Dividend Declaration Board Resolution Template for United States

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Key Requirements PROMPT example:

Dividend Declaration Board Resolution

"Need a Dividend Declaration Board Resolution for our Delaware corporation to declare a quarterly dividend of $0.25 per share of common stock, to be paid on March 15, 2025, with a record date of February 28, 2025."

Document background
The Dividend Declaration Board Resolution serves as the official record of a corporation's decision to distribute profits to its shareholders. This document is required under U.S. corporate law whenever a company's board of directors approves a dividend payment. It demonstrates compliance with legal requirements, including adequate surplus funds and solvency tests, while protecting directors from potential liability. The resolution typically includes financial justification, payment terms, and necessary authorizations, forming part of the company's permanent records.
Suggested Sections

1. Title and Date: Name of corporation and date of resolution

2. Recitals: Meeting details, quorum confirmation, chair appointment

3. Financial Review: Statement of financial position and available funds for dividend distribution

4. Declaration: Formal dividend declaration including amount per share, record date, and payment date

5. Authorization: Authority granted to officers to take all necessary actions to effect the dividend payment

Optional Sections

1. Special Conditions: Specific conditions or restrictions attached to the dividend payment

2. Tax Considerations: Special tax treatment or withholding requirements for the dividend

Suggested Schedules

1. Financial Statement Summary: Summary of current financial position supporting the dividend declaration

2. Solvency Certificate: Certificate confirming company's ability to pay its debts after dividend distribution

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Industries

Internal Revenue Code: Federal tax legislation governing the tax treatment of dividend distributions and reporting requirements

Securities Exchange Act of 1934: Federal law governing securities trading and corporate reporting requirements for publicly traded companies regarding dividend declarations

Sarbanes-Oxley Act 2002: Federal legislation establishing corporate governance and financial reporting requirements that may affect dividend declaration processes

State Corporation Laws: State-specific laws (such as Delaware General Corporation Law) governing corporate actions including dividend declarations and restrictions

Balance Sheet Test: Legal requirement to verify sufficient surplus exists for dividend distribution according to company's balance sheet

Solvency Test: Legal requirement to ensure company can pay its debts as they become due after dividend distribution

Articles of Incorporation: Company's foundational document that may contain specific provisions regarding dividend declarations and restrictions

Corporate Bylaws: Internal governance rules that may specify procedures and requirements for dividend declarations

Shareholder Agreements: Contracts between shareholders that may contain provisions affecting dividend distribution rights and procedures

SEC Requirements: Securities and Exchange Commission regulations governing dividend declarations and disclosures for public companies

Stock Exchange Rules: Requirements set by stock exchanges regarding dividend declarations and notifications for listed companies

Capital Maintenance Requirements: Legal rules requiring maintenance of minimum capital levels to protect creditors when declaring dividends

Fiduciary Duties: Legal obligations of board members to act in the best interest of the company when declaring dividends

Equal Treatment Principle: Legal requirement to treat all shareholders within the same class equally in dividend distributions

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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