TERMS AND CONDITIONS OF APPOINTMENT OF INDEPENDENT DIRECTORS OF THE COMPANY IN ACCORDANCE WITH THE APPLICABLE PROVISIONS OF COMPANIES ACT 2013 AND THE RULES MADE THEREUNDER
|Name of Independent Directors
||Mr. M.L. Pachisia
||Mr. Rajat Mukherjee
|Date of Appointment/ Date of meeting in which appointment was made
||Board Meeting dated November 26, 2014. The appointment is subject to appointment in the next General Meeting of the Company. Director is not liable to rotation
||Board Meeting dated 28th April 2014 and Annual General Meeting dated 10th July 2014. Director is not liable to rotation.
|Period of Appointment
||5 years from the date of appointment in Board Meeting
||5 years from the date of appointment in Board Meeting
|Declaration of Independence and other Statutory forms received from Independent Directors
||Received. Placed before the Board and Noted thereat
||Received. Placed before the Board and Noted thereat
|Address of Independent Directors as per the records of the Company
||8/12, Alipur Road,
|B-1/1, 1st Floor,
|Date of Appointment Letter
||November 26, 2014
||April 28, 2014 for appointment as Additional Director. And, in the Annual general meeting dated July 10, 2014, Mr. Rajat Mukherjee was appointed as a Independent Director
- The appointment of aforesaid Independent Directors shall be governed by applicable provisions of the Companies Act 2013 read with applicable rules and Schedule IV thereof.
- The Directors have confirmed in-principle their acceptance to this appointment. It was agreed with the Directors that, their appointment will be construed as contract for services and not a contract of employment.
- The appointment is subject to the articles of association. Nothing in this letter shall be taken to exclude or vary the terms of the articles of association as they apply to the Independent Director of the Company.
- Continuation of the contract of appointment is also contingent on satisfactory performance and any relevant statutory provisions relating to the removal of a Independent Director.
- Notwithstanding the foregoing paragraphs, the Company may terminate the appointment of Independent Directors with immediate effect if they:
- commit a material breach of obligations under the letter of appointment issued to them and specifically mentioned herein; or
- commit any serious or repeated breach or non-observance of obligations to the Company (which include an obligation not to breach the duties to the Company, whether statutory, fiduciary or common-law); or
- are guilty of any fraud or dishonesty or acted in a manner which, in the opinion of the Company acting reasonably, brings or is likely to bring or the Company into disrepute or is materially adverse to the interests of the Company; or
- are convicted of any criminal offence resulting in imprisonment of not less than 6 months; or
- are declared insolvent or have made an arrangement with or for the benefit of their creditors; or
- are disqualified from acting as a director or required to vacate the office as a director, in accordance with the provisions of the Companies Act, 2013 read with rules framed there under, or any applicable law, as amended from time to time.
- If there are matters which arise which cause them concern about their role, they should discuss with the chairman or the company secretary of the Company. If they have any concerns that cannot be resolved, and they choose to resign for that, or any other, reason, they should provide an appropriate written statement to the chairman or the company secretary for circulation to the Board.
- Time commitment
- The Board normally meets for a minimum of 4 (four) times in a year and holds additional meetings as the occasion requires. As an Independent Director, they would also be required to attend a separate meeting of Independent Directors conducted at least once in a year.
- The Company has requested the Independent Directors to confirm that they will be able to devote sufficient time and attention to meet the expectations of the role as an Independent Director. They will be expected to devote such time as is necessary for the proper performance of their duties and they should be prepared to spend sufficient time for preparation for and attendance at:
- scheduled Board meetings
- scheduled meetings of the Committees of the Board in which they are member
- scheduled meeting of the Independent Directors
- general meetings of members including the AGM
- updating meetings/training
- meetings as part of the Board evaluation process
- such other activity / meeting as may be required for effective discharge of their professional obligations as an independent director.
- Meetings may involve them in some travel within India or overseas. Unless urgent and unavoidable circumstances prevent them from doing so, it is expected that they will attend all the meetings outlined above.
- The nature of the role makes it impossible to be specific about the maximum time commitment, and there is always the possibility of additional time commitment in respect of preparation time ahead of board meeting and ad hoc matters which may arise from time to time, and particularly when the Company is undergoing a period of increased activity. At certain times it may be necessary to convene additional Board, committee or shareholder meetings.
