Board Resolution Format for Related Party Transaction

BOARD RESOLUTION: APPROVAL OF RELATED PARTY TRANSACTION

DOCUMENT ID: CORP-RES-RPT-[YEAR]-[SEQ#]
EFFECTIVE DATE: [Date]
VERSION: 1.0
GOVERNING JURISDICTION: [State/Country of Incorporation]

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STATUTORY & LEGAL COMPLIANCE NOTICE

This document is a formal corporate instrument intended to satisfy statutory requirements regarding the disclosure and authorization of transactions between a corporation and its directors, officers, or affiliated entities. Disclaimer: This template does not constitute specific legal advice. Counsel must verify compliance with local corporate law (e.g., Delaware General Corporation Law § 144, or equivalent) and applicable securities regulations regarding "interested director" conflicts, fiduciary duties of loyalty, and fairness opinions.

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I. RECITALS

WHEREAS, [Company Full Legal Name] (the "Company") intends to enter into a commercial arrangement (the "Transaction") with [Related Party Name] (the "Counterparty"), who holds the status of a [Director/Officer/Shareholder/Affiliate] of the Company;

WHEREAS, the Board of Directors (the "Board") has reviewed the terms of the proposed Transaction, including the consideration of $[Amount in USD] (the "Transaction Value"), and has determined that such Transaction is in the best interests of the Company;

WHEREAS, the conflicted Director(s) have fully disclosed their interest and recused themselves from the final deliberations and voting process regarding this Transaction;

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II. OPERATIVE RESOLUTIONS

1. APPROVAL OF TRANSACTION: The Board hereby approves, ratifies, and confirms the Transaction between the Company and the Counterparty, as described in the attached Agreement, finding that the terms are fair and reasonable and not less favorable than those that would be available in a comparable arm's-length transaction with an unrelated third party.

2. DELEGATION OF AUTHORITY: The CEO or the CFO of the Company (the "Authorized Officers") are hereby authorized, empowered, and directed, for and on behalf of the Company, to execute, deliver, and perform the Transaction documents, with such modifications as the Authorized Officers may deem necessary or advisable, such execution being conclusive evidence of the Board’s approval.

3. RATIFICATION OF ACTS: All actions heretofore taken by any officer or director of the Company in connection with the negotiation, preparation, and execution of the Transaction are hereby ratified, confirmed, and approved in all respects.

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III. TRANSACTION TERMS (SUMMARY OF SCOPE)

4. SCOPE OF ENGAGEMENT: The Counterparty shall provide [Description of Services/Goods] as defined in the master service agreement. Performance shall meet the standard of professional care prevailing in the industry.

5. COMPENSATION & PAYMENT: The Company shall pay the Counterparty $[Amount] within [Number] days of receipt of a valid invoice. Payments overdue by more than [Number] days shall accrue interest at a rate of [1.5%] per month or the maximum permitted by law.

6. TERM & TERMINATION: This resolution shall remain effective for the duration of the Transaction. The Company may terminate the underlying agreement for convenience with [Number] days' written notice, or immediately for material breach, subject to a [30]-day cure period.

7. INTELLECTUAL PROPERTY: All deliverables, work product, and inventions created by the Counterparty in connection with this Transaction shall be deemed "Work Made for Hire" and shall remain the sole and exclusive property of the Company.

8. CONFIDENTIALITY: The parties agree to hold all non-public information disclosed in connection with the Transaction in strict confidence and shall not disclose such information to any third party without prior written consent.

9. LIMITATION OF LIABILITY & INDEMNIFICATION: Except in cases of gross negligence or willful misconduct, neither party shall be liable for indirect, incidental, or consequential damages. The Counterparty agrees to indemnify the Company against all claims arising out of the Counterparty’s performance of the Transaction.

10. DISPUTE RESOLUTION: Any controversy arising out of this Transaction shall be settled by binding arbitration administered by the [e.g., American Arbitration Association] in [City, State] in accordance with its Commercial Arbitration Rules.

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IV. EXECUTION & SIGNATURES

FOR [COMPANY FULL LEGAL NAME]: Signature: _____________________________________ Printed Name: [Authorized Signatory Name] Title: [Title / Role] Company: [Company Legal Name] Date: [Date]

FOR [RELATED PARTY / COUNTERPARTY]: Signature: _____________________________________ Printed Name: [Authorized Signatory Name] Title: [Title / Role] Date: [Date]

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V. STEP-BY-STEP EXECUTION & FILING GUIDE

1. Preparation: Open this document in your preferred word processor. Use "Find and Replace" (Ctrl+H) to update all bracketed fields ([...]) with the specific details of your transaction.
2. Board Review: Circulate the draft to all non-conflicted directors. Ensure the minutes of the board meeting specifically note the recusal of the interested party.
3. Digital Execution: Upload the finalized document to a platform like DocuSign, Adobe Sign, or HelloSign. Assign signing roles to the Authorized Officer and the Counterparty.
4. Verification: Ensure the person signing for the Counterparty has the legal capacity to bind that entity (verify through a Corporate Secretary’s certificate if necessary).
5. Record Retention:
   • Minute Book: Store the signed resolution in the Company’s Official Minute Book.
   • Audit Trail: Retain the digital audit certificate (generated by the e-signature platform) as proof of the execution timeline.
   • Compliance Audit: If the company is public, verify if an 8-K filing (or equivalent local notice) is required due to the "Related Party" nature of the deal.