When a company needs to make a significant decision or enter into a contract, they often use a board resolution to document and approve the decision. A board resolution can also help ensure that all necessary parties are aware of and agree to the decision. This article will focus on the format for a board resolution when entering into an agreement.
1. Heading
The resolution should start with a heading that includes the name of the company, the date, and the title of the resolution. For example: “XYZ Corporation Board Resolution for Entering into a Marketing Agreement.”
2. Introduction
The introduction should state the purpose of the resolution, which is to enter into an agreement with a specific individual or company. It should also contain a brief summary of the terms of the agreement.
3. Background
The background section should provide more information about the agreement and why it is necessary. This can include any research or analysis done by the board members that led to the decision to enter into the agreement.
4. Resolved Clause
The resolved clause is the heart of the board resolution. It should start with the word “resolved” and state in clear and concise language that the board has approved the entering into the agreement. The clause should also include the specifics of the agreement, such as the name of the other party, the length of the agreement, and any important terms or conditions.
5. Signatures
The board resolution should be signed by the members of the board who are present at the meeting where the resolution was passed. If the company has a corporate secretary, they should also sign the resolution.
6. Notarization
It is not uncommon for board resolutions to be notarized to add an extra layer of legality to the document. This step may be required in some states or jurisdictions.
In conclusion, a board resolution is an essential document when entering into an agreement. It provides a clear record of the decision-making process and ensures that all members of the board are in agreement with the decision. By following the format outlined above, companies can ensure that their board resolutions are clear, concise, and legally binding.