Document:

EXHIBIT
4.24

 

Non-executive
director appointment letter – Mr Daniel T Gilbert

 

 

Mr Daniel
Thomas Gilbert

 

 

9
August 2004

 

Dear Danny

 

Letter of Appointment

 

I am pleased
to advise you that at the meeting of the Board of Directors of National
Australia Bank Limited (the National) held on 5 – 6 August 2004, the Board
approved your appointment as a Non-Executive Director of the National and
National Equities Limited (the holding company for the major offshore assets),
subject to the regulator, the Australian Prudential Regulation Authority,
having no objection to your appointment and receipt of a signed Consent to Act
as a Director.

 

We are
delighted that you have indicated that you would accept such an appointment if
an invitation was extended to you.  We look
forward to your contribution during this period of renewal for the National.

 

Enclosed is a
Consent to Act as a Director & Disclosures on Appointment form which I
would ask you to complete and return to the Company Secretary, Mr Garry Nolan,
as soon as possible.  Garry’s fax number
is 03 8641 4927.  Could you also return
the original by post to the address at the end of this letter.  In addition, a BR4 form is enclosed which I
would ask you to complete and return. 
This form is required to be lodged with the Companies House in Britain.

 

We are
preparing a draft announcement to the market and the media concerning your
appointment and Garry will provide a copy of this to you for your
consideration, prior to its release.

 

Also enclosed
is a form headed Staff in Confidence which I would ask you to complete and
return.  Through this form you authorise
to National to undertake a police check on you as required by the National’s
internal policies and by the regulators.

 

In addition to
expressing our delight that you will be joining the Board of the National, when
all of the formalities are completed, this letter is intended to inform you of
the terms of your appointment to the office of Non-Executive Director of the
National and National Equities Limited. 
It should be read in conjunction with, and is subject to, the National’s
Constitution (a copy of which is attached to this letter), and the charters and
policies approved from time to time by the Board, including the Board Charter
(a copy of which is attached to this letter). 
Such charters and policies may be changed by the Board from time to
time.

 

 

Following your
formal appointment, you will hold office until the next Annual General Meeting
of the National which will be held on 31 January 2005, at which time you will
stand for election by the shareholders as a Director of the National.

 

Please
acknowledge that you have read, understand and accept the contents of this
letter by signing the enclosed copy of this letter and returning it to the
Company Secretary.

 

1                                          Board
members

 

The Chairman of the Board is Mr Graham Kraehe, an Independent
Non-Executive Director.

 

The other Independent Non-Executive Directors, at present, are:

 

•                                           Dr Brian Clark (standing down in late August 2004);

•                                           Mr Peter Duncan;

•                                           Dr Ken Moss (standing down in late August 2004);

•                                           Mr Geoff Tomlinson;

•                                           Dr Ed Tweddell (standing down in late August 2004); and

•                                           Mr Malcolm Williamson.

 

Mr John Stewart is the Managing Director & Group Chief Executive,
the only executive director at this time.

 

The Company Secretary is Mr Garry Nolan.  Mr Nolan can be contacted on (03) 8641 3505.

 

Further details of Board members can be obtained from the Company
Secretary.

 

2                                          Terms of
appointment

 

2.1                                Qualifications

 

To qualify for the office of Director of the National, you must:

 

•                                           be under 70 years of age; [Article 10.9]

 

•                                           not be disqualified or suspended from managing corporations and must
otherwise be permitted by law to act as a director of a company; [s203B Corporations Act and Part 2D.6]

 

•                                           sign a Confidentiality Deed which prohibits you from disclosing any
matters, affairs or concerns of the National; [Article
11.8 of the National’s Constitution] and

 

•                                           hold at least 2,000 fully paid shares in the National in your own
right within two months after your appointment. 
[Article 10.8]

 

 

2.2                                Term

 

Following your appointment by the Board, you hold office until the
first Annual General Meeting of the National after the date of your
appointment.  You are then eligible for
election to the position of Director by resolution of the shareholders of the
National at that Annual General Meeting. 
[Articles 10.12 and 10.13]

 

Once you have been elected to the office of Director by resolution of
the shareholders of the National in General Meeting, you will be subject to the
rotation of Directors provided for in Articles 10.3 to 10.7 of the National’s
Constitution.  Broadly, these Articles
provide that at each Annual General Meeting one-third of the Directors for the
time being and any other Director not in such one-third who has held office for
three years or more must retire from the office and is eligible for
re-election.  Please refer to the clause
3.8 – Performance evaluation, concerning the process undertaken by the Board to
determine if the Board will recommend to shareholders that a Director be
re-elected to office.

 

The National may remove a Director from office as a Director at any
time by a resolution passed at a General Meeting.  [Articles 10.3-10.7 and
10.14].

