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1       Dated 12 October 2017          HSBC GROUP MANAGEMENT SERVICES LIMITED  and JOHN FLINT       SERVICE AGREEMENT   

 

2   Contents  Clause Page 1 Appointment .................................................................................................. 3 2 Remuneration ................................................................................................ 3 3 Benefits and Pension ..................................................................................... 3 4 Scope and duties of the Employment ............................................................. 7 5 Hours and place of work ................................................................................. 8 6 Expenses ....................................................................................................... 8 7 Holidays ......................................................................................................... 9 8 Sickness benefits ........................................................................................... 9 9 Restrictions during the Employment ............................................................... 9 1O Confidential Information and Company documents ...................................... 10 11 Inventions and other Intellectual Property ..................................................... 11 12. Termination and Garden Leave ..................................................................... 12 13 Restrictive covenants .................................................................................... 15 14 Grievance, dismissal and disciplinary procedures .......................................... 19 15 Disclosure of information ................................................................................ 20 16 General ....................................................................................................20 17 Definitions .................................................................................................... 21 

 

3   THIS AGREEMENT is dated 12 October 2017 and is made BETWEEN:  (1) HSBC GROUP MANAGEMENT SERVICES LIMITED (registered number 9231974), whose registered office is at 8 Canada Square, London E14 5HQ (the Company); and  (2) JOHN  FLINT  of  *  (the Executive).  IT IS AGREED as follows:  1 Appointment  1.1 The Employment will begin on the Commencement Date. The Executive's continuous employment began on 18 October 1989  1.2 Subject to clauses 1.5 and 12, the Employment will continue until terminated by either party giving to the other twelve months'  notice in  writing.  1.3 The Executive shall be employed as Group Chief Executive at Global Career Band (GCB) 0. The Executive shall report to the Group Chairman or such other appropriate person as the Company shall designate from time to time. The Employment also requires the Executive to hold various directorships and offices within the Group from time to time including in relation to Hong Kong and Shanghai Banking Corporation Limited.  1.4 The Executive consents to the Company transferring of the Executive's employment and assigning the provisions of this Agreement to any Group Company at any time (on the terms and conditions of this Agreement).  1.5 The Employment is and remains at all times subject to the Executive successfully completing all Company required and on-going screenings for a "High Risk Role", given that any abuse of the role poses particular potential damage to the Group and external stakeholders. Additionally, the Executive is at all times required to hold the required approvals by the FCA and all other relevant regulatory bodies in order to be able to carry out his/her duties. In the event of any screening result being considered unsatisfactory in the reasonable opinion of the Company and/or where FCA or any other relevant regulatory approval is withdrawn, the Company has the right to terminate the Employment with immediate effect and with no further sums payable to the Executive beyond any sums accrued due as at the date of that termination.  2 Remuneration  2.1 The Company will pay the Executive a Base Salary of £1,200,000 per annum (Base Salary). The Base Salary will be paid less Statutory Deductions and accrue from day to day and be payable in equal monthly instalments in arrears on or around the 20th day of each calendar month. Unless notice to terminate the Employment has been given by either party, the Company will review the Executive's Base Salary in March of each calendar year, in good faith, the first such review to take place on or about March 2019. The Company has no obligation to increase the Executive's Base Salary following a review.  2.2 The Executive will not be entitled to receive any other fees for holding any offices in the Company or any Group Company by virtue of the Employment. 

 

4   2.3 In its absolute discretion, the Company will pay the Executive a fixed allowance of £1,700,000 per annum (the Fixed Pay Allowance). This Fixed  Pay Allowance replaces any fixed pay allowance which you were eligible for in connection with your previous role or otherwise. The Fixed Pay Allowance will be granted in shares that vest immediately on a quarterly basis or at any other frequency that the Group's Remuneration Committee deems appropriate. These shares (net of those sold to cover any income tax and social security) will be then be released annually on a pro rata basis over five years, starting from the March immediately following the end of the financial year for which the shares are granted.  2.4 The Company and/or the Group may decide, in its discretion, to award the Executive an amount of Variable Pay for any complete financial year of the Company and/or the Group during which the Employment has continued. The Executive acknowledges that he/she has no contractual right to receive any Variable Pay in any financial year even where it may have been paid to him/her in any previous year(s).  2.5 The Executive will not, unless otherwise approved in writing by the Group's Remuneration Committee in its absolute discretion, be considered for any Variable Pay award if, at the date when it might otherwise have been payable, he/she is under notice of termination (served by either party) or is suspended pursuant to clause 12.3 and/or is on garden leave in accordance with   clause 12.4. The Company (on behalf of itself and/or any Group Company) also has the right to postpone the payment of any Variable Pay award if, at the date when it might otherwise have been payable, the Executive is subject to an ongoing investigation or disciplinary process.  2.6 Where a decision to pay to the Executive a Variable Pay award is made, the Executive agrees that this will always be, and remain, subject to (i) any obligations or conditions required by the regulator(s) of the Group or any other regulatory requirements, including the application of malus and/or clawback in accordance with the Group's Malus and Clawback Policies in force from time  to time; (ii) any remuneration policy of the Company or any relevant Group Company from time to time; and (iii) any other applicable rules, codes of practice and/or guidance regarding remuneration from time to time. Any adjustment forfeiture or repayment arising from the application of malus and/or clawback may be deducted from any sums due to the Executive at any time. This is without prejudice to any right the Company or any Group Company may have to recover any sums from the Executive including any clawback. The Executive irrevocably agrees that such sums are recoverable by the Company and/or any Group Company from any sums otherwise due and/or payable to him/her.  2.7 The Executive may be eligible to participate in any employee share plan established by the Company and/or the Group from time to time. Eligibility to participate is subject always to the rules of the relevant plan in force from time to time and is at the discretion of the Company and/or any Group Company (as applicable).  2.8 Subject to the rules of the relevant plan as referenced in clause 2.7 and in the definition of Variable Pay, the Executive waives all rights to compensation or damages arising from any loss sustained to him/her by a failure to receive any rights or benefits under the relevant plan (or by their reduction in value) as a result of: 

 

5   (a) notice of termination and/or the termination of his/her office and/or the Employment given by either party for any reason whatsoever; and/or  (b) the Company's exercise or failure to exercise any discretion  available to it, whether conferred by the rules of the plan or otherwise.  2.9 The Executive authorises the Company to deduct from any Salary or awards of Variable Pay or from any other remuneration or payments due to the Executive from the Company or any Group Company at any time, any sums due from the Executive to the Company including any overpayments, loans or advances made to him/her by the Company or any Group Company, the cost of repairing any damage or loss to the Group's property caused by the Executive (and of recovering such costs), sums in respect of clause 8.3 and/or any sums owing in connection any malus and/or clawback pursuant to the Group's Malus and Clawback Policies from time to time in  force.  2.10 To avoid any doubt, the operation of and all arrangements relating to any Variable Pay, can be terminated, replaced and/or amended by the Company at any time with or without notice to the Executive and, further, the Executive's total remuneration in respect of the Employment is at all times subject to the Directors' Remuneration Policy as approved by the Group's shareholders from time to time.  3 Benefits and Pension  3.1 In connection with his/her role as an Executive Director of the Group, the Executive is eligible to receive the following benefits during the Employment: 3.1.1 Car  The Executive has access to the chauffeur driven services operated by the Company under the terms of the Global Expenses Framework for Executive Directors, Group Managing Directors and Group General Managers that may apply from time to time.  3.1.2 Personal Accident Insurance Cover  The Executive is eligible to participate on a non-contributory basis in the Group's personal accident insurance scheme, subject to the rules of the scheme in force from time to time.  3.1.3 Clubs  The Company will make reasonable payments on the Executive's behalf in respect of the membership fees for annual memberships of up to two clubs nominated by the Executive each year, to be pre  approved by the Group Chairman.  3.1.4 Health Check  The Executive is eligible for an annual voluntary health check with a medical adviser appointed and paid for by the  Company.  3.1.5 Medical Cover  The Executive and his/her spouse/partner and eligible dependants are eligible to participate in  any relevant  medical scheme  operated   for 

 

