Directors service contract (tcw)


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Directors service contract (tcw)

  1. 1. DIRECTOR’S SERVICE AGREEMENTTHIS AGREEMENT is made on the [INSERT DATE] BETWEEN:[NAME OF COMPANY] a company incorporated under the Companies Acts with registered number[COMPANY NUMBER] and having its registered office at [COMPANY ADDRESS] ("the Company")AND[NAME OF DIRECTOR] residing at [ADDRESS OF DIRECTOR] ("the Director")IT IS AGREED as follows:1. DEFINITIONS 1.1 In this Agreement the words and expressions contained in this Clause 1.1 shall, unless otherwise specified or the context otherwise requires, have the meanings set opposite them: "the Employment" means the employment of the Director by the Company under the terms of this Agreement; "the Board" means the board of directors of the Company from time to time or any duly authorised committee thereof; "group company" means any subsidiary or associated company of the group "Confidential Information" means all information which may be imparted in confidence or be of a confidential nature relating to the business or prospective business, plans or internal affairs of the Company or any group company; "Intellectual Property" means inventions, discoveries, processes, copyright works, designs, plans, drawings, computer programmes and codes, and all other forms of data or records, procedures or systems in respect of which intellectual property rights (as hereinafter defined) subsist (or are capable of subsisting subject to the making of the appropriate application or registration) and any later modification or development and all other similar or analogous items; "Intellectual Property Rights" means all and any intellectual property rights subsisting in any part of the world, whether registered or unregistered, and all applications for such rights, including without limitation, patents, applications for patents, inventions, trademarks or trading names, service marks, know-how, United Kingdom and foreign designs, copyrights (including rights in computer software), topography rights and other rights in electronic, optical, magnetic devices or media, moral rights and all rights having equivalent or similar effect wheresoever situated.1.2 References in this Agreement to any statute or statutory provision shall include a reference to that statute or statutory provision as may from time to time be amended, extended, consolidated or replaced, and shall include any orders, regulations or instruments made under the relevant statute.1.3 References in this agreement to persons shall include references to firms, corporations or unincorporated associations. 1
  2. 2. 1.4 Words denoting the singular shall include the plural and vice versa and words denoting any gender shall include all genders.2. THE APPOINTMENT2.1 The Company shall employ the Director and the Director shall serve the Company with effect from [COMMENCEMENT DATE] ("the commencement date") notwithstanding the date or dates of this Agreement.2.2 The Company may at any time require the Director to serve any other group company or companies and to carry out for such group company or companies such duties and responsibilities as may be assigned by the Board, but otherwise on the same terms and conditions as herein provided.3. THE TERM3.1 The Employment (subject to the provisions of Clause 14) shall continue unless and until terminated at any time by either the Company or the Director giving [INSERT NOTICE PERIOD] months notice in writing to that effect.3.2 On either the Company or the Director serving notice to terminate the Employment for any reason the Company shall be entitled to make a payment to the Director in lieu of notice, such payment to be made after deductions required or permitted by law in respect of income tax, national insurance contributions and any other relevant deductions. 4. DUTIES AND RESPONSIBILITIES4.1 The Director shall well and faithfully serve the Company or any group company and use their best endeavours to promote the interests of the Company or any group company and shall undertake such duties and responsibilities and exercise such powers in relation to the business of the Company or any group company as may be assigned to or vested in them by the Board.4.2 In discharging such duties and responsibilities and exercising such powers, the Director shall at all times conform to the reasonable directions of the Board, and whenever required to do so, shall give a full account to the Board of their conduct of the business or affairs of the Company or any group company.4.3 The Director shall work such hours as is necessary for the proper discharge of their duties and shall attend and work at the address referred to in Clause 2.2 or at such place or places in the United Kingdom or elsewhere as the Company shall reasonably specify, provided that the Director shall not be required to work outside the United Kingdom for a period of longer than one month. 5. REMUNERATION5.1 As remuneration for their services hereunder, the Director shall be paid a salary at the rate of [SALARY] per annum which shall accrue from day to day and be payable by equal instalments in arrears at the end of each calendar month (or such other date as the Company may determine) and which shall be inclusive of any fees payable to the Director as director of the Company and/or any group company. 2