- By accepting this appointment, they have undertaken that taking into account all other commitments that they may have; they are able to, and will, devote sufficient time to their duties as an independent director.
- The Company recognizes the demands on the time of its directors. Management, under the oversight of the chairman and fellow directors is expected to ensure that the most efficient and productive use is made of the time which the independent directors commit to the Company.
- The Board's role is to effectively represent, and promote the interests of, all the stakeholders with a view to adding long-term value to the Company's stakeholders. In the normal course of events, day to day management of the Company is left to management; the Board directs and supervises the management with regard to the business and affairs of the Company. An independent director has the same general legal responsibilities to the Company as any other director.
- The Independent Directors have acknowledged that the Board as a whole is collectively responsible for the success of the Company. The Board:
- provides entrepreneurial leadership of the Company within a framework of prudent and effective controls which enable risk to be assessed and managed;
- sets the Company's strategic aims, ensures that the necessary financial and human resources are in place for the Company to meet its objectives, and reviews management performance;
- sets the Company's values and standards and ensures that its obligations to its shareholders and others are understood and met.
- The Independent Directors have acknowledged that in addition to these requirements of all directors, the role of an independent director has the following key elements:
- Strategy – independent directors should constructively challenge and help develop proposals on strategy.
- Performance – independent directors should scrutinize the performance of management in meeting agreed goals and objectives and monitor the reporting of performance.
- Risk – independent directors should satisfy themselves on the integrity of financial information and that financial controls and systems of risk management are robust and defensible.
- People – independent directors are responsible for determining appropriate levels of remuneration of executive directors and have a prime role in appointing, and where necessary removing, executive directors and in succession planning.
- The primary duties as an independent director will include:
- bringing an independent judgment to bear on the Board's deliberations especially on issues of strategy, performance, risk management, resources, key appointments and standards of conduct;
- bringing an objective view in the evaluation of the performance of board and management;
- safeguarding the interests of all stakeholders, particularly the minority shareholders;
- balancing the conflicting interest of the stakeholders;
- determining appropriate levels of remuneration of executive directors, key managerial personnel and senior management and have a prime role in appointing and where necessary recommend removal of executive directors, key managerial personnel and senior management;
- moderating and arbitrating in the interest of the Company as a whole, in situations of conflict between management and shareholder's interest;
- constructively challenging and helping in developing proposals on strategy;
- scrutinizing the performance of management in meeting agreed goals and objectives and monitoring the reporting of performance;
- satisfying yourself on the integrity of financial information and that financial controls and systems of risk management are robust and defensible;
- upholding high standards of integrity and probity and supporting the other directors in instilling the appropriate culture, values and behaviours in the boardroom and beyond;
- insisting on receiving high-quality information sufficiently in advance of board meetings;
- taking into account the views of shareholders and other stakeholders where appropriate;
- constructive and active participation in the committees of the Board in which the Independent Directors is a chairperson or member;
- ensuring that the concerns of Independent Directors about the running of the Company or a proposed action are addressed to the Board and recorded in the minutes of the meeting to the extent they are not resolved;
- being well informed about the Company and the external environment it operates in;
- not to unfairly obstruct the functioning of the Board or the committee of the Board;
- ensuring that sufficient deliberations are held before approving related party transactions and assure that they are in the interest of the Company;
- ascertaining and ensuring that the Company has an adequate and functional vigil mechanism and that the interests of a person who uses such mechanism are not prejudicially affected on account of such use;
- reporting concerns about unethical behavior, actual or suspected fraud or violation of the Code; and
- assisting in protecting legitimate interests of the Company, shareholders and its employees.
- Fiduciary Responsibility of the Independent Director
- A director of the Company shall act in accordance with the memorandum and articles of association of the Company.
- A director of the Company shall act in good faith in order to promote the objects of the Company for the benefit of its members as a whole, and in the best interests of the Company, its employees, the shareholders particularly the minority shareholders, the community and for the protection of environment.
- A director of the Company shall exercise his duties with due and reasonable care, skill and diligence.
- A director of the Company shall not involve in a situation in which he may have a direct or indirect interest that conflicts, or possibly may conflict, with the interest of the Company in terms of provisions of the Companies Act, 2013 read with rules framed thereunder, and other applicable laws, as amended from time to time.
- A director of the Company shall not achieve or attempt to achieve any undue gain or advantage either to himself or to his relatives, partners, or associates and if such director is found guilty of making undue gain, he shall be liable to pay an amount equal to that gain to the Company.
