A resolution is a formal document within a company (corporation, LLC etc) stating certain actions that the company’s governing body is taking. The action could be anything: appointing someone to an executive position, authorizing a contract, issuing shares or membership interest, or even ratifying a sale of the company. The governing body in question could be a corporation’s board of directors or shareholders, an LLC’s members, or even a sub-committee within such groups.

Usually a resolution will start with “recitals” (short paragraphs that start with “whereas”) that lay out the ground work or background behind the actions to be taken.

Then, after the words “now therefore” there will usually be words to the effect of “be it resolved” and then the sentence(s) following that memorialize the action that the company is taking. For example, “be it resolved that John H. Smith is hereby appointed to serve as Chief Executive Officer effective Jan 1, 2020 on the terms set out in the contract between John H. Smith and Company, dated December 26, 2019.”

Resolutions are one of the formal company documents that need to be kept with the company records.