 

Appointment and removal of Directors is a matter for shareholders.  However, the Board has set a policy limit of
10 years for individual service as a Director, subject to an annual review
thereafter.  The Board regards this as an
appropriate period of service.  This
provided an opportunity for renewal of the Board whilst recognising that
Directors who have served on the Board for an extended period of time have
gained valuable experiences, insights and historical perspectives regarding the
National that would not be easily replaced.  [Clause 7.5 of Board Charter]

 

2.3                                Vacation
of office

 

Your position becomes vacant if any of the circumstances prescribed
under the Corporations Act 2001 (Cwlth) or the
National’s Constitution, arise, including the following:

 

•                                           you are disqualified from managing corporations; [s203B Corporations Act and Part 2D.6]

 

•                                           you resign from office or refuse to act; [Article
10.28(b)]

 

•                                           you are removed from office by resolution passed at a General
Meeting of the National; [Article 10.28(c)]

 

•                                           you are not present personally or by an alternate director or proxy
at meetings for a continuous period of two months without a leave of absence
from the Board; or [Article 10.28(d)]

 

•                                           you accept or hold any office in another bank without the consent of
the Board.  [Article
10.28(f)]

 

Article 10.28 of the National’s Constitution contains a list of
circumstances that, in addition to those prescribed by the Corporations Act,
will result in the office of a Director becoming vacant.

 

 

2.4                                Relationship
with the National

 

Once appointed, you hold office as a Director of the National.  You are not appointed or designated as an
employee of the National nor are you an Executive Director within the meaning
of the National’s Constitution.

 

3                                          Expectations

 

3.1                                Overview

 

The National’s expectations of you as a Director are listed in this
section.  In many cases, you are obliged
to meet these expectations because of your legal duties to the National.  You are encouraged to seek independent legal
advice to assist you in the performance of these duties.

 

3.2                                Time commitment

 

You must contribute sufficient time to your directorship to enable you
to effectively fulfil your duties to the National.  You may also be expected to spend additional
time if you are a Board committee member or if you are the Chairman, or a
director of a subsidiary of the National.

 

While most Board and Board committee meetings are held in Melbourne,
the Board does visit and hold meetings at interstate and international venues
from time to time.

 

You should inform the Board of any change in circumstances that could
affect your ability to commit time to the position.

 

3.3                                Board
meetings

 

Board meetings are scheduled ten times a year and normally have a
duration of two days, with the exception of the annual Board meeting in the
United Kingdom which usually has a duration of five days.  A list of the Board Meeting dates for the
remainder of 2004 and for 2005 is attached. 
It is necessary from time to time to convene an unscheduled
meeting.  The National endeavours to keep
such meetings to a minimum, however, a Director may convene additional Board
meetings at any time.  [Article 12.2]

 

You are expected to:

 

•                                           attend Board meetings and ensure that you have fully read all papers
relating to agenda items;

 

•                                           apply your mind to the matters before you and bring your own special
skills and experience to your position;

 

•                                           raise questions and make enquiries when you need more information;

 

•                                           make sure that any of the Board’s delegates are qualified, reliable
and competent to carry out the duties given to them; and

 

 

•                                           make sure that you have been provided with accurate, relevant and
timely information to reach any decision that will affect the National.  You should not make a decision, and you may
refuse to consider any matter, until appropriate information has been provided
to you.

 

3.4                                Board
committees and subsidiaries

 

Currently there are four standing Board committees:  the Audit Committee, Risk Committee,
Compensation Committee and the Nomination Committee, and the Board may, from
time to time, convene other Board committees.

 

At present, all Directors are members of the Nomination Committee.

 

You are expected to serve on one additional committee, and may be asked
to serve on more than one, of these Board committees in accordance with the
written charters of those committees. 
Charters for all Board committees are approved by the Board.

 

You may also be appointed a director of a subsidiary, or subsidiaries,
of the National.

 

3.5                                Independence

 

Non-Executive Directors are appointed on the basis that they remain independent
of management and free from any business or other relationship that could
materially interfere with, or could reasonably be perceived to materially
interfere with, the exercise of their unfettered and independent judgment.

 

The Board has approved the definition of ‘independence’ which is set
out in the Board Charter.

 

The Board regularly reviews Director independence.  You should immediately report to the Board
any change in your relationship or the relationship of your associates with the
National, or with its management team, which could affect your independence.

 

3.6                                Insider
trading policy and Code of Conduct

 

Directors are expected to comply with the corporate policies approved
from time to time by the Board, including:

 

•                                             the National’s insider trading policy;

 

•                                             the National’s Code of Conduct; and

 

•                                             the Corporate Governance Guide entitled “Role, Duties,
Responsibilities and Rights of the Directors of Category A Company”.

 

Copies of these key policies and codes are attached to this letter.

 

The insider trading policy restricts dealings in National securities by
Directors as well as other officers and employees of the National.  Directors may only deal in such securities in
the eight-week periods immediately following either the release of the half
year and full year profit announcements (currently made in May and

 

 

November) or following the release of a qualifying prospectus.  However, even during such periods, Directors
may not deal in National securities if they are aware of any share price
sensitive information.  An example of
this may be any merger, acquisition or significant disposal activity occurring
during the window period.  Further, under
the insider trading policy, Directors must not deal in National securities for
short-term gain and therefore dealing in the same National securities within a
12-month period is prohibited.  Directors
must also discuss their intention to deal in National securities with the
Chairman before undertaking any such dealings.