  3. 3. 5.2 Such salary shall be subject to annual review on [REVIEW DATE] in each year or such other date as may be agreed between the Company and the Director. 6. EXPENSES6.1 The Director shall be reimbursed all reasonable expenses properly incurred by them in the discharge of their duties hereunder upon production of satisfactory documentary evidence.6.2 If the Company issues the Director with a company sponsored credit or charge card, such card shall be used solely for expenses reimbursable under Clause 6.1. The Director shall promptly return any such credit or charge card when so requested and in any event forthwith upon termination of the Employment howsoever arising. 7. HOLIDAY ENTITLEMENT7.1 In addition to public and statutory holidays, the Director shall be entitled to [DAYS HOLIDAY] days paid holiday in each calendar year to be taken at such time or times as may be agreed with the Board.7.2 Such holiday entitlement shall accrue from day to day and may, with the consent of the Board, be carried forward from one calendar year to the next but not further. For the purpose of calculating holiday entitlement hereunder, the Company’s holiday year runs from the commencement of this Agreement and annually thereafter. In respect of any holidays accrued but not taken, the Director shall not be entitled to receive holiday pay except on termination of office (other than termination pursuant to Clause 14) when the Director shall be entitled to pay in lieu of outstanding holiday entitlement.8. PENSION8.1 There is no pension scheme in which the Director will participate by virtue of their employment. 8.2 A contracting-out certificate under the Social Security Pensions Act 1975 is [NOT] in force in respect of the Employment. 9. SICKNESS ABSENCE9.1 If the Director is prevented by illness or injury from performing their duties and responsibilities hereunder, they shall notify the Company on the first day of such illness or injury and provide the Company with a completed self certification form in respect of any absence from business lasting more than 3 days but less than 8, or a doctor’s certificate in respect of any absence exceeding 7 consecutive days.9.2 In the event of such illness or injury, the Director shall be entitled to receive full remuneration unless and until the Director’s employment is terminated in terms of Clause 14.1.3, provided that such remuneration shall be inclusive of any statutory sick pay to which the Director is entitled at the time and any social security sickness benefit or other benefits or insurance policies recoverable by the Director. 10 RESTRICTIONS 10.1 The Director shall disclose to the Board any interest of their own (or that of their spouse or any child of their or their spouse under the age of 18): 3
  4. 4. 10.1.1 in any trade, business or occupation whatsoever which is in any way similar to any ofthose in which the Company or any group company is involved; and10.1.2 in any trade or business carried on by any supplier or customer of the Company orany group company whether or not such trade, business or occupation may beconducted for profit or gain.10.2 Save as permitted under Clause 11.1 the Director shall not at any time, without theprior written consent of the Board, carry on or be concerned, engaged orinterested directly or indirectly (whether as principal, shareholder, partner,consultant, employee, director, sub- contractor, Director, agent or otherwise) inany trade or business, other than that of the Company or any group company;provided that this provision shall not prevent the Director from holding anyshares or loan capital (not, when aggregated with any shares or loan capital held by the spouse of the Director and their children under the age of 18, exceeding 3% of the shares or loan capital of the class concerned forthe time being issued) in any company which is quoted on a recognised investmentexchange (as defined by the Financial Services Act 1986).11. INTELLECTUAL PROPERTY11.1 If during the period of Employment the Director either alone or jointly with othersmakes any invention, design or discovery capable of use in connection with anybusiness of the Company or any group company such invention, design ordiscovery and any intellectual property rights associated with the same will belongto the Company or any group company or (for the extent that the same belongautomatically to the Director by operation of law) will forthwith be assigned tothe Company or any group company. Upon making any such invention, design ordiscovery the Director will immediately communicate all information concerningthe same to the Company or any group company. If so requested at the Company’s expense but without receiving payment, the Director will execute andprocure execution of all documents and do all things necessary to vest thetitle to such invention, design or discovery in the Company or any group company.11.2 The Director hereby irrevocably appoints the Company or its nominee to be their attorney in their name and on their behalf to execute anydocuments and generally to act and to use their name for thepurpose of giving to the Company (or its nominee) the full provisionof Clause 12.1.12 CONFIDENTIALITY12.1 The Director shall at all times (both during and after the termination of their Employment) maintain absolute confidentiality in respect of allConfidential Information and shall not disclose any of the same except in theproper performance of their duties hereunder or unless ordered to doso by a court of competent jurisdiction.13 TERMINATION OF APPOINTMENT 4
