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Financial Solvency Resolution

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FINANCIAL SOLVENCY RESOLUTION

Corporate Identification

Corporation Name:

Corporation Limited Liability Company Partnership Other

Employer Identification Number (EIN) or Tax ID:

Meeting and Financial Review

At a meeting of the Board of Directors duly called and held on , at which a quorum was present and acting throughout, the following recitals and resolutions were considered and approved.

WHEREAS, the Board has reviewed and considered the Company's consolidated financial statements and schedules as of , together with management's representations and such other information as the Board deemed appropriate; and

WHEREAS, the Board, after reasonable inquiry of officers and advisors, has caused an analysis of the Company's assets and liabilities and cash flow projections for the next twelve months to be prepared and considered.

Findings of Solvency

The Board finds, determines and declares that, based on the information presented and reasonable inquiry:

1. As of the date of the financial statements referenced above, the fair value of the Company's assets, including contingent assets reasonably expected to be realized, is not less than the probable present value of its liabilities. Total assets: $ ; Total liabilities: $ .

2. The Company is able to pay its debts and other liabilities as they become due in the usual course of business for a period of at least twelve months following the date hereof.

3. The Board has considered the reasonably foreseeable cash needs of the Company, its expected capital expenditures, and the likelihood and effect of contingent liabilities.

Resolved

NOW, THEREFORE, BE IT RESOLVED, that the Board hereby confirms the foregoing findings and declares the Company to be solvent within the meaning of applicable law as of the dates set forth above.

BE IT FURTHER RESOLVED, that the officers of the Company are authorized and directed, on behalf of the Company, to take any action necessary to effect distributions, dividends, redemptions or similar transfers of assets in an aggregate amount not to exceed $ , provided such actions remain consistent with the solvency determinations recited herein and with applicable law.

BE IT FURTHER RESOLVED, that the Company is authorized to incur indebtedness, enter into credit facilities, and execute promissory notes, guarantees, and related instruments for purposes of financing operations or refinancing existing obligations in an aggregate principal amount not to exceed $ without further approval of the Board, provided that officers determine in good faith that such indebtedness will not render the Company insolvent.

BE IT FURTHER RESOLVED, that the Chief Executive Officer, Chief Financial Officer, and such other officers as are designated by the Board (each an Authorized Officer) are authorized to negotiate, execute and deliver in the name and on behalf of the Company any and all agreements, certificates, instruments and documents, and to take any and all actions deemed necessary or appropriate to carry out the purposes of the foregoing resolutions.

BE IT FURTHER RESOLVED, that officers are directed to obtain and retain written analyses (including cash-flow projections and pro forma balance sheets) supporting any distribution or borrowing authorized under these resolutions, and such analyses shall be maintained in the corporate records.

Authorize Distribution/Dividend Authorize Borrowing Execute Notes, Guarantees, or Security Instruments

Authorized Counterparties and Limits

Effective Date:

Certification

I, the undersigned, do hereby certify that the foregoing is a true and correct copy of resolutions duly adopted by the Board of Directors of the Company in accordance with the Company's bylaws, that such resolutions have not been amended or revoked and are in full force and effect as of the date set forth below, and that the persons executing this certificate are duly authorized to do so.

Chair/President:

By:

Date:

Corporate Secretary:

By:

Date:

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What a Financial Solvency Resolution Is and when organizations use it

A Financial Solvency Resolution is a formal corporate resolution where a board or authorized officer certifies that the company is solvent for a specified action, such as declaring dividends, approving a distribution, entering a merger, or issuing a loan guarantee. The resolution typically summarizes current assets and liabilities, affirms the ability to pay debts as they come due, and documents the factual basis for the solvency finding. It becomes part of the corporate minutes and serves as evidence for lenders, auditors, creditors, and regulators that the company met solvency standards at the stated effective date.

Why a clear, documented solvency determination matters

A written Financial Solvency Resolution creates an auditable record that supports corporate decisions, reduces personal liability risk for directors and officers, and helps satisfy third‑party due diligence from lenders, investors, or regulators. It clarifies the facts and assumptions relied upon and can be essential evidence if solvency is questioned later.

Why a clear, documented solvency determination matters

Typical users and signers for a solvency resolution

The following parties commonly prepare, approve, or rely on a Financial Solvency Resolution.

  • Board of Directors — Approves the resolution after reviewing financial statements and management attestations.
  • CFO or Controller — Prepares the supporting financial statements and certifies accuracy for the board.
  • Lenders and Investors — Request a resolution to confirm solvency before funding or closing transactions.

Use this distribution model to determine who must sign, who must review supporting documents, and who retains the official record.

Who has authority to sign the resolution

Board Chair

As presiding officer, the board chair commonly signs to attest that the board duly considered the solvency determination and approved the resolution during a properly noticed meeting.

Chief Financial Officer

The CFO or other authorized financial officer frequently provides a written certification of the balance sheet and cash flow analysis and signs to confirm the factual basis for the solvency finding.

Essential components every professional resolution should include

A complete Financial Solvency Resolution contains a formal recitation of facts, the board's finding, supporting documentation, signatory attestations, and distribution instructions so it can be relied on by internal and external stakeholders.

Title

A clear title such as 'Financial Solvency Resolution of [Company Name]' and a statement of the governing meeting or consent action for context and recordkeeping.

Recitals

Concise recitals describing recent financial reports, management representations, the purpose of the resolution, and any assumptions used in the solvency determination.

Solvency Finding

A direct statement that the company can pay debts as they come due and that assets exceed liabilities under the methods described.

