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Finsbury Dials
20 Finsbury Street
London
EC2Y 9AQ
PRIVATE AND CONFIDENTIAL
Ken McCall
[22] January 2019
Dear Ken,
Letter of re-appointment as Senior Independent Director
Following the approval of the Special Shareholder, the recommendation of the
Nominations Committee to the Board and the ratification of the re-appointment
by the board of directors (Board), I am pleased to issue this letter which sets
out the main terms of your re-appointment as Senior Independent Director.
By accepting this appointment, you agree that this letter is a contract for
services and is not a contract of employment and you confirm that you are not
subject to any restrictions which prevent you from holding office as a director.
1. APPOINTMENT
Subject to the remaining provisions of this letter, your appointment shall be for
a term of three years commencing on 29th January 2019 until the Board
meeting occurring approximately three years from that date unless terminated
earlier by either party giving to the other six months’ prior written notice.
1.1. Your appointment is subject to the Company's articles of association, as I
amended from time to time (Articles). Nothing in this letter shall be I
taken to exclude or vary the terms of the Articles as they apply to you as
a director of the Company. Your appointment is subject to the prior
written consent of the Special Shareholder (as defined within the
Articles), which has been obtained.
1.2. Continuation of your appointment is contingent on your continued
satisfactory performance and any relevant statutory provisions relating
to the removal of a director. If you are retired from office under the
Post Office Limited is registered in England and Wales. Registered No, 2154540
Registered Office Finsbury Dials, 20 Finsbury Street, London, EC2Y 9AQ PostOffice.co.uk
Post Office and the Post Office logo are registered trade marks of Post Office Limited
1.3
1.4
1.5
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Articles, your appointment shall terminate automatically, with immediate
effect and without compensation.
You may be required to serve on one or more Board committees in
addition to acting as Senior Independent Director and chairing the
Remuneration Committee. You will be provided with the relevant terms
of reference on your appointment to such a committee. You also may be
asked to serve as a non-executive director on the board of any of the
Company's subsidiaries or joint ventures. Any such appointment will be
covered in a separate communication.
Notwithstanding paragraph 0 to paragraph 1.33, the Company may
terminate your appointment with immediate effect if you have:
(a) committed a material breach of your obligations under this letter;
(b) committed any serious or repeated breach or non-observance of
your obligations to the Company (which include an obligation not to
breach your statutory, fiduciary or common-law duties);
(c) been guilty of any fraud or dishonesty or acted in any manner which,
in the Company's opinion, brings or is likely to bring you or the
Company into disrepute or is materially adverse to the Company's
interests;
(d) been convicted of an arrestable criminal offence other than a road
traffic offence for which a fine or non-custodial penalty is imposed;
(e) been declared bankrupt or have made an arrangement with or for
the benefit of your creditors, or if you have a county court
administration order made against you under the County Courts Act
1984;
(f) been disqualified from acting as a director;
(g) not complied with the Company’s anti-corruption and bribery policy
and procedures or the Bribery Act 2010.
On termination of your appointment, you shall, at the Company’s
request, resign from your office as Senior Independent Director of the
Company and any offices you hold in any of the Company’s group
companies.
If matters arise which cause you concern about your role, you should
discuss these matters with the Chief Executive or Chairman. If you have
any concerns which cannot be resolved, and you choose to resign for
that, or any other, reason, you should provide an appropriate written
statement to the Chief Executive or the Chairman for circulation to the
Board.
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TIME COMMITMENT
You will be expected to devote such time as is necessary for the proper
performance of your duties as a director. Overall we anticipate that you
will spend a minimum of 24 days a year on work for the Company. This
will include attendance at eight scheduled Board meetings per year, the
AGM (if one is called), one annual Board away day event a year (which
may span over two days), at least one site visit a year, Board dinners,
meetings with the non-executive directors, meetings with
representatives of the Special Shareholder, meetings forming part of the
Board evaluation process and training meetings. Some of these
meetings may involve overseas travel. In addition, you will be required
to consider all relevant papers before each meeting. Unless urgent and
unavoidable circumstances prevent you from doing so, it is expected that
you will attend such of the meetings outlined in this paragraph as may
be required.
The nature of the role makes it impossible to be specific about the
maximum time commitment. You may be required to devote additional
time to the Company in respect of preparation time and ad hoc matters
which may arise and particularly when the Company is undergoing a
period of increased activity. At certain times it may be necessary to
convene additional Board or committee meetings.
The overall time commitment stated in paragraph 2.1 will increase if you
become a committee member or chair, or if you are given additional
responsibilities, such as being appointed as non-executive director on the
board of any of the Company’s subsidiaries or joint ventures. Details of
the expected increase in time commitment will be covered in any relevant
communication confirming the additional responsibility.
By accepting this appointment, you confirm that, taking into account all
of your other commitments, you are able to allocate sufficient time to the
Company to discharge your responsibilities effectively. You should obtain
the agreement of the Chairman before accepting additional commitments
that might affect the time you are able to devote to your role as Senior
Independent Director of the Company.
