HB228 Alabama 2024 Session

Summary

Primary Sponsor

Tim WadsworthRepresentative

Republican

Session

Regular Session 2024

Title

Alabama Business and Nonprofit Entities Code; amended to delete references to Alabama Nonprofit Corporation Law, clarify and streamline certain provisions in accordance with changes in Delaware law and the Model Business Corporation Act

Summary

HB228 updates Alabama’s Business and Nonprofit Entities Code to modernize formation, governance, and transactions by aligning with Delaware law and the Model Business Corporation Act, and tightening in-state agent requirements.

What This Bill Does

It removes references to the old Alabama Nonprofit Corporation Law and requires registered agents to have addresses in Alabama, with formation certificates listing the county of the registered agent. It allows officer exculpation for certain actions and updates amendment, restatement, and sales of property provisions to conform with Delaware law and the Model Business Corporation Act; it also aligns professional corporation law. It creates new ratification and restatement procedures for actions and transactions involving LLCs, LPs, and partnerships, including new Sections 10A-5A-1.11, 10A-8A-1.14, and 10A-9A-1.15.

Who It Affects

• Businesses and nonprofit entities in Alabama (corporations, nonprofit corporations, professional corporations, LLCs, limited partnerships, and partnerships) would be affected by changes to formation, ratification, asset transactions, and governance.
• Stockholders, members, directors, officers, and registered agents involved in governance and service of process would be affected by new notice, voting, appraisal rights, liability exculpation, and in-state agent/address requirements.

Key Provisions

• Eliminates references to the old Alabama Nonprofit Corporation Law and requires registered agents to be in Alabama, with the certificate of formation noting the county of the registered agent.
• Authorizes officer exculpation for certain actions and updates amendment, restatement, and sale-of-property provisions to conform with Delaware law and the Model Business Corporation Act; also aligns professional corporation law.
• Creates new ratification and restatement procedures for actions and transactions involving LLCs, LPs, and partnerships, including new Sections 10A-5A-1.11, 10A-8A-1.14, and 10A-9A-1.15.
• Expands notice, voting, appraisal, and other rights for stockholders and members in fundamental corporate actions, with rules for written consents and protections for creditors, plus a constitutional local-funds-expenditure caveat and exemptions.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Businesses & Financial Institutions