Nominee Director Agreement Template for England and Wales

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Key Requirements PROMPT example:

Nominee Director Agreement

"I need a Nominee Director Agreement for my UK-based fintech startup, where we're appointing a professional corporate services firm to provide nominee director services across our European subsidiaries, with the agreement to commence from March 2025."

What is a Nominee Director Agreement?

The Nominee Director Agreement is essential when companies require professional directors to fulfill statutory requirements or maintain corporate presence in specific jurisdictions. This agreement, governed by English and Welsh law, defines the relationship between the appointing company and the nominee director, ensuring clear understanding of roles, responsibilities, and legal obligations. It addresses key aspects such as fiduciary duties, decision-making authority, liability protection, and compliance with regulatory requirements. The document is particularly crucial for international businesses, offshore structures, and situations requiring professional directorship services.

What sections should be included in a Nominee Director Agreement?

1. Parties: Identification of the appointing company and nominee director

2. Background: Context of the appointment and relationship between parties

3. Definitions: Key terms used throughout the agreement

4. Appointment and Term: Terms of appointment and duration

5. Duties and Responsibilities: Specific obligations of the nominee director including statutory duties under Companies Act 2006

6. Remuneration: Payment terms and compensation details

7. Indemnification: Protection and liability coverage provisions

8. Termination: Circumstances and procedures for ending the agreement

What sections are optional to include in a Nominee Director Agreement?

1. Insurance: Directors and Officers (D&O) insurance requirements and coverage details

2. Non-Competition: Restrictions on competing activities and protection of business interests

3. Power of Attorney: Specific powers granted to the nominee director for acting on behalf of the company

What schedules should be included in a Nominee Director Agreement?

1. Schedule 1: Services: Detailed list of services to be provided by nominee director

2. Schedule 2: Fee Schedule: Detailed breakdown of fees and payment terms

3. Schedule 3: Company Information: Details of the company and its operations

4. Appendix A: Board Resolution: Copy of board resolution appointing the nominee director

What is a nominee director agreement?

A nominee director agreement is a legal document that outlines the rights and responsibilities of a nominee director appointed to the board of a company. A nominee director is typically nominated by an investor or shareholder to represent their interests on the board. The agreement clarifies the nominee's role, voting rights, confidentiality obligations, and potential conflicts of interest. It also specifies the circumstances under which the nominee can be removed from the board. Companies House provides guidance on director responsibilities in the UK. Consulting a solicitor is advisable when drafting a nominee director agreement to ensure compliance with relevant laws and regulations.

What are the legal risks in using a nominee structure?

Using a nominee structure, where a nominee director is appointed to represent the interests of a third party, can carry legal risks if not properly implemented. In the UK, nominee directors have the same duties and responsibilities as other directors under the Companies Act 2006. It's crucial to seek professional advice and ensure full transparency to mitigate these risks.