Section 11-62-8
Bonds and notes generally - Form, terms, denominations, etc.; execution, sale, delivery, redemption, etc.; security for payment of principal or interest; remedies upon default; liability of municipalities, board, etc., thereupon.
(a) Any authority shall have power to issue from time to time its bonds and notes in such principal amount as its board shall determine to be necessary to provide sufficient funds for achieving any of its corporate purposes, including the payment of interest on any of its notes and bonds, the establishment of reserves to secure any such notes and bonds and all other expenditures of such authority incident to and necessary or convenient to carry out its corporate purposes and powers. Any authority shall also have the power to issue from time to time notes to renew notes and bonds to pay notes, including interest thereon and, whenever it deems refunding expedient, to refund any bonds by the issuance of new bonds, whether the bonds to be refunded have or have not matured, and to issue bonds partly to refund bonds then outstanding and partly for any other of its corporate purposes.
(b) If deemed advisable by the board of any authority, there may be retained in the resolution adopted by such board authorizing the issuance of any bonds or notes an option to redeem all or any part thereof as specified in such resolution at such price or prices and after such notice or notices and on such terms and in such manner as may be provided in such resolution and as may be recited in summary form on the face of the bonds or notes; provided, that any bond of any authority having a specified maturity more than 15 years after its date shall be made subject to redemption at the option of such authority at the expiration of 15 years from its date and on any interest payment date thereafter at such price or prices and after such notice or notices and on such terms and in such manner as may be provided in the resolution adopted by the board of such authority authorizing the issuance of such bond. Any authority may pay all expenses, premiums and commissions which its board may deem necessary and advantageous in connection with the issuance of any of its bonds or notes. Issuance by any authority of one or more series of bonds for one or more purposes shall not preclude it from issuing other bonds, but the resolutions whereunder any subsequent bonds may be issued shall recognize and protect any prior pledge or mortgage made for the benefit of any prior issue of bonds, unless in the proceedings authorizing such prior issue the right was reserved to issue subsequent bonds on a parity with such prior issue.
(c) Notes or bonds issued by any authority may, as its board may deem advisable, be either general obligations of such authority or limited obligations payable only out of certain specified revenues or assets of such authority; provided, that any authority may enter into contracts with the holders of any of its bonds or notes preventing such authority from thereafter issuing general obligation bonds or notes or limiting the amount of such bonds or notes that may thereafter be issued. To the extent permitted by any contracts with the holders of outstanding bonds and notes and any other contractual obligations or requirements, any authority may pledge any of its revenues or mortgage or assign any of its assets, whether real or personal and whether tangible or intangible, to secure the payment of any of its bonds or notes.
(d) All obligations created or assumed by any authority and all bonds or notes issued thereby shall be solely and exclusively an obligation of such authority and shall not create an obligation or debt of the state, the determining municipality or any other political subdivision of the state or public corporation or governmental agency existing under the laws thereof; provided, that the provisions of this sentence shall not be construed to release the original obligor from liability on any bond or other obligation assumed by any authority.
(e) The notes and bonds issued by any authority shall be authorized by resolution or resolutions adopted by its board, shall bear such date or dates and shall mature at such time or times as such resolution or resolutions may provide, except that no bond shall mature more than 45 years from the date of its issue. The bonds of any authority may be issued as serial bonds payable in annual installments or as term bonds or as a combination thereof. The notes and bonds of any authority shall bear interest at such rate or rates, be in such form and denominations, either coupon or registered, carry such registration privileges, be executed by such officers of such authority and in such manner, be payable in such medium of payment, at such place or places within or without the state and be subject to such terms of redemption as may be provided in the resolution or resolutions by which they are authorized to be issued. The notes and bonds of any authority may be sold by such authority at public or private sale at such price or prices as such authority shall determine.
(f) Any resolution or resolutions authorizing bonds or notes of any authority may contain provisions, which shall constitute a part of the contract or contracts with the holders of such bonds or notes, pertaining to, among other things, the following matters:
(1) Pledging all or any part of the revenues of such authority to secure the payment of such bonds or notes, subject to contracts with the holders of its then outstanding bonds and notes;
(2) Pledging, assigning or mortgaging all or any part of the assets of such authority to secure the payment of such bonds or notes, subject to contracts with the holders of its then outstanding bonds and notes;
(3) Setting aside of reserves, sinking funds or other funds and the regulation and disposition thereof;
(4) Limitations on the purpose to which the proceeds of sale of such notes or bonds may be applied and pledging such proceeds to secure the payment of such bonds or notes;
(5) Limitations on the issuance of additional bonds or notes, the terms upon which additional bonds or notes may be issued and secured and the refunding of outstanding bonds or notes;
(6) Procedure, if any, by which the terms of any contract with the holders of such bonds or notes may be amended or abrogated, the amount of bonds or notes the holders of which must consent thereto and the manner in which such consent may be given;
(7) Limitations on the amount of moneys to be expended by such authority for its operating expenses;
(8) Vesting in a trustee or trustees such property, rights, powers and duties as such authority may determine;
(9) Defining the acts or omissions to act that shall constitute a default in the performance of the obligations and duties of such authority to the holders of such bonds or notes and providing for the rights and remedies of such holders in the event of such default; provided, however, that such rights and remedies shall not be inconsistent with the general laws of the state and the other provisions of this chapter; and
(10) Any other matters of like or different character which in any way affect the security or protection of the holders of such bonds or notes.
