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A Directors Service Agreement is a crucial document used when appointing new members to a company's board of directors in Saudi Arabia. This agreement serves as the primary contract between the company and its directors, whether executive or non-executive, establishing their rights, duties, and obligations. The document must comply with Saudi Companies Law, Capital Market Authority regulations (for listed companies), and Shariah principles, while incorporating international corporate governance best practices. It is particularly important in the Saudi context due to the ongoing economic reforms under Vision 2030, which emphasize improved corporate governance and transparency. The agreement typically covers comprehensive details about the appointment, including remuneration, time commitment, confidentiality obligations, and termination provisions, while ensuring alignment with both local regulatory requirements and the company's constitutional documents.

1. Parties: Identification of the Company and the Director

2. Background: Context of the appointment and brief company overview

3. Definitions: Key terms used throughout the agreement

4. Appointment and Term: Terms of appointment, position, and duration

5. Duties and Responsibilities: Director's key duties, including statutory obligations under Saudi law

6. Time Commitment: Expected time dedication to the role

7. Remuneration and Benefits: Compensation package, including fees, allowances, and benefits

8. Expenses: Policy on reimbursement of business expenses

9. Confidentiality: Obligations regarding company confidential information

10. Conflicts of Interest: Procedures for declaring and handling conflicts

11. Board Policies: Compliance with company policies and procedures

12. Termination: Circumstances and procedures for ending the appointment

13. Post-Termination Obligations: Continuing duties after termination

14. Company Property: Handling of company assets and documents

15. Notices: Communication procedures between parties

16. Governing Law: Application of Saudi law and jurisdiction