Special Resolution for Reappointment of Independent Director

     

Special Resolution for Reappointment of Independent Director

“RESOLVED THAT pursuant to the provisions of Sections 149 and 152 read with Schedule IV and any other applicable provisions of the Companies Act, 2013 (‘the Act’) and the Companies (Appointment and Qualification of Directors) Rules, 2014 (including any statutory modification(s) or re-enactment thereof for the time being in force), Mr. __________ (DIN: ______), Independent Director of the Company who has submitted a declaration that he meets the criteria for independence as provided in Section 149(6) of the Companies Act, 2013 and who is eligible for re-appointment, be and is hereby re-appointed to hold office for five consecutive years for a term from ________ to _______, and whose office shall not be liable to retire by rotation.”

EXPLANATORY STATEMENT UNDER SECTION 102 OF THE COMPANIES ACT, 2013

Item No. __

The Members of the Company, at the _th Annual General Meeting held on ______ had approved the appointment of Mr. ______ as an Independent Director of the Company, whose term is due to expire on____.

As per Section 149(10) of the Companies Act, 2013 (CA 2013), an Independent Director shall hold office for a term of upto five consecutive years on the Board of a Company, but shall be eligible for re-appointment on passing a special resolution by the Company for another term of upto five consecutive years on the Board of a Company.

In line with the aforesaid provisions of the CA 2013 and in view of long, rich experience, continued valuable guidance to the management and strong Board performance of Mr._______, it is proposed to re-appoint him for the second term as an independent Director on the Board of _______ for a period of five years upto _____

 In the opinion of the Board, Mr. ________ fulfills the conditions specified in the Act and he is independent of the management. Copy of the draft letter for appointment of Mr. _______ as an Independent Director setting out the terms and conditions would be available for inspection without any fee by the members at the Registered Office of the Company during normal business hours on any working day, excluding Saturday.

The Board considers that his continued association would be of immense benefit to the Company and it is desirable to continue to avail services of Mr. ______ as an Independent Director. Accordingly, the Board recommends passing of the Resolution at Item No. ___ of the Notice as a Special Resolution.

Except Mr. ________, being an appointee, none of the Directors or Key Managerial Personnel (KMP) of the Company or their relatives are concerned or interested, financial or otherwise, in the resolution set out at Item No. ___.

Related Provisions :

Re-appointment of Independent Director

The re-appointment of independent director shall be on the basis of report of performance evaluation.

Section 149(11) provides that the Independent Director shall be eligible for re-appointment on passing of special resolution. He shall not hold office for more than 2 consecutive terms, but such independent director shall be eligible for appointment after the expiration of 3 years of ceasing to become an independent director.

However, he shall not, during the said period of 3 years, be appointed in or be associated with the company in any other capacity, either directly or indirectly.

Other Related Provisions ;

Every listed public company shall have at least one-third of the total number of directors as independent directors and the Central Government may prescribe the minimum number of independent directors in case of any class or classes of public companies. Rule 4 of the Companies (Appointment and Qualification of Directors) Rules, 2014 provides that following class of companies should have independent director:

(i)     the Public Companies having paid up share capital of Rs.10 crore or more; or

(ii)    the Public Companies having turnover of Rs.100 crore or more; or

(iii)  the Public Companies which have, in aggregate, outstanding loans, debentures and deposits, exceeding Rs. 50 crore.

Related Post ;

Draft Board Resolution for Appointment of Independent Director

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