 

Given the above restrictions, a new Director appointed to the Board,
who does not already meet the Director share qualification requirement set out
in the National’s Constitution and clause 2.1 of this letter, should acquire
such shares as soon as possible before s/he acquires any share price sensitive
information.

 

3.7                                Confidentiality

 

You are expected to maintain the confidentiality of all materials and
information you obtain in connection with your position.  You are also expected to ensure that your
representative, if applicable, maintains the confidentiality of such materials
and information.

 

You must comply with the Confidentiality
Deed you execute in accordance with Article 11.8 of the National’s
Constitution.

 

3.8                                Performance
evaluation

 

The Board regularly conducts an assessment of its effectiveness using
an external facilitator.  This review may
include an assessment of individual director performance.

 

In addition, in advance of you being presented to shareholders for
re-election in accordance with the retirement by rotation provisions in the
National’s Constitution, a peer review process will be undertaken.  That is, the Board (in your absence) will
consider whether the Board will make a recommendation to shareholders in
support of your re-election as a Director of the National.

 

The Nomination Committee will oversee the implementation of this
process.

 

4                                          Duties
and powers

 

4.1                                Duties

 

At the most general level, your role is to
oversee management on behalf of the National, to monitor the National’s
business results and to set goals and formulate strategy.  In performing this role, you are subject to a
number of legal duties to the National.

 

A detailed explanation of your duties is
provided in the Corporate Governance Guide entitled “Role, Duties,
Responsibilities and Rights of the Directors of Category A Company” referred to
earlier and attached to this letter.

 

 

4.2                                Disclosure
of conflicts and material personal interests

 

If a conflict of interest arises in
relation to a matter that will be considered by the Board, you must give the
other Directors notice of the conflict, and, if the conflict is a material
personal interest in the matter (as defined by section 191(2) of the
Corporations Act), you must not be present while the matter is being considered
at a Board meeting or vote on the matter.

 

Further guidance in relation to conflicts
and material personal interests is given in the Corporate Governance Guide
attached.

 

4.3                                Powers

 

The Board has the power to exercise all of the National’s powers, other
than the powers which the Constitution and the Corporations Act require to be
exercised by the National in General Meeting. 
[Article 11.1 and s198A(2) of Corporations Act]

 

Decisions of the Board are decided by a majority of votes of Directors
present and entitled to vote.  Each
Director has one vote.  [Articles 12.3 and 12.4]

 

4.4                                Appointment
of Alternate Director

 

Articles 12.6 - 12.14 of the National’s Constitution provides for a
Director to appoint an Alternate Director to act in his / her place, subject to
the approval of the majority of the other Directors.  However, it has not been the practice in the
National to appoint Alternate Directors.

 

5                                          Remuneration

 

5.1                                Remuneration

 

Non-Executive Directors do not participate in schemes designed to
remunerate executives and do not receive share options, performance rights,
bonuses or other types of performance based remuneration.

 

The National does not provide retirement benefits to Non-Executive
Directors, other than the superannuation payments described below.

 

Each Non-Executive Director will receive the fees set out in Schedule 1
of this letter for their directorship.

 

Additional fees are payable for membership of any Board committees,
subsidiary directorships and for the position of Chairman, in accordance with
the National’s Constitution.

 

The Board approves these fees within the limits set by the shareholders
of the National in General Meeting.

 

Shares

 

Under the National’s Non-Executive Director Share Plan, you will be
provided at least 10% of your annual remuneration in the form of National
shares, except in limited, unusual circumstances.  There is flexibility to provide a maximum of
40%

 

 

of your annual emoluments in the form of National shares.  The Company Secretary will provide you with
further information on the Non-Executive Director Share Plan.

 

Superannuation

 

Directors may elect to receive part of their remuneration in the form
of superannuation contributions.  As a
minimum, in accordance with the relevant superannuation guarantee (“SG”)
legislation, the National is generally obliged to pay into an approved
superannuation fund, superannuation guarantee contributions on behalf of
Directors at the rate of 9% of the fees (and any other amounts which fall
within the description of “ordinary time earnings” for SG purposes) paid to
you.

 

Other
non-cash benefits

 

If required, the National will provide Directors with a laptop computer
to facilitate the electronic receipt of Board papers and receipt of electronic
communication material to enable Directors to effectively perform their duties
to the National.  Subject to applicable
law, financial services may also be provided by the National to Directors under
terms and conditions that would normally apply to the public.  [Clause 13.5 of Board
Charter]

 

The Company Secretary will assist you to make arrangements in this
regard.

 

5.2                                Expenses

 

You are entitled to be reimbursed out of the funds of the National such
reasonable travelling, accommodation and other expenses as you may incur when
travelling to or from Board meetings or Board committee meetings or when you
are otherwise engaged in the business of the National.  [Article 10.18]  I should mention that it is the
National’s policy that no more than two Directors should travel by air together
at any time.