  5. 5. 13.1 The Company shall be entitled to terminate the Employment at any time by givingwritten notice of immediate termination to the Director in any of the followingcircumstances:13.2 if the Director commits a criminal offence or is found guilty of serious misconduct or dishonesty or wilful neglect whether during the performance oftheir duties or otherwise which in the opinion of the Companyrenders the Director unfit to continue their Employment with the Company orwhich would be likely to adversely prejudice the reputation orinterests of the Company or any group company;13.3 if the Director seriously or persistently breaches any provision in this Agreement oris, in the opinion of the Board, incompetent in the performance of theirduties;13.4 if the Director is unable to perform their duties as a result of illness or injury for a period or periods aggregating at least [INSERT DAYS] working days inany period of 12 consecutive calendar months or for [INSERT DAYS]consecutive working days;13.5 if the Director becomes insolvent or bankrupt or enters into any composition or arrangement with or for the benefit of their creditors;13.6 if the Director becomes of unsound mind;13.7 if the Director becomes prohibited by law from being a director.13.8 The Director shall not be entitled to make a claim against the Company for damagesfor loss of Employment where the Employment was validly terminated under thisClause 14.13.9 Upon termination of the Employment the Director shall deliver up to the Companyall notes, memoranda and other correspondence, documents, papers andproperty belonging to the Company or any group company which may havebeen prepared by them or have come into their possession and shallnot retain any copies thereof and not permit the same to be used by any party.14 RESTRICTIONS AFTER TERMINATION14.1 The Director shall not after termination of the Employment represent themself as being in any way connected with the Company or any groupcompany.14.2 Since the Director is likely to obtain knowledge of Confidential Information in thecourse of their Employment and the trust and personal knowledge ofcustomers, suppliers and other contacts of the Company or any groupcompany the Director hereby agrees that in addition to the other terms of thisAgreement they will be bound by the following restrictions:14.2.1 the Director shall not for a period of [RESTRICTED PERIOD] months from the date of termination of Employment ("the restricted period"), and within[RESTRICTED AREA] ("the prohibited area"), directly or indirectly carry on orbe engaged or concerned in (whether as director, manager, partner,consultant, agent, employee or otherwise) any business which is or is likelyto be competitive with or similar to the business carried on by the Company or anygroup company; 5
  6. 6. 14.2.2 the Director shall not during the restricted period directly or indirectly by any means whatsoever, whether for themself or for any third party, canvass orsolicit the custom of any person, firm, company or otherwisewho was a customer of, or who dealt with the Company or any group company atany time during the 12 month period preceding the date of termination ofEmployment;14.2.3 the Director shall not during the restricted period directly or indirectly by any means whatsoever, whether for themself or for any third party, solicit orendeavour to entice away from the Company or any groupcompany any person who is at the date of termination of Employmenta director, consultant, agent, employee or otherwise of the Company orany group company;14.2.4 the Director shall not following termination of the Employment disclose anyconfidential information relating to the business of the Company or any groupcompany to any party whatsoever, unless ordered to do so by a court ofcompetent jurisdiction.15 RECONSTRUCTION AND AMALGAMATIONS15.1 If before the expiration or determination of this Agreement the Employment shall be terminated by reason of the liquidation of the Company for thepurpose of reconstruction or amalgamation and the Director shall be offeredemployment with any concern or undertaking resulting from suchreconstruction or amalgamation on terms which are substantially thesame as the terms of this Agreement then they shall have no claim against the Company in respect of the termination of the Employment.16 GENERAL16.1 If any of the foregoing undertakings is held for any reason not to be valid orenforceable as going beyond what is reasonable for the protection of the interestsof the Company or any group company, but would be valid if part of the wordingwere deleted or its extent reduced or