<PAGE> 1
EXHIBIT 5.1
[LETTERHEAD OF PIETRANTONI MENDEZ & ALVAREZ LLP]
December 29, 2000
Doral Financial Corporation
1159 Franklin D. Roosevelt Avenue
San Juan, Puerto Rico 00918
Re: Doral Financial Corporation
Registration Statement on Form S-3
Dear Ladies and Gentlemen:
We have acted as special counsel to Doral Financial Corporation, a
Puerto Rico corporation ("Doral"), in connection with the preparation of a
Registration Statement on Form S-3 (the "Registration Statement") to be filed
with the Securities and Exchange Commission (the "Commission") on or about
December 29, 2000 under the Securities Act of 1933, as amended (the "Securities
Act"). The Registration Statement relates to the issuance and sale from time to
time, pursuant to Rule 415 of the General Rules and Regulations of the
Commission promulgated under the Securities Act, of the following securities of
Doral with an aggregate initial public offering price of up to $250,000,000, or
the equivalent thereof in one or more foreign currencies or composite
currencies: (i) senior or subordinated debt securities, in one or more series
(the "Debt Securities"), which may be issued under a senior indenture, dated as
of May 14, 1999 (the "Senior Indenture") between Doral and Bankers Trust Company
(the "Trustee") as senior trustee and a subordinated indenture, dated as of May
14, 1999 (the "Subordinated Indenture" and together with the Senior Indenture,
the "Indentures") between Doral and the Trustee, as subordinated trustee
Indentures (the "Indentures") proposed to be entered into among Doral and
Bankers Trust Company (the "Trustee"), (ii) shares of Doral common stock, par
value $1.00 per share (the "Common Stock") and (iii) shares of Doral preferred
stock, par value $1.00 per share (the "Preferred Stock"), in one or more series.
The Debt Securities, the Common Stock and the Preferred Stock are
collectively referred to herein as the "Offered Securities."
This opinion is being furnished in accordance with the requirements of
Item 601(b)(5) of Regulation S-K promulgated under the Securities Act.
In connection with this opinion, we have examined originals or copies,
certified or otherwise identified to our satisfaction, of:
(i) the Registration Statement;
(ii) the forms of Indentures incorporated by reference as
exhibits to the Registration Statement;
<PAGE> 2
(iii) the Second Restated Certificate of Incorporation of
Doral, as presently in effect;
(iv) the By-laws of Doral, as presently in effect;
(v) certain resolutions of the Board of Directors of Doral
adopted at a meeting duly held on October 26, 2000 (the "Board Resolutions")
relating to the issuance and sale of the Offered Securities and related matters,
including a delegation of authority to Doral's Pricing Committee to fix and
determine the terms of certain of the Offered Securities; and
(vi) A specimen of the Common Stock certificate of Doral.
We have also examined originals or copies, certified or otherwise
identified to our satisfaction, of such records of Doral and such agreements,
certificates of public officials, certificates of officers or other
representatives of Doral and others, and such other documents, certificates and
records as we have deemed necessary or appropriate as a basis for the opinions
set forth herein.
In our examination, we have assumed the legal capacity of all natural
persons, the genuineness of all signatures, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified, conformed or photostatic copies and the
authenticity of the originals of such latter documents. In making our
examination of documents executed or to be executed by parties other than
Doral, we have assumed that such parties had or will have the power, corporate
or other, to enter into and perform all obligations thereunder and have also
assumed the due authorization by all requisite action, corporate or other, and
execution and delivery by such parties of such documents and the validity and
binding effect thereof. As to any facts material to the opinions expressed
herein which were not independently established or verified, we have relied
upon oral or written statements and representations of officers and other
representatives of Doral and others.
We do not express any opinion as to the laws of any jurisdiction other
than those of the Commonwealth of Puerto Rico.