 

5.3                                Insurance
and indemnity

 

You have the benefit of the indemnity provided to you in the National’s
Constitution.  This indemnity is broad,
however, it does not provide protection if the National is prohibited from
indemnifying you, for example, where liability is owed to the National.  [Article 21.1 and s199A(2)
of the Corporations Act]

 

You are invited to enter into a Deed of Access, Indemnity and Insurance
which mirrors the protection afforded to you under the National’s
Constitution.  That deed also includes an
undertaking by the National to effect and maintain an appropriate Directors’
and Officers’ Insurance Policy.  A copy
of that deed is attached.  Could you
please sign the deed and return it at your convenience.

 

You may also be protected under the National’s Directors & Officers
Insurance Policy.  Details of the
insurance policy are provided in the brochure attached.

 

It is important that, if you become aware of any matter that may give
rise to an actual or potential claim, or of any circumstances that may lead to
such a claim, you contact Global Operational Risk, Insurance & Compliance
(Melbourne).

 

 

6                                          Induction
and training

 

6.1                                Induction

 

The National’s Induction Program for Non-Executive Directors is
designed to assist them to participate fully and actively in Board
decision-making from the date of appointment.

 

The program enables appointees to gain an understanding of:

 

•                                             the National’s financial, strategic, operational and risk management
position;

 

•                                             their rights, duties and responsibilities; and

 

•                                             the role of Board Committees.

 

The National’s Induction Program involves the supply of reading
material, informal discussions with the Group Chief Executive and Executive
General Managers, and technical workshops.

 

From time to time, the Nominations Committee reviews the effectiveness
of the Induction Program.

 

Continuing
education

 

The National is committed to providing its Directors with opportunities
to update and enhance their skills and knowledge.  Directors are regularly provided with updates
from management and external advisers about key developments in the company and
the banking and funds management industries.

 

Directors are also entitled to attend external seminars, workshops and
other training programs that are relevant to the National or to their directorship.  The National will reimburse a Director for
any reasonable costs of such additional training.

 

7                                          Access to
information

 

7.1                                Access to
financial records and company books

 

Under the Corporations Act, a Director has
rights of access to the National’s financial records and, for the purposes of
legal proceedings to which the Director is a party, the National’s books, at
all reasonable times.  [Section 198F and section 290 of the Corporations Act]

 

The Deed of Access, Indemnity and Insurance
grants you access to Board papers and related material.

 

7.2                                Access to
the Company Secretary

 

The Company Secretary is responsible for
providing advice and support to the Board and for ensuring that Directors have
sufficient information to make decisions at meetings of the Board.  The Company Secretary also prepares minutes
of all Board meetings.

 

 

Directors have direct access to, and are
entitled to request additional assistance and information from, the Company
Secretary.

 

7.3                                Authority
to appoint independent professional advisers

 

Directors are entitled to seek independent professional advice in
relation to their duties and powers as Directors of the National.  The National will reimburse Directors for all
reasonable expenses incurred in obtaining such advice, provided that the
expenses have been approved by the Chairman and, where appropriate, a copy of
the advice is made available to the Board.

 

8                                          Further
guidance and information

 

If you have any queries about your appointment, please contact the
Company Secretary.

 

The next Board
meeting is on 2 – 3 September in Melbourne and the following meeting after that
will be in New Zealand on 7 – 8 October. 
I will call you to discuss what would be the most suitable starting date
for you.

 

Danny, I and my other
Board colleagues and I are looking forward to working with you in the future.

 

 

Yours
sincerely

 

	
  [Original signed]

  	
   

  

 

 

GRAHAM
J KRAEHE AO

CHAIRMAN

 

 

I
acknowledge that I have read, understood and accepted the contents of this
letter.

 

 

	
  Signed:

  	
  [Original signed]

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
  D.T.
  GILBERT

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
  12
  August 2004

  	
   

  

 

When
you have signed the attached copy of this letter, please return the signed copy
to –

 

Mr GF Nolan

Company Secretary

National Australia Bank Limited

Level 24

500 Bourke Street

MELBOURNE   VIC   3000

 

 

Schedule
1: Directors’ Fees as at 9 August 2004

 

	
  BOARD/COMMITTEE

  	
   

  	
  CHAIRMAN

  	
   

  	
  MEMBER

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal
  Board and Board Nomination Committee

  	
   

  	
   

  	
   

  	
   

  	
  A$

  	
  137,150

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal
  Board Audit Committee

  	
   

  	
  A$

  	
  39,000

  	
   

  	
  A$

  	
  19,500

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal
  Board Risk Committee

  	
   

  	
  A$

  	
  39,000

  	
   

  	
  A$

  	
  19,500

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Compensation
  Committee

  	
   

  	
  A$

  	
  17,550

  	
   

  	
  A$

  	
  7,364EXHIBIT
4.25

 

Non-executive
director appointment letter – Mr Paul J Rizzo

 

 

Mr Paul John
Rizzo

 

9
August 2004

 

Dear Paul

 

Letter of Appointment

 

I am pleased
to advise you that at the meeting of the Board of Directors of National
Australia Bank Limited (the National) held on 5 – 6 August 2004, the Board
approved your appointment as a Non-Executive Director of the National and
National Equities Limited (the holding company for the major offshore assets),
subject to the regulator, the Australian Prudential Regulation Authority,
having no objection to your appointment and receipt of a signed Consent to Act
as a Director.