6   officers of the Group, from time to time subject always to the rules of the scheme for the time being in force.  3.1.6 Group Income Protection  If the Executive is unable by reason of illness or injury, to perform the material or substantial parts of his/her duties, following a period of absence from work in excess of 26 consecutive weeks, the Executive will be eligible to be considered for a monthly payment equivalent to 50 per cent. of monthly Base Salary for some or all of his/her on-going absence. In the event of such payment, the Executive's total annual pension allowance as set out at clause 3.1.10 will continue to be payable, subject to a proportionate reduction and, therefore, an overall reduced cap of 15 per cent. of Base Salary.  3.1.7 Life Assurance Cover  The Executive is eligible for cover under the Group Life Assurance Scheme up to a sum (currently) equivalent to four times the Executive's Base Salary, subject to the rules of the scheme in force from time and any necessary approvals  by the Scheme's trustees.  3.1.8 Tax Return Preparation  The Executive is eligible to receive tax return support provided by the Group's tax provider for global mobility activities, from time to time. The provision of the tax return support will cover only compensation delivered to the Executive in respect of the Employment and will not cover extended wealth management or other investment  advice.  3.1.9 Directors'  and Officers' Liability  The Executive is eligible for cover under the relevant Company or Group Directors' and Officers' Liability policy (including Outside Directors' and Officers' Liability) subject always to the existence of that policy (determined by the Company in its discretion and the rules of the policy in force from time in force).  3.1.10 Pension  Subject to clause 3.1.6, the Company will pay to the Executive an annual pension allowance (Pension Allowance) of 30 per cent of the Executive's Base Salary payable monthly in arrears, less Statutory Deductions.  The  Executive  has  already  opted  out  of  the  relevant Company and/or Group sponsored UK pension plan under UK pension legislation.  3.1.11 Other Benefits  The Executive may be eligible to take advantage of certain other employee benefits, including accommodation and car benefit in Hong Kong, as referred to from time to time in the Directors' Remuneration Report, in any given year, during the Employment.  3.2 The Company reserves the right to amend or withdraw any employee benefit without prior notice (although the Company will take reasonable endeavours to 

 

7   advise the Executive of any such variation or withdrawal) in circumstances either where Director's remuneration is not approved or where it is otherwise reasonable to do so. The Company is not obliged to provide any alternative benefit or other compensation in the event of withdrawal and/or generally, where any scheme provider refuses to provide benefits to the Executive (or to his/her partner/spouse and/or eligible dependants).  4 Scope and duties of the Employment  4.1 In his/her role as Group Chief Executive, the Executive (with delegated authority from the Board) will be responsible for the day to day operations of the Group; leading and directing the implementation of the Group's business strategies; embedding the Group's culture, values and supporting behaviours; managing risks associated with the Group's business activities; and ensuring the fulfilment of the Group's corporate responsibilities across all communities in which the Group operates. As custodian of the Group's franchise, the Group Chief Executive will have a primary responsibility to protect the Group's reputation and develop the franchise. During the Employment, the Executive will comply with any role profile and/or statement of responsibilities applicable to his/her role, and will at all times:  4.1.1 diligently perform such duties and exercise such powers consistent with his/her position as Group Chief Executive may from time to time be assigned to or vested in him/her by the Board (including where he may be assigned duties of another position of comparable status);  4.1.2 comply with all reasonable and lawful directions given to him/her by the Board;  4.1.3 act in good faith, and in a way most likely to promote the success of the Group for the benefit of its members as a whole (which may also include performing duties from time to time on behalf of any Group Company);  4.1.4 perform his/her services in a professional and competent manner and in cooperation with others;  4.1.5 use his/her best endeavours to promote, protect, develop and extend the business of the Company and any Group Company;  4.1.6 keep the Board and any relevant Group Company promptly and fully informed (in writing if so requested) of his/her conduct and activities in relation to the business of the Company and any Group Company and provide such explanations as the Board may require from time to time (including for the avoidance of doubt, any misconduct of other employees or directors or his/her own (including any plans of any other senior employee to leave, join a competitor and/or establish a business in competition with the Company or any Group Company as required by clause 9.5);  4.1.7 not do or fail to do anything that might reasonably be expected to harm the reputation of the Company or any relevant Group Company;  4.1.8 do all such things as are necessary to ensure his/her compliance with the Companies Act 2006, the UK Listing Rules (including the Model Code  for  transactions  in securities  by  directors  and  certain senior 

 

8   executives of listed companies), the Market Abuse Regulation (596/2014/EU) and the Corporate Governance Code, and all equivalent legal obligations elsewhere in the world to which he/she is or may become subject (and specifically, so far as it lies within his/her power to do so, in all cases, also by the Company and any Group Company;)  4.1.9 comply with all Company and Group Company policies, including, without limitation, the Code for Dealing in HSBC Group Securities, the Compliance Guidelines and those set out in the Company's Employee Handbook and the HR Procedure Manuals from time to time together with any relevant statement of responsibilities as a Senior Manager and/or Group Chief Executive as required by the Company, any Group Company,  the FCA or similar regulator;  4.1.10 not, in breach of any applicable legislation, directly or indirectly seek, receive or obtain, in respect of the performance of his/her duties or of any goods or services sold or purchased or other business transacted (whether or not by the Executive) by or on behalf of the Company   or any  Group  Company,   any  personal  benefits,   discount   rebate, commission, bribe, kickback or other inducement (whether in cash or in kind).  5 Hours and place of work  5.1 The Company's standard working week is 35 hours. The Executive will, however, devote the whole of his/her time, skill and attention during normal business hours, and at such other times as may be reasonably necessary (without additional remuneration,) to his/her duties.  5.2 The Executive acknowledges that, because of the autonomous nature of his/her role, the duration of his/her working time is not measured or monitored or determined by the Company, so that the limit on weekly working time set out in Regulation 4 of the Working Time Regulations 1998 (or such other regulations as may from time to time come into force) does not apply to the Employment.  5.3 The Executive's normal place of work is the Company's offices at 8 Canada Square, London E14 5HQ and such other places within the UK as the Company may reasonably require for the proper performance of his/her duties. The Executive will be required (subject always to the appropriate immigration approvals) to travel to such places within or outside the UK as may be required in order to properly perform his/her duties.  6 Expenses  6.1 The Company will reimburse the Executive the amount of all expenses evidenced by him/her as properly and reasonably incurred in the discharge of his/her duties, in accordance with the Global Expenses Framework for Executive Directors, Group Managing Directors and Group General Managers and any other relevant global policies for directors that may apply from time to time. 

 

9   7 Holidays  7.1 The Executive is entitled to 30 days' holiday in each holiday year (1 January to 31 December) calculated on Base Salary and any relevant allowance notified to the Executive under clause 2.3, in addition to the usual (currently eight) annual public or bank holidays in England, to be taken at times convenient to the Company. Holiday entitlement for one holiday year may be carried over to the following holiday year with the prior agreement of the Group Chairman.  7.2 If the Employment begins or ends part way through a holiday year, the Executive's holiday entitlement will be calculated on a prorated basis for that holiday year.  7.3 If, on the termination of the Employment the Executive has: (i) exceeded his/her accrued holiday entitlement, the excess may be deducted from sums due to the Executive and the Executive hereby authorises the Company to make such deduction; or (ii) any unused accrued holiday entitlement, the Company may either require the Executive to take such unused holiday during any notice period (whether or not the Executive is on Garden Leave) or make an appropriate payment in lieu of such untaken accrued holiday.  8 Sickness benefits  8.1 If the Executive cannot attend work due to sickness or injury, he/she will comply with the notification and certification requirements of the Absence from Work Policy set out in the Company's Employee Handbook and will receive relevant payments in respect of his/her absence according to the policy (which are deemed inclusive of Statutory Sick Pay and all other statutory benefits to which the Executive may otherwise be entitled).  8.2 If so required, the Executive agrees to supply the Company with medical certificates covering any period of sickness or incapacity exceeding seven days (including weekends) and to undergo, at the Company's expense, a medical examination by a doctor appointed by the Company (and the Executive agrees that copies of any medical reports prepared by such doctor shall be sent directly to the Company).  8.3 If the Executive is incapable of performing his/her duties by reason of injury sustained wholly or partly as a result of negligence or breach of any duty on the part of a third party, and the Executive recovers an amount by way of compensation for loss of earnings from that third party, he/she will pay to the Company any sum (or part sum) received by him/her in respect of any amount paid to him/her under clause 8.1 above.  9 Restrictions during the Employment  9.1 During the Employment, the Executive will not directly or indirectly either on his/her own account or on behalf of any other person, company, business entity or other organisation be employed, engaged, concerned or interested in any other business or undertaking, except:  9.1.1 as holder (directly or through nominees) of investments listed on the London Stock Exchange pie or in respect of which dealing takes place on the Alternative Investment Market of the London Stock Exchange pie or on The Stock Exchange of Hong Kong Limited or on any Recognised Investment Exchange, as long as not more than 5 per 

