Director Appointment Agreement Template for India

A Director Appointment Agreement formally establishes the terms and conditions when someone joins a company's board of directors in India. This legal contract spells out key details like duties, compensation, meeting attendance requirements, and confidentiality obligations aligned with the Companies Act, 2013.

Beyond meeting regulatory requirements, this agreement protects both the company and the incoming director by clearly defining their relationship. It typically covers important aspects like board tenure, removal procedures, indemnification rights, and compliance with SEBI guidelines for listed companies. Having clear written terms helps prevent future disputes and ensures smooth corporate governance.

Use a Director Appointment Agreement when bringing new directors onto your company's board, especially during key transitions like IPOs, expansions, or restructuring. This agreement becomes essential before the director begins their duties and must align with your company's Articles of Association and the Companies Act requirements.

The timing matters most when appointing independent directors, professional directors from other industries, or family members in closely-held companies. Getting this agreement in place early helps avoid governance issues, clarifies expectations, and provides legal protection - particularly important when dealing with sensitive information or complex decision-making responsibilities.

• Standard Executive Director Agreement: Used for full-time managing directors and executive board members, focusing on operational responsibilities and performance metrics
• Independent Director Agreement: Contains specific provisions for maintaining independence, committee roles, and compliance with SEBI guidelines
• Non-Executive Director Agreement: Emphasizes advisory roles, meeting attendance, and part-time commitment structures
• Nominee Director Agreement: Tailored for directors representing specific shareholders or investors, with special reporting obligations
• Family Business Director Agreement: Includes provisions for succession planning, family council interaction, and dual roles in management

• Board of Directors: Reviews and approves the Director Appointment Agreement terms, ensuring alignment with company strategy and governance needs
• Company Secretary: Drafts and maintains the agreement, ensures compliance with Companies Act requirements, and handles filing obligations
• Legal Counsel: Reviews or prepares the agreement, especially for listed companies requiring SEBI compliance
• Incoming Director: Negotiates and accepts the terms, responsibilities, and compensation outlined in the agreement
• Shareholders: May need to approve certain director appointments, particularly for key positions or special appointments

• Director Details: Gather full legal name, DIN, residential address, and qualifications of the incoming director
• Company Information: Compile board resolutions, Articles of Association excerpts, and existing director policies
• Role Specifics: Define exact designation, tenure, duties, committee memberships, and reporting relationships
• Compensation Structure: Document sitting fees, commission details, stock options, and other benefits
• Compliance Requirements: Check MCA guidelines, SEBI regulations for listed companies, and industry-specific rules
• Document Generation: Use our platform to create a legally sound agreement that incorporates all essential elements

• Appointment Terms: Director's designation, effective date, tenure, and board position details
• Duties & Powers: Specific responsibilities, authority limits, and committee assignments
• Remuneration: Sitting fees, commission structure, benefits, and reimbursement policies
• Confidentiality: Non-disclosure obligations and handling of sensitive company information
• Compliance: References to Companies Act 2013, SEBI guidelines, and industry regulations
• Termination: Resignation process, removal conditions, and notice requirements
• Indemnification: Protection clauses and liability coverage for the director's actions

A Director Appointment Agreement differs significantly from a Director Services Agreement in several key aspects, though they're often confused. While both deal with director-company relationships, their scope and application vary considerably.

• Primary Purpose: Director Appointment Agreements focus on establishing board membership and governance roles, while Director Services Agreements detail specific operational or consulting services beyond basic board duties
• Legal Framework: Appointment agreements must comply with Companies Act 2013 board composition rules, while services agreements follow general contract law principles
• Compensation Structure: Appointment agreements typically cover statutory fees and board-related compensation, while services agreements outline project-based or consulting fees
• Duration and Terms: Appointment agreements align with board tenure and corporate governance, while services agreements often have specific project timelines or consulting periods