 

We are
delighted that you have indicated that you would accept such an appointment if
an invitation was extended to you.  We
look forward to your contribution during this period of renewal for the
National.

 

Enclosed is a
Consent to Act as a Director & Disclosures on Appointment form which I
would ask you to complete and return to the Company Secretary, Mr Garry Nolan,
as soon as possible.  Garry’s fax number
is 03 8641 4927.  Could you also return
the original by post to the address at the end of this letter.  In addition, a BR4 form is enclosed which I
would ask you to complete and return. 
This form is required to be lodged with the Companies House in Britain.

 

We are
preparing a draft announcement to the market and the media concerning your
appointment and Garry will provide a copy of this to you for your
consideration, prior to its release.

 

Also enclosed
is a form headed Staff in Confidence which I would ask you to complete and
return.  Through this form you authorise
to National to undertake a police check on you as required by the National’s
internal policies and by the regulators.

 

In addition to expressing our delight that you will be
joining the Board of the National, when all of the formalities are completed,
this letter is intended to inform you of the terms of your appointment to the
office of Non-Executive Director of the National and National Equities Limited.  It should be read in conjunction with, and is
subject to, the National’s Constitution (a copy of which is attached to this
letter), and the charters and policies approved from time to time by the Board,
including the Board Charter (a copy of which is attached to this letter).  Such charters and policies may be changed by
the Board from time to time.

 

 

Following your
formal appointment, you will hold office until the next Annual General Meeting
of the National which will be held on 31 January 2005, at which time you will
stand for election by the shareholders as a Director of the National.

 

Please
acknowledge that you have read, understand and accept the contents of this
letter by signing the enclosed copy of this letter and returning it to the
Company Secretary.

 

1                                          Board members

 

The Chairman of the Board is Mr Graham Kraehe, an Independent
Non-Executive Director.

 

The other Independent Non-Executive Directors, at present, are:

 

•                                           Dr Brian Clark (standing down in late August 2004);

 

•                                           Mr Peter Duncan;

 

•                                           Dr Ken Moss (standing down in late August 2004);

 

•                                           Mr Geoff Tomlinson;

 

•                                           Dr Ed Tweddell (standing down in late August 2004); and

 

•                                           Mr Malcolm Williamson.

 

Mr John Stewart is the Managing Director & Group Chief Executive,
the only executive director at this time.

 

The Company Secretary is Mr Garry Nolan.  Mr Nolan can be contacted on (03) 8641 3505.

 

Further details of Board members can be obtained from the Company
Secretary.

 

2                                          Terms of
appointment

 

2.1                                Qualifications

 

To qualify for the office of Director of the National, you must:

 

•                                           be under 70 years of age; [Article 10.9]

 

•                                           not be disqualified or suspended from managing corporations and must
otherwise be permitted by law to act as a director of a company; [s203B Corporations Act and Part 2D.6]

 

•                                           sign a Confidentiality Deed which prohibits you from disclosing any
matters, affairs or concerns of the National; [Article
11.8 of the National’s Constitution] and

 

•                                           hold at least 2,000 fully paid shares in the National in your own
right within two months after your appointment. 
[Article 10.8]

 

 

2.2                                Term

 

Following your appointment by the Board, you hold office until the
first Annual General Meeting of the National after the date of your
appointment.  You are then eligible for
election to the position of Director by resolution of the shareholders of the
National at that Annual General Meeting. 
[Articles 10.12 and 10.13]

 

Once you have been elected to the office of Director by resolution of
the shareholders of the National in General Meeting, you will be subject to the
rotation of Directors provided for in Articles 10.3 to 10.7 of the National’s
Constitution.  Broadly, these Articles
provide that at each Annual General Meeting one-third of the Directors for the
time being and any other Director not in such one-third who has held office for
three years or more must retire from the office and is eligible for
re-election.  Please refer to the clause
3.8 – Performance evaluation, concerning the process undertaken by the Board to
determine if the Board will recommend to shareholders that a Director be
re-elected to office.

 

The National may remove a Director from office as a Director at any
time by a resolution passed at a General Meeting.  [Articles 10.3-10.7 and
10.14].