modified, then such undertakings shallapply with such modifications or variations as may be necessary to make themenforceable, and any such modifications or variations shall not thereby affect thevalidity of any of the other undertakings.16.2 No failure on the part of either party to exercise, and no delay on its part inexercising any right or remedy under this Agreement will operate as a waiverthereof, nor will any single or partial exercise of any right or remedy preclude anyother or further exercise thereof or the exercise of any other right or remedy.16.3 This Agreement governs the terms of the Director’s employment with the Companyfrom the commencement date to the exclusion of all other agreements orarrangements whether written or oral or expressed or implied between the Directorand the Company relating to the Employment of the Director which are cancelledwith immediate effect.17. GOVERNING LAW AND JURISDICTION 6
  7. 7. This Agreement shall be governed by and construed in accordance with the law of [England OR Scotland] and the parties hereby submit to the exclusive jurisdiction of the [English OR Scottish] courts.IF JURISDICTION IS ENGLAND INCLUDE FOLLOWING LINEIN WITNESS WHEREOF the parties have signed this agreement the day and year first above written.OR IF JURISDICTION IS SCOTLAND INCLUDE FOLLOWING LINEIN WITNESS WHEREOF these presents are executed on this [INSERT DATE] as follows: SIGNED for and on behalf of the Company by (Director/Secretary) before this witness: Witness signature: Witness name: Witness address: SIGNED by the Director before this witness: Witness signature: Witness name: Witness address: 7
  8. 8. GUIDANCE NOTESThese notes are provided to assist you in completing your document. They do not form part of theDirectors Service Agreement.IMPORTANT: The content and terms of this Agreement are those commonly used to cover thegeneral provisions required between a Company (Employer) and a Director (Employee). ThisAgreement is solely to be used as a template which can be tailored to the individual needs of theparties using it. Clauses and terms can be added, edited and removed – but care must be taken toensure that if alterations are made all references to clause numbers in the Agreement areamended to reflect those changes. The provision of this document does not consititute legaladvice or compliance and where necessary it is recommended that independent legal advice issought.Each party must sign and date the document before a witness, who must also sign and insert theirname and address. If both parties sign at the same time, the same person may act as a witness foreach party.Please complete and insert the fields highlighted in Red in the agreement to meet your specificneeds. A description of each of these field are listed below to assist in the information required. [ADDRESS OF DIRECTOR] The home address of the Director. [COMPANY ADDRESS] The registered office address of the Company. [COMPANY NUMBER] The registered company number. [COMMENCEMENT DATE] The day, month and year on which the appointment of the Director to the Company will begin. [DAYS HOLIDAY] The number of annual days of paid holiday to which the Director will be entitled. [England OR Scotland], [English OR Scottish] Specify the jurisdiction which will apply to the Agreement. If the Companys place of business is in Scotland specify "Scotland" and “Scottish”; if the Companys place of business is in England or Wales specify "England" and “English”. [EXPIRY DATE] This value is used to calculate the expiry date of the (fixed period) contract. [FIXED PERIOD] 8
  9. 9. The number of months or years for which the (fixed period) contract will run.[NAME OF COMPANY]The name under which the Company trades.[NAME OF DIRECTOR]The full name of the Director.[NOT]An indication of whether or not the Company holds a contracting out certificate in respect ofthe Social Security Pensions Act 1975. This is to do with contracting out of the Stateadditional pension top-up arrangements. If an employer has a good enough pension schemeit can qualify for contracting out and as a result NI contributions are less than they otherwisewould be.[PENSION SCHEME]The name of the scheme in which the Director may participate.[PLACE OF WORK]The address where the Director will principally carry out his or her duties.[RESTRICTED PERIOD], [RESTRICTED AREA]It is common for employers to place restrictions upon a Director after termination ofemployment to prevent the Director from using information obtained from the Company torun a business in competition, poach staff or customers etc. The restrictions are limited to atime period and a geographic area. The period should be no longer than is reasonablynecessary to protect the Companys legitimate business interests and the same care appliesto the extent of the restricted area. Excessive restrictions may not be upheld by the courts ifchallenged.[REVIEW DATE]The day and month each year when the Directors salary will be reviewed. This wouldtypically be on the anniversary of the day Director joined the company. Alternatively, a fixeddate for all employees might be specified.[SALARY]The annual salary that the Director will be paid. 9