 

10   cent. of the issued shares or other securities of any class of any one company shall be so held; or  9.1.2 with the consent in writing of the Company which may be given subject to any terms which the Company requires.  9.2 The Executive will not (and will procure so far as he/she is able that any person connected with the Executive within the meaning of section 252 Companies Act 2006 (Connected Person) shall not) deal or become or cease to be interested (within the meaning set out in Schedule 1 Companies Act 2006) in any securities of the Company, except in accordance with the Company and/or the Group Code for Dealing in HSBC Group Securities and every regulation of the Group for the time being in force in relation to dealings in shares or other securities of the Company or any Group Company.  9.3 Subject to any regulations issued by the Company or any relevant Group Company, the Executive and any Connected Person shall not be entitled to receive or obtain directly or indirectly any discount, rebate or commission in respect of any sale or purchase of goods effected or other business transacted (whether or not by the Executive) by or on behalf of the Company or any Group Company and if he/she or any Connected Person (or any firm or company in which he/she or any Connected Person is interested) shall obtain any such discount, rebate or commission the Executive will account to the Company or the relevant Group Company for the amount received by the Executive or any Connected Person (or a due proportion of the amount received by such company or firm having regard to the extent of the Executive's or the Connected Person's interest therein).  9.4 The Executive agrees to disclose to the Board any matters relating to any Connected Person which may, in the reasonable opinion of the Board, be considered to interfere, conflict or compete with the proper performance of the Executive's obligations under this Agreement.  9.5 During the Employment the Executive will inform the appropriate member of the Board without delay if he/she becomes aware that any director, officer, or senior employee of the Company or any Group Company is or may be planning to materially breach any of the provisions of their contract of employment or implied duties of loyalty, good faith and fidelity.  9.6 The Executive will not, other than having observed the relevant policies and procedures in force from time to time make or issue any press, radio or television statement or publish or submit for publication any letter or article relating directly or indirectly to the business or affairs of the Company or any Group Company, its or their officers, directors or employees or the Employment or its termination.  10 Confidential Information and Company documents  1O.1 The Executive recognises that, whilst performing the duties for the Company the Executive will have access to and come into contact with Confidential Information belonging to the Company and/or any Group Company and will obtain personal knowledge of and influence over its or their customers, suppliers   and/or   employees.   The   Executive   therefore   agrees   that   the restrictions set out in this clause 1O are reasonable and necessary to protect the legitimate business interests of the Company and the Group both during and after the termination of the Employment. The Executive shall neither during 

 

11   the Employment (except in the proper performance of the duties) nor at any time (without limit) after the termination of the Employment directly or indirectly:  10.1.1 divulge or communicate to any person, company, business entity or other organisation; or  10.1.2 use for his/her own purposes or for any purposes other than those of the Company or any Group Company;  or  10.1.3 through any failure to exercise due care and diligence, cause any unauthorised disclosure of  any Confidential  Information relating to the Company or any Group  Company.  10.2 This restriction does not apply to information  which:  10.2.1 is used or disclosed by the Executive in the proper performance of his/her duties or with the prior written consent of the Company or any Group Company;  10.2.2 the Executive is ordered by a court of competent jurisdiction to disclose or which is otherwise required to be disclosed by law; or  10.2.3 is already in the public domain (other than as a result of unauthorised disclosure by the Executive or any other person).  10.3 The Executive will not, during the Employment or at any time thereafter, make, except for the benefit of the Company or any Group Company, any copy, record or memorandum of any Confidential Information and any such copy, record or memorandum will be and remain the property of the Company and will be returned by the Executive to the Company or irrevocably deleted from any computer, mobile and/or handheld device and/or any other media (including, but not limited to, any cloud based storage system) in the Executive's possession or under the Executive's control, when required to do so by the Company and in any event on the termination of the Employment.  10.4 Nothing in this Agreement precludes the Executive from making any legitimate whistleblowing type disclosure to any relevant regulator anywhere in the world (including, so far as the UK is concerned, within the meaning of Part 4A (Protected Disclosures) of the Employment Rights Act 1996 and so far as reportable concerns are defined by the FCA).  11 Inventions and other Intellectual Property  11.1 The Executive may make inventions or create other Intellectual Property during the Employment. In this respect the Executive has a special responsibility to further the interests of the Company and the Group given the Executive's position at the Company and the remuneration paid to the Executive under this Agreement.  11.2 In recognition of the Executive's position, remuneration and responsibility, the Executive acknowledges and agrees that any Intellectual Property made, created or discovered by him/her during the Employment (whether capable of being patented or registered or not) in conjunction with or in any way affecting or relating to the business of the Company or any Group Company or capable of being used or adapted for use in the Company or any such Group Company or in connection therewith shall be immediately disclosed to the Company and 

 

12   shall belong to and be the absolute property of the Company or such Group Company as the Company may direct.  11.3 However this will only apply to the extent that any invention was made by the Executive in the course of his/her duties or in the course of duties falling outside the Executive's normal duties but which have been specifically assigned to him/her (together Duties) and (i) such invention was reasonably expected to result therefrom; and/or (ii) at the time of making the invention, because of the nature of his/her Duties and the particular responsibilities arising therefrom, the Executive had a special obligation to further the interests of the Company.  11.4 The Executive acknowledges that he/she has no rights, interest or claims, either during the Employment or after the termination of the Employment, in or to any such Intellectual Property and he/she shall not use such Intellectual Property other than during the period of the Employment and for the purpose of the Company or the Group.  11.5 The Executive agrees to sign all documents and to do all other acts which the Company requests (at its expense) to enable the Company to enjoy the full benefit of this clause 11. This includes joining in any application, which may be made in the Company's sole name for registration of any Intellectual Property Rights (such as a patent, trademark or registered design), and assisting the Company in defending and enforcing such rights during and after the employment (at the Company's expense).  11.6 The Executive understands and accepts that the remuneration and benefits provided to him/her by the Company in accordance with this Agreement constitute sufficient consideration to the Executive for the performance of his/her obligations under this clause 11, including the waiver of or covenant not to assert any moral rights that he/she may have.  11.7 This clause 11, and the rights and obligations of the parties contained, will survive expiry of this Agreement, or its termination, for any reason.  12 Termination and Garden Leave  12.1 Notwithstanding the notice obligation to which the parties are generally subject in clause 1.2, the Employment may also be terminated by the Company:  12.1.1 by not less than six months' notice in writing given at any time where the Executive has been incapacitated by reason of ill health or accident from performing the duties hereunder for a period of (or periods aggregating) 26 weeks in total in any period of 12 months, provided that such termination does not take effect if it would remove any entitlement he would otherwise have thereafter for a maximum period of 24 months to enjoy the receipt of any benefits arising out of or in connection with any permanent health insurance policy or arrangement existing from time to time for his benefit. The Executive generally agrees that if he has been incapacitated by reason of ill health or accident from performing the duties hereunder for the said period of (or periods aggregating) 26 weeks in any period of 12 months, the Company may appoint another person or persons to perform his role of CEO pursuant to clause 1.3 without giving rise to any breach of any obligation owed to the Executive (under this agreement  or generally,  as a matter of law,  and,  accordingly,  he will 

 

