135 
(7) INSURED BOND.—The term ‘‘Insured Bond’’ 
means a bond subject to a financial guarantee or 
similar insurance contract, policy or surety issued by 
a monoline insurer. 
(8) ISSUER.—The term ‘‘Issuer’’ means, as ap-
plicable, the Territory Government Issuer or an Au-
thorized Territorial Instrumentality that has issued 
or guaranteed at least one Bond that is Outstanding. 
(9) MODIFICATION.—The term ‘‘Modification’’ 
means any modification, amendment, supplement or 
waiver affecting one or more series of Bonds, includ-
ing those effected by way of exchange, repurchase, con-
version, or substitution. 
(10) OUTSTANDING.—The term ‘‘Outstanding,’’ 
in the context of the principal amount of Bonds, shall 
be determined in accordance with subsection (b). 
(11) OUTSTANDING PRINCIPAL.—The term ‘‘Out-
standing Principal’’ means— 
(A) for a Bond that is not a Capital Appre-
ciation Bond or a Convertible Capital Apprecia-
tion Bond, the outstanding principal amount of 
such Bond; and 
(B) for a Bond that is a Capital Apprecia-
tion Bond or a Convertible Capital Appreciation 
Bond, the current accreted value of such Capital 
VerDate Sep 11 2014 
21:15 Jun 03, 2016
Jkt 059200
PO 00000
Frm 00135
Fmt 6652
Sfmt 6203
E:\BILLS\H5278.RH
H5278
asabaliauskas on DSK3SPTVN1PROD with BILLS
136 
Appreciation Bond or a Convertible Capital Ap-
preciation Bond, as applicable. 
(12) POOL.—The term ‘‘Pool’’ means a pool es-
tablished in accordance with subsection (d). 
(13) 
QUALIFYING
MODIFICATION.—The 
term 
‘‘Qualifying Modification’’ means a Modification pro-
posed in accordance with subsection (g). 
(14) SECURED POOL.—The term ‘‘Secured Pool’’ 
means a Pool established in accordance with sub-
section (d) consisting only of Bonds that are secured 
by a lien on property, provided that the inclusion of 
a Bond Claim in such Pool shall not in any way 
limit or prejudice the right of the Issuer, the Adminis-
trative Supervisor, or any creditor to recharacterize 
or challenge such Bond Claim, or any purported lien 
securing such Bond Claim, in any other manner in 
any subsequent proceeding in the event a proposed 
Qualifying Modification is not consummated. 
(15) TERRITORY
GOVERNMENT
ISSUER.—The 
term ‘‘Territory Government Issuer’’ means the Gov-
ernment of Puerto Rico or such covered territory for 
which an Oversight Board has been established pursu-
ant to section 101. 
(b) OUTSTANDING BONDS.—In determining whether 
holders of the requisite principal amount of Outstanding 
VerDate Sep 11 2014 
21:15 Jun 03, 2016
Jkt 059200
PO 00000
Frm 00136
Fmt 6652
Sfmt 6203
E:\BILLS\H5278.RH
H5278
asabaliauskas on DSK3SPTVN1PROD with BILLS
137 
Bonds have voted in favor of, or consented to, a proposed 
Qualifying Modification, a Bond will be deemed not to be 
outstanding, and may not be counted in a vote or consent 
solicitation for or against a proposed Qualifying Modifica-
tion, if on the record date for the proposed Qualifying Modi-
fication— 
(1) the Bond has previously been cancelled or de-
livered for cancellation or is held for reissuance but 
has not been reissued; 
(2) the Bond has previously been called for re-
demption in accordance with its terms or previously 
become due and payable at maturity or otherwise and 
the Issuer has previously satisfied its obligation to 
make, or provide for, all payments due in respect of 
the Bond in accordance with its terms; 
(3) the Bond has been substituted with a security 
of another series; or 
(4) the Bond is held by the Issuer or by an Au-
thorized Territorial Instrumentality of the Territory 
Government Issuer or by a corporation, trust or other 
legal entity that is controlled by the Issuer or an Au-
thorized Territorial Instrumentality of the Territory 
Government Issuer, as applicable. 
