P.R. Laws tit. 25, § 3051k
(a) The Authority, with the prior [approval] of the Legislature, is hereby authorized to issue bonds from time to time for those amounts which in the opinion of the Authority are necessary to provide sufficient funds for any of its purposes, to include financing the expenses incurred by the Authority or incurred by the contracted entity for the planning, redevelopment, design and construction of the land and facilities of the Naval Station.
(b) The bonds issued by the Authority may be made payable from and be guaranteed by a pledge of or the constitution of another lien on the total or part of the gross or net income of the Authority which may include, subject to the provisions of Section 8 of Article VI of the Constitution of the Commonwealth of Puerto Rico, those funds which may be made available to the Authority by the Commonwealth of Puerto Rico, as provided in the trust agreement or resolution under which the bonds are issued. All bonds issued by the Authority may also be made payable from and be guaranteed by a pledge of or the constitution of another lien on the total or part of the income derived by the Authority under the clauses of a finance contract with the contracted entity, whose revenues have been pledged for the payment of said bonds under said finance contract and the trust agreement under which the bonds are issued. The pledge of or constitution of another lien on said income or funds of the Authority shall be valid and obligatory from the moment this is done without the need for executing a public or notarized document. The income thus encumbered, including those the Authority may receive subsequently shall be immediately subject to said lien without the need for physically delivering the same or of any other act, and said lien shall be valid and obligatory and shall prevail against any third party with any type of claim for damages, noncompliance of contract or another motive against the Authority regardless of whether said third party has not been notified in that respect. Neither the trust agreement or the resolution nor any collateral contract through which the rights of the Authority over any income are pledged or assigned shall have to be presented or registered to perfect the lien on the same against any third party.
(c) The resolution or resolutions authorizing the bond issue or the trust agreement guaranteeing the same may contain provisions which shall be part of the contract with the holders of the bonds issued under said resolution or resolutions or under said trust agreement with respect to: the disposition of the total gross or net income and present or future income of the Authority; the guarantee and creation of the lien on the income and assets of the Authority; the charges and tariffs to be imposed and the application, use and disposition of the amounts collected through the collection of said tariffs and other income of the Authority; the creation and maintenance of redemption funds and reserves; the limitations relative to the purposes for which the product of said bonds or the bonds to be issued in the future may be used; the limitations as to the issue of additional bonds; the limitations as to the introduction of amendments and attachments to the resolution or resolutions or to the trust agreement; the procedure through which the terms of any resolution authorizing bonds or any other contract with the bond holder may be amended or repealed; and as to the total amount of the bonds whose holders must give their consent to that effect, as well as the manner in which said consent must be given; the class and amount of the insurance the Authority must maintain on its properties and the use and disposition of the insurance money; the commitment to not encumber all or part of the income of the Authority, both as to the right it may have then as well as the right that may arise in the future; the concession of rights, faculties and privileges and the imposition of obligations and responsibilities of the trustee under any trust agreement or resolution; the cases of noncompliance and the terms and conditions under which any or all bonds should come due or may be declared due before their due date; and as to the terms and conditions for which said declaration and its consequences may be waived; the rights, faculties, obligations and responsibilities that shall arise in the event of noncompliance with any obligation under said resolution or resolutions or under said trust agreement; any rights, faculties or privileges conferred upon the bond holders as security for the same to increase the saleability of the bonds; and other matters not in conflict with this chapter that may be necessary or convenient to guarantee the bonds or that tend to make the bonds more negotiable.
(d) The bonds may be authorized through a resolution or resolutions of the Board and issued in a series; bear the date or dates authorized by the Board, come due in an installment or installments that do not exceed fifty (50) years after their respective dates of issue; accrue interest at the type or types that do not exceed the maximum type then permitted by law; be of the denomination or denominations authorized by the Board and [in the form of] bonds with coupons or registered; have the privilege of registration or conversion; be granted in the manner authorized by the Board; be payable through the means for payment and at the place or places; and be subject to the terms of redemption with or without premium; be declared mature or come due on a date prior to their maturity; provide for the replacement of mutilated, destroyed, stolen or lost bonds; be authenticated in such a way once the conditions have been met and contain all other terms and stipulations provided by said resolution or resolutions approved by the Board. The Bonds may be sold publicly or privately, at the price or prices determined by the Authority; Provided, That convertible bonds may be exchanged for outstanding bonds of the Authority according to the terms the Authority may deem beneficial to the best interests of the Authority. Their text and form notwithstanding and lacking an express statement in the bond that the latter is not negotiable, all bonds of the Authority shall be and shall be deemed to be at all times negotiable bonds for all purposes.
