A corporate resolution is a recorded formal process adopted by a majority of a company’s Board of Directors authorizing the company’s officers or management team to undertake actions on behalf of the entire company. A corporate resolution has the intent of amending the corporation’s existing terms of reference, by-laws, or regulations, or to provide exact advice for the corporation’s management team on specific matters regarding the overall operation of the company.
A certificate of corporate resolution is the actual formal written or printed record of the corporate resolution. The certificate is used by a corporation as proof that designates an individual or several individuals as legal signers on behalf of the company.
Such persons named in the corporate resolution certificate are authorized by the corporation’s officers to perform actions on behalf of the company, such as sign checks for operations and employee payment. They also are given access to the corporation’s bank account, enabling the representative to withdraw cash from company reserves. Corporate resolutions are also used to identify corporate officers who can assign, trade, transfer or even hedge on behalf of the corporation.
The corporate board of directors is responsible for major corporate decisions such as company dividends and the election of new board members. If a board decides to increase the size of a dividend paid to shareholders, a corporate resolution will be created. A corporate resolution, in this case, will detail the terms of new dividends along with the date of the board meeting and who was in attendance.
Procedure
Typically, all persons named in a corporate resolution must be present in person in order to ratify the document correctly. Once the document has been agreed upon by all of the members present and the body has been filled out entirely, those identified sign and date the resolution.
The Secretary of the company can use his or her state-issued seal on the document, which indicates its official value.
The resolutions enacted resulting from the creation of a corporate resolution certificate must be recorded – typically by the corporate Secretary – in the board of directors’ written minutes record, which details all of the decisions made throughout the course of the meeting.
SAMPLE CORPORATE RESOLUTION
I, the undersigned, hereby certify that I am the Secretary
of_______________________________(Name of Corporation), a corporation
duly organized and existing under and by virtue of the laws of the State
of ___________________________, that I am the keeper of the corporate
records of this Corporation and that as such, I am authorized to execute
this certification on behalf of this Corporation; that the following is
a true, correct and compared copy of a resolution duly adopted and
ratified at a meeting of the Board of Directors of this Corporation,
duly called and held on _______________________(Date) , in accordance
with its charter and by laws, at which meeting a quorum was present and
acting throughout; that said resolution has not been in any way amended,
annulled, modified, rescinded or revoked, but is in full force and
effect.
Resolved, that the President and Treasurer of this Corporation are
hereby authorized in the name of this Corporation to borrow up to the
sum of_____________________________ Dollars from
____________________________(Another Company) , for the purpose of
__________________________________ and on behalf, and as the act, of
this Corporation to execute and deliver to
____________________________(Another Company), a valid mortgage or deed
of trust and promissory note, providing for repayment of the principal
and interest.
I further certify that the Board of Directors of this Corporation has,
and at the time of adoption of this resolution had, full power and
lawful authority to adopt the foregoing resolution and to confer the
powers granted to the persons named who have full power and lawful
authority to exercise the same.
IN WITNESS WHEREOF, I hereunto subscribe my name and affixed the seal of
this Corporation on this _________ day of __________________, 20 ___
SEAL
Secretary__________________________________
Attest:
President __________________________________
Treasurer __________________________________