the case may be, has the right to vote on these terms .
▪ The committee recommends to the board of directors the annual remuneration of board members, taking into account that it is based on the percentage of attendance of board members at board meetings during the year in which the decision is taken and in accordance with the companies ' bylaws and regulations for the remuneration of board members issued by the Capital Market Authority and the company's articles of association .
▪ The nomination committee recommends to the board of directors the remuneration of senior executives based on the established remuneration policy related to the performance rate.
▪ The Company shall disburse expenses in lieu of attendance at the meetings of the board of directors, the committee member and the secretary of the board at each meeting, and the remuneration of the members of the board of directors in accordance with what was approved by the board of directors
financial statements and in a manner not inconsistent with the company's articles of association and the companies law provided that the total amount of the member of the board of directors and the secretary, whether attendance allowance or remuneration of board membership or benefits in kind or financial, shall not exceed five hundred thousand riyals per year in addition to the remuneration of the members of the audit committee if they are members of the board of directors.
at a meeting of the annual financial statements and in a manner not inconsistent with the company's articles of association and the companies law provided that the total amount of the member of the board of directors and the secretary, whether attendance allowance or remuneration of board membership or benefits in kind or financial, shall not exceed five hundred thousand riyals per year in addition to the remuneration of the members of the audit committee if they are members of the board of directors.
8. Reporting responsibilities
After each meeting held by the committee, its chairman submits an official report to the council on the facts of that meeting on all matters related to the tasks and responsibilities of the committee.
The committee shall make such recommendations as it deems appropriate to the council on any matter falling within its competence, and which it deems necessary to take the necessary action or make improvements thereto.
As previously explained, the committee prepares an annual report on the company's remuneration and compensation policy and practices, which forms part of the company's annual report, and ensures that it is presented to shareholders each year through the Ordinary General Assembly for approval. The annual report of the committee shall indicate the number of times its meetings have been held and the members present at those meetings.
9. Delegation of authority
The committee May, on the basis of a decision voted by a majority of its members, appoint one or more subcommittees, each of which
8. Reporting responsibilities
After each meeting held by the committee, its chairman submits an official report to the council on the facts of that meeting on all matters related to the tasks and responsibilities of the committee.
The committee shall make such recommendations as it deems appropriate to the council on any matter falling within its competence, and which it deems necessary to take the necessary action or make improvements thereto.
As previously explained, the committee prepares an annual report on the company's remuneration and compensation policy and practices, which forms part of the company's annual report, and ensures that it is presented to shareholders each year through the Ordinary General Assembly for approval. The annual report of the committee shall indicate the number of times its meetings have been held and the members present at those meetings.
9. Delegation of authority
The committee May, on the basis of a decision voted by a majority of its members, appoint one or more subcommittees, each of which
consists of one or several members of the committee. Each of the formed sub-committees may enjoy all the powers and authorities of the remuneration and Nominations Committee and may exercise these powers to the extent specified in the decisions of the committee and to the extent permitted by the applicable regulations or the listing rules of the Capital Market Authority. Each sub-committee shall bear the name assigned to it in the decision of the remuneration and nominations committee to form that sub- committee. Each Subcommittee shall keep a regular record of the Proceedings of its meetings and, when requested to do so, Report thereon to the committee or the council.
10. Adoption by the General Assembly of the regulation
Based on Article (60) and Article (64) of the corporate governance regulation issued by the Capital Market Authority, this regulation was approved by the shareholders at the Ordinary General Assembly meeting on 24/ 04 / 2019.
consists of one or several members of the committee. Each of the formed sub-committees may enjoy all the powers and authorities of the remuneration and Nominations Committee and may exercise these powers to the extent specified in the decisions of the committee and to the extent permitted by the applicable regulations or the listing rules of the Capital Market Authority. Each sub-committee shall bear the name assigned to it in the decision of the remuneration and nominations committee to form that sub-committee. Each Subcommittee shall keep a regular record of the Proceedings of its meetings and, when requested to do so, Report thereon to the committee or the council. The committee may use consultants and experienced external parties to study certain topics, seek opinions and present the results of the study to the board of directors.
10. Adoption by the General Assembly of the regulation
Based on Article (57) and Article (61) of the corporate governance regulation issued by the Capital Market Authority, this regulation was approved by the shareholders at the Ordinary General Assembly meeting on / / 2023 .
