Bring-Down Certificate - Alabama

BRING-DOWN CERTIFICATE — ALABAMA

State of Alabama — Corporate Closing Documents

PART I: OVERVIEW AND PURPOSE

1.1 What Is a Bring-Down Certificate?

A bring-down certificate is a closing deliverable in which an authorized officer of a party to a transaction certifies that representations, warranties, and covenants made in the underlying agreement remain true and have been performed as of the closing date.

1.2 Alabama Corporate Law Framework

Alabama business entities are governed by the Alabama Business and Nonprofit Entities Code, codified at Ala. Code Title 10A. The 2019 revision replaced the prior Title 10A structure with new Chapter 2A (Alabama Business Corporation Law). Key provisions include:

• Ala. Code 10A-2A-1.21 — Certificate of Existence or Registration (for business corporations). A certificate of existence or certificate of registration issued by the Secretary of State is conclusive evidence that the domestic corporation is in existence or the foreign corporation is authorized to transact business in Alabama.
• Ala. Code 10A-1-3.07 — Certificate of Existence or Registration (general provisions applying across entity types).
• Ala. Code 10A-2A-8.41 — Duties of Officers. Each officer must discharge duties in good faith, with the care an ordinarily prudent person in a like position would exercise under similar circumstances, and in a manner the officer reasonably believes to be in the best interests of the corporation.
• Ala. Code 10A-2A-8.40 — Required Officers.

1.3 When Is a Bring-Down Certificate Required?

☐ Mergers and acquisitions involving Alabama corporations or LLCs
☐ Equity and debt financing closings
☐ Business reorganizations and restructurings
☐ Joint venture formations
☐ Any transaction where the Agreement requires an officer's certificate as a closing condition

1.4 Legal Effect

• Condition to Closing. Satisfies a condition precedent to the other party's obligation to close.
• Post-Closing Indemnification. Supports indemnification claims if certified statements prove false.
• Reliance Basis. Provides documented reliance for the receiving party.
• Officer Liability. Under Ala. Code 10A-2A-8.41, an officer who certifies knowingly false statements may face liability for breach of fiduciary duty.

PART II: OFFICER'S CERTIFICATE

OFFICER'S CERTIFICATE

Pursuant to Section [____] of the [____] Agreement

STATE OF ALABAMA

This Officer's Certificate (this "Certificate") is delivered pursuant to Section [________________________________] of that certain [Stock Purchase Agreement / Asset Purchase Agreement / Agreement and Plan of Merger / Credit Agreement] dated as of [__/__/____] (the "Agreement"), by and among:

Buyer/Lender: [________________________________] ("Buyer")

Seller/Borrower: [________________________________], an Alabama [corporation / limited liability company] (the "Company")

Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Agreement.

The undersigned, [________________________________], the duly elected and acting [Title] of the Company, hereby certifies, on behalf of the Company and not in any individual capacity, as follows:

Section 1. Organization and Good Standing

The Company is a [corporation duly organized / limited liability company duly formed] and validly existing under the laws of the State of Alabama pursuant to the Alabama Business and Nonprofit Entities Code (Ala. Code Title 10A). The Company is in good standing with the Alabama Secretary of State and has not been administratively dissolved, revoked, or suspended.

Section 2. Representations and Warranties

[SELECT ONE:]

Option A — Full Bring-Down:

Each of the representations and warranties of the Company contained in Article [____] of the Agreement is true and correct in all respects as of the date hereof with the same force and effect as though such representations and warranties had been made on and as of the date hereof, except to the extent that any such representation or warranty expressly relates to an earlier date, in which case such representation or warranty was true and correct in all respects as of such earlier date.

Option B — Materiality-Qualified Bring-Down:

Each of the representations and warranties of the Company contained in Article [____] of the Agreement is true and correct in all material respects as of the date hereof with the same force and effect as though such representations and warranties had been made on and as of the date hereof, except to the extent that any such representation or warranty expressly relates to an earlier date, in which case such representation or warranty was true and correct in all material respects as of such earlier date.

Option C — MAE-Qualified Bring-Down:

Each of the representations and warranties of the Company contained in Article [____] of the Agreement (disregarding all qualifications and exceptions contained therein relating to materiality or Material Adverse Effect) is true and correct as of the date hereof, except (i) to the extent that any such representation or warranty expressly relates to an earlier date, in which case such representation or warranty was true and correct as of such earlier date, and (ii) where the failure of such representations and warranties to be true and correct would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 3. Performance of Covenants

The Company has performed and complied in all material respects with all covenants and agreements required by the Agreement to be performed or complied with by the Company on or before the Closing Date.