(e) At the discretion of the Authority any bonds issued under the provisions of this chapter may be secured by a trust agreement by and between the Authority and any bank or trust company described in subsection (f) of this section, which may be a bank or a trust company in or outside of the Commonwealth of Puerto Rico. Any provision of law to the contrary notwithstanding, said trust agreement shall not have to be executed through a public deed for it to be a valid trust under the laws of the Commonwealth of Puerto Rico. The trust agreement may contain all those provisions the Authority may deem reasonable and appropriate concerning the security of the bondholders.
(f) It shall be lawful for any bank or trust company incorporated under the laws of the Commonwealth of Puerto Rico, of the United States of America or of any state of the United States of America to act as depository of the product of the bonds, revenues and other monies, and to grant indemnification bonds or provide as surety those securities required by the Authority.
(g) The bonds of the Authority that bear the signatures of the officers of the Authority while [sic] holding office at the date of signing the same shall be valid and shall constitute unavoidable obligations even when before the delivery of and payment for said bonds any or all officers whose signatures or facsimiles thereof appear in said bonds have ceased to hold office as such in the Authority. The validity of the authorization and issue of bonds shall not depend or be affect in any manner whatsoever by any procedure related to the construction, acquisition, expansion or improvement of the installation for which the bonds are issued or by any contract executed in relation to such installations. Any resolution authorizing bonds may provide that said bonds contain a statement indicating that they are issued in accordance with this chapter and any bond containing said statement authorized by such a resolution shall conclusively be considered valid and issued according to the provisions of this chapter.
(h) Provisional or temporary bonds and receipts or certificates may be issued while the definitive bonds are granted and delivered, in the manner and with the provisions set forth in the resolution or resolutions authorizing said bonds.
(i) Neither the members of the Board or the Executive Director nor any other person who grants the bonds shall be personally responsible for said bonds.
(j) The Authority is authorized to purchase with any funds available for such a purpose, any outstanding bonds issued or assumed by the Authority at a price that shall not exceed the total amount of the principal or of the current redemption value of the same plus the accrued interest.
(k) The Authority is hereby authorized to issue refinancing bonds of the Authority for the purpose of refinancing those bonds that are outstanding and in force and effect at that time and that have been issued under the provisions of this chapter, including the payment of any redemption premium in relation thereto and any interest accrued or to be accrued by the date of redemption or maturity of said bonds and, should the Board deem it advisable, for any of the purpose for which the Authority may issue bonds. The issue of said bonds, their maturity and other details regarding the same, the rights of the holders of said bonds and the rights, duties and obligations of the Authority concerning the same shall be governed by the provisions of this chapter related to the issue of bonds as far as said provisions may be applicable.
(l) The refinancing bonds issued under this section may be sold or exchanged for outstanding bonds issued under this chapter and if sold the product of said sale may be devoted, in addition to any authorized purpose, to the purchase, redemption or payment of those bonds that are outstanding and in force and effect and may be invested depending on said application. The refinancing bonds may be issued, at the discretion of the Authority, at any time, on or before their date of maturity or maturities or the date selected for the redemption of the bonds being refinanced.
(m) The bonds and other obligations issued by the Authority shall not constitute a debt of the Commonwealth of Puerto Rico nor of any of its municipalities or other political subdivisions and neither the Commonwealth of Puerto Rico or any of its municipalities nor political subdivisions shall be liable concerning these, nor shall the bonds or other obligations payable with funds other than those of the Authority. The Authority shall have no power whatsoever at any time or in any manner to pledge the credit or the power to impose taxes of the Commonwealth of Puerto Rico or of any of its political subdivisions.
(n) The bonds of the Authority shall constitute lawful investments and may be accepted as security for any special or public trust fund whose investment or deposit is under the authority or the dominion of the Government of the Commonwealth of Puerto Rico or of any officer or officers of the latter.
(o) The provisions of subsection (m) of this section notwithstanding, and with the understanding that the Authority has been created for an effective term of ten years, any bond issued under the provisions of this chapter may be subscribed jointly by another public corporation or government instrumentality of the Commonwealth of Puerto Rico, a government instrumentality which shall assume the title of the properties pledged in the bonds and/or which assume the rights and responsibilities related to the bonds once the Authority ceases to exist as provided in this chapter.
History —Sept. 29, 2004, No. 508, § 13.