§ 10A-3A-1.21 — Defective Corporate Actions

Alabama § 10A-3A-1.21

• Jurisdiction: Alabama
• Title 10A: Alabama Business and Nonprofit Entities Code
• Ch. 3A: Alabama Nonprofit Corporation Law
• Art. 1: General Provisions
• Div. B: Ratification of Defective Corporate Actions

Text

(a) A defective corporate action shall not be void or voidable if ratified in accordance with Section 10A-3A-1.22 or validated in accordance with Section 10A-3A-1.27.
(b) Ratification under Section 10A-3A-1.22 or validation under Section 10A-2A-1.27 shall not be deemed to be the exclusive means of ratifying or validating any defective corporate action, and the absence or failure of ratification in accordance with this Division shall not, of itself, affect the validity or effectiveness of any corporate action properly ratified under common law or otherwise, nor shall it create a presumption that any such corporate action is or was a defective corporate action or void or voidable.
(c) In the case of an overissue, a putative membership interest shall be valid a membership interest effective as of the date originally issued or purportedly issued upon:
(1) the effectiveness under this article and under Article 9 of an amendment to the certificate of incorporation or bylaws authorizing, designating, or creating that membership interest; or
(2) the effectiveness of any other corporate action under this article ratifying the authorization, designation, or creation of a membership interest.

Legislative History

(Act 2023-503, §1.)