Board resolution template for approving a data license

Does a data license need board approval?#

A data license often does not strictly require board approval, but seeking it is usually the prudent choice. Licensing support tickets, code reviews or engineering histories to an AI developer sits outside the ordinary course for most companies, and a resolution gives the signing officer clear authority and leaves a clean record for a future acquirer.

Check four documents before deciding: the bylaws, any delegation of authority policy, investor agreements with protective provisions, and the credit agreement. Protective provisions sometimes cover exclusive licenses of company intellectual property, and loan covenants sometimes restrict licensing assets that secure the loan. If either applies, pair the resolution with the required consents.

The template assumes a corporation with a board of directors. A limited liability company acts through its managers or members under its operating agreement, so the same content becomes a written consent of the managers or members. Either way, have company counsel adapt the wording to the state of formation and the governing documents.

What the resolution needs to cover#

A data license resolution needs six parts, each doing a different job. The table shows what each part is for and how to draft it so the officers have room to negotiate without drifting outside what the board approved.

Template: recitals#

The recitals record the facts the board relied on. Write them so a reader years later, such as an acquirer's counsel, understands what the board knew when it approved the license. Replace the bracketed text.

• 1WHEREAS, the Company holds operational records generated in the course of its business, including [record families, such as support tickets, issue histories and code review records] covering [date range];
• 2WHEREAS, the Company has received a proposal to grant a limited, non-exclusive license to use certain of these records, after removal of personal and confidential information, for training and evaluation of artificial intelligence models;
• 3WHEREAS, the Board has reviewed [a summary of proposed terms, a rights review memorandum and a description of the privacy preparation process];
• 4WHEREAS, the Board has determined that entering into such a license on terms within the limits set out below is advisable and in the best interests of the Company;

Template: operative resolutions#

The operative resolutions grant authority and fix the limits. Each one should be something a lawyer can check the final contract against, line by line.

• 1RESOLVED, that the Company is authorized to enter into one or more data license agreements covering the records described in Exhibit A (the Licensed Records), on terms consistent with these resolutions;
• 2RESOLVED FURTHER, that any such agreement shall (a) grant only a non-exclusive license unless the Board separately approves exclusivity, (b) limit use to training and evaluation of models and prohibit resale of the Licensed Records, (c) prohibit any attempt to re-identify individuals or customers, (d) require deletion or return of the Licensed Records on termination, subject to agreed exceptions, (e) require that personal and confidential information be removed before delivery as described in the privacy preparation summary, and (f) exclude the records listed in Exhibit B;
• 3RESOLVED FURTHER, that the [Chief Executive Officer] and the [Chief Financial Officer], each acting alone, are authorized to negotiate, execute and deliver such agreements and related documents within these limits;
• 4RESOLVED FURTHER, that execution of any such agreement is conditioned on receipt of the consents listed in Exhibit C;
• 5RESOLVED FURTHER, that all actions previously taken by the officers in evaluating the proposed license are ratified, confirmed and approved.

Which limits belong in the resolution and which in the contract?#

The resolution should carry the limits the board wants to own, while the contract carries the mechanics. Exhibit A describes record families and date coverage; Exhibit B lists excluded material, such as records of customers with no-training clauses, third-party code and client-owned deliverables.

Keeping fees and payment mechanics out of the resolution lets officers negotiate without returning to the board for each change. A buyer request outside the limits, such as exclusivity or broader use rights, goes back to the board.

Written consent or a board meeting?#

Written consent works when directors agree and the bylaws and state law permit action without a meeting, which for many companies means every director must sign. A meeting is the better choice when directors have questions about rights, customer reaction or brand risk, because the minutes can record the discussion and the answers.

Either way, attach the exhibits, file the signed resolution in the minute book and give a copy to whoever assembles the transaction record. Buyers often ask for an officer's or secretary's certificate confirming that the resolution is in force and identifying who may sign, so keep a certified copy ready.

Five drafting mistakes cause most of the rework when counsel later checks the final contract against the resolution.

• 1Approving a named buyer before terms exist, which forces a new resolution if the deal changes.
• 2Describing scope as all company data instead of named record families and date ranges.
• 3Leaving out the excluded-records exhibit, so restricted customers and third-party code are not clearly carved out.
• 4Ignoring director conflicts: if a director is affiliated with the buyer, disclose it and record approval by the disinterested directors.
• 5Forgetting to update the resolution when record families, date ranges or exclusivity change.

Illustrative: a vertical SaaS board approves a narrow first license#

Illustrative: a fictional software company serving equipment rental businesses wants to license redacted support ticket threads and the linked Jira issues. Its preferred stock terms require investor consent for exclusive licenses of company intellectual property, and its credit agreement restricts licensing collateral without lender consent.

The board adopts a written consent approving a non-exclusive license of support and engineering records from a defined date range, excluding customers whose contracts prohibit AI training and any third-party code. Because the license is non-exclusive, the investor consent is not triggered; the lender consent is listed in Exhibit C. The CEO signs once the lender confirms, and the signed consent joins the transaction file.

Where the resolution fits in a SourceX transaction#

In the SourceX five-step transaction, the board resolution supports the Approval step by showing who authorized the license and within which limits. SourceX files it with the release authorization in the SourceX Evidence Packet, next to provenance, licensing rights, permitted use and the privacy record, and nothing moves to Delivery until the approved scope matches the final file list.