 

Appointment and removal of Directors is a matter for shareholders.  However, the Board has set a policy limit of
10 years for individual service as a Director, subject to an annual review
thereafter.  The Board regards this as an
appropriate period of service.  This
provided an opportunity for renewal of the Board whilst recognising that
Directors who have served on the Board for an extended period of time have
gained valuable experiences, insights and historical perspectives regarding the
National that would not be easily replaced.  [Clause 7.5 of Board Charter]

 

2.3                                Vacation
of office

 

Your position becomes vacant if any of the circumstances prescribed
under the Corporations Act 2001 (Cwlth) or the
National’s Constitution, arise, including the following:

 

•                                           you are disqualified from managing corporations; [s203B Corporations Act and Part 2D.6]

 

•                                           you resign from office or refuse to act; [Article
10.28(b)]

 

•                                           you are removed from office by resolution passed at a General
Meeting of the National; [Article 10.28(c)]

 

•                                           you are not present personally or by an alternate director or proxy
at meetings for a continuous period of two months without a leave of absence
from the Board; or [Article 10.28(d)]

 

•                                           you accept or hold any office in another bank without the consent of
the Board.  [Article
10.28(f)]

 

Article 10.28 of the National’s Constitution contains a list of
circumstances that, in addition to those prescribed by the Corporations Act,
will result in the office of a Director becoming vacant.

 

 

2.4                                Relationship
with the National

 

Once appointed, you hold office as a Director of the National.  You are not appointed or designated as an
employee of the National nor are you an Executive Director within the meaning
of the National’s Constitution.

 

3                                          Expectations

 

3.1                                Overview

 

The National’s expectations of you as a Director are listed in this
section.  In many cases, you are obliged
to meet these expectations because of your legal duties to the National.  You are encouraged to seek independent legal advice
to assist you in the performance of these duties.

 

3.2                                Time
commitment

 

You must contribute sufficient time to your directorship to enable you
to effectively fulfil your duties to the National.  You may also be expected to spend additional
time if you are a Board committee member or if you are the Chairman, or a
director of a subsidiary of the National.

 

While most Board and Board committee meetings are held in Melbourne,
the Board does visit and hold meetings at interstate and international venues
from time to time.

 

You should inform the Board of any change in circumstances that could
affect your ability to commit time to the position.

 

3.3                                Board
meetings

 

Board meetings are scheduled ten times a year and normally have a
duration of two days, with the exception of the annual Board meeting in the
United Kingdom which usually has a duration of five days.  A list of the Board Meeting dates for the
remainder of 2004 and for 2005 is attached. 
It is necessary from time to time to convene an unscheduled meeting.  The National endeavours to keep such meetings
to a minimum, however, a Director may convene additional Board meetings at any
time.  [Article
12.2]

 

You are expected to:

 

•                                           attend Board meetings and ensure that you have fully read all papers
relating to agenda items;

 

•                                           apply your mind to the matters before you and bring your own special
skills and experience to your position;

 

•                                           raise questions and make enquiries when you need more information;

 

•                                           make sure that any of the Board’s delegates are qualified, reliable
and competent to carry out the duties given to them; and

 

 

•                                           make sure that you have been provided with accurate, relevant and
timely information to reach any decision that will affect the National.  You should not make a decision, and you may
refuse to consider any matter, until appropriate information has been provided
to you.

 

3.4                                Board
committees and subsidiaries

 

Currently there are four standing Board committees:  the Audit Committee, Risk Committee,
Compensation Committee and the Nomination Committee, and the Board may, from
time to time, convene other Board committees.

 

At present, all Directors are members of the Nomination Committee.

 

You are expected to serve on one additional committee, and may be asked
to serve on more than one, of these Board committees in accordance with the
written charters of those committees. 
Charters for all Board committees are approved by the Board.

 

You may also be appointed a director of a subsidiary, or subsidiaries,
of the National.

 

3.5                                Independence

 

Non-Executive Directors are appointed on the basis that they remain
independent of management and free from any business or other relationship that
could materially interfere with, or could reasonably be perceived to materially
interfere with, the exercise of their unfettered and independent judgment.

 

The Board has approved the definition of ‘independence’ which is set
out in the Board Charter.

 

The Board regularly reviews Director independence.  You should immediately report to the Board
any change in your relationship or the relationship of your associates with the
National, or with its management team, which could affect your independence.

 

3.6                                Insider
trading policy and Code of Conduct

 

Directors are expected to comply with the corporate policies approved
from time to time by the Board, including:

 

•                                             the National’s insider trading policy;

 

•                                             the National’s Code of Conduct; and

 

•                                             the Corporate Governance Guide entitled “Role, Duties,
Responsibilities and Rights of the Directors of Category A Company”.

 

Copies of these key policies and codes are attached to this letter.

 

The insider trading policy restricts dealings in National securities by
Directors as well as other officers and employees of the National.  Directors may only deal in such securities in
the eight-week periods immediately following either the release of the half year
and full year profit announcements (currently made in May and

 

 

November) or following the release of a qualifying prospectus.  However, even during such periods, Directors
may not deal in National securities if they are aware of any share price sensitive
information.  An example of this may be
any merger, acquisition or significant disposal activity occurring during the
window period.  Further, under the
insider trading policy, Directors must not deal in National securities for
short-term gain and therefore dealing in the same National securities within a
12-month period is prohibited.  Directors
must also discuss their intention to deal in National securities with the
Chairman before undertaking any such dealings.

