Board Resolution For Execution of Indemnity Bond

     

 

Board Resolution For Execution of Indemnity Bond

An indemnity bond is a guarantee given by one party to another to confirm that an agreement will be honored as promised. It is an obligation to compensate one party financially or otherwise if the other party fails to fulfill the contract or obligation. It is an obligation to pay someone if the obligation is not met. They are used in a wide variety of situations. A surety offers different types of guarantees for different transactions. Examples include tender bonds being placed where someone is trying to get a contract, under which the contractor provides indemnity bond in case of any default in the execution of work allotted to him it indemnifies the other party.

The companies are quite often required to execute indemnity and for this purpose, the company has to authorize someone to sign/execute the indemnity bond on behalf of the company. So to authorize someone from the company to execute the indemnity bond, approval of the board by way of board resolution is necessary. For this purpose a draft format of the board resolution for the execution of indemnity bond is provided hereunder for your ready reference.

“RESOLVED THAT the draft of the indemnity bond as placed before the board at Annexure – I, to be executed in favour of M/s. …………. _under the agreement dated ……….. , be and is hereby approved and consent of the board be and is hereby accorded to execute the same.

“RESOLVED FURTHER THAT (Name of the authorized person(s)) be and are hereby authorized jointly / individually to sign and execute the indemnity bond (Annexure – I ) in favour of M/s. ________ as approved by the board. 

“RESOLVED FURTHER THAT (Name of the authorized person(s) ) be and are hereby jointly / individually authorized on behalf of the Company to do all such acts, deeds and things that may be necessary, proper, expedient or incidental for the purpose of giving effect to the aforesaid Resolution.”   

“RESOLVED FURTHER THAT all acts, deeds, things, matters, etc. as aforestated shall be deemed to be valid and enforceable only if they are consistent with the instant resolution as may be relevant in this case and that the Board shall not be responsible for any acts beyond the scope of the aforestated powers done by (Name of the authorized person(s) and such invalid, illegal acts, and acts done beyond the scope of  powers granted in this Resolution shall not bind the Company against any third parties or before any authorities  in any manner and that the Board shall not be answerable in that behalf.”

“RESOLVED FURTHER THAT the aforesaid power entrusted to the said official shall be valid and effective unless revoked earlier by the Board or shall be exercisable by him so long as he is in the services of the Company.” 

The above draft Board Resolution For Execution of Indemnity Bond is only for reference purposes make sure to incorporate necessary changes as per your requirements before using this draft format.

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