For purposes of this subsection, a corporation, trust or other 
legal entity is controlled by the Issuer or by an Authorized 
VerDate Sep 11 2014 
21:15 Jun 03, 2016
Jkt 059200
PO 00000
Frm 00137
Fmt 6652
Sfmt 6203
E:\BILLS\H5278.RH
H5278
asabaliauskas on DSK3SPTVN1PROD with BILLS
138 
Territorial Instrumentality of the Territory Government 
Issuer if the Issuer or an Authorized Territorial Instrumen-
tality of the Territory Government Issuer, as applicable, has 
the power, directly or indirectly, through the ownership of 
voting securities or other ownership interests, by contract 
or otherwise, to direct the management of or elect or appoint 
a majority of the board of directors or other persons per-
forming similar functions in lieu of, or in addition to, the 
board of directors of that legal entity. 
(c) CERTIFICATION OF DISENFRANCHISED BONDS.— 
Prior to any vote on, or consent solicitation for, a Quali-
fying Modification, the Issuer shall deliver to the Calcula-
tion Agent a certificate signed by an authorized representa-
tive of the Issuer specifying any Bonds that are deemed not 
to be Outstanding for the purpose of subsection (b) above. 
(d) DETERMINATION OF POOLS FOR VOTING.—The Ad-
ministrative Supervisor, in consultation with the Issuer, 
shall establish Pools in accordance with the following: 
(1) Not less than one Pool shall be established for 
each Issuer. 
(2) A Pool that contains one or more Bonds that 
are secured by a lien on property shall be a Secured 
Pool. 
(3) The Administrative Supervisor shall establish 
Pools according to the following principles: 
VerDate Sep 11 2014 
21:15 Jun 03, 2016
Jkt 059200
PO 00000
Frm 00138
Fmt 6652
Sfmt 6203
E:\BILLS\H5278.RH
H5278
asabaliauskas on DSK3SPTVN1PROD with BILLS
139 
(A) For each Issuer that has issued multiple 
Bonds that are distinguished by specific provi-
sions governing priority or security arrange-
ments, including Bonds that have been issued as 
general obligations of the Territory Government 
Issuer to which the Territory Government Issuer 
pledged the full or good faith, credit, and taxing 
power of the Territory Government Issuer, sepa-
rate Pools shall be established corresponding to 
the relative priority or security arrangements of 
each holder of Bonds against each Issuer, as ap-
plicable, provided, however, that the term ‘‘pri-
ority’’ as used in this section shall not be under-
stood to mean differing payment or maturity 
dates. 
(B) For each Issuer that has issued senior 
and subordinated Bonds, separate Pools shall be 
established for the senior and subordinated 
Bonds corresponding to the relative priority or 
security arrangements. 
(C) For each Issuer that has issued multiple 
Bonds, for at least some of which a guarantee of 
repayment has been provided by the Territory 
Government Issuer, separate Pools shall be estab-
VerDate Sep 11 2014 
21:15 Jun 03, 2016
Jkt 059200
PO 00000
Frm 00139
Fmt 6652
Sfmt 6203
E:\BILLS\H5278.RH
H5278
asabaliauskas on DSK3SPTVN1PROD with BILLS
140 
lished for such guaranteed and non-guaranteed 
Bonds. 
(D) Subject to the other requirements con-
tained in this section, for each Issuer that has 
issued multiple Bonds, for at least some of which 
a dedicated revenue stream has been pledged for 
repayment, separate Pools for such Issuer shall 
be established as follows— 
(i) for each dedicated revenue stream 
that has been pledged for repayment, not 
less than one Secured Pool for Bonds for 
which such revenue stream has been pledged, 
and separate Secured Pools shall be estab-
lished for Bonds of different priority; and 
(ii) not less than one Pool for all other 
Bonds issued by the Issuer for which a dedi-
cated revenue stream has not been pledged 
for repayment. 
(E) The Administrative Supervisor shall 
not place into separate Pools Bonds of the same 
Issuer that have identical rights in security or 
priority. 
(4) Notwithstanding the preceding provisions of 
this subsection, a preexisting voluntary agreement 
may classify Insured Bonds and uninsured bonds in 
VerDate Sep 11 2014 
21:15 Jun 03, 2016
Jkt 059200
PO 00000
Frm 00140
Fmt 6652
Sfmt 6203
E:\BILLS\H5278.RH
H5278
asabaliauskas on DSK3SPTVN1PROD with BILLS
141 
different Pools and provide different treatment thereof 
so long as the preexisting voluntary agreement has 
been agreed to by— 
(A) holders of a majority in amount of all 
uninsured bonds outstanding in the modified 
Pool; and 
(B) holders (including insurers with power 
to vote) of a majority in amount of all Insured 
Bonds. 