 

Given the above restrictions, a new Director appointed to the Board,
who does not already meet the Director share qualification requirement set out
in the National’s Constitution and clause 2.1 of this letter, should acquire
such shares as soon as possible before s/he acquires any share price sensitive
information.

 

3.7                                Confidentiality

 

You are expected to maintain the confidentiality of all materials and
information you obtain in connection with your position.  You are also expected to ensure that your
representative, if applicable, maintains the confidentiality of such materials
and information.

 

You must comply with the Confidentiality
Deed you execute in accordance with Article 11.8 of the National’s
Constitution.

 

3.8                                Performance
evaluation

 

The Board regularly conducts an assessment of its effectiveness using
an external facilitator.  This review may
include an assessment of individual director performance.

 

In addition, in advance of you being presented to shareholders for
re-election in accordance with the retirement by rotation provisions in the
National’s Constitution, a peer review process will be undertaken.  That is, the Board (in your absence) will
consider whether the Board will make a recommendation to shareholders in
support of your re-election as a Director of the National.

 

The Nomination Committee will oversee the implementation of this
process.

 

4                                          Duties
and powers

 

4.1                                Duties

 

At the most general level, your role is to
oversee management on behalf of the National, to monitor the National’s
business results and to set goals and formulate strategy.  In performing this role, you are subject to a
number of legal duties to the National.

 

A detailed explanation of your duties is
provided in the Corporate Governance Guide entitled “Role, Duties,
Responsibilities and Rights of the Directors of Category A Company” referred to
earlier and attached to this letter.

 

 

4.2                                Disclosure
of conflicts and material personal interests

 

If a conflict of interest arises in
relation to a matter that will be considered by the Board, you must give the
other Directors notice of the conflict, and, if the conflict is a material
personal interest in the matter (as defined by section 191(2) of the
Corporations Act), you must not be present while the matter is being considered
at a Board meeting or vote on the matter.

 

Further guidance in relation to conflicts
and material personal interests is given in the Corporate Governance Guide
attached.

 

4.3                                Powers

 

The Board has the power to exercise all of the National’s powers, other
than the powers which the Constitution and the Corporations Act require to be
exercised by the National in General Meeting. 
[Article 11.1 and s198A(2) of Corporations Act]

 

Decisions of the Board are decided by a majority of votes of Directors
present and entitled to vote.  Each Director
has one vote.  [Articles
12.3 and 12.4]

 

4.4                                Appointment
of Alternate Director

 

Articles 12.6 - 12.14 of the National’s Constitution provides for a
Director to appoint an Alternate Director to act in his / her place, subject to
the approval of the majority of the other Directors.  However, it has not been the practice in the
National to appoint Alternate Directors.

 

5                                          Remuneration

 

5.1                                Remuneration

 

Non-Executive Directors do not participate in schemes designed to
remunerate executives and do not receive share options, performance rights,
bonuses or other types of performance based remuneration.

 

The National does not provide retirement benefits to Non-Executive
Directors, other than the superannuation payments described below.

 

Each Non-Executive Director will receive the fees set out in Schedule 1
of this letter for their directorship.

 

Additional fees are payable for membership of any Board committees,
subsidiary directorships and for the position of Chairman, in accordance with
the National’s Constitution.

 

The Board approves these fees within the limits set by the shareholders
of the National in General Meeting.

 

Shares

 

Under the National’s Non-Executive Director Share Plan, you will be
provided at least 10% of your annual remuneration in the form of National
shares, except in limited, unusual circumstances.  There is flexibility to provide a maximum of
40%

 

 

of your annual emoluments in the form of National shares.  The Company Secretary will provide you with
further information on the Non-Executive Director Share Plan.

 

Superannuation

 

Directors may elect to receive part of their remuneration in the form
of superannuation contributions.  As a
minimum, in accordance with the relevant superannuation guarantee (“SG”)
legislation, the National is generally obliged to pay into an approved
superannuation fund, superannuation guarantee contributions on behalf of
Directors at the rate of 9% of the fees (and any other amounts which fall
within the description of “ordinary time earnings” for SG purposes) paid to
you.

 

Other
non-cash benefits

 

If required, the National will provide Directors with a laptop computer
to facilitate the electronic receipt of Board papers and receipt of electronic
communication material to enable Directors to effectively perform their duties
to the National.  Subject to applicable
law, financial services may also be provided by the National to Directors under
terms and conditions that would normally apply to the public.  [Clause 13.5 of Board
Charter]

 

The Company Secretary will assist you to make arrangements in this
regard.

 

5.2                                Expenses

 

You are entitled to be reimbursed out of the funds of the National such
reasonable travelling, accommodation and other expenses as you may incur when
travelling to or from Board meetings or Board committee meetings or when you
are otherwise engaged in the business of the National.  [Article 10.18]  I should mention that it is the
National’s policy that no more than two Directors should travel by air together
at any time.

