(a) Warehouse-stored cotton. (1) Form A.

(2) Warehouse receipts complying with the provisions of § 256.7 hereof.

(3) Producer's Letter of Transmittal (C.C.C. Cotton Form B) or Lending Agency's Letter of Transmittal (C.C.C. Cotton Form C).

(b) Farm-stored cotton.

(1) Form E.

(2) Form F covering the cotton tendered as security for the loan.

(3) Lending Agency's Letter of Transmittal (C.C.C. Cotton Form C) (unless the loan is being made direct by Commodity Credit Corporation).

Each of the forms A, B, E, F, and FF, representing American-Egyptian cotton or Sea-Island cotton, must have the words "American-Egyptian cotton" or "Sea-Island cotton," as the case may be, conspicuously stamped or typed at the top of each such form.

§ 256.3 Amount. All loans will be made on the net weight of the cotton. Loans will be made only on those grades and staple lengths shown in Tables Nos. 1, 2, and 3 infra.

(a) Upland cotton. The base loan rate applicable at each approved warehouse will be shown in the "Schedule of Approved Warehouses," and the base loan rate under the farm storage program for each county will be shown in the "Schedule of Base Loan Rates by Counties for Farm-Stored Cotton." These schedules will be issued by Commodity Credit Corporation and will be available at the office of the county agricultural conservation committee (hereinafter called "county committee"). Premiums and discounts applicable to each grade and staple length are shown in Table No. 1. Loans on warehouse-stored cotton will be made at the rates shown in the "Schedule of Approved Warehouses," and loans on farm-stored cotton will be made at the rates shown in the "Schedule of Base Loan Rates by Counties for Farm-Stored Cotton," adjusted for the appropriate premiums and discounts for each grade and staple length.

(b) American-Egyptian cotton. Loans will be made at the rates shown in Table No. 2.

(c) Sea-Island cotton. Loans will be made at the rates shown in Table No. 3.

All

§ 256.4 Classification of cotton. cotton must be classified by a Board of Cotton Examiners of the War Food Administration. Warehousemen (in the case of warehouse-stored cotton) and the county committee (in the case of farm-stored cotton) should forward samples to the Board of Cotton Examiners serving the district in which the warehouse or county is located, and a list showing the class of the cotton will be returned by the board. Instructions have been issued to approved warehouses and county committees concerning sampling and forwarding of samples and recording the class of the cotton in the loan agreement or chattel mortgage. No separate charge is to be made to producers for this service. A Form 1 classification memorandum of the War Food Administration will also be accepted as evidence of the class of cotton.

A charge of 15 cents per bale shall be collected from the producer for all cotton from which samples are submitted to the Board of Cotton Examiners for classification. The Board of Cotton Examiners will make collections for classing charges from the warehousemen and county committees at the end of each month. A certified check, cashier's check, or postal money order, payable to Commodity Credit Corporation, must be sent to the Board of Cotton Examiners by each warehouseman and county committee in payment of these charges.

§ 256.5 Preparation of documents. All blanks must be filled in with ink, indelible pencil, or typewriter in the manner indicated therein, and no documents containing additions, alterations or erasures will be accepted by Commodity Credit Corporation.

(a) Warehouse-stored cotton. A producer desiring to obtain a loan may obtain the necessary forms from approved cotton warehouses, and also from persons approved by the county committees in the cotton-producing areas to assist producers in preparing and executing the loan forms. Only persons approved by county committees for such purpose may execute the Clerk's Certificate on Form A. The Clerk's Certificate must be executed on each Form A tendered for a loan. Such persons are permitted to collect a fee from producers not to exceed the fees shown in the following schedule:

A

(b) Farm-stored cotton. A producer desiring to obtain a loan on farm-stored cotton may obtain the necessary forms from, and will be assisted in their preparation by, the county committee. service fee for upland cotton of $1 per bale and for American-Egyptian cotton and Sea-Island cotton of $1.30 per bale shall be collected by the county committee from the producer to cover services rendered under this program. Each Form E must be approved by the county committee, and the member signing such form in the space provided certifies on behalf of the county committee, as provided in 1944 Cotton Loan (Farm Storage) Part I, Revised, issued by the Agricultural Adjustment Agency.