Based upon and subject to the foregoing, we are of the opinion that:
1. With respect to any series of Debt Securities (the "Offered
Debt Securities"), when (i) the authorized officers of Doral have taken all
necessary corporate action to fix and determine the terms of the Offered Debt
Securities in accordance with the Board Resolutions; (ii) the terms of the
Offered Debt Securities and of their issuance and sale have been duly
established in conformity with
2
<PAGE> 3
the applicable Indenture so as not to violate any applicable law, the Second
Restated Certificate of Incorporation or By-laws of Doral or result in a
default under or breach of any agreement or instrument binding upon Doral, and
so as to comply with any requirement or restriction imposed by any court or
governmental body having jurisdiction over Doral; and (iii) the Offered Debt
Securities have been duly executed and authenticated in accordance with the
terms of the applicable Indenture and duly delivered to the purchasers thereof
upon payment of the agreed-upon consideration therefor, the issuance and sale
of the Offered Debt Securities (including any Offered Debt Securities duly
issued upon exchange or conversion of any shares of Preferred Stock that are
exchangeable or convertible into Debt Securities) will have been duly
authorized, and the Offered Debt Securities will be valid and binding
obligations of Doral entitled to the benefits of the applicable Indenture,
except to the extent that (x) enforcement thereof may be limited by (1)
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or
other similar laws now or hereafter in effect relating to creditors' rights
generally, (2) general principles of equity (regardless of whether
enforceability is considered in proceeding at law or in equity), and (3)
governmental authority to limit, delay or prohibit the making of payments
outside the United States or in foreign currency or composite currency and (y)
the waiver contained in Section 5.15 of the applicable Indenture may be deemed
unenforceable.
2. With respect to the shares of Common Stock (the "Offered
Common Stock") when (i) the Board of Directors or the Pricing Committee has
taken all necessary corporate action to authorize their issuance of sales in
accordance with the Company's Certificate of Incorporation and the Board
Resolutions; (ii) certificates representing the shares of the Offered Common
Stock have been manually signed by an authorized officer of the transfer agent
and registrar for the Common Stock and registered by such transfer agent and
registrar and delivered to the purchasers thereof; and (iii) Doral receives
consideration per share of the offered Preferred Stock in such amount (not less
than the par value per share) as may be determined by the Board of Directors or
the Pricing Committee in the form of cash, services rendered, personal property,
real property, leases of real property, or a combination thereof, the issuance
and sale of the shares of Offered Preferred Stock will have been duly
authorized, and such shares will be validly issued, fully paid and
nonassessable.
2. With respect to the shares of any series of Preferred Stock
(the "Offered Preferred Stock"), when (i) the Board of Directors or the Pricing
Committee has taken all necessary corporate action to fix and determine the
terms of the Offered Preferred Stock and authorize their issuance and sale in
accordance with the Company's Certificate of Incorporation and the Board
Resolutions, including the adoption of a Certificate of Designation for such
Preferred Stock in the form required by applicable law; (ii) such Certificate
of Designation has been duly filed with the Department of State of the
Commonwealth of Puerto Rico; (iii) certificates representing the shares of the
offered Preferred Stock have been manually signed by an authorized officer of
the transfer agent and registrar for the Preferred Stock and registered by such
transfer agent and registrar, and delivered to the purchasers thereof; and (iv)
Doral receives consideration per share of the offered Preferred Stock in such
amount (not less than the par value per share) as may be determined by the
Board of Directors or the Pricing Committee in the form of cash, services
rendered, personal property, real property, leases of real property, or a
combination thereof, the issuance and sale of the shares of Offered Preferred
Stock will have been duly authorized, and such shares will be validly issued,
fully paid and nonassessable.
3
<PAGE> 4
We hereby consent to the filing of this opinion with the Commission as
an exhibit to the Registration Statement. We also consent to the reference to
our firm under the caption "Legal Matters" in the Registration Statement. In
giving this consent, we do not thereby admit that we are included in the
category of persons whose consent is required under Section 7 of the Securities
Act or the Rules and Regulations of the Commission.
Very truly yours,
/s/Pietrantoni Mendez & Alvarez LLP
4
