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Alabama Corporate Bylaws

Alabama corporate bylaws are the rules that guide your corporation’s operations and create your company’s organizational structure. Your bylaws establish policies for appointing directors and officers, holding shareholder and board meetings, amending the bylaws themselves, and handling conflicts of interest, among other issues.

Strong corporate bylaws are essential, which is why we at Northwest offer a free, attorney-drafted, Alabama-specific template you can use to create corporate bylaws that suit your business.

Why do I need corporate bylaws?

You won’t file your bylaws with the Alabama Secretary of State—like your Alabama Certificate of Incorporation. However, bylaws are legally recognized and no less important than any public document. Here’s why:

1. Corporate bylaws are legally required in Alabama.

According to AL Code § 10A-2A-2.05, the board of directors (or if directors are not yet selected, the incorporators) “shall adopt initial bylaws for the corporation.” So, adopting corporate bylaws is a necessity for staying legally compliant.

2. Corporate bylaws establish the rules and roles within your corporation.

Your corporate bylaws determine important aspects of your corporate structure, like how many people will be on your board of directors, how you’ll hold shareholders’ meetings, how you’ll issue stocks and keep records. This agreed-upon set of rules for day-to-day operations helps prevent company disagreements, which could otherwise disrupt the flow of operations.

3. Corporate bylaws prove that your business is a legitimate corporation.

Not only does having corporate bylaws signal to others that your corporation is legit, but banks, landlords, and potential investors will want to see your bylaws before doing business with you. Plus, your corporate bylaws help reinforce your limited liability status.

What is included in Alabama corporate bylaws?

Corporate bylaws can include anything (within the law) not already covered by Alabama’s statutes. But strong bylaws are essential, and should include information about:

  • Meetings
  • Stock
  • Directors and officers
  • Finances
  • Records
  • Amendments and emergencies

Who prepares the bylaws?

Bylaws are initially adopted by your board of directors or—if directors have not yet been named, your incorporators—at your first meeting following incorporation. While it’s a good idea to consult with a lawyer before finalizing your bylaws, you can use our free Alabama Corporate Bylines template to help get you started.

Are corporate bylaws legally binding?

Yes. In fact, corporate bylaws are considered contractual in Alabama. According to AL Code § 10A-2A-2.05, bylaws are “part of a binding contract between the corporation and the stockholders.” In other words, your Alabama corporate bylaws are official legal documents that can be used in a court of law to prove your limited liability status or show how your corporation functions. It also means you could be subject to legal ramifications if you don’t follow your bylaws.

Alabama Corporate Bylaws Template

Here is our free Corporate Bylaws template. It has been drafted by our attorney specifically for Alabama corporations.

FAQs

Are bylaws filed with the state of Alabama?

No. Your corporate bylaws are internal documents, which means they should be kept on file with your business records.

Do bylaws need to be signed?

No. Alabama statutes do not explicitly state that bylaws need to be signed. However, including signatures from all board members and officers adds to your corporation’s legitimacy, and helps ensure that your bylaws will hold-up in court.

How do I amend my bylaws in Alabama?

Alabama’s statutes provide some rules for amending bylaws, but for the most part, corporations establish the procedures for amending bylaws in the bylaws themselves.

For example, AL Code § 10A-2A-10.21 allows corporate bylaws to “increase a quorum” (the minimum number of board members need to hold an official meeting), and AL Code § 10A-2A-10.22 states that bylaws may create special provisions for selecting directors.

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