(g) Any mortgage of property granted by any authority, any security interest in property created by it or any assignment or pledge of revenues or contract rights made by it, in each case to secure the payment of its bonds or notes, shall be valid and binding from the time when such mortgage is granted, such security interest created or such assignment or pledge is made, as the case may be, and the property so mortgaged, the property with respect to which such security interest is so created and the revenues and contract rights so assigned or pledged shall immediately, or as soon thereafter as such authority obtains any right thereto or interest therein, be subject to such mortgage, security interest, assignment or pledge, as the case may be, without physical delivery of any property, revenues or contract documents covered thereby or any further act, and the lien of any such mortgage, security interest, assignment or pledge shall be valid and binding as against all persons having claims of any kind in tort, contract or otherwise against such authority, irrespective of whether such persons have actual notice thereof, from the time notice of such mortgage, security interest, assignment or pledge is filed for record in the office of the judge of probate in which the certificate of incorporation of such authority was filed for record and, in the case of any mortgage or security interest covering any tangible property, whether real, personal or mixed, in the office of the judge of probate of the county in which such property is or is to be located pursuant to any agreement made by such authority with any user respecting the location and use of such property. Such notice shall contain a statement of the existence of any such mortgage, security interest, assignment or pledge, as the case may be, a description of the property, revenues or contract rights subject thereto and a description of the bonds or notes secured thereby, all in terms sufficient to give notice to a reasonably prudent person of the existence and effect of any such mortgage, security interest, assignment or pledge. If the requirements of the preceding sentence are met, such notice may consist of a summary statement prepared specially for the purpose of serving as such notice, an executed counterpart of any mortgage, security agreement, assignment, trust indenture or other instrument granting such mortgage, creating such security interest or making such assignment or pledge, as the case may be, or a certified copy of the resolution adopted by the board of such authority authorizing such mortgage, security interest, assignment or pledge, as the case may be.
(h) Any authority shall have power, subject to contracts with the holders of its then outstanding bonds and notes, to purchase for retirement and cancellation any of its bonds or notes and to use any of its available funds for such purpose, provided that, if such bonds or notes are then redeemable, the purchase price thereof shall not exceed the redemption price then applicable, plus accrued interest thereon to the date of purchase, and, if such bonds or notes are not then redeemable, the purchase price thereof shall not exceed the redemption price applicable on the earliest date after such purchase upon which such bonds or notes become subject to redemption, plus accrued interest thereon to the date of purchase.
(i) The bonds or notes of any authority may, at the discretion of such authority, be issued under and secured by a trust indenture or trust indentures by and between such authority and a corporate trustee, which may be any trust company or bank having the power of a trust company within or without the state. Any such trust indenture may contain such provisions for protecting and enforcing the rights and remedies of bondholders or noteholders as may be reasonable and proper and not in violation of law, including covenants setting forth the duties of such authority in relation to the exercise of its corporate powers and the custody, safeguarding and application of all moneys. Such authority may provide by any such trust indenture for the payment to the trustee thereunder or other depository of the proceeds of any bonds or notes issued thereunder and any revenues pledged for the security of such proceeds and revenues, with such safeguards and restrictions as it may determine. All expenses incurred in connection with such trust indenture may be treated as part of the operating expenses of such authority.
(j) Whether or not the notes and bonds of any authority are of such form and character as to be negotiable instruments under the terms of the Alabama Uniform Commercial Code, such notes and bonds are hereby made negotiable instruments within the meaning of the Alabama Uniform Commercial Code and for all purposes thereof, subject only to any registration provisions of such notes and bonds. In case any of the directors or officers of any authority whose signatures appear on any notes, bonds or coupons appertaining to any bond shall cease to be such directors or officers before the delivery of such notes, bonds or coupons, such signatures shall, nevertheless, be valid and sufficient for all purposes to the same extent as if such directors or officers had remained in office until such delivery.
(k) The directors and officers of any authority shall not be subject to any personal liability by reason of the issuance of any bonds or notes of such authority.
(Acts 1979, No. 79-332, p. 506, §8.)