(e) AUTHORIZATION OF TERRITORY INSTRUMENTAL-
ITIES.—A covered territorial instrumentality is an Author-
ized Territorial Instrumentality if it has been specifically 
authorized to be eligible to avail itself of the procedures 
under this section by the Administrative Supervisor. 
(f) INFORMATION DELIVERY REQUIREMENT.—Before 
solicitation of acceptance or rejection of a Modification 
under subsection (h), the Issuer shall provide to the Calcula-
tion Agent, the Information Agent, and the Administrative 
Supervisor, the following information— 
(1) a description of the Issuer’s economic and fi-
nancial circumstances which are, in the Issuer’s opin-
ion, relevant to the request for the proposed Quali-
fying Modification, a description of the Issuer’s exist-
ing debts, a description of the impact of the proposed 
VerDate Sep 11 2014 
21:15 Jun 03, 2016
Jkt 059200
PO 00000
Frm 00141
Fmt 6652
Sfmt 6203
E:\BILLS\H5278.RH
H5278
asabaliauskas on DSK3SPTVN1PROD with BILLS
142 
Qualifying Modification on the territory’s or its terri-
torial instrumentalities’ public debt; 
(2) if the Issuer is seeking Modifications affect-
ing any other Pools of Bonds of the Territory Govern-
ment Issuer or its Authorized Territorial Instrumen-
talities, a description of such other Modifications; 
(3) if a Fiscal Plan with respect to such Issuer 
has been certified, the applicable Fiscal Plan certified 
in accordance with section 201; and 
(4) such other information as may be required 
under applicable securities laws. 
(g) QUALIFYING MODIFICATION.—A Modification is a 
Qualifying Modification if— 
(1) the Issuer proposing the Modification has 
consulted with holders of Bonds in each Pool of such 
Issuer prior to soliciting a vote on such Modification; 
(2) each exchanging, repurchasing, converting, or 
substituting holder of Bonds of any series in a Pool 
affected by that Modification is offered the same 
amount of consideration per amount of principal, the 
same amount of consideration per amount of interest 
accrued but unpaid and the same amount of consider-
ation per amount of past due interest, respectively, as 
that offered to each other exchanging, repurchasing, 
converting, or substituting holder of Bonds of any se-
VerDate Sep 11 2014 
21:15 Jun 03, 2016
Jkt 059200
PO 00000
Frm 00142
Fmt 6652
Sfmt 6203
E:\BILLS\H5278.RH
H5278
asabaliauskas on DSK3SPTVN1PROD with BILLS
143 
ries in a Pool affected by that Modification (or, where 
a menu of instruments or other consideration is of-
fered, each exchanging, repurchasing, converting, or 
substituting holder of Bonds of any series in a Pool 
affected by that Modification is offered the same 
amount of consideration per amount of principal, the 
same amount of consideration per amount of interest 
accrued but unpaid and the same amount of consider-
ation per amount of past due interest, respectively, as 
that offered to each other exchanging, repurchasing, 
converting, or substituting holder of Bonds of any se-
ries in a Pool affected by that Modification electing 
the same option under such menu of instruments); 
(3) the Modification is certified by the Adminis-
trative Supervisor as being consistent with the re-
quirements set forth in section 104(i)(1) and is in the 
best interests of the creditors and is feasible; or 
(4) notwithstanding paragraphs (1) through (3), 
the Administrative Supervisor has issued a certifi-
cation that— 
(A) the requirements set forth in section 
104(i)(2) have been satisfied; or 
(B) the Modification is consistent with a re-
structuring support or similar agreement to be 
implemented pursuant to the law of the covered 
VerDate Sep 11 2014 
21:15 Jun 03, 2016
Jkt 059200
PO 00000
Frm 00143
Fmt 6652
Sfmt 6203
E:\BILLS\H5278.RH
H5278
asabaliauskas on DSK3SPTVN1PROD with BILLS
144 
territory executed by the Issuer prior to the es-
tablishment of an Oversight Board for the rel-
evant territory. 
