Document background
The Director's Agreement is a crucial document used when appointing executive directors (Vorstandsmitglieder) or managing directors (Geschäftsführer) in German companies. It serves as the primary contractual framework defining the relationship between the company and its directors, ensuring compliance with German corporate law, particularly the Stock Corporation Act (AktG) for AGs and the GmbH Act for limited liability companies. The agreement is typically prepared when appointing new directors or renewing existing appointments, and must carefully balance corporate law requirements with employment aspects. It requires approval from the Supervisory Board (in case of an AG) or shareholders (in case of a GmbH) and includes comprehensive provisions on duties, remuneration, benefits, and liability, while adhering to German corporate governance standards and regulatory requirements.