13   have no cause of action against the Company or the Group whatsoever in respect of such termination of employment.  12.1.2 by summary notice in writing and with no liability to make any further payment to the Executive (other than in respect of any sums accrued due as at the Termination Date) if the Executive:  (a) fails or neglects efficiently and diligently to discharge his/her duties, or is guilty of any serious or repeated breach of his/her obligations  under this Agreement  (b) is guilty of any fraud, dishonesty, serious misconduct or any other conduct which brings or is likely to bring the Executive or the Company or any Group Company into disrepute or affects or is likely to affect prejudicially the interests of the Company or the Group;  (c) is convicted of an arrestable offence (other than a road traffic offence for which a non-custodial penalty is imposed);  (d) is guilty of any material breach or material non-observance of any code of conduct, rule or regulation referred to in clause 4.1;  (e) becomes bankrupt or makes any arrangement or composition with his/her creditors;  (f) is prohibited from being a director by law, or has such regulatory approval as required pursuant to clause 1.5, withheld or withdrawn;  (g) voluntarily resigns as a director of the Company or any Group Company; or  (h) is not or ceases to be eligible to work in the UK.  12.2 The Company's rights under clause 12.1 are without prejudice to any other rights that it might have at law to terminate the Employment or to accept any breach of this Agreement by the Executive as having brought the Agreement to an end. Any delay by the Company in exercising its rights will not constitute a waiver.  12.3 If the Company may be or becomes entitled to terminate the Employment pursuant to clauses 1.5 or 12.1.2, or whilst the Company or any external body may wish to investigate any allegation against the Executive it will be entitled (without prejudice to its termination rights) to suspend the Executive for so long as it considers necessary or appropriate.  12.4 Following service of notice to terminate the Employment by either party, the Company may require the Executive to stay away from all or any of the Company's premises and/or will not be provided with any work and/or will have no  business  contact  with  all  or  any  of  the  Group's  agents,  employees, customers, clients, distributors and suppliers and/or will have no access to the Company's communications systems (Garden Leave). During any period of Garden Leave, the Company may appoint a replacement to exercise any of the Executive's  duties and responsibilities and may require the Executive to  take 

 

14   such actions as it reasonably requires to effect a proper handover of any or all of his/her duties and responsibilities. However, the Executive will continue to be bound by all his/her obligations under this Agreement including, without limitation, his/her duties of fidelity and of good faith.  12.5 In addition to the circumstances referred to in clause 12.1.1 above, the Company may terminate the Employment at any time and with immediate effect by notifying the Executive in writing of that fact, confirming the date termination is to occur. If the Company terminates the Executive's employment in this way, it will make a payment in lieu of any notice of termination and/or in lieu of the balance of the fixed term of employment corresponding to the notice period as set out in clause 1.2 (the Payment in Lieu). The Executive agrees that the Payment in Lieu will consist of Base Salary, Fixed Pay Allowance and Pension Allowance but will not include any Variable Pay, payment in respect of benefits or any holiday entitlement for the fixed term and/or notice period which is accrued due as at the Termination Date (or, if notice has already been given, during the remainder of the notice period) less Statutory Deductions.  12.6 The Company may decide to pay any Payment in Lieu only in equal monthly instalments until the date on which the notice period referred to in clause 1.2 would have expired if notice had been given (the Payment Period). The Executive shall comply with his/her common law duty immediately following the termination of his/her employment and take all reasonable steps to obtain alternative employment or engagement during the Payment Period.  12.7 If the Executive obtains alternative employment or engagement during the Payment Period, any further monthly instalments of the Payment in Lieu will be reduced on a pro rata basis by the amount he/she receives. If the Executive fails to take all reasonable steps to obtain alternative employment or engagement, the Company will have the right to terminate all further instalments of the Payment in Lieu, and he/she will not be entitled to any further compensation.  12.8 Without prejudice to the constitution (including for the avoidance of doubt the articles of association) of any Group Company, on the Termination Date or on either the Company or the Executive having served notice of such termination, the Executive will:  12.8.1 at the request of the Company resign from office as a Director of the Company and all offices held by the Executive in any Group Company provided however that such resignation shall be without prejudice to any claims which the Executive may have against the Company or any Group Company arising out of the termination of the Employment;  12.8.2 transfer without payment to the Company or as the Company may direct to any third party, any shares or other securities held by the Executive in the Company as a nominee or trustee for the Company or any Group Company and deliver to the Company the related certificates;  12.8.3 deliver to the Company all Confidential Information which may be in the Executive's possession or under the Executive's power or control and, if requested, provide a signed statement that he/she has fully complied with the obligations under this clause 12.8.3; and 

 

15   12.8.4 cooperate with the Company and any Group Company by providing such assistance as may reasonably be required in connection with any handover arrangements or any claim made by or against the Company or any such Group  Company.  12.9 If the Employment is terminated for the purpose of the reconstruction or amalgamation of the Company or by reason of the Company transferring all or a substantial part of its business to another company and the Executive is offered  employment  by  the  reconstructed or  amalgamated  or  transferee company on similar terms to the terms of this Agreement, the Executive will have no claim against the Company or such reconstructed or amalgamated or transferee company in respect of the termination of the Appointment.  13 Restrictive  covenants  13.1 For the purposes of this clause 13 the following words have the following meanings:  13.1.1 Capacity means as agent, consultant, director, employee, owner, partner, shareholder beyond the shareholding limits  applied in  clause 9.1 or in any other capacity;  13.1.2 Company Products means any risk, banking or financial products researched into, developed, supplied, distributed or sold to or by the Company with which the duties of the Executive were materially concerned or for which he/she was directly or ultimately responsible during the Restricted Period;  13.1.3 Company Services means any risk, banking or financial services (including but not limited to technical and product support technical advice and customer services) developed or supplied to or by the Company with which the duties of the Executive were materially concerned or for which he/she was directly or ultimately responsible during the Restricted Period;  13.1.4 Comparator Group as at the date of this Agreement means Bank of America, Barclays, BNP Paribas, Citigroup, Credit Suisse, DBS, Deutsche Bank, JP Morgan Chase, Lloyds Banking Group, Standard Chartered and UBS, together with any transfer, merger, amalgamation and/or reconstruction of any relevant business or part of such business of any such company. This list of Comparator Group may have names removed, amended and/or added at any time during the Employment by the Company;  13.1.5 Customer means any person or firm or company or other organisation whatsoever to whom or which the Company supplied Company Products and/or Company Services during the Restricted Period and with whom or which, during the Restricted Period:  (a) the Executive had material personal dealings pursuant to the Employment; or  (b) any employee who was under the direct supervision of either the Executive or of the Executive's direct reports, had material personal dealings pursuant to their employment, 

 

16   provided that in the case of a firm, company or other organisation "Customer" shall not include any division, branch or office of such firm or company or other organisation with which the Executive and/or any such employee as defined in sub-clause (b) above had no dealings during the Restricted Period save that where a restructuring of the firm or company or organisation has occurred following such personal dealings "Customer" shall include the part of the business with which the Executive or any employee as defined in sub-clause (b) above had dealings during the Restricted Period;  13.1.6 Prospective Customer means any person or firm or company or other organisation whatsoever with whom or which the Company shall have had negotiations or material discussions regarding the possible distribution, sale or supply of Company Products and/or Company Services during the Restricted Period and which were ongoing and not finally concluded at the Termination Date and with whom or which during such period:  (a) the Executive will have had material personal dealings pursuant to the Employment; or  (b) any employee who was under the direct supervision of either the Executive or of the Executive's direct reports will have had material personal dealings pursuant to their employment; or  (c) the Executive was directly responsible in a client management capacity on behalf of the  Company,  provided that in the case of a firm, company or other organisation "Prospecitve Customer" shall not include any division,  branch  or office of such firm, company or other organisation with which the Executive and/or any such employee had no dealings during the Restricted Period save that where a restructuring of the firm or company or organisaiton has occurred following such personal dealings, ''Prospective Customer'' shall include the part of the business with which the Executive or any employee as defined in sub-clause (b) had dealings during the Restricted  Period;  13.1.7 Restricted Employee means any person who is on the Termination Date, or was during the Restricted Period, employed or engaged by the Company or any Group Company and is by reason of such employment or engagement in possession of, or is reasonably likely to be  in  possession  of,  any  trade secret  or  Confidential  Information relating to the business of the Company or any Group Company or has acquired influence over its Customers or Prospective Customers (as defined in this clause 13 but so that references to "the Executive" will be replaced by references to the relevant employee and so that references to Employment will mean the relevant employee's employment with the Company or Group Company, being in either case a person with whom the Executive had material dealings during the Restricted Period);  13.1.8 Restricted Period means the period of 12 months ending on the Termination Date or, in the event that no duties were assigned to the Executive for any part of the duration of the notice period, the 12 months 

 

