Terms and conditions of Appointment of Independent Directors
The terms and conditions of appointment of Independent Directors are subject to the extant provisions of the (i) applicable laws, including the Companies Act, 2013 (‘2013 Act’) and (ii) Articles of Association of the Company.
The broad terms and conditions of their appointments as Independent Directors of the Company are reproduced hereunder:
1. Appointment
The appointment will be for the period as approved by the shareholders in the Annual General Meeting (a term of three years with effect from 22nd November 2021). The Company may disengage Independent Directors prior to completion of the Term subject to compliance of relevant provisions of the Companies Act 2013.
As Independent Directors, they will not be liable to retire by rotation.
Reappointment at the end of the Term shall be based on the recommendation of the Nomination & Remuneration Committee and subject to the approval of the Board and the shareholders. The reappointment would be considered by the Board based on the outcome of the performance evaluation process and the directors continuing to meet the independence criteria.
The directors may be requested to be a member / Chairman of any one or more Committees of the Board which may be constituted from time to time.
2. Role, duties and responsibilities
A. As members of the Board, they along with the other Directors will be collectively responsible for meeting the objectives of the Board which include:
- - Requirements under the Companies Act 2013
- - Accountability under the Director’s Responsibility Statement.
B. They shall abide by the ‘Code for Independent Directors’ as outlined in Schedule IV to section 149(8) of the 2013 Act, and duties of directors as provided in the 2013 Act (including Section 166).
C. They are particularly requested to provide guidance in their area of expertise.
3. Time Commitment
They agree to devote such time as is prudent and necessary for the proper performance of their role, duties and responsibilities as an Independent Director.
4. Remuneration
As Independent Directors, they shall be paid sitting fees for attending the meetings of the Board and the Committees of which they are members. The sitting fees for attending each meeting of the Board and its Committees would be as determined by the Board from time to time.
The sitting fees presently paid to the Independent Director is Rs. 25,000/- per meeting of the Board and Rs.15,000/- per Committee meeting.
Further, the Company may pay or reimburse to the Director such expenditure, as may have been incurred by them while performing their role as an Independent Director of the Company. This could include reimbursement of expenditure incurred by them for accommodation, travel and any out of pocket expenses for attending Board / Committee meetings, General Meetings, court convened meetings, meetings with shareholders / creditors / management, site visits, induction and training (organized by the Company for Directors) and in obtaining, subject to the expense being reasonable, professional advice from independent advisors in the furtherance of their duties as Independent Directors.
5. Code of Conduct
Unless specifically authorised by the Company, they shall not disclose Company and business information to constituencies such as the media, the financial community, employees, shareholders, agents, franchisees, dealers, distributors and importers.
Their obligation of confidentiality shall survive cessation of their respective directorships with the Company.
Additionally, they shall not participate in any business activity which might impede the application of their independent judgment in the best interest of the Company. All Directors are required to sign a confirmation of acceptance of the Code of Conduct as adopted by the Board on annual basis.
6. Performance Appraisal / Evaluation Process
As members of the Board, their performance as well as the performance of the entire Board and its Committees will be evaluated annually. Evaluation of each director shall be done by all the other directors. The criteria for evaluation shall be disclosed in the Company’s Annual Report. However, the actual evaluation process shall remain confidential and shall be a constructive mechanism to improve the effectiveness of the Board / Committee.
7. Disclosures, other directorships and business interests
During the Term, they agree to promptly notify the Company of any change in their directorships, and provide such other disclosures and information as may be required under the applicable laws. They also agree that upon becoming aware of any potential conflict of interest with their position as Independent Directors of the Company, they shall promptly disclose the same to the Chairman and the Company Secretary.
During their Term, they agree to promptly provide a declaration under Section 149(7) of the 2013 Act, upon any change in circumstances which may affect their status as an Independent Director.
8. Changes of personal details
During the Term, they shall promptly intimate the Company Secretary and the Registrar of Companies in the prescribed manner, of any change in address or other contact and personal details provided to the Company.
9. Disengagement
They may resign from the directorship of the Company by giving a notice in writing to the Company stating the reasons for resignation. The resignation shall take effect from the date on which the notice is received by the Company or the date, if any, specified by them in the notice, whichever is later.
Their directorship on the Board of the Company shall cease in accordance with law.