Section 4. No Material Adverse Change

Since the date of the Agreement, no event, change, occurrence, circumstance, or condition has occurred that, individually or in the aggregate, has had or would reasonably be expected to have a Material Adverse Effect.

Section 5. No Legal Impediment

No temporary restraining order, preliminary or permanent injunction, or other order issued by any court of competent jurisdiction (including any Alabama Circuit Court or the United States District Court for the Northern, Middle, or Southern District of Alabama), and no statute, rule, regulation, or executive order promulgated or enacted by any governmental authority, is in effect that prevents or prohibits the consummation of the transactions contemplated by the Agreement.

Section 6. No Proceedings

No action, suit, investigation, or proceeding is pending or, to the knowledge of the Company, threatened before any governmental authority that seeks to restrain, enjoin, or otherwise prevent the consummation of the transactions contemplated by the Agreement.

Section 7. Exceptions to Certifications

☐ No exceptions to the foregoing certifications exist.

☐ The following exceptions are set forth on Schedule A attached hereto:

[________________________________]

Section 8. Officer Authority

The undersigned is a duly elected and acting officer of the Company, holding the office indicated below, and has been duly authorized by the [Board of Directors / Members / Managers] of the Company to execute and deliver this Certificate on behalf of the Company pursuant to Ala. Code 10A-2A-8.40.

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate as of [__/__/____].

[________________________________]
(Name of Company)

By: ____________________________________
Name: [________________________________]
Title: [________________________________]

PART III: SECRETARY'S CERTIFICATE

SECRETARY'S CERTIFICATE

The undersigned, [________________________________], the duly elected and acting Secretary (or Assistant Secretary) of [________________________________] (the "Company"), an Alabama [corporation / limited liability company], hereby certifies, on behalf of the Company and not in any individual capacity, as follows:

Section 1. Incumbency

The following persons are the duly elected or appointed officers of the Company holding the offices set forth opposite their names below, and the signatures set forth opposite their names below are their genuine signatures:

Section 2. Organizational Documents

(a) Attached hereto as Exhibit A is a true, correct, and complete copy of the [Certificate of Formation / Certificate of Incorporation / Articles of Organization] of the Company as filed with the Alabama Secretary of State, as currently in effect, including all amendments thereto.

(b) Attached hereto as Exhibit B is a true, correct, and complete copy of the [Bylaws / Operating Agreement] of the Company, as currently in effect, including all amendments thereto.

Section 3. Resolutions

Attached hereto as Exhibit C is a true, correct, and complete copy of the resolutions duly adopted by the [Board of Directors / Members / Managers] of the Company authorizing the execution, delivery, and performance of the Agreement and the consummation of the transactions contemplated thereby. Such resolutions have not been amended, modified, supplemented, revoked, or rescinded and remain in full force and effect as of the date hereof.

Section 4. Certificate of Existence

Attached hereto as Exhibit D is a Certificate of Existence issued by the Alabama Secretary of State, dated not earlier than [____] days before the Closing Date, confirming that the Company is in existence under the laws of Alabama.

[DRAFTER'S NOTE: A Certificate of Existence from the Secretary of State confirms entity existence but does not confirm tax good standing. For tax compliance, see Part V regarding the Alabama Department of Revenue Certificate of Compliance.]

Section 5. Foreign Qualification

The Company is qualified to do business as a foreign [corporation / limited liability company] in good standing in the following jurisdictions:

Section 6. No Dissolution

No proceedings for the dissolution, winding up, liquidation, or reorganization of the Company have been commenced or are contemplated. No assignment for the benefit of creditors has been made.

Section 7. Secretary's Authority

The undersigned is the duly elected and acting Secretary of the Company and has been duly authorized to execute and deliver this Certificate.

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate as of [__/__/____].

By: ____________________________________
Name: [________________________________]
Title: Secretary

[COUNTER-CERTIFICATION:]

I, [________________________________], [Title] of the Company, hereby confirm that [________________________________] is the duly elected and acting Secretary of the Company and that the signature above is his/her genuine signature.

By: ____________________________________
Name: [________________________________]
Title: [________________________________]

PART IV: GOOD STANDING CERTIFICATE PROCEDURES — ALABAMA

4.1 Important Distinction: Two Separate Certificates

Alabama has two separate documents that serve good standing functions:

[DRAFTER'S NOTE: Many purchase agreements require both documents. Review the Agreement carefully to determine which certificates are required.]