17   immediately preceding the last day on which the Executive carried out any duties for the Company;  13.1.9 Restricted Products means Company Products or any products of the same or of a similar kind;  13.1.10 Restricted Services means Company Services or any services of the same or of a similar kind;  13.1.11 Restricted Supplier means any person, company, business entity or other organisation whatsoever who has supplied goods or services to the Company or any Group Company (other than utilities and goods or services supplied for administrative purposes) during any part of the Restricted Period or who has agreed prior to the Termination Date to supply goods or services to the Company to commence at any time in the twelve months following the Termination Date.  13.2 The Executive recognises that, whilst performing his/her duties for the Company, he/she will have access to and come into contact with Confidential Information belonging to the Company and certain Group Companies and will obtain personal knowledge of and influence over their customers and/or employees.  13.3 The Executive hereby undertakes with the Company that he/she will not for the period of six months after the Termination Date without the prior written consent of the Company (such consent not to be unreasonably withheld) whether by himself/herself, through his/her employees or agents or otherwise and whether on his/her own behalf or on behalf of any other person, firm, company or other organisation, directly or indirectly:  13.3.1 in competition with the Company anywhere in the world in a senior role, be involved in any Capacity in any of the companies (or other entities) in the Comparator Group in the business of researching into, developing, distributing, selling, supplying or otherwise dealing with Restricted Products or Restricted Services; or  13.3.2 in competition with the Company, accept orders or facilitate the acceptance of any orders or have any business dealings for Restricted Products or Restricted Services from any Customer or Prospective Customer;   or  13.3.3 employ or otherwise engage any Restricted Employee in the business of or be personally involved to a material extent in employing or otherwise engaging any Restricted Employee in the business of researching into, developing, manufacturing, distributing, selling, supplying or otherwise dealing with Restricted Products or Restricted Services; or  13.3.4 interfere with, or endeavour to interfere with, the supply or provision of goods or services (other than utilities, or goods or services supplied for an administrative purpose) to the Company or to induce the cessation of the supply or provision of such goods or services from any Restricted Supplier;  or  13.3.5 in competition with the Company, solicit business from, or solicit the supply of goods or services (other than utilities, or goods or services 

 

18   supplied for an administrative purpose) from any Restricted Supplier for the purposes of the provision of Restricted Products or Restricted Services.  13.4 The Executive hereby undertakes with the Company that he/she will not for the period of twelve months after the Termination Date without the prior written consent of the Company (such consent not to be unreasonably withheld) whether by himself/herself through his/her employees or agents or otherwise and whether on his/her own behalf or on behalf of any other person, firm, company or other organisation, directly or indirectly:  13.4.1 in competition with the Company, solicit business from or endeavour  to entice away or canvass any Customer or Prospective Customer if such solicitation or canvassing is in respect of Restricted Products or Restricted Services;  13.4.2 solicit or induce or endeavour to solicit or induce any Restricted Employee to cease working for or providing services to the Company, whether or not any such person would thereby commit a breach of contract.  13.5 The Executive agrees that a copy of this clause 13, and clauses 1O and 11 will be provided by him/her to any person firm company or other entity that makes or may make an offer to him/her of employment appointment as a director or officer, agency, partnership, or joint venture either during Employment or after its termination (in such latter case, where such restriction continues in full force and effect).  13.6 If the restrictions in clauses 13.3 and 13.4 are for any reason held to be unenforceable in any jurisdiction in the world the Executive agrees to such amended or lesser restriction as would enable that restriction to be enforced so far as possible in such jurisdiction.  13.7 In addition to the provisions of clause 16.6, the benefit of clauses 13.3 and 13.4 shall be held on trust by the Company for each Group Company and the Company reserves the right to assign the benefit of such provisions to any Group Company, in addition such provisions also apply as though there were substituted for references to "the Company" references to each Group Company in relation to which the Executive has in the course of his/her duties for the Company or by reason of rendering services to or holding office in such Group Company:  13.7.1 acquired knowledge of its trade secrets or Confidential Information; or  13.7.2 had material personal dealings with its Customers or Prospective Customers; or  13.7.3 supervised directly or indirectly employees having material personal dealings with its Customers or Prospective Customers,  but so that references in clause 13 to "the Company" shall for this purpose be deemed to be replaced by references to the relevant Group Company. The obligations undertaken by the Executive pursuant to this clause 13.7 shall, with respect to each such Group Company, constitute a separate and distinct covenant and the invalidity or unenforceability of any such covenant  shall not 

 

19   affect the validity or enforceability of the covenants in favour of any other Group Company or the Company.  13.8 In the event of the transfer(within the meaning of the Transfer of Undertakings (Protection of Employment) Regulations 2006 and other equivalent legislation (the Transfer Regulations) of the undertaking or the part of the undertaking in which the Executive shall at the time be employed as the result of which (by virtue of the Transfer Regulations) the Employment is automatically transferred to another company (the Transferee), the provisions of this clause 13 shall have effect as though references in it (and in all associated terms defined in this Agreement) to "the Group" are construed as references to "any other company within the Transferee's Group" (which for these purposes shall comprise the Transferee and any holding company of the Transferee and the subsidiaries of the Transferee and of any such holding companies for the time being).  13.9 The Executive hereby undertakes with the Company that he/she will not at any time without the consent of the Company after the Termination Date:  13.9.1 engage other than as a private consumer in any trade or business or be associated with any person, firm or company engaged in any trade or business using the name(s)  HSBC or Hongkongand Shanghai Banking Corporation or incorporating the word(s) Hongkong Shanghai  Banking  Corporation;  13.9.2 in the course of carrying on any trade or business, claim, represent or otherwise indicate any present association with the Company or any Group Company or for the purpose of carrying on or retaining any business or custom, claim, represent or otherwise indicate any past association with the Company or any Group Company to its detriment other than simple and factual statements regarding the Executive's period of employment, job title, responsibilities and role.  13.10 The parties agree that the periods referred to in clauses 13.3 and 13.4 above will be reduced by one day for every day, during which, at the Company's direction, the Executive is on Garden Leave.  13.11 The Executive agrees that, having taken independent legal advice, the restrictions contained in this clause 13 are reasonable and necessary for the protection of the Company and any Group Company and that they do not bear harshly upon him/her. The parties  agree that:  13.11.1 each restriction shall be read and construed independently of the other restrictions so that if one or more are found to be void or unenforceable as an unreasonable restraint of trade or for any other reason the remaining restrictions shall not be affected; and  13.11.2 if any restriction is found to be void but would be valid and enforceable if some part of it were deleted, that restriction shall apply with such deletion as may be necessary to make it valid and enforceable.  14 Grievance,  dismissal  and disciplinary procedures  14.1 The non-contractual grievance and disciplinary procedures applicable to the Executive are set out in the Company's Employee Handbook. 

 

HIGHLY RESTRICTED - 20   15 Disclosure of information  15.1 The Executive consents to the Company or any Group Company processing data relating to the Executive for legal, personnel, administrative and management purposes and in particular to the processing of any sensitive personal data (as defined in the Data Protection Act 1998) relating to the Executive,  including,  as appropriate:  15.1.1 information about the Executive's physical or mental health or condition in order to monitor sick leave and take decisions as to the Executive's  fitness for work;  15.1.2 the Executive's racial or ethnic origin or religious or similar information in order to monitor compliance with equal opportunities legislation; and  15.1.3 information relating to any criminal proceedings in which the Executive has been involved for insurance purposes and in order to comply with legal requirements and obligations to third parties.  15.2 The Company may make such information available to any Group Company,  to third parties who provide products or services to any Group Company, including in connection with the administration of benefits (such as advisers, payroll administrators, actuaries, insurers, pension scheme administrators and banks), regulatory authorities, potential or future employers, governmental or quasi- governmental organisations and potential purchasers of the Company or the business in which the Executive works. Data may also be shared with or transferred to parties with whom the Company or any Group Company is negotiating a commercial agreement (including relating to a business sale or joint  venture).  15.3 3  The  Executive  consents  to  the  transfer  of  such  information  to  any Group Company and the Company's business contacts (including service providers and third parties specified in clause 15.2) outside the European Economic Area in order to further their business interests even where the country or territory in question does not maintain adequate data protection standards.  15.4 The Executive consents to the Company monitoring and recording any use that he/she makes of the Company's electronic communications systems for the purpose of ensuring compliance with the Company's policies and procedures. 16 General  16.1 This Agreement is governed by and interpreted in accordance with English law.  16.2 The parties submit to the exclusive jurisdiction of the courts of England and Wales, but this Agreement may be enforced by the Company in any court of competent jurisdiction.  16.3 This Agreement contains all the information required to be provided to the Executive under section 1 of the Employment Rights Act 1996.  16.4 Any notices or other document to be served on a party under this Agreement will be delivered by hand or sent to the party at the address or fax number given in this Agreement or as otherwise notified in writing to the other party. A properly addressed and prepaid notice sent by post will be deemed to have been served at 9.00amon the second working day after posting or at the  time 