- A director of the Company must act in the way he considers, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to -
- the likely consequences of any decision in the long term;
- the interests of the Company's employees;
- the need to foster the Company's business relationships with suppliers, customers and others;
- the impact of the Company's operations on the community and the environment;
- the desirability of the Company maintaining a reputation for high standards of business conduct; and
- the need to act fairly as between members of the Company.
- Unless specifically authorised to do so by the Board, a director of the Company must not enter into any legal or other commitment or contract on behalf of the Company.
- Such other duties as may be specified by the Companies Act, 2013 read with the rules framed there under, as amended from time to time.
- Code for Independent Directors, Business Ethics and Price Sensitive Information
- As an Independent Director you are required to abide by the provisions of "Code for Independent Directors" ("Code") specified in schedule IV of Companies Act, 2013, as amended from time to time, enclosed alongwith the letter of appointment issued to them as Annexure -I to the letter. Compliance with the Code would inter alia require the Independent Directors to:
- uphold ethical standards of integrity and probity;
- act objectively and constructively while exercising their duties;
- exercise their responsibilities in a bona fide manner in the interest of the Company;
- devote sufficient time and attention to their professional obligations for informed and balanced decision making;
- not allow any extraneous considerations that will vitiate their exercise of objective independent judgment in the paramount interest of the Company as a whole, while concurring in or dissenting from the collective judgment of the Board in its decision making;
- not abuse their position to the detriment of the Company or its shareholders or for the purpose of gaining direct or indirect personal advantage or advantage for any associated person;
- assist the Company in implementing the best corporate governance practices.
- During their period of appointment they are also required to comply with the provisions of all applicable statutory regulations.
- Independent Directors shall comply with all requirements under both law and regulation regarding the disclosure of price sensitive information, and in particular to the Rules, Regulations and guidelines issued by the Securities & Exchange Board of India, the Stock Exchanges and the Code of Conduct for prohibition of insider trading. Independent Directors should avoid making any statements that might risk a breach of these requirements. If in doubt, the Independent Directors may please contact the chairperson or the company secretary for any guidance in this behalf.
- Committee Involvement
- Board committees are formed when it is efficient or necessary to facilitate effective decision-making. From time to time, as deemed fit by the Board, the Independent Directors may be requested by the Board to serve on one or more Board committees.
- The Board may appoint Independent Directors as a member of Nomination and Remuneration Committee or any other Committee of the Board. As and when required, Independent Directors may seek the assistance of the company secretary to ensure that the Independent Directors are aware of the committee's terms of reference and the responsibilities involved.
- Remuneration and Expenses
- As an Independent Director, they are eligible for sitting fees for attending meetings of the Board or committee thereof as decided by the Board from time to time. Independent Directors shall also be eligible for receipt of profit related commission, if any, as may be approved by the members from time to time, however Independent Directors shall not be entitled to any stock option.
- The Company will reimburse Independent Directors for all expenses, as may be incurred by you for participation in the Board and other meetings, such as accommodation, travelling expenses etc., reasonably and properly incurred and documented.
- All fees payable shall be subject to income tax and other statutory deductions.
- On termination of the appointment, Independent Directors shall only be entitled to such fees as may have accrued to the date of termination, together with reimbursement in the normal way of any expenses properly incurred prior to that date.
- Board and Individual Director Evaluation Processes
The performance of the Board as a whole, its committees and individual directors is evaluated annually. If, during the tenure of directorship of Independent Directors, there are any matters which cause you concern about their role, then they may discuss them with the chairman of the Board. Independent Directors may also seek the assistance of the key managerial personnel's of the Company, as and when required, for effectively discharging of their duties.
- Outside Interests Including Directorships
- It is accepted and acknowledged that Independent Directors may have business interests other than those of the Company. Independent Directors are requested to contact the company secretary as soon as possible to arrange for the disclosures of Independent Directors interests, direct or indirect as a shareholder, director, partner or owner of other companies, body corporate, firms or other entities as required under the Companies Act, 2013 read with rules framed there under, as may be amended from time to time.
- The Board of the Company, on the basis of certificate of independence submitted by Independent Directors, has determined Independent Directors to be independent according to Section 149 and Schedule IV of the Companies Act, 2013.