4.2 Certificate of Existence — Alabama Secretary of State

Issuing Authority

Alabama Secretary of State
Business Services Division
P.O. Box 5616
Montgomery, AL 36103-5616
Phone: (334) 242-5324
Website: https://www.sos.alabama.gov

How to Obtain

Online:
☐ Visit the Alabama Secretary of State's online portal
☐ Navigate to the Certificate of Existence application
☐ Enter entity name or entity ID number
☐ Pay the applicable fee
☐ Processing: 24 to 48 hours

By Mail or Courier:
☐ Download the Application for Certificate of Existence form
☐ Complete the form with entity name and identification number
☐ Submit with payment to the address above
☐ Processing: 24 to 48 hours after receipt

Fees

What the Certificate Confirms

Under Ala. Code 10A-2A-1.21, a Certificate of Existence confirms:
☐ The domestic corporation is duly incorporated under Alabama law
☐ The date of incorporation
☐ All fees, taxes, and penalties owed to the Secretary of State have been paid
☐ The most recent annual report has been delivered
☐ The entity has not been administratively dissolved

4.3 Certificate of Compliance (Good Standing) — Alabama Department of Revenue

Issuing Authority

Alabama Department of Revenue
Website: https://www.revenue.alabama.gov
Online Portal: https://www.alabamainteractive.org/ador_tax_compliance/welcome.action

How to Obtain

☐ Visit the Alabama Department of Revenue online portal
☐ Request a Certificate of Compliance (Good Standing)
☐ The Department will verify the entity's state tax compliance
☐ Processing: 2 to 3 business days for online requests

Fees

What the Certificate Confirms

☐ The entity is current on Alabama state tax obligations
☐ No outstanding state tax liabilities exist

4.4 Practice Tips for Alabama

• Two Certificates Required. Many M&A agreements require both the Certificate of Existence (Secretary of State) and the Certificate of Compliance (Department of Revenue). Order both simultaneously.
• Annual Reports. Alabama business entities must file annual reports. Ensure the Company's annual report is current before requesting certificates.
• Business Privilege Tax. Alabama imposes a business privilege tax (Ala. Code 40-14A) on entities organized or doing business in Alabama. Confirm compliance before closing.
• Jefferson County Considerations. Entities doing business in Jefferson County may have additional local tax obligations.

PART V: COMPLIANCE CERTIFICATE — ALABAMA

COMPLIANCE CERTIFICATE

The undersigned, [________________________________], the duly elected and acting [Title] of [________________________________] (the "Company"), an Alabama [corporation / limited liability company], hereby certifies, on behalf of the Company and not in any individual capacity, as follows:

Section 1. Alabama Tax Compliance

☐ The Company has timely filed all Alabama tax returns and reports required to be filed, including business privilege tax returns (Ala. Code 40-14A) and corporate income tax returns (Ala. Code 40-18) as applicable.

☐ The Company has paid all Alabama taxes due and payable, except for taxes being contested in good faith for which adequate reserves have been established.

☐ There are no outstanding Alabama state tax liens against the Company or its assets.

☐ No audit, examination, or investigation by the Alabama Department of Revenue is pending or, to the knowledge of the Company, threatened.

☐ A Certificate of Compliance (Good Standing) from the Alabama Department of Revenue is attached hereto as Exhibit E (or has been separately delivered).

Section 2. Federal Tax Compliance

☐ The Company has timely filed all federal tax returns and reports required to be filed.

☐ The Company has paid all federal taxes due and payable, except for taxes being contested in good faith for which adequate reserves have been established.

☐ There are no outstanding federal tax liens against the Company or its assets.

Section 3. Regulatory Compliance

☐ The Company holds all material licenses, permits, and authorizations necessary for the lawful conduct of its business in Alabama.

☐ All such licenses, permits, and authorizations are valid, in full force and effect, and not subject to any pending revocation, suspension, or modification.

☐ The Company is in compliance in all material respects with all applicable Alabama statutes, regulations, and orders.

Section 4. Employment Compliance

☐ The Company is in compliance in all material respects with Alabama labor and employment laws, including workers' compensation requirements under Ala. Code 25-5.

☐ The Company is in compliance with the Alabama Immigration Law (Ala. Code 31-13) as applicable.

