P.R. Laws tit. 23, § 612
(a) By authority of the Commonwealth, hereby granted, the Authority is authorized to issue and sell its own bonds from time to time for its corporate purposes.
(b) The Board of Directors of the Authority is hereby authorized to direct the issue of bonds of the Authority, all at one time, or from time to time, in order to provide funds to be used by the Authority for any of its corporate purposes. The bonds shall be dated, shall bear interest at such rate or rates not exceeding six percent (6%) per annum, shall mature at such date or dates not exceeding forty (40) years from their respective date or dates, as the Board of Directors may determine, and may be made redeemable before maturity, at the option of the Authority, at such price or prices, and under such terms and conditions as may be fixed by the Board of Directors prior to the issue of the bonds. The Board of Directors shall determine the form and manner of execution of the bonds, including any interest coupons to be adhered thereto, and the denomination or denominations of the bonds, and, subject to the provisions of §§ 581—595 of Title 7, the place or places for the payment of the principal and the interest. In case any officer whose signature or facsimile signature appears on any bond or coupon ceases to be such officer before the delivery of such bonds, such signature or facsimile signature shall, however, be valid or sufficient for all purposes, as if said officer had remained in office until such delivery. Notwithstanding any other provision of this chapter or any other provision included in any bonds issued under this chapter, all these bonds shall be considered negotiable instruments under the laws of Puerto Rico. The bonds may be issued in coupon form or registered, or both, as determined by the Board of Directors, and provision may be made for the registering of any coupon bond only as regards principal, and also as regards principal and interest, and for the reconversion into coupon bond of any bond registered as regards principal and interest. The Board of Directors may sell such bonds in such manner, either at public or private sale, and at such price as it may determine most desirable to the best interests of the Authority, but such sale shall not be done at a price so low as to require that the interest paid on the money so received be at a rate higher than six percent (6%) per annum, computed in relation to the absolute maturity or maturities of the bonds according to the normal schedule of bond values, excluding, however, from such computation, the amount of any premium payable upon the redemption of any bonds before maturity.
Before the preparation of the definitive bonds, the Board of Directors may, under similar restrictions, issue interim receipts or provisional bonds, with or without coupons, exchangeable for definitive bonds when said bonds have been executed and are ready for delivery. The Board of Directors may also provide for the replacement of any bonds that may be mutilated, destroyed or lost.
Subject to the provisions of §§ 581—595 of Title 7, known as “Fiscal Agency Act”, the Board of Directors may issue bonds under the provisions of this chapter without need of obtaining the consent of any commission, board, bureau or agency of the Commonwealth of Puerto Rico, and without any procedures, conditions or things other than such procedures, conditions or things as may be required by this chapter.
(c) Any bond issued by the Board of Directors under the provisions of this chapter may be secured by a trust contract between the Government Development Bank for Puerto Rico and a corporate trustee, that may be any trust company or bank having the powers of a trust company within or without the Commonwealth of Puerto Rico. Any resolution or resolutions authorizing the issue of the bonds or trust contract may contain provisions which shall be a part of the contract with the holders of the bonds:
(1) As to the disposition of the entire gross or net revenues and present or future income of the Authority, including the pledging of all or any part thereof to secure payment of the bonds;
(2) as to the rates to be charged, and the application, use, and disposition of the amounts that may be raised by the collection of such rates and from other receipts of the Authority;
(3) as to the setting aside of reserves for amortization funds, and the regulation and disposition thereof;
(4) as to limitations on the right of the Authority to restrict and regulate the use of any undertaking or part thereof;
(5) as to limitations on the purpose to which the proceeds of the sale of any bond issue may be applied;
(6) as to limitations on the issuance of additional bonds;
(7) as to the procedure for amending or abrogating the terms of any resolution authorizing bonds, or of any other contract with the bondholders; and as to the amount of the bonds the holders of which must consent thereto, and the manner in which such consent may be given;
(8) as to the amount and kind of insurance to be maintained by the Authority on its undertakings, and the use and disposition of insurance moneys;
(9) covenanting against pledging all or any part of the revenues and income of the Authority to which its right then exists or the right to which may thereafter come into existence;
(10) as to events of default, and terms and conditions upon which any or all of the bonds shall become or may be declared due before maturity; and as to the terms and conditions upon which such declaration and its consequences may be waived;
(11) as to the rights, liabilities, powers, and duties arising upon default of the Authority to fulfill any of its covenants, conditions or obligations;
(12) as to investing a trustee or trustees with the right to enforce any covenants made to secure or pay, or otherwise act in relation to the bonds; as to the powers and duties of each trustee, or trustees, and the limitation of the liabilities thereof; and as to the terms and conditions upon which the holders of the bonds, or any proportion or percentage of them, may enforce any covenants made under this chapter or the duties imposed hereby;
(13) as to the manner of collecting the rates, fees, rentals, or other charges for the services, facilities, or commodities of undertakings of the Authority, and of combining in one sole bill the rates, fees, rentals, or other charges for the services, facilities, or commodities of any two (2) or more of such undertakings;
(14) as to the discontinuance of services, facilities, or commodities of any undertaking of the Authority, in the event that the rates, fees, rentals, or other charges for the services, facilities, or commodities of such undertaking are not paid, and
(15) as to any other acts and aspects not inconsistent with this chapter that may be necessary or convenient for the security of the bonds, or as may render the bonds more marketable.
The Authority shall transmit to the Legislature a copy of the resolution or resolutions authorizing the issuance of bonds.
History —May 11, 1959, No. 5, p. 17, § 12.