(a) All agreements and covenants undertaken, and all indebtedness issued, by an authority shall be solely and exclusively an obligation of the authority and, except as otherwise provided in a written agreement in accordance with Section 16-17A-17, shall not create an obligation or debt of the state, any university, or any other governmental entity or public corporation within the meaning of any constitutional or statutory provision.
Terms Used In Alabama Code 16-17A-12
- 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.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- state: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Alabama Code 30-3D-608
(b) Neither the directors nor any officer of an authority executing indebtedness issued pursuant to this chapter shall be personally liable for such indebtedness by reason of the execution or issuance thereof.
(c) The state and the sponsoring university do hereby pledge to and agree with the holders of any indebtedness issued under this chapter that neither the state nor the sponsoring university will limit or alter the rights hereby vested in the authority to fulfill the terms of any indebtedness or related security documents made with the holders thereof or in any way impair the rights and remedies of the holders until such indebtedness, together with the interest thereon, and all costs and expenses in connection with any action or proceeding by or on behalf of the holders, are fully met and discharged. An authority is authorized to include this pledge and agreement of this state or sponsoring university in any agreement with the holders of its indebtedness.