 

5.3                                Insurance
and indemnity

 

You have the benefit of the indemnity provided to you in the National’s
Constitution.  This indemnity is broad,
however, it does not provide protection if the National is prohibited from
indemnifying you, for example, where liability is owed to the National.  [Article 21.1 and s199A(2)
of the Corporations Act]

 

You are invited to enter into a Deed of Access, Indemnity and Insurance
which mirrors the protection afforded to you under the National’s
Constitution.  That deed also includes an
undertaking by the National to effect and maintain an appropriate Directors’
and Officers’ Insurance Policy.  A copy
of that deed is attached.  Could you
please sign the deed and return it at your convenience.

 

You may also be protected under the National’s Directors & Officers
Insurance Policy.  Details of the
insurance policy are provided in the brochure attached.

 

It is important that, if you become aware of any matter that may give
rise to an actual or potential claim, or of any circumstances that may lead to
such a claim, you contact Global Operational Risk, Insurance & Compliance
(Melbourne).

 

 

6                                          Induction
and training

 

6.1                                Induction

 

The National’s Induction Program for Non-Executive Directors is
designed to assist them to participate fully and actively in Board decision-making
from the date of appointment.

 

The program enables appointees to gain an understanding of:

 

•                                             the National’s financial, strategic, operational and risk management
position;

 

•                                             their rights, duties and responsibilities; and

 

•                                             the role of Board Committees.

 

The National’s Induction Program involves the supply of reading
material, informal discussions with the Group Chief Executive and Executive
General Managers, and technical workshops.

 

From time to time, the Nominations Committee reviews the effectiveness
of the Induction Program.

 

Continuing
education

 

The National is committed to providing its Directors with opportunities
to update and enhance their skills and knowledge.  Directors are regularly provided with updates
from management and external advisers about key developments in the company and
the banking and funds management industries.

 

Directors are also entitled to attend external seminars, workshops and
other training programs that are relevant to the National or to their
directorship.  The National will
reimburse a Director for any reasonable costs of such additional training.

 

7                                          Access to
information

 

7.1                                Access to
financial records and company books

 

Under the Corporations Act, a Director has
rights of access to the National’s financial records and, for the purposes of
legal proceedings to which the Director is a party, the National’s books, at
all reasonable times.  [Section 198F and section 290 of the Corporations Act]

 

The Deed of Access, Indemnity and Insurance
grants you access to Board papers and related material.

 

7.2                                Access to
the Company Secretary

 

The Company Secretary is responsible for
providing advice and support to the Board and for ensuring that Directors have
sufficient information to make decisions at meetings of the Board.  The Company Secretary also prepares minutes
of all Board meetings.

 

 

Directors have direct access to, and are
entitled to request additional assistance and information from, the Company
Secretary.

 

7.3                                Authority
to appoint independent professional advisers

 

Directors are entitled to seek independent professional advice in
relation to their duties and powers as Directors of the National.  The National will reimburse Directors for all
reasonable expenses incurred in obtaining such advice, provided that the
expenses have been approved by the Chairman and, where appropriate, a copy of
the advice is made available to the Board.

 

8                                          Further
guidance and information

 

If you have any queries about your appointment, please contact the
Company Secretary.

 

The next Board
meeting is on 2 – 3 September in Melbourne and the following meeting after that
will be in New Zealand on 7 – 8 October. 
I will call you to discuss what would be the most suitable starting date
for you.

 

Paul, I and my other
Board colleagues and I are looking forward to working with you in the future.

 

 

	
  Yours sincerely

  
	
   

  
	
  [Original signed]

  	
   

  
	
   

  
	
  GRAHAM J KRAEHE AO

  
	
  CHAIRMAN

  

 

 

I acknowledge that I have read, understood and
accepted the contents of this letter.

 

 

	
  Signed:

  	
  [Original signed]

  	
   

  
	
   

  
	
  Name:

  	
  PAUL J. RIZZO

  	
   

  
	
   

  
	
  Date:

  	
  11 August 2004

  	
   

  

 

 

When you have signed the attached copy of this letter,
please return the signed copy to –

 

Mr GF Nolan

Company Secretary

National Australia Bank Limited

Level 24

500 Bourke Street

MELBOURNE   VIC   3000

 

 

Schedule 1: Directors’ Fees as at 9 August 2004

 

	
  BOARD/COMMITTEE

  	
   

  	
  CHAIRMAN

  	
   

  	
  MEMBER

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal
  Board and Board Nomination Committee

  	
   

  	
   

  	
   

  	
  A$

  	
  137,150

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal
  Board Audit Committee

  	
   

  	
  A$

  	
  39,000

  	
   

  	
  A$

  	
  19,500

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal
  Board Risk Committee

  	
   

  	
  A$

  	
  39,000

  	
   

  	
  A$

  	
  19,500

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Compensation
  Committee

  	
   

  	
  A$

  	
  17,550

  	
   

  	
  A$

  	
  7,364

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