Supporting Exhibits

Attach balance sheet, cash flow projections, and accountant or CFO certification to substantiate the factual basis of the solvency finding.

Signatures

Signature blocks for authorized directors or officers with printed names, titles, and dates; note whether notarization is required by recipient.

Recordkeeping Instructions

Specify where the signed resolution and exhibits will be retained (corporate minutes, finance folder) and who may distribute certified copies.

Key information fields required on the resolution

Entity Name: Full legal name
Resolution Title: One-line description
Effective Date: MM/DD/YYYY
Financial Statement Dates: Reporting date(s)
Authorized Signers: Names and titles
Attachment Index: List of exhibits

Step-by-step: drafting and approving the resolution

Follow this sequence to prepare a defensible solvency resolution and maintain a complete audit trail for internal and external review.

  • 01
    Gather Financials: Assemble balance sheet, income statement, and cash flow dated to the effective date.
  • 02
    Draft Resolution: Write recitals, the solvency finding, and reference supporting exhibits.
  • 03
    Board Review: Present at a properly noticed meeting or unanimous written consent for approval.
  • 04
    Sign and Record: Obtain authorized signatures, notarize if required, and file in corporate minutes.

Where the completed resolution goes and who receives it

A Financial Solvency Resolution is retained internally and may be provided to lenders, auditors, or regulators; maintain control copies and provide certified copies only to authorized third parties.

  • Corporate Minutes: Retain the signed original in the company minute book for legal proof.
  • Lenders / Investors: Provide certified copies to lenders as required by financing conditions.
  • Auditors: Supply exhibits to external auditors during financial reviews or audits.
  • Regulators / Counsel: Share copies when requested for compliance or legal review.

How to configure an online workflow for this resolution

Set up a simple, auditable workflow that collects signatures, attachments, and stores a certificate of completion for compliance.

Field Configuration
Template Create a reusable template with required fields and attachment placeholders.
Conditional Fields Show notary fields only if recipient requires notarization.
Signer Authentication Require email + SMS code or stronger verification for external signers.
Audit Trail Enable timestamping, IP logging, and PDF certificate of completion.

Technical options for digital completion and distribution

Choose a platform that supports secure signing, attachments, audit trails, and common integrations used by finance and legal teams.

  • Integrations: Salesforce, NetSuite, Google Workspace
  • Document Formats: PDF, DOCX, Excel
  • Authentication: Email, SMS, KBA, SSO

Confirm the vendor supports the authentication, retention, and export options you need before sending signed copies to lenders or auditors.

Common timing and processing expectations

Timing depends on the corporate calendar and transaction deadlines; plan the resolution sequence to meet lender, board, or closing timelines.

Before Distributions:

Issue resolution prior to declaring dividends or shareholder distributions.

M&A Closings:

Complete solvency finding before executing closing documents.

Lender Requests:

Provide certified copies within the timeframe requested by the lender.

Internal Records:

Record in minutes within the corporate recordkeeping cycle.

External Audit:

Make supporting exhibits available during scheduled audits.

Key milestones from draft to certified copy

Track these four milestones to ensure timely approval, signature capture, and distribution.

01

Draft Approval

Legal and finance finalize language and exhibits before board presentation.

02

Board Action

Board meeting or written consent records the approval vote and authorizes signatures.

03

Signature Capture

Signers execute the resolution, and notarization occurs if required.

04

Certification & Distribution

Certified copies issued to lenders and originals filed in minutes.

Legal and financial risks from an incorrect or unsupported resolution

Fiduciary Liability: Directors may face personal liability for improper distributions.
Contractual Challenge: Creditors can challenge transactions if solvency was misrepresented.
Tax Consequences: Incorrect reporting can trigger penalties or reclassification.
Regulatory Scrutiny: Regulators may investigate misleading corporate statements.
Loan Default Risk: Lenders may call covenants if solvency certifications prove inaccurate.
Audit Findings: Auditors may issue qualified opinions without adequate support.

Common mistakes to avoid when preparing the resolution

  • Using outdated or unaudited financials that do not support the solvency finding and invite lender scrutiny.
  • Failing to document assumptions and projections used to determine cash flow sufficiency for near‑term obligations.
  • Not obtaining proper board approval or failing to record unanimous written consent when a meeting did not occur.
  • Providing unsigned or uncertified copies to lenders when originals or notarized copies are contractually required.

eSignature vendor pricing and feature comparison for Financial Solvency Resolutions

Compare basic pricing and feature differences across common eSignature providers to choose a solution that meets notarization, HIPAA, and volume needs.

signNow DocuSign Adobe Sign PandaDoc HelloSign
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial 7-day trial Varies Varies Varies Varies
Bulk Send Yes Yes Yes Yes No
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No
Envelope Cap No cap 100 envelopes/user/year Varies Varies Varies

Real examples of online signature workflows for solvency documentation

These customer examples show how teams streamline approvals and preserve audit trails when third parties request solvency confirmations.

Optica Ventures — Board Approval

Optica Ventures standardized its board resolution template to speed approvals.

  • The cloud template reduced manual edits.
  • The team reported faster review cycles and consistent certified copies for investors and lenders while keeping a single source of record in the corporate minute system.

Martin Properties — Remote Closings

Martin Properties used online signing to provide solvency certifications for real estate closings.

  • Mobile signing enabled offsite approvals.
  • This eliminated shipping notarized originals for many transactions, improving closing timelines while preserving notarized records where required.

Frequently asked questions about Financial Solvency Resolutions

Answers to common legal, procedural, and technical questions when preparing, signing, and distributing a solvency resolution.


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