§ 256.6 Approved warehouses. Warehouse receipts representing eligible cotton will be accepted as security for loans made pursuant to Form A only if issued by warehousemen approved by Commodity Credit Corporation. Warehousemen desiring to be approved should communicate with the regional office of Commodity Credit Corporation, New Orleans 12, Louisiana. When warehouses are approved, notification will be given either by letter or published lists. All cotton pledged as security for any one loan must be in the same warehouse.

The warehouseman is required, as provided in the Warehouseman's Certificate and Storage Agreement in Form A, to draw representative samples from the bales and to deliver or forward such samples to a board of cotton examiners for classing, except where Form 1 classification memorandum of the War Food Administration is used.

Since the loan will be made on net weight, it will be necessary for the warehouseman to determine the amount of tare on each bale and show the tare in the Schedule of Pledged Cotton in Form A. Instructions will be issued to the warehousemen for their guidance in determining tare.

§ 256.7 Warehouse receipts. Only negotiable warehouse receipts issued by an approved warehouse, dated on or prior to the date of the producer's note, and properly assigned by an endorsement in blank so as to vest title in the holders or issued to bearer will be acceptable. They must set out in their written or printed terms a description by tag number and weight of the bale represented thereby, and all other facts and statements required to be stated in the written or printed terms of a warehouse receipt under the provisions of section 2 of the Uniform Warehouse Receipts Act. Warehouse receipts issued prior to August 1, 1944, which by their terms will expire prior to August 1, 1945, must bear an endorsement of the warehouse extending the terms of the warehouse receipt for a period of 1 year from August 1, 1944. Block warehouse receipts will not be accepted.

§ 256.8 Warehouse charges. The warehouseman's charges are limited and his obligation defined by the Warehouseman's Certificate and Storage Agreement contained in Form A. This should be read carefully and must be executed by the warehouseman issuing the cotton warehouse receipts pledged as collateral to the producer's note. It must not be executed more than 10 days preceding the date of the note.

§ 256.9 Liens. Eligible cotton must be free and clear of all liens except (in the case of warehouse-stored cotton) those in favor of the warehouse in which the cotton is stored, as specified in the Warehouseman's Certificate and Storage Agreement in Form A. The names of the holders of all existing liens on cotton tendered as security for a loan, such as landlords, laborers, or mortgagees (but not the warehouseman, if the cotton is stored in a warehouse), must be listed in the List of Lienholders on each Form A and Form FF, and the lienholders so listed must execute the Lienholder's

Waiver on such forms. A Form A or Form FF will not be acceptable unless all prior lienholders are listed in the List of Lienholders and have executed the Lienholder's Waiver. If the producer tendering the cotton for the loan is not the owner of the land on which the cotton was produced, all landowners and landlords must be listed in the List of Lienholders on the Form A or Form FF and must sign the Lienholder's Waiver on such form, whether or not they claim liens, unless they sign the note jointly with the borrower. A misrepresentation, as to prior liens or otherwise, will render the producer personally liable under the terms of the Loan Agreement and subject him to criminal prosecution under the provisions of section 35 (A) of the Criminal Code of the United States (18 U. S. C. 80 (1940)). The Lienholder's Waiver must be signed personally by all lienholders listed, by their agents (in which case duly executed powers of attorney must be attached), or, if a corporation, by the designated officer thereof customarily authorized to execute such instruments (in which case no authority need be attached).

§ 256.10 Direct loans. It is contemplated that producers will ordinarily obtain loans from a local bank or other lending agency which, in turn, may sell the paper evidencing such loans to Commodity Credit Corporation. Arrangements, however, have been made for making direct loans to producers prior to May 1, 1945. In each such case the note must be made payable to Commodity Credit Corporation and must be tendered to Commodity Credit Corporation, New Orleans 12, Louisiana, on a Producer's Letter of Transmittal (C.C.C. Cotton Form B) in duplicate, postmarked not later than April 30, 1945, if tendered by mail. Upon receipt of all necessary documents, properly executed, and upon approval, payment will be made in accordance with the directions of the producer contained in the C.C.C. Cotton Form B, which permits the producer, if he so desires, to designate persons other than himself to receive all or part of the proceeds of the loan.

