(a) A nonprofit corporation may indemnify and advance expenses under this Division E of this Article 8 to an officer who is a party to a proceeding because he or she is an officer:

Attorney's Note

Under the Alabama Code, punishments for crimes depend on the classification. In the case of this section:
ClassPrisonFine
Violationup to 30 daysup to $200
For details, see Ala. Code § 13A-5-7
non profit

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Terms Used In Alabama Code 10A-3A-8.56

  • certificate of incorporation: as used in this chapter is synonymous to the term certificate of formation used in Chapter 1. See Alabama Code 10A-3A-1.02
  • Contract: A legal written agreement that becomes binding when signed.
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Indemnification: In general, a collateral contract or assurance under which one person agrees to secure another person against either anticipated financial losses or potential adverse legal consequences. Source: FDIC
  • person: includes a corporation as well as a natural person. See Alabama Code 1-1-1
(1) to the same extent as a director; and
(2) if he or she is an officer but not a director, to such further extent as may be provided by the certificate of incorporation or the bylaws, or by a resolution adopted or a contract approved by the board of directors or members except for

(i) liability in connection with a proceeding by the nonprofit corporation other than for expenses incurred in connection with the proceeding, or
(ii) liability arising out of conduct that constitutes

(A) receipt by the officer of a financial benefit to which the officer is not entitled,
(B) an intentional infliction of harm on the nonprofit corporation or the members, or
(C) an intentional violation of criminal law.
(b) Subsection (a)(2) shall apply to an officer who is also a director if the person is made a party to the proceeding based on an act or omission solely as an officer.
(c) An officer who is not a director is entitled to indemnification under Section 10A-3A-8.52 if the certificate of incorporation or bylaws of the nonprofit corporation allows for such indemnification, and may apply to a court under Section 10A-3A-8.54 for indemnification or an advance for expenses, in each case to the same extent to which a director may be entitled to indemnification or advance for expenses under those sections, unless otherwise provided in the certificate of incorporation or bylaws.
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