(h) SOLICITATION.— 
(1) Upon receipt of a certification from the Ad-
ministrative Supervisor under subsection (g), the In-
formation Agent shall, if practical and except as pro-
vided in paragraph (2), submit to the holders of any 
Outstanding Bonds of the relevant Issuer, including 
holders of the right to vote such Outstanding Bonds, 
the information submitted by the relevant Issuer 
under subsection (f)(1) in order to solicit the vote of 
such holders to approve or reject the Qualifying Modi-
fication. 
(2) If the Information Agent is unable to iden-
tify the address of holders of any Outstanding Bonds 
of the relevant Issuer, the Information Agent may so-
licit the vote or consent of such holders by— 
(A) delivering the solicitation to the paying 
agent for any such Issuer or Depository Trust 
Corporation if it serves as the clearing system 
for any of the Issuer’s Outstanding Bonds; or 
(B) delivering or publishing the solicitation 
by whatever additional means the Information 
Agent, after consultation with the Issuer, deems 
VerDate Sep 11 2014 
21:15 Jun 03, 2016
Jkt 059200
PO 00000
Frm 00144
Fmt 6652
Sfmt 6203
E:\BILLS\H5278.RH
H5278
asabaliauskas on DSK3SPTVN1PROD with BILLS
145 
necessary and appropriate in order to make a 
reasonable effort to inform holders of any Out-
standing Bonds of the Issuer which may include, 
notice by mail, publication in electronic media, 
publication on a website of the Issuer, or publi-
cation in newspapers of national circulation in 
the United States and in a newspaper of general 
circulation in the territory. 
(i) WHO MAY PROPOSE A MODIFICATION.—For each 
Issuer, a Modification may be proposed to the Administra-
tive Supervisor by the Issuer or by one or more holders of 
the right to vote the Issuer’s Outstanding Bonds. To the ex-
tent a Modification proposed by one or more holders of the 
right to vote Outstanding Bonds otherwise complies with 
the requirements of this title, the Administrative Supervisor 
may accept such Modification on behalf of the Issuer, in 
which case the Administrative Supervisor will instruct the 
Issuer to provide the information required in subsection (f). 
(j) VOTING.—For each Issuer, any Qualifying Modi-
fication may be made with the affirmative vote of the hold-
ers of the right to vote at least two-thirds of the Outstanding 
Principal amount of the Outstanding Bonds in each Pool 
that have voted to approve or reject the Qualifying Modi-
fication, provided that holders of the right to vote not less 
than a majority of the aggregate Outstanding Principal 
VerDate Sep 11 2014 
21:15 Jun 03, 2016
Jkt 059200
PO 00000
Frm 00145
Fmt 6652
Sfmt 6203
E:\BILLS\H5278.RH
H5278
asabaliauskas on DSK3SPTVN1PROD with BILLS
146 
amount of all the Outstanding Bonds in each Pool have 
voted to approve the Qualifying Modification. The holder 
of the right to vote the Outstanding Bonds that are Insured 
Bonds shall be the monoline insurer insuring such Insured 
Bond to the extent such insurer is granted the right to vote 
Insured Bonds for purposes of directing remedies or con-
senting to proposed amendments or modifications as pro-
vided in the applicable documents pursuant to which such 
Insured Bond was issued and insured. 
(k) CALCULATION AGENT.—For the purpose of calcu-
lating the principal amount of the Bonds of any series eligi-
ble to participate in such a vote or consent solicitation and 
tabulating such votes or consents, the Territory Government 
Issuer may appoint a Calculation Agent for each Pool rea-
sonably acceptable to the Administrative Supervisor. 
(l) INFORMATION AGENT.—For the purpose of admin-
istering a vote of holders of Bonds, including the holders 
of the right to vote such Bonds, or seeking the consent of 
holder of Bonds, including the holders of the right to vote 
such Bonds, to a written action under this section, the Ter-
ritory Government Issuer may appoint an Information 
Agent for each Pool reasonably acceptable to the Adminis-
trative Supervisor. 
(m) BINDING EFFECT.— 
VerDate Sep 11 2014 
21:15 Jun 03, 2016
Jkt 059200
PO 00000
Frm 00146
Fmt 6652
Sfmt 6203
E:\BILLS\H5278.RH
H5278
asabaliauskas on DSK3SPTVN1PROD with BILLS