ROLE AND DUTIES
The Board as a whole is collectively responsible for the success of the
Company. The Board's role is to:
(a) provide entrepreneurial leadership of the Company within a
framework of prudent and effective controls which enable risk to be
assessed and managed;
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3.3
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(b) set the Company’s strategic aims, ensure that the necessary
financial and human resources are in place for the Company to meet
its objectives, and review management performance; and
(c) set the Company’s values and standards and ensure that its
obligations to its shareholders and others are understood and met.
As Senior Independent Director you shall have the same general legal
responsibilities to the Company as any other director. You are expected
to perform your duties (whether statutory, fiduciary or common law)
faithfully, diligently and to a standard commensurate with the functions
of your role and your knowledge, skills and experience.
You shall exercise your powers in your role as Senior Independent
Director having regard to relevant obligations under prevailing law and
regulation, including the Companies Act 2006 and the UK Corporate
Governance Code and associated guidance.
You shall have particular regard to the general duties of directors in Part
10 of the Companies Act 2006, including the duty to promote the success
of the Company under which all directors must act in the way they
consider, in good faith, would be most likely to promote the success of
the Company for the benefit of its members as a whole. In doing so, as
a director, you must have regard (among other matters) to:
(a) the likely consequences of any decision in the long term;
(b) the interests of the Company's employees;
(c) the need to foster the Company's business relationships with
suppliers, customers and others;
(d) the impact of the Company's operations on the community and the
environment;
(e) the desirability of the Company maintaining a reputation for high
standards of business conduct; and
(f) the need to act fairly as between the members of the Company.
You shall have particular regard to the Financial Reporting Council's UK
Corporate Governance Code and associated Guidance on Board
Effectiveness in respect of the role of the Board and the role of the non-
executive director.
In your role as Non-Executive Director, you shall also be required to:
(a) constructively challenge and help develop proposals on strategy;
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(b)
(c)
(d)
(e)
(f)
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scrutinise the performance of management in meeting agreed goals
and objectives and monitor the reporting of performance;
satisfy yourself on the integrity of financial information and that
financial controls and systems of risk management are robust and
defensible;
be responsible for determining appropriate levels of remuneration of
executive directors and have a prime role in appointing and, where
necessary, removing senior management and in succession
planning;
devote time to developing and refreshing your knowledge and skills;
uphold high standards of integrity and probity and support the
executive directors in instilling the appropriate culture, values and
behaviours in the boardroom and beyond;
satisfy yourself as to the Company’s ongoing and consistent
compliance with any regulatory responsibilities;
insist on receiving high-quality information sufficiently in advance of
Board meetings;
take into account the views of shareholders and other stakeholders
where appropriate;
make sufficient time available to discharge your responsibilities
effectively;
exercise relevant powers under, and abide by, the Articles;
disclose the nature and extent of any direct or indirect interest you
may have in any matter being considered at a Board or committee
meeting and, except as permitted under the Articles you will not
vote on any resolution of the Board, or of one of its committees, on
any matter where you have any direct or indirect interest;
immediately report your own wrongdoing or the wrongdoing or
proposed wrongdoing of any employee or other director of the
Company of which you become aware to the senior independent
director;
exercise your powers as a director in accordance with the Company's
policies and procedures, internal control framework and the Bribery
Act 2010; and
not do anything that would cause you to be disqualified from acting
as a director.
Unless the Board specifically authorises you to do so, you shall not enter
into any legal or other commitment or contract on behalf of the Company.
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In addition, in your role as Senior Independent Director you should: I
a. chair the meetings of the Remuneration Committee; I
b. act as a sounding board for the Chairman and an intermediary for
the other directors; and
[on ensure that the performance of the Chairman is evaluated as part
of the wider Board evaluation, which should take place at least
once a year,
You shall be entitled to request all relevant information about the
Company’s affairs as is reasonably necessary to enable you to discharge
your duties.
FEES AND EXPENSES
You shall be paid an annual fee of £50,000 gross (current at the date of
this letter), which shall be paid in equal instalments monthly in arrears
through PAYE after deduction of any taxes and other amounts that are
required by law, which shall be subject to a periodic review by the Board.
This fee covers all duties, including service on any Board committee or
Company subsidiary, acting as Senior Independent Director and for
chairing the Remuneration Committee.
The Company shall reimburse you for all reasonable and properly
documented expenses that you incur in performing the duties of your
office. The procedure and other guidance in respect of expense claims is
available from the Company Secretary.
On termination of your appointment, you 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
before that date.
INDEPENDENT PROFESSIONAL ADVICE
In some circumstances you may consider that you need professional
advice in the furtherance of your duties as a director and it may be
appropriate for you to seek advice from independent advisers at the
Company’s expense. A copy of the Board’s agreed procedure under which
directors may obtain such independent advice is available from the
company secretary. The Company shall reimburse the reasonable cost of
expenditure incurred by you in accordance with its policy.
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OUTSIDE INTERESTS
You have already disclosed to the Board the commitments you have
outside your role in the Company. You must inform the Chairman in
advance of any changes to these commitments. In certain circumstances,
you may have to seek the Board's agreement before accepting further
commitments which either might give rise to a conflict of interest or a
conflict with any of your duties to the Company, or which might impact
on the time that you are able to devote to your role at the Company.