 

21   recorded by the delivery service. If sent by fax, notice will be deemed to have been received at the time of transmission.  16.5 The Executive will, at the time of signing this Agreement, appoint the Company as his/her attorney so that the Company can give effect to the provisions of clauses 11 and 12.8.1.  16.6 Each Group Company will have the right under the Contracts (Rights of Third Parties) Act 1999 to enforce the rights bestowed on it by this Agreement. The consent of a Group Company is not required to amend any terms of this Agreement. Except as set out in this clause 16, a person who is not a party to this Agreement may not enforce any of its provisions under the Contracts (Rights of Third Parties) Act 1999.  16.7 The Company is not party to any collective agreement which affects the Employment.  16.8 Save as otherwise advised in writing to the Executive, upon or during the Employment, pursuant to clause 2.3 or otherwise, this Agreement comprises the whole agreement between the parties relating to the Employment. Accordingly, as from the effective date of this Agreement, all other agreements or arrangements between the Company and/or any Group Company relating to the employment of the Executive, save for such matters referred to within this Agreement or required to be entered into pursuant to this Agreement will cease to have effect.  16.9 This Agreement may be executed in any number of counterparts, each of which, when executed, shall constitute a duplicate original, but all the counterparts shall together constitute the one agreement.  17 Definitions  17.1 In this Agreement unless the context otherwise requires the following expressions have the following meanings:  Board means the Board of Directors for the time being of HSBC Holdings pie or any committee of the Board (including the Group Management Board) to which powers have been properly delegated or such person or persons designated by the Board from time to time as its representative for the purposes of this Agreement;  Commencement Date means 22 February 2018;  Company's Employee Handbook and Company's HR Procedures Manual means the Company's Employee Handbook and the Company's HR Procedures Manual from time to time in force, which can be viewed on the Company's intranet;  Confidential Information means information relating to the business, clients, customers, products, affairs and finances of the Company or any Group Company that is confidential to the Company or any Group Company, or in relation to which the Company or any Group Company is subject to a duty of confidentiality, and trade secrets including technical data and know-how relating to the business of the Company or any Group Company or of any persons having dealings with the Company or any Group Company, whether or not  such information  is marked  confidential.  This  includes:  details  of 

 

22   suppliers and their terms of business, details of customers, clients and prospective customers/clients and their requirements, the prices charged to and terms of business with customers, marketing plans and sales forecasts, financial information, results and forecasts (save to the extent that these are included in published audited accounts), any proposals relating to the acquisition or disposal of a company or business or any part thereof or to any proposed expansion or contraction of activities, or any other business strategy or tender, details of employees, atypical workers and officers and of the remuneration and other benefits paid to them, information relating to research activities, inventions, secret processes, designs, software, formulae and product lines, any information which the Executive either is aware or reasonably ought to know is confidential and any information which has been given to the Company or any Group Company in confidence by customers, suppliers or other persons;  Corporate Governance Code means the UK Corporate Governance Code published by the Financial Reporting Council (as amended from time to  time);  Directors' Remuneration Policy means the Group's directors' remuneration policy as set out in the Directors' Remuneration Report of the Group's Annual Report and Accounts from time to time;  Employment means the Executive's employment under this Agreement;  FCA means the Financial Conduct Authority;  Group means (1) HSBC Holdings pie and any entity which from time to time is a holding company of HSBC Holdings pie or a subsidiary of HSBC Holdings pie or of any such holding company; and (2) any entity over which from time to time any of the entities defined in paragraph (1) of this definition either directly or indirectly exercises management control, even though it may own less than fifty per cent. (50%) of the shares and is prevented by law from owning a greater shareholding and Group Company and Group Companies shall be construed accordingly;  Group Chairman means the Chairman of the Group from time to time;  Group Chief Executive means the Chief Executive of the Group (not simply of the Company) from time to time;  Group's Malus and Clawback Policies means any of the Group's policies on malus and clawback which may be in force and amended from time to time;  Intellectual Property means any invention, improvement, design, process, information, copyright work, trade mark, trade name or get-up or any other intellectual property;  Recognised Investment Exchange means an investment exchange granted recognition under section 285 (1) Financial Services and Markets Act 2000 including a recognised overseas investment exchange;  Statutory Deductions means appropriate tax, national insurance contributions and any other applicable statutory deductions;  Termination Date means the date on which the Executive's Employment terminated; 

 

23   UK Listing Authority means the FCA in its capacity as the competent authority for the purposes of Part VI of the Financial Services and Markets Act 2000, as amended by the Financial Services Act 2012;  Variable Pay means any non-pensionable incentive compensation (excluding any other allowance notified to the Executive in writing from time to time) including any bonus or deferred bonus in the form of (i) cash (ii) deferred cash or (iii) equity awarded under any share or variable pay/ Long Term Incentive plan in force from time to time (in relation to which performance and/or other conditions may or may not be attached) and subject always to the deferral policy and/or any other variable pay policy applicable at the time of such award and subject to clauses 2.5, 2.6, 2.8, 2.9 and  2.10.  17.2 References to clauses, sub-clauses and schedules are unless otherwise stated to clauses and sub-clauses of and schedules to this Agreement.  17.3 The headings to the clauses are for convenience only and shall not affect the construction or interpretation of this Agreement.  17.4 The words subsidiary and holding company have the meanings set out in section 1159 of the UK Companies Act 2006 and "management control" shall be demonstrated by the ability to exercise significant influence over an entity  or its management.  17.5 A reference to any statute or statutory provision (whether of the United Kingdom or elsewhere) includes any subordinate provision (as defined by section 21(1) Interpretation Act 1978) made under it and provision which has superseded it or re-enacted it (with or without modification) before or after the date of this Agreement except where it is after the date of this Agreement to the extent that the liability of any party is thereby increased or extended. 

 

24     This Agreement has been signed on behalf of the Company and executed as a deed by the Executive the day and year first above written.   Executed as a Dee  EMENT SERVICES LIMITED in the presence of:    Dated: .... .. ... ... .. . ..... . .......... .. ... .  Director                           Dated: ...... ... ..... ....... ... ..... .. ....... Director/Secretaryexhibit411marktucker

    Ben J S Mathews Group Company Secretary  12 March 2017 Dear Mark, Appointment as non-executive Director and Group Chairman designate This letter together with any further documents referred to herein and any separate letter(s) confirming your appointment to any Board committee(s}, together with the Articles of Association of HSBC Holdings pie as amended from time to time (the "Articles"), set out the terms of your appointment as a non-executive Director and the Group Chairman designate of HSBC Holdings pie ("the Company"). It is agreed between us that this is a contract for services and not a contract of employment and you further confirm that you are not subject to any restrictions which prevent you from holding office as a Director and the role of non-executive  Group Chairman in due course. The office of non-executive director and Group Chairman designate will be held in accordance with and subject to the Articles as amended from time to time and nothing in this letter shall be taken to exclude or vary the terms of the Articles as they apply to you as a Director of the Company ("Director"). 1. Appointment 1.1 Subject to the provisions of this letter and the Articles, your appointment as non-executive Director and Group Chairman designate is for an initial term of three years commencing 1 September 2017 with your role as Group Chairman being effective on 1 October  2017. 1.2 You will be expected to serve at least two three-year terms. Notwithstanding this expectation (and any other mutual expectation) please note that there is no right to re-appointment as a Director by the Board, either annually or at the expiry of any term of appointment. 1.3 Your appointment and continued appointment is subject to a number of conditions.   