- Independent Directors shall ensure that the Company is kept informed of any changes to Independent Directors interests from time to time.
- In the event that Independent Directors become aware of any further potential or actual conflicts of interest, these should be disclosed to the company secretary as soon as they become apparent.
- Independent Directors will disclose any direct or indirect interest which Independent Directors may have in any matter being considered at a board meeting or committee meeting and, save as permitted under the articles of association, applicable provisions of the Companies Act 2013 read with the rules framed there under, Independent Directors will not vote on any resolution of the Board, or of one of its committees, on any matter where Independent Directors have any direct or indirect interest.
- Shareholdings by Directors in the Company
Directors when buying or selling shares are expected to strictly observe the provisions of the Company's articles of association, the Company's own internal rules including the "Code of Conducts" framed by Company and all relevant legislative and regulatory procedures.
- Induction and Development Processes
- As soon as practicable, the Company will provide a comprehensive, formal and tailored induction programme aimed at broadening their understanding of the Company, its business, and the environment and markets in which it operates. As part of the programme, Independent Directors will meet key management and receive essential Board and Company information. Independent Directors will be expected to make themselves available for the purposes of the induction. The company secretary will be in touch with the Independent Directors for further details.
- The Independent Directors are expected to remain updated on how to best discharge the responsibilities as director of the Company including keeping abreast of changes and trends in economic, political, social, financial and legal climates and governance practices.
- Directors and Officers Liability Insurance
- The Company provides all its directors with, and pays the premiums for Directors and Officers Liability insurance cover, while acting in their capacities as directors.
- You may obtain a copy of the relevant policy from the company secretary and satisfy yourself as to the suitability and extent of the cover.
- All information acquired during appointment of Independent Directors is confidential to the Company and should not be be released, communicated, nor disclosed either during their Independent Directors appointment or following the expiry of their term or vacation (by whatever means) to third parties except as permitted by law and with prior clearance from the Chairman/ Company Secretary.
- This restriction shall cease to apply to any confidential information which may (other than by reason of your breach) become available to the public generally.
- Independent Directors have acknowledged the need to hold and retain Company information (in whatever format they may receive it) under appropriately secure conditions.
- Changes in personal details
Independent Directors shall advise the company secretary promptly of any change in address or other personal contact details.
- Return of property
Upon termination of appointment of Independent Directors with the Company (for whatever cause), they shall deliver to the Company all documents, records, papers or other company property which may be in their possession or under their control, and which relate in any way to the business affairs of the Company, and they shall not retain any copies thereof.
- Data protection
By signing the letter of appointment, the Independent Directors have accorded their unconditional consent to the Company for holding and processing information about their legal, personnel, administrative and management purposes and in particular to the processing of any sensitive personal data or information (as defined in the Information Technology (Reasonable Security Practices and Procedures and Sensitive Personal Data or Information) Rules, 2011) as applicable, information relating to:
i. any of the information received under above clauses by body corporate for processing, stored or processed under lawful contract or otherwise.
ii. any detail relating to the above clauses as provided to body corporate for providing service; and
iii. Biometric information;
iv. medical records and history;
v. sexual orientation;
vi. physical, physiological and mental health condition;
vii. financial information such as Bank account or credit card or debit card or other payment instrument details ;
d. Independent Directors have acknowledged that any information that is freely available or accessible in public domain or furnished under the Right to Information Act, 2005 or any other law for the time being in force shall not be regarded as sensitive personal data or information for the purposes of those rules.
e. Independent Directors have given their consent to the transfer of such personal information to other offices the Company may have or to other third parties, whether or not outside the Union of India, for administration purposes and other purposes in connection with their appointment, where it is necessary or desirable for the Company to do so.
The engagement of Independent Directors with the Company is governed by and shall be construed and interpreted in accordance with the laws of India and their engagement shall be subject to the jurisdiction of the Courts of Delhi, India.
25. The terms and conditions of appointment of Independent Directors as mentioned in their respective appointment letters constitutes the entire terms and conditions of Independent Directors' appointment and no waiver or modification thereof shall be valid unless in writing and signed by the parties hereto
For Birlasoft Limited
Registered & Corporate Office: Plot No. 35 & 36, MIDC Phase I, Rajiv Gandhi Infotech Park, Hinjewadi, Pune – 411 057
T +91-20-6652 5000 F +91-20-6652 5001.
CIN No.: L72200PN1990PLC059594