It is accepted and acknowledged that you have business interests other
than those of the Company and have declared any conflicts that are
apparent at present. If you become aware of any further potential or
actual conflicts of interest, these should be disclosed to the Chairman and
Company Secretary as soon as you become aware of them and again you
may have to seek the agreement of the Board.
CONFIDENTIALITY
You acknowledge that all information acquired during your appointment
is confidential to the Company and should not be released, communicated
or disclosed to third parties or used for any reason other than in the
interests of the Company, either during your appointment or following
termination (by whatever means), without prior clearance from the Chief
Executive. 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.
You acknowledge the need to hold and retain Company information (in
whatever format you may receive it) under appropriately secure
conditions.
Nothing in this paragraph 7 shall prevent you from disclosing information
which you are entitled to disclose under the Public Interest Disclosure Act
1998, provided that the disclosure is made in accordance with the
provisions of that Act and you have complied with the Company's policy
from time to time in force regarding such disclosures.
TRAINING
On an on-going basis, and further to the annual evaluation process, the
Company will arrange for you to develop and refresh your skills and
knowledge in areas which are mutually identified as being likely to be
required, or of benefit to you, in carrying out your duties effectively. You
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should try to make yourself available for any relevant training sessions
which may be organised for the Board.
INSURANCE AND INDEMNITY
The Company has directors’ and officers’ liability insurance and it intends
to maintain such cover for the full term of your appointment. The
indemnity limit is £60m (current at the date of this letter). A copy of the
policy document is available from the Company Secretary.
CHANGES TO PERSONAL DETAILS
You shall advise the Company Secretary promptly of any change in your
address or other personal contact details.
RETURN OF PROPERTY
On termination of your appointment with the Company however arising,
or at any time at the Board's request, you shall immediately return to the
Company all documents, records, papers or other property belonging to
the Company which may be in your possession or under your control, and
which relate in any way to the Company's business affairs and you shall
not retain any copies thereof.
MORAL RIGHTS
You hereby irrevocably waive any moral rights in all works prepared by
you, in the provision of your services to the Company, to which you are
now or may at any future time be entitled under Chapter IV of the
Copyright Designs and Patents Act 1988 or any similar provisions of law
in any jurisdiction, including (but without limitation) the right to be
identified, the right of integrity and the right against false attribution, and
agree not to institute, support, maintain or permit any action or claim to
the effect that any treatment, exploitation or use of such works or other
materials, infringes your moral rights.
POST-TERMINATION RESTRICTION
By countersignature of this letter and in consideration for the fees
payable to you under the terms of this letter, you agree that, in order to
protect the confidential information, trade secrets and business
connections of the Company to which you have access as a result of your
appointment, you will not (without the previous consent in writing of the
Company), for the period of six months immediately after the termination
of your appointment, whether as principal or agent and whether alone or
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15.
16.
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jointly with, or as a director, manager, partner, shareholder, employee
consultant of, any other person, carry on or be engaged, concerned or
interested in any business which is similar to or which is (or intends to
be) in competition with any business being carried on by the Company or
any company in the Company's group.
DATA PROTECTION
Post Office Limited is the Data Controller for the information about you
that we use and hold. We comply with the UK Data Protection Act and
respect your privacy in everything we do. We collect information from
you such as name, bank details, NI number in order to pay expenses in
accordance with this letter. We collect information for justifiable
purposes such as providing you with access to Post Office systems and
providing training.
For more information please contact our Data Protection Officer by
sending an email to data.protection@postoffice.co.uk
THIRD PARTY RIGHTS
No one other than you and the Company shall have any rights to
enforce the terms of this letter.
ENTIRE AGREEMENT
This letter constitutes the entire terms and conditions of your
appointment and supersedes and extinguishes all previous agreements,
promises, assurances, warranties, representations and understandings
between you and the Company, whether written or oral, relating to its
subject matter.
You agree that you shall have no remedies in respect of any
representation, assurance or warranty (whether made innocently or
negligently) that is not set out in this letter and you shall not have any
claim for innocent or negligent misrepresentation or negligent
misstatement based on any statement in this letter.
VARIATION
No variation of this letter shall be effective unless it is in writing and
signed by you and the Company (or respective authorised
representatives).
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18. GOVERNING LAW AND JURISDICTION
Your appointment with the Company and any dispute or claim arising out
of or in connection with it or its subject matter or formation (including
non-contractual disputes or claims) shall be governed by and construed
in accordance with the law of England and Wales and you and the
Company irrevocably agree that the courts of England and Wales shall
have exclusive jurisdiction to settle any dispute or claim that arises out
of or in connection with this appointment or its subject matter. or
formation (including non-contractual disputes or claims).
Please indicate your acceptance of these terms by signing and returning to the
attached copy of this letter to me.
Yours sincerely
Jane MacLeod (Company Secretary)
For and on behalf of Post Office Limited
Signed on 22 Jonnavy 2019
I agree to the above terms of my appointment as Senior Independent Director
of Post Office Limited as set out in this letter.
Signed on 22 purery 2019
Ken McCall
Senior Independent Director
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