 

 2  Firstly, your  initial approval and continued  approval  by  the Prudential  Regulation Authority ("PRA") and Financial Conduct Authority ("FCA") as a Senior Manager (SMF7). Secondly, the obligations in relation to your roles and duties, as set out in paragraphs 4 to 9 of this letter, as amended from time to time. Thirdly,  your election and subsequent  re-elections by shareholders at  Annual General Meetings ("AGM"). During the term or terms of your appointment as  a  non-executive Director, subject to HSBC Holdings plc Level 41. 8 Canada Square. London E14 5HQ Tel: 020-7991  0588 fax: 020-7991 4639 Registered in England number 617987. Registered Office: 8 Canada, Square, London E14 5HQy the approval of the Board, you will need to stand for election and, thereafter, re-election at each AGM. If shareholders do not elect or re-elect you as non-executive Director (whether as Group Chairman or otherwise), your appointment will terminate automatically, with immediate effect and without any compensation being due or payable to you. Fourthly, you consenting to the Company routinely undertaking vetting of you on the same basis as it does now or in the future for other individuals holding similar positions to you and any necessary approval by the FCA and PRA and/or any other relevant regulatory body being in place prior to the commencement of your appointment and, thereafter, remaining in place for the duration of the appointment. Fifthly, your continued satisfactory performance and conduct as determined by the Board which can terminate your appointment with immediate effect if in its reasonable opinion it considers that your performance or conduct falls below the level expected of someone in your position and, having been given notice of such concerns, you fail to rectify (where such rectification is considered by the Board to be possible) your performance or conduct to the Board's satisfaction. 1.4 Without prejudice to any other provision of this letter, your appointment may be terminated before the expiry of any term or successive term, by either of us giving to the other three months' prior written notice to expire at any time. Your appointment may also be terminated in accordance with the Articles, as referred to above, and any relevant statutory provisions relating to the removal of directors. 1.5 On termination of your appointment, you shall immediately, at the request of the Company, resign from all offices held by you in or on the Board or in any Group Company (defined below) or on any of their respective committees including your future role as non-executive Group Chairman. 1.6 If at any time there are matters which arise to cause you concern about your role, you should discuss them with the Senior Independent Director (defined below) or the Group Company Secretary (defined below). 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 Senior Independent Director or the Group Company Secretary for circulation to the Board. 

 

 3  2. Additional roles/functions 2.1 It is expected that in future, consistent with holding the role as non-executive Group Chairman, you will chair the Group Nomination Committee, subject to the terms of reference of that committee. You may additionally be invited to serve on more committees of the Board from time to time. Any such appointment will be covered in a future separate communication 3. Time commitment 3.1 In your future role as non-executive Group Chairman. we anticipate a time commitment of not less than four days per week although this may be greater at the outset and at times of heightened corporate activity. You are expected to devote such time as is necessary for the proper performance of your duties. The time commitment is subject to periodic review and (if needed) adjustment by the Board. Time devoted to the Company could be considerably more at times, on ad-hoc matters. You will be expected to perform your role at the Company's head office in Canary Wharf, although you will also be required to travel as necessary for the proper performance of your duties. 3.2 By accepting this appointment and intended future role, you have confirmed that, taking into account any other commitments, you are able to allocate sufficient time to meet the expectations of your role. You may not hold nor accept any other directorship or other role or accept any additional or changed commitment with any other company or other third party (whether inside or outside the HSBC Group) without the prior written consent of the Senior Independent Director or the Group Company Secretary on behalf of the Board. 4. Role and duties 4.1 The Board as a whole is collectively responsible for the success of the Company.   The Board: (a) provides leadership of the Company within a framework of prudent and effective controls which enable risk to be assessed and managed; (b) 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; and (c) sets the Company's values and standards and ensures that its obligations to its shareholders and others are understood and met. 4.2 You shall perform your duties (whether statutory, regulatory, fiduciary or common law) faithfully, efficiently and diligently and to a standard commensurate with the functions of your role and your knowledge, skills and experience. 4.3 As the non-executive Group Chairman you will be required to provide effective leadership of the Board of the Company. You will not be responsible for executive matters regarding the Group's business, but your principal duties and responsibilities will be: 

 

 4  (a) ensuring effective Board leadership; (b) developing and maintaining strong external regulatory and political relationships, as well as relationships with shareholders and others considered material to the business of the Group; (c) ensuring Board, committee and director development and evaluation; and (d) promoting the highest standard of corporate governance. 4.4 As a non-executive Director you shall exercise your powers regard to relevant obligations under prevailing law and regulation in the UK and other relevant jurisdictions, including (without limitation} the Companies Act 2006, as amended, the Financial Services (Banking Reform) Act 2013, the UK Corporate Governance Code, the UK listing Authority's Listing, Prospectus and Disclosure & Transparency Rules, Part 9 of the Financial Services and Markets Act 2000, the Hong Kong Corporate Governance Code, the listing Rules of the Stock Exchange of Hong Kong limited and US securities laws. 4.5 You shall have particular regard to the statutory statement of seven general duties of directors as set out in the Companies Act 2006, as amended (whether acting through the Board, a committee of the Board or under delegated authority). 4.6 You shall immediately report to the Group Chief Executive Officer, Senior Independent Director or the Group Company Secretary your own wrongdoing or the wrongdoing or proposed wrongdoing of any employee or Director of which you become aware. 4.7 Unless specifically authorised to do so by the Board, you shall not enter into any legal or other commitment or contract on behalf of the Company. 4.8 As a non-executive Director holding a Senior Management Function you are required to: (i) be aware of those activities for which you have responsibility; (ii) comply with all regulatory requirements applicable to you and, in particular, with the Group's standards and policies (as amended or added to from time to time}; and (iii) maintain and evidence at all times your fitness and propriety to perform your Senior Management Function. 4.9 You are required to comply with any and all conduct rules which are from time to time issued by the PRA and/or FCA and which are applicable to your role as a non-executive Director and/or Senior Management Function. In accordance with its regulatory obligations, HSBC may be required to report to the regulators any actual or suspected breaches of any conduct rules. 4.10 Whenever all or part of your Senior Management Function is transferred to another person. you must provide such assistance as is required for you and HSBC to meet regulatory requirements, whether such assistance is reasonably required before or after the termination of your appointment. 

 

 5  4.11 It is essential that you do whatever is required to ensure you are granted regulatory approval and do nothing which could cause you to lose it. This is particularly important as if you are not granted or if you lose Senior Manager status, fit and proper status and/or any other regulatory approval which you may need, then your appointment may be terminated with immediate effect. 4.12 You will be required to comply with your supervisory and other regulatory responsibilities as set out in HSBC's Management Responsibility Map and also in your own Statement of Responsibilities. Whilst these documents are not contractual and may be amended by HSBC, you are required to comply with them at all times. 5. Fees and expenses 5.1 You will be paid a fee of £1,500,000 gross per annum. No other fees will be payable in respect of your chairmanship of the Group Nomination Committee or any other committee. 5.2 In line with the Directors' remuneration policy, the fee of the non-executive Group Chairman will be reviewed by the Group Remuneration Committee annually to assess whether it remains competitive and appropriate. 5.3 All fees will be paid in approximately equal monthly instalments in arrears and are subject to income tax, national insurance and any and all other relevant statutory deductions. 5.4 The Company will reimburse you for all reasonable and properly documented business related travel and expenses you incur in performing the duties of your office, in line with the expenses framework for non-executive directors applicable to the Group Chairman of the Company. Specifically, the Company will make available to you; (1) a Company car and driver available whenever you are performing duties for the Group; (2) an office available for you at the Company's Canary Wharf office; and (3) appropriate secretarial support at that office (and any other which you are required to travel to) throughout the appointment. 5.5 You will also receive a one-time mobility benefit of GBP 300,000 gross payable within 30 days of the commencement of your appointment. This will cover any and all mobility expenses related to your relocation from Hong Kong to London including accommodation, shipping, personal flights and any other associated costs of the move. In the event that, on or prior to 31 December 2017, you terminate your appointment with the Company for any reason other than death or illness. you agree that you will repay the net value of this sum as received by you in full. 5.6 Upon termination of your appointment with the Company (for whatever reason),  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 prior to that date. 6. Independence and outside interests 6.1 The Board has determined you to be independent pursuant to provision B.1.1 of the UK Corporate Governance Code. 

