China Zhongwang Holdings Limited（the “Company”）
Terms of Reference of the Nomination and Remuneration Committee of the Board of Directors (the “Board”)
I. Constitution
The Board resolved to establish a Remuneration Committee (the “Committee”) under the Board at its meeting held on 20 August 2008.
Pursuant to the amendment to the Listing Rules (as defined below) issued by The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) on 28 October 2011, the Board resolved to change the name of the Committee to Nomination and Remuneration Committee as well as to broaden its terms of reference accordingly on 28 December 2011.
II. Membership
1. The Committee is composed of three members who are directors. All members of the Committee (“Member(s)”) shall be appointed by the Board and can be removed by the Board at its sole discretion. The Board may from time to time vary the composition of the Committee as may be required by the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”) (as amended from time to time) or applicable laws.
2. A majority of the Members shall be independent non-executive directors.
3. The chairman of the Committee shall be the chairman of the Board or an independent non-executive director appointed by the Board. The Board has the authority to remove the committee chairman appointed by it.
4. The company secretary of the Company shall be the secretary of the Committee. The secretary of the Committee shall give detailed replies to queries raised by any Member in relation to the meeting procedures and the authority and duties of the Committee.
III. Authority
1. The Committee shall report directly to the Board and shall consult the chairman of the Board and/or the chief executive of the Company before making recommendations relating to executive directors’ remuneration.
2. The Committee is authorised to obtain independent external professional advice and to invite external parties with relevant experience and expertise to attend its meetings where it considers necessary. The Company shall bear all related fees and expenses.
3. The Committee should be provided with sufficient resources to perform its duties.
IV. Duties
The duties of the Committee shall include the following:
1. To regularly review the structure, size and composition (including the skills, knowledge and experience) of the Board at least annually and make recommendations on any proposed changes to the Board to complement the Company’s corporate strategy;
2. To identify individuals suitably qualified to become Board members and select or make recommendations to the Board on the selection of individuals nominated for directorships;
3. To assess the independence of the independent non-executive directors;
4. To make recommendations to the Board on the appointment or re-appointment of directors and succession planning for directors, in particular the chairman and the chief executive;
5. To make recommendations to the Board on the policy and structure of the Company for all directors’ and senior management remuneration and on the establishment of a formal and transparent procedure for developing remuneration policy;
6. To review and approve remuneration recommendations by reference to corporate goals and objectives resolved by the Board;
7. To examine and determine the remuneration packages of executive directors and senior management. These shall include any benefits in kind, pension rights and any other compensation payments (including compensation for any loss or termination of office or appointment);
8. To make recommendations to the Board on remuneration of non-executive directors;
9. To consider salaries paid by comparable companies, time commitment, responsibilities and employment conditions elsewhere within the Group.
10. To review and approve compensation for executive directors and senior management in respect of any loss or termination of office or appointment and report it to the Board, ensuring that such compensation is consistent with relevant contractual terms and is otherwise fair, reasonable, and not excessive;
11. To review and approve compensation arrangements for directors in respect of dismissal or removal of directors for misconduct and report it to the Board, ensuring that such compensation arrangements are consistent with relevant contractual terms and are otherwise reasonable and appropriate;
12. To ensure that no director or any of his/her associates is involved in determining his/her own remuneration;
13. To advise shareholders on votes to be taken with respect to any service contracts of directors if shareholders’ approval is required under the Listing Rules.
V. Reporting Procedures
1. The Committee shall report on its decisions or recommendations to the Board subject to legal or regulatory restrictions.
2. The Committee secretary shall circulate minutes and reports of the Committee to all members of the Board.
VI. Committee Meetings
1. Frequency
The Committee shall meet at least once a year. Additional meetings shall be held as and when the Committee sees fit.
2. Notice
Notice of any meetings of the Committee has to be given at least 5 days prior to any such meeting being held, unless all Members unanimously waive such notice. The Committee secretary shall ensure that matters raised by any Members for discussion are included in the agenda of the meeting. Irrespective of the length of notice being given, attendance of a meeting by a Member shall be deemed waiver of the requisite length of notice by the Member. The requisite notice period is not required if a Committee meeting is adjourned for less than 5 days.
3. Quorum
The quorum necessary for resolving matters during Committee meetings shall be：
（a） Any two Members;and
（b） The majority of attending Members being independent non-executive directors.
4. Resolutions
Resolutions of the Committee shall be passed by a majority of votes or unanimous written consent. Meetings can be held in person, by telephone or by video conference.
5. Minutes
The Committee secretary shall keep full minutes of all Committee meetings with details on matters considered (including matters noted and objections raised by any members) by the Committee, the relevant resolutions and the voting results. The draft and the final version of the minutes of Committee meetings shall be sent to all Members, respectively for their review and records within a reasonable time after the meeting.
The minutes of all of the Committee meetings shall be delivered to other Board members simultaneously when they are sent to the Committee Members.
VII. Publication of the terms of reference
These terms of reference will be posted on the websites of the Stock Exchange and the Company.