Section 5. Environmental Compliance

☐ The Company is in compliance in all material respects with all applicable Alabama and federal environmental laws, including the Alabama Environmental Management Act (Ala. Code 22-22A).

☐ There are no pending or, to the knowledge of the Company, threatened environmental claims with respect to the Company or its properties in Alabama.

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate as of [__/__/____].

[________________________________]
(Name of Company)

By: ____________________________________
Name: [________________________________]
Title: [________________________________]

PART VI: BRING-DOWN QUALIFICATION STANDARDS

6.1 The Three Common Standards

Standard A: "True and Correct in All Respects"

• Buyer-favorable. Even minor inaccuracies cause the condition to fail.
• Typically used only for fundamental representations.

Standard B: "True and Correct in All Material Respects"

• Balanced. Most common standard for general representations.

Standard C: "MAE-Qualified"

• Seller-favorable. Only inaccuracies rising to a Material Adverse Effect prevent closing.

6.2 Double-Materiality Scrub

☐ Read through materiality qualifiers (more buyer-favorable)
☐ Preserve materiality qualifiers (more seller-favorable)

6.3 Common MAE Carve-Outs

☐ Changes in general economic or political conditions
☐ Changes affecting the Company's industry generally
☐ Changes in applicable law or GAAP
☐ Changes resulting from announcement or pendency of the transactions
☐ Changes resulting from actions taken at Buyer's request or with Buyer's consent
☐ Acts of war, terrorism, natural disasters, or pandemics
☐ Changes in the trading price or volume of the Company's securities
☐ Failure to meet projections or forecasts

6.4 Tiered Bring-Down Structure

PART VII: PRACTICE NOTES — ALABAMA-SPECIFIC

7.1 Alabama-Specific Considerations

• Alabama Business Corporation Law (2019 Revision). Alabama revised its business corporation law effective January 1, 2020, recodifying it as Chapter 2A of Title 10A. Practitioners should ensure they are citing the current Chapter 2A provisions rather than the prior Chapter 2 provisions.
• Business Privilege Tax. Alabama imposes an annual business privilege tax (Ala. Code 40-14A) on all entities formed or qualified to do business in Alabama. Confirm the Company's business privilege tax is current before closing.
• Two-Certificate System. Alabama uniquely requires separate certificates from the Secretary of State (existence) and the Department of Revenue (tax compliance). Many out-of-state counsel are unfamiliar with this distinction — clarify which certificates are needed early in the transaction.
• Registered Agent. Confirm the Company's registered agent and registered office information is current under Ala. Code 10A-2A-5.01.

7.2 Timing Considerations

• Certificate of Existence. Processing time is 24 to 48 hours (online or mail).
• Certificate of Compliance. Processing time is 2 to 3 business days for online requests.
• Pre-Closing Review. Begin preparation at least 5 to 10 business days before the anticipated closing date.

7.3 Bring-Down Certificate Preparation Checklist — Alabama

☐ Obtain fully executed Agreement and all amendments
☐ Identify the applicable bring-down standard
☐ Review all representations against current facts
☐ Prepare updated disclosure schedules if needed
☐ Confirm officer authorization via board resolutions
☐ Prepare secretary's certificate with incumbency, resolutions, and organizational documents
☐ Order Certificate of Existence from Alabama Secretary of State ($25 / $27.50 online)
☐ Order Certificate of Compliance from Alabama Department of Revenue ($14)
☐ Verify annual reports are filed and current
☐ Verify business privilege tax (Ala. Code 40-14A) is current
☐ Obtain foreign qualification good standing certificates for other states
☐ Circulate drafts to opposing counsel
☐ Obtain final approval from certifying officer
☐ Execute and deliver at closing

SOURCES AND REFERENCES

• Alabama Code, Title 10A — Alabama Business and Nonprofit Entities Code
• Ala. Code 10A-2A — Alabama Business Corporation Law
• Ala. Code 10A-2A-1.21 — Certificate of Existence or Registration
• Ala. Code 10A-1-3.07 — Certificate of Existence or Registration (General Provisions)
• Ala. Code 10A-2A-8.40 — Required Officers
• Ala. Code 10A-2A-8.41 — Duties of Officers
• Alabama Secretary of State — Business Services Division: https://www.sos.alabama.gov
• Alabama Department of Revenue — Certificate of Compliance: https://www.revenue.alabama.gov

This template is provided by ezel.ai for informational purposes only and does not constitute legal advice. Consult a qualified attorney licensed in Alabama before using this template.