If you`re a director or executive leaving a company, it`s important to have a properly drafted exit agreement that protects your rights and interests. An exit agreement or severance agreement is a legally binding contract between the departing executive and the company. It outlines the terms and conditions of the executive`s departure from the company, including any compensation or benefits owed to them.
To ensure that your exit agreement is comprehensive and covers all the necessary provisions, you can use a template. A director exit agreement template is a pre-drafted document that contains the standard clauses and provisions that should be included in an exit agreement. It saves time and money on drafting a custom agreement from scratch.
Here are some key provisions that should be included in a director exit agreement template:
1. Severance pay: The agreement should specify the amount of severance pay that the executive will receive upon termination. This can be a fixed amount or a formula based on their salary and length of service.
2. Release of claims: The agreement should contain a release of claims provision, which means that the executive agrees not to sue the company for any claims arising from their employment or termination.
3. Non-compete and non-solicitation clauses: The agreement may contain non-compete and non-solicitation clauses, which restrict the departing executive from working for a competitor or soliciting the company`s clients or employees.
4. Confidentiality and non-disclosure: The agreement should include confidentiality and non-disclosure provisions, which prohibit the executive from disclosing any confidential information about the company, its customers, or its operations.
5. Return of company property: The agreement should require the executive to return all company property, including laptops, phones, and other equipment, upon termination.
6. Governing law and jurisdiction: The agreement should specify the governing law and jurisdiction that will apply in case of any disputes.
Using a director exit agreement template can ensure that all these provisions are included in the agreement and that the agreement is legally valid and enforceable. However, it`s important to customize the template to suit the specific circumstances of your departure and to seek legal advice before signing the agreement.
In conclusion, a director exit agreement template can be a useful tool for departing executives to protect their interests. It can save time and money on drafting a custom agreement and ensure that all the necessary provisions are included in the agreement. However, it`s important to customize the template and seek legal advice before signing the agreement.