A director agreement is a contract between an employer and a director that sets the terms and conditions of their working relationship. The contract states what the roles and responsibilities of each party are and what rules and regulations they must follow. It also includes a rundown of the director's proposed compensation rate, including details about any available bonuses or other compensatory items. If benefits are offered during the director's employment with the company, that information is also included in the director agreement.
The purpose of the director agreement is to ensure that the employer-employee relationship is mutually beneficial and that all perks and conditions of employment are understood prior to job acceptance.
Below is a list of common sections included in Director Agreements. These sections are linked to the below sample agreement for you to explore.
This Director Agreement (the “ Agreement ”) is made and entered into as of [ ], 2007, by and between CNinsure Inc., a Cayman Islands company (the “ Company ”), and [ ], an individual (“ Director ”).
| I. | SERVICES |
1.1 Board of Directors . Director has been appointed as an Independent Director of the Company’s Board of Directors (the “ Board ”), effective upon approval by the Board, until the earlier of the date on which Director ceases to be a member of the Board for any reason or the date of termination or expiration of this Agreement in accordance with Section 5.1 and 5.2 hereof (such earlier date being the “ Expiration Date ”). The Board shall consist of the Director and such other members as nominated and elected pursuant to the then-current Memorandum and Articles of Association of the Company (the “ Memorandum and Articles ”).
1.2 Director Services . Director’s services to the Company hereunder shall include service on the Board to manage the business of the Company in accordance with applicable law and the Memorandum and Articles, and such other services mutually agreed to by Director and the Company (the “ Director Services ”).
| II. | COMPENSATION |
2.1 Expense Reimbursement . The Company shall reimburse Director for all reasonable travel and other out-of-pocket expenses incurred in connection with the Director Services rendered by Director. In addition, the Company will pay Director US$[ ] for each board meeting Director attended in person.
2.2 Fees to Director . The Company agrees to pay Director an annual fee of US$[ ] for the Director Services. In addition, the Company agrees to pay Director an annual fee of US$[ ] for serving as the chairperson of a Board committee. In the event Director ceases to serve on the Board for any reason, Director shall be entitled to the pro rata portion of the annual fee for the number of months he has served on the Board in a given year. The Company may also grant Director certain amount of stock-based compensation according to the Company’s effective stock-based compensation plans and approved by the compensation committee of the Board.
2.3 Company Obligation. The Company is obliged to buy sufficient Director & Officer insurance covering the complete term of Director.
| III. | DUTIES OF DIRECTOR |
3.1 Fiduciary Duties . In fulfilling his managerial responsibilities, Director shall be charged with a fiduciary duty to the Company and all of its shareholders. Director shall be attentive and inform himself of all material facts regarding a decision before taking action. In addition, Director’s actions shall be motivated solely by the best interests of the Company and its shareholders.
3.2 Confidentiality . During the term of this Agreement, and for a period of one (1) year after the Expiration Date, Director shall maintain in strict confidence all information he has obtained or shall obtain from the Company, which the Company has designated as “confidential” or which is by its nature confidential, relating to the Company’s business, operations, properties, assets, services, condition (financial or otherwise), liabilities, employee relations, customers (including customer usage statistics), suppliers, prospects, technology, or trade secrets, except to the extent such information (i) is in the public domain through no act or omission of the Company, (ii) is required to be disclosed by law or a valid order by a court or other governmental body, or (iii) is independently learned by Director outside of this relationship (the “ Confidential Information ”).
3.3 Nondisclosure and Nonuse Obligations . Director will use the Confidential Information solely to perform the Director Services for the benefit of the Company. Director will treat all Confidential Information of the Company with the same degree of care as Director treats his own Confidential Information, and Director will use its best efforts to protect the Confidential Information. Director will not use the Confidential Information for his own benefit or the benefit of any other person or entity, except as may be specifically permitted in this Agreement. Director will immediately give notice to the Company of any unauthorized use or disclosure by or through him, or of which he becomes aware, of the Confidential Information. Director agrees to assist the Company in remedying any such unauthorized use or disclosure of the Confidential Information.
3.4 Return of The Company Property . All materials furnished to Director by the Company, whether delivered to Director by the Company or made by Director in the performance of Director Services under this Agreement (the “ Company Property ”), are the sole and exclusive property of the Company. Director agrees to promptly deliver the original and any copies of the Company Property to the Company at any time upon the Company’s request. Upon termination of this Agreement by either party for any reason, Director agrees to promptly deliver to the Company or destroy, at the Company’s option, the original and any copies of the Company Property. Director agrees to certify in writing that Director has so returned or destroyed all such Company Property.
| IV. | COVENANTS OF DIRECTOR |