Ala. Code § 10A-3A-2.02

Current through the 2024 Regular Session.

Section 10A-3A-2.02 - Certificate of incorporation

Section 10A-1-3.05 shall not apply to this chapter. Instead:

(a) The certificate of incorporation must set forth:

(1) a name for the nonprofit corporation that satisfies the requirements of Article 5 of Chapter 1;

(2) the street and mailing address of the nonprofit corporation's initial registered office, the county within this state in which the street and mailing address is located, and the name of the nonprofit corporation's initial registered agent at that office as required by Article 5 of Chapter 1;

(3) that the nonprofit corporation is incorporated under this chapter;

(4) the name and address of each incorporator; and

(5)

(i) if the nonprofit corporation will have members, a statement to that effect; or

(ii) if the nonprofit corporation will not have members, a statement to that effect.

(b) The certificate of incorporation may set forth:

(1) the names and addresses of the individuals who are to serve as the initial directors;

(2) provisions not inconsistent with law regarding:

(i) the purpose or purposes for which the nonprofit corporation is organized;

(ii) managing the activities and regulating the affairs of the nonprofit corporation;

(iii) defining, limiting, and regulating the powers of the nonprofit corporation, its board of directors, and the members;

(iv) the characteristics, qualifications, rights, limitations, and obligations attaching to each or any class of members;

(v) subject to Section 10A-3A-4.20, limiting a member's right to inspect and copy the records of the nonprofit corporation under Section 10A-3A-4.02(b);

(vi) the distribution of assets on dissolution;

(vii) provisions for the election, appointment, or designation of directors;

(viii) provisions granting inspection rights to a person or group of persons under Section 10A-3A-4.07; and

(ix) provisions specifying a person or group of persons whose approval is required under Sections 10A-3A-9.30, 10A-3A-10.04, 10A-3A-11.04, 10A-3A-12.08, or 10A-3A-13.08;

(3) any provision that under this chapter is permitted to be set forth in the certificate of incorporation or required or permitted to be set forth in the bylaws;

(4) a provision eliminating or limiting the liability of a director or officer to a nonprofit corporation or its members for money damages for any action taken, or any failure to take any action, as a director or officer, except liability for (i) the amount of a financial benefit received by a director or officer to which the director or officer is not entitled, (ii) an intentional infliction of harm on the nonprofit corporation or its members, (iii) in the case of a director, a violation of Section 10A-3A-8.32, (iv) an intentional violation of criminal law, or (v) in the case of an officer, any claim by or in the right of the nonprofit corporation;

(5) a provision permitting or making obligatory indemnification of a director for liability as defined in Section 10A-3A-8.50 to any person for any action taken, or any failure to take any action, as a director, except liability for (i) receipt of a financial benefit to which the director is not entitled, (ii) an intentional infliction of harm on the nonprofit corporation or its members, (iii) a violation of Section 10A-3A-8.32, or (iv) an intentional violation of criminal law;

(6) a provision limiting or eliminating any duty of a director or any other person to offer the nonprofit corporation the right to have or participate in any, or one or more classes or categories of, corporate opportunities, before the pursuit or taking of the opportunity by the director or other person; provided that the application of that provision to an officer or a related person of that officer (i) also requires approval of that application by the board of directors, subsequent to the effective date of the provision, by action of the disinterested or qualified directors taken in compliance with the same procedures as are set forth in Section 10A-3A-8.60, and (ii) may be limited by the authorizing action of the board of directors; and

(7) provisions required if the nonprofit corporation is to be exempt from taxation under federal, state, or local law.

(c) The certificate of incorporation need not set forth any of the corporate powers enumerated in Sections 10A-1-2.11, 10A-1-2.12, and 10A-1-2.13.

(d) Provisions of the certificate of incorporation may be made dependent upon facts objectively ascertainable outside the certificate of incorporation in accordance with Section 10A-3A-1.04.

(e) As used in this section, "related person" means:

(i) the individual's spouse;

(ii) a child, stepchild, grandchild, parent, stepparent, grandparent, sibling, stepsibling, half sibling, aunt, uncle, niece, or nephew (or spouse of any such person) of the individual or of the individual's spouse;

(iii) a natural person living in the same home as the individual;

(iv) an entity (other than the nonprofit corporation or an entity controlled by the nonprofit corporation) controlled by the individual or any person specified above in this definition;

(v) a domestic or foreign (A) business or nonprofit corporation (other than the nonprofit corporation or an entity controlled by the nonprofit corporation) of which the individual is a director, (B) unincorporated entity of which the individual is a general partner or a member of the governing authority, or (C) individual, trust or estate for whom or of which the individual is a trustee, guardian, personal representative, or like fiduciary; or

(vi) a person that is, or an entity that is, controlled by, an employer of the individual.

(f) The certificate of incorporation may not contain any provision that would impose liability on a member or a director for the attorney's fees or expenses of the nonprofit corporation or any other party in connection with an internal corporate claim, as defined in Section 10A-3A-2.07(d).

(g) The certificate of incorporation is a part of a binding contract between the nonprofit corporation and (i) the members in a membership nonprofit corporation and (ii) the directors in a nonmembership nonprofit corporation, subject to the provisions of this chapter.

(h) For purposes of subsection (b)(4) only, unless the certificate of incorporation otherwise provides, "officer" means an individual appointed or elected in accordance with Section 10A-3A-8.40 as (i) president, chief executive officer, chief operating officer, chief financial officer, chief legal officer, secretary, controller, treasurer, or chief accounting officer of the nonprofit corporation and (ii) any officer of the nonprofit corporation designated by resolution of the board of directors as an "officer" for purposes of subsection (b)(4). The board of directors may from time to time by resolution determine that one or more of the officers designated in accordance with subsection (h)(ii) shall no longer be an "officer" for purposes of subsection (b)(4), but no such resolution shall be effective as to any such officer, or any act or omission of any such officer, prior to the adoption of such resolution.

(i) No provision in the certificate of incorporation pursuant to subsection (b)(4) shall eliminate or limit the liability of a director or officer for any act or omission occurring prior to the date when the provision in the certificate of incorporation becomes effective. Any amendment, repeal, or elimination of a provision in the certificate of incorporation pursuant to subsection (b)(4) shall not affect its application with respect to an act or omission by a director or officer occurring before the amendment, repeal, or elimination unless the provision in the certificate of incorporation provides otherwise at the time of the act or omission.

Ala. Code § 10A-3A-2.02 (1975)

Amended by Act 2024-413,§ 1, eff. 8/1/2024.

Added by Act 2023-503,§ 1, eff. 1/1/2024.