§ 256.11 Time and manner of tendering loans for purchase and pooling. Loans made by a lending agency which has executed and delivered a Lending Agency Agreement (C.C.C. Cotton Form

D) to the Regional Office of Commodity Credit Corporation, New Orleans 12, Louisiana, prior to the making of the loan, will be eligible for purchase or pooling by Commodity Credit Corporation. C.C.C. Cotton Forms D are obtainable only from the Regional Office of Commodity Credit Corporation, New Orleans 12, Louisiana. Under the terms of this agreement, lending agencies which are parties thereto are required to tender to Commodity Credit Corporation, New Orleans 12, Louisiana, on Lending Agency's Letter of Transmittal (C.C.C. Cotton Form C), executed in triplicate, all notes on Form A and Form E, with warehouse receipts and cotton chattel mortgages attached, representing loans made by the lending agency within 15 days of the dates of the notes. Forty notes shall be submitted on each Lending Agency's Letter of Transmittal except when fewer notes are listed thereon in order that the loans may be tendered within 15 days of the dates of their execution. The Lending Agency's Letter of Transmittal shall state whether the lending agency desires the Corporation to purchase the notes or to place them in a pool operated by the Corporation. Upon receipt by Commodity Credit Corporation, the loan papers will be examined and, if found correct, will be approved and purchased or will be transmitted to the Federal Reserve bank serving the district in which the cotton is stored and placed in a pool, as directed by the lending agency. In the event that the notes are pooled, a certificate of interest representing the interest in the pool, acquired as the result of the deposit therein of the notes shown on the letter of transmittal, will be issued to any approved lending agency designated by the lending agency tendering the eligible paper.

§ 256.12 Lending agency. The lending agency shall endorse the notes of producers as provided on Form A and Form E. Care should be exercised by the lending agency (in the case of warehouse-stored cotton) to determine that the warehouse receipts are genuine. No provision is made for any deduction from the loan proceeds by the lending agency as a charge for handling the loan documents, except the authorized clerk's fee in case the lending agency has executed the Clerk's Certificate on Form A.

§ 256.13 Federal Reserve Banks. The location of the Federal Reserve banks

Location

Atlanta, Ga.. Birmingham, Ala. Dallas, Texas_ Little Rock, Ark.. Los Angeles, Calif_ Memphis, Tenn..

New Orleans, La... Oklahoma City, Okla..

and branches referred to herein and the district served by each are shown below:

District Served

§ 256.14 Repayments-(a) Warehouse-stored cotton. No partial releases of the cotton securing a note will be permitted. If a producer desires to obtain the return of the note and the release of the collateral, he should notify Commodity Credit Corporation, care of the Federal Reserve Bank or branch thereof serving the district in which the cotton is stored, as stated in § 256.13 hereof. The notes and warehouse receipts will then be forwarded to an approved bank for release to said producer only and no other person, upon payment of the amount of the loan, the accrued interest and proper charges. Do not send requests for the return of notes and the release of collateral to Regional Office of Commodity Credit Corporation, New Orleans, Louisiana, as this causes delay in making the release. If the producer desires to sell his equity in the loan cotton, he must complete the Producer's Equity Transfer on his copy of Form A. Upon the request of the producer or upon receipt of the request contained in the Producer's Equity Transfer on the producer's copy of Form A, the note and warehouse receipts will be forwarded to any approved bank

designated by the person requesting the release of the cotton with directions to release such note and warehouse receipts upon payment of the amount of the loan, the accrued interest, and proper charges. In all such cases, the bank will be instructed to return the notes and warehouse receipts to the Federal Reserve bank if payment is not effected within 15 days. All charges and expenses of the bank to which the notes and warehouse receipts are sent shall be paid by the person requesting the release of the cotton. In the event that release of the cotton is requested by the submission of the Producer's Equity Transfer, the witness to the producer's signature to such form must be a person approved for such purpose by a county committee in the cotton-producing area.

(b) Farm-stored cotton. If a producer desires to obtain the return of the note and release of the collateral, he should notify the county committee of the county in which the cotton is stored. Partial releases will be allowed. Complete instructions on the release of farmstored cotton may be obtained from the county committee.

TABLE 1-PREMIUMS AND DISCOUNTS FOR ALL QUALITIES OF 1944 AMERICAN UPLAND COTTON (BASIS 15/16 MIDDLING)