P.R. Laws tit. 23, § 311o
(a) By authority of the Government of Puerto Rico, hereby granted, the Administration may issue and sell its own bonds from time to time, and have them outstanding.
(b) The Administration, through resolution or resolutions to that effect, shall determine everything related with the date; time of maturity; rate or rates of interest; denomination or denominations; series; form; registration or conversion privileges; medium of payment; place or places of payment; terms of redemption, with or without premium; date they may be declared due, even before their maturity; replacement of mutilated, destroyed, stolen or lost bonds; and all the other conditions and stipulations which it may consider convenient.
(c) The bonds may be sold at public or private sale for such price or prices not lower than ninety-five percent (95%) of the par value thereof as the Board shall determine; refunding bonds may be exchanged for outstanding bonds of the Administration on such terms as the Board may deem to be in the best interest of the Administration. All bonds of the Administration shall be negotiable instruments.
(d) The bonds of the Administration bearing the signature of the officers of the Administration in office on the date of the signing thereof shall be valid and binding obligations, notwithstanding that before the delivery thereof and payment therefor any or all of the officers of the Administration whose signatures or facsimile signatures appear thereon have ceased to be such officers of the Administration.
(e) Temporary or interim bonds, receipts or certificates may be issued in such form and with such provisions as may be provided in such resolution or resolutions.
(f) Any resolution or resolutions authorizing bonds may contain provisions which shall be part of the contract with the bondholders:
(1) As to the disposition of the entire gross or net revenue and present or future income of the Administration, including the pledging of all or any part thereof to secure payment of the bonds;
(2) as to the covenant of pledging all or any part of the revenues, income or property of the Administration;
(3) as to the setting aside of reserves for amortization funds, and the regulation and disposition thereof;
(4) as to limitations on the purposes to which may be applied the proceeds of the sale of any issue of bonds made;
(5) as to limitations on the issuance of additional bonds;
(6) as to the procedure by which the terms of any resolution authorizing bonds, or any other contract with the bondholders, may be amended or abrogated;
(7) as to the amount of the bonds whose holders must consent thereto, and the manner in which such consent may be given;
(8) as to the events, default, and terms and conditions upon which any or all of the bonds should 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, and
(9) as to any other acts or conditions which may be necessary or convenient for the security of the bonds, or that may tend to make the bonds more marketable.
(g) No officer or employee of the Administration executing bonds shall be liable personally on the bonds.
(h) The Administration is authorized to purchase any outstanding bonds issued or assumed thereby, with any funds available therefor, at a price not exceeding the principal amount or the redemption price thereof plus the accrued interest.
(i) The bonds issued by the Administration shall be lawful investments and may be accepted as securities for all trust funds, special or public, whose investment or deposit is under the authority and jurisdiction of the Commonwealth Government or of any officer or employee thereof.
(j) The bonds and other obligations issued by the Administration shall not be a debt of the Commonwealth of Puerto Rico or of any of its agencies; nor shall such bonds or other obligations be payable out of any funds other than those of the Administration.
(k) The bonds issued by the Administration and the income deriving therefrom shall be exempt from taxes and imposts from the Commonwealth of Puerto Rico and its agencies.
(l) The Commonwealth of Puerto Rico does hereby pledge to, and agree with, any of its agencies, or with any agency of the Government of the United States or of any state of the Union, or with any person subscribing to or acquiring bonds or other obligations of the Administration, that it will not encumber, limit nor restrict the properties, incomes, revenues, rights or powers hereby vested in the Administration until all such bonds or other obligations at any time issued, together with the interest thereon, are fully met and discharged.
(m) In addition to the rights which they may have, subject only to the restrictions arising from the contract, the bondholders shall be entitled to compel the Administration, its officers, agents or employees, by mandamus, action or proceeding at law or in equity, to fulfill any and all the terms, agreements or provisions contained in the contract of the Administration with or for the benefit of said bondholders, and to require that there be carried out or performed any of the resolutions and covenants of the Administration or of the duties required by this chapter. They may likewise, by action or proceeding at law, challenge any illegal act in violation of their rights on the part of the Administration.
History —May 16, 1962, No. 13, p. 11, § 16.