 

 6  6.2 It is accepted and acknowledged that you have and/or will have business interests other than those of the Company. In accordance with your duty to avoid conflicts of interest. by signing the duplicate copy of this letter, you confirm that: (a) you have disclosed to the Senior Independent Director or the Group Company Secretary the significant commitments you have outside your role at the Company; (b) you have declared to the Senior Independent Director or the Group Company Secretary any potential conflicts that are apparent at present; and (c) you are not aware of any circumstances arising out of your dealings with any  other person or entity of any matter that might reasonably be expected to lead to reputational risk for the Company and/or the Group given your role as Group  Chairman. 6.3 In the event that you become aware of any further potential or actual conflicts of interest or circumstances which could lead to reputational risk for the Company and/or the Group, you shall disclose these to the Senior Independent Director or the Group Company Secretary as soon as apparent and the agreement of the Board will have to be sought. A copy of the conflicts of interest policy of the Company will be sent to you. 7. Confidentiality 7.1 As a non-executive Director you are required to maintain strict confidentiality with regard to any and all matters of a confidential nature concerning the Company and the Group, including in relation to any such information provided to you prior to the commencement of your appointment. Save as required by law, you must not disclose any confidential information to any third party or use such information for your own or a third party's benefit either during your appointment or following termination (for whatever reason) without the prior written consent of the Group Chief Executive Officer or the Senior Independent Director or the Group Company Secretary.  Where you consider you have a legal obligation to disclose confidential information you  will,  to  the extent possible, first discuss this with the Group Chief Executive Officer or  the  Senior Independent Director or the Group Secretary prior to any such disclosure. 7.2 In the event that you are asked to undertake any duties on behalf of the Company or the Group prior to the commencement of your appointment, you will ensure that undertaking such duties will not amount to a breach of any obligation that you continue to owe to any third party or to any conflict of interest. If you believe such a breach may occur or that there may be a conflict of interest, you will immediately disclose this and discuss it with the Senior Independent Director or the Group Company Secretary. 8. Inside information and dealings in the Group securities 8.1 Your attention is also drawn to the requirements under both legislation and regulation as to the disclosure of inside information. Consequently, you should avoid making any statements that might risk a breach of these requirements. More details will be sent to you in the Memorandum for Directors or other communications from time to time. 9. Share interests and disclosure 

 

 7  9.1 As a Director, you must comply with all applicable laws, regulations and rules on the disclosure of the interests and transactions of Directors and their connected persons in shares and other securities of Group Companies.  More details will be sent to you from time to time. 9.2 You are expected to comply with the Company's shareholding guidelines regarding the minimum shareholding level to be built up by a non-executive Director within a period of time. The guidelines (a copy of which will be provided to you) may be reviewed and updated by the Board from time to time. The current expectation is for non-executive Directors to build up a shareholding of 15,000 HSBC  Holdings shares within 5  years of  the commencement  of  your appointment, but this may be reviewed and (if needed) adjusted from time to time. 10. Induction and training 10.1 Immediately after your appointment, the Company will provide a comprehensive, formal and tailored induction. You will be expected to make yourself available for the purposes of the induction. The Group Company Secretary will be in touch with further details. 10.2 On an ongoing basis, the Company will make arrangements for you to develop and refresh your skills and knowledge in areas which are identified as being likely to be required, or of benefit to you, in carrying out your duties effectively. You should endeavour to make yourself available for any relevant training sessions which may be organised for the Board. 11. Review process 11.1 The performance of individual Directors and the whole Board and its committees is evaluated annually. 12. Insurance and indemnity 12.1 The  Company  maintains  directors'  and  officers'  liability  insurance  for its  Directors and officers and intends to maintain such cover for the full term of your appointment. There is also an indemnity under the Company's Articles and a deed poll executed in favour of each present and future Director. A summary of the directors' and officers' liability insurance policy document and details of the provisions for indemnification under the Articles and deed poll will be sent to you. 13. Independent professional advice 13.1 Circumstances may occur when it will be appropriate for you to seek advice from independent advisers at the Company's expense.  The Board policy under which Directors may obtain such independent advice will be provided to you. The Company will reimburse the full cost of expenditure incurred by you in accordance with the policy in force from time to time. 14. Intellectual property 14.1 You may make inventions or create other intellectual property during the appointment and the provision of your services to the Company. In this respect you have a special responsibility to further the interests of the Company and the Group given your position at the Company. In recognition of your position and responsibility, you acknowledge and agree that 

 

 8  any invention, improvement, design, process, information, copyright work, trade mark, trade name or get-up or any other intellectual property (together the "Intellectual Property") made, created or discovered by you during the appointment (whether capable of being patented or registered or not) in conjunction with or in any way affecting or relating to the business of the Company or any Group Company or capable of being used or adapted for use in the Company or any Group Company or in connection therewith shall be immediately disclosed to the Company and shall belong to and be the absolute property of the Company or such Group Company as the Company may direct. 14.2 Paragraph 14.1 shall only apply to the extent that any invention was made by you in the course of the provision of your services. 15. Data protection 15.1 By signing this letter you consent to the Company holding and processing data about you for legal, personnel, administrative and management purposes and in particular the processing of any sensitive personal data (as defined in the Data Protection Act 1998) relating to you including, as appropriate: (a) information about your physical and mental health or condition in order to monitor any sickness absence and take decisions as to your fitness to perform your duties; or (b) your racial or ethnic origin or religious or similar beliefs in order to monitor compliance  with equal opportunities legislation; or (c) information relating to any criminal proceedings in which you have been involved for insurance purposes and in order to comply with legal requirements and obligations  to third parties. 15.2 You consent to the Company making such information available to any of its Group Companies, those  who provide products or services to the Company (such as advisers), regulatory authorities, governmental or quasi-governmental organisations and potential purchasers of the Company. You also consent to the transfer of such information outside of the European Economic Area. 16. Return of property 16.1 Upon termination of your appointment with the Company (for whatever reason), you shall deliver to the Company all notes, memoranda, lists of customers and suppliers and employees, correspondence, computer, blackberry, mobile telephone, tablet and other discs and tapes, data listings, codes, designs and drawings notes. documents, records, papers or other documents and material whatsoever (whether made or created by you or otherwise) which may be in your possession or under your control, and which relate in any way to the business affairs of the Company, and you shall not retain any copies thereof. If required to do so you will confirm in writing that you have complied with the obligation and that you have permanently and irrevocably deleted any copy documents in your possession from any computer and other system (including but not limited to mobile telephone or tablet) in your possession or control. 

 

 9  17. Entire agreement 17.1 This letter together with any further documents referred to herein and any separate letter(s) confirming your appointment to any Board committee(s), together with the Articles, constitute the entire terms and conditions of your appointment and supersede and extinguish all previous agreements, promises, assurances, warranties, representations and understandings between you and the Company, whether written or oral, relating to its subject matter. 18. Rights of third parties 18.1 Each Group Company shall have the right under the Contracts (Rights of Third Parties) Act 1999 to enforce the rights bestowed on it by this letter. The consent of a Group Company is not required to amend any of the terms of this letter.   Except as set out in this paragraph, a   person who is not a party to this letter may not enforce any of its provisions under the Contracts (Rights of Third Parties) Act 1999 19. Governing Law 19.1 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 laws of England and Wales. 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). 20. Definitions "Board" means the Board of Directors for the time being of HSBC Holdings pie or, as the context permits, any committee of the Board (including the Group Management Board) to which powers have been properly delegated or such person or persons designated by the Board from time to time as its representative for the purposes of this letter of appointment; "Group" means (1) HSBC Holdings pie and any entity which from time to time is a holding company of HSBC Holdings pie or a subsidiary of HSBC Holdings pie or of any such holding company; and (2) any entity over which from time to time any of the entities defined in paragraph (1) of this definition either directly or indirectly exercises management control, even though it may own less than fifty per cent (50%) of the shares and is prevented by law from owning a greater shareholding, and "Group Company” and "Group Companies” shall be construed accordingly; "Group Chariman" means the non-executive Group Chairman of HSBC Holdings plc from time to time; "Group Chief Executive Officer" means the Group Chief Executive Officer of HSBC Holdings plc from time to time; "Group Company Secretary" means the Group Company Secretary of HSBC Holdings plc from time to time; 

 

 10  "Senior Independent Director" means the senior independent non-executive Director of the Company from time to time. Please indicate your acceptance of these terms by signing and returning the attached copy of this letter to me at 41/F, 8 Canada Square. Canary Wharf. London E14 5HQ, UK. Yours sincerely Ben J S Mathews Group Company Secretary  HSBC Holdings plc I confirm and agree to the terms and conditions of my appointment as a non-executive Director and Group Chairman designate of HSBC Holdings plc as set out in this letter.

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