Directors Service Contract Template for United States

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Key Requirements PROMPT example:

Directors Service Contract

"I need a Directors Service Contract for appointing a new non-executive director to our tech startup's board, with specific provisions for equity compensation and remote board meeting attendance, starting March 1, 2025."

Document background
The Director's Service Contract is essential when appointing new board members or formalizing existing director relationships. This document is particularly crucial in the United States where corporate governance requirements are strictly regulated at both federal and state levels. The contract typically includes detailed provisions about duties, compensation, confidentiality, and termination terms, while ensuring compliance with various regulatory requirements including Sarbanes-Oxley and SEC regulations for public companies. Directors Service Contracts are fundamental in establishing clear expectations and protecting both the company's and director's interests.
Suggested Sections

1. Parties: Identifies the company and the director entering into the service agreement

2. Background: Context of the director's appointment and relevant corporate background

3. Definitions: Key terms and their meanings used throughout the agreement

4. Appointment and Term: Details of the director's position, appointment date, and duration of service

5. Duties and Responsibilities: Comprehensive outline of director's obligations, authority, and fiduciary duties

6. Time Commitment: Expected time dedication and availability requirements

7. Compensation: Details of salary, fees, benefits, and other remuneration arrangements

8. Expenses: Policy on reimbursement of business-related expenses

9. Confidentiality: Obligations regarding confidential information and trade secrets

10. Intellectual Property: Rights and obligations regarding company IP and creations during service

11. Termination: Grounds and procedures for ending the service agreement

12. Post-Termination Obligations: Continuing duties and restrictions after agreement ends

13. General Provisions: Standard legal clauses including governing law, notices, and amendments

Optional Sections

1. Stock Options and Equity Compensation: Terms of any share-based compensation or equity participation (include when director receives equity compensation)

2. International Travel and Duties: Provisions for overseas responsibilities and travel requirements (include for companies with international operations)

3. Multiple Board Positions: Terms for serving on boards of subsidiaries or related entities (include for corporate groups)

4. Change of Control: Special provisions triggered by company ownership changes (include for public companies or those planning exit events)

5. Corporate Opportunity: Guidelines for handling business opportunities related to company's interests (include for companies in competitive industries)

Suggested Schedules

1. Schedule 1: Compensation Details: Detailed breakdown of all compensation elements including salary, bonuses, and benefits

2. Schedule 2: Company Policies: Key corporate policies applicable to directors including code of conduct and governance guidelines

3. Schedule 3: D&O Insurance Coverage: Details of directors' and officers' liability insurance protection

4. Schedule 4: Board Committee Assignments: List of specific committee responsibilities and roles

5. Schedule 5: Performance Metrics: Specific performance criteria and evaluation standards for the director

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Clauses
Industries

Securities Exchange Act 1934: Federal law governing securities trading and public company requirements, essential for director obligations in publicly traded companies

Sarbanes-Oxley Act 2002: Corporate governance legislation establishing standards for public company boards, management, and accounting firms, including director responsibilities

Dodd-Frank Act: Financial regulation reform law affecting corporate governance, executive compensation, and disclosure requirements

Internal Revenue Code: Federal tax regulations affecting director compensation, benefits, and related tax implications

ERISA: Employee Retirement Income Security Act governing retirement and benefit plans that may apply to director compensation packages

FLSA: Fair Labor Standards Act establishing wage and hour standards, though directors typically exempt as executives

Equal Employment Opportunity Laws: Federal anti-discrimination laws ensuring equal treatment in employment matters, including director appointments

ADEA: Age Discrimination in Employment Act protecting against age discrimination for individuals over 40

ADA: Americans with Disabilities Act ensuring reasonable accommodations and preventing discrimination based on disabilities

State Corporate Laws: Specific state legislation governing corporate operations and director duties within the jurisdiction

Corporate Bylaws Compliance: Internal company rules and governance requirements affecting director roles and responsibilities

Stock Exchange Requirements: Listing requirements from relevant stock exchanges regarding board composition and director qualifications

Fiduciary Duties: Legal obligations including duty of care, loyalty, and good faith that directors owe to the corporation and shareholders

Executive Compensation Regulations: SEC and IRS rules governing director compensation, including disclosure requirements and tax implications

Trade Secrets and IP Laws: Legislation protecting company intellectual property and confidential information that directors must safeguard

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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