template

Independent Non-Executive Director (NED) Letter Agreement

by
Genie Team
Genie Team
Nov, 14 2023

When to use this template

The Independent Non-Executive Director (NED) Letter Agreement under UK law is a legal template designed to formalize the appointment of an independent non-executive director in a company incorporated and operating in the United Kingdom.

This letter agreement outlines the terms and conditions of the director's appointment, defining their role and responsibilities within the company. It covers crucial aspects such as the director's duties, time commitments, remuneration, and specific provisions related to their independence and impartiality.

The agreement also touches upon areas like confidentiality, conflicts of interest, and intellectual property, ensuring that the director is aware of their obligations and adheres to the highest ethical standards and legal requirements in the performance of their duties.

Furthermore, it may include termination clauses, specifying the circumstances in which the agreement can be terminated by either party and the associated procedures or consequences.

Overall, this legal template serves as an essential instrument to establish a clear and legally binding agreement between a company and an independent non-executive director, ensuring transparency, accountability, and compliance with UK corporate governance principles and regulations.

Key issues covered in this template

  • Fee structure
  • Confidential information
  • NED duties
  • Requirements to join shareholder and board meetings
  • Company induction
  • Other directorships and business interests
  • Non-independent NEDs
  • Payment to NED via the HMRC Extra-Statutory Concession ESC/A37

What to watch out for

  • Because the payment structure is monthly in arrears, it is important to track when the NED actually works and pay this accordingly each month. Alternative fee structures could also be implemented.

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Author

Genie Team

Genie Team

@genieteam
Genie AI

The Genie Team consists of lawyers and paralegals. Our aim is to open source the law and provide high quality, regularly reviewed legal documents.

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Additional information

Business categories

Relevant sectors

Relevant company sizes

Governing law

England and Wales

Language

English UK

Gender neutral

Yes