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LOST, STOLEN, DESTROYED, MUTILATED, OR

DEFACED DEBENTURES

as provided in § 73.9, a Custodian shall release to the bank for cooperatives which he serves any collateral held by him or for his account upon the substitution of cash or other collateral of the character authorized by law sufficient in amount to maintain the collateral requirements specified, as mentioned in paragraph (a) of this section. $ 73.8 Subcollateral.

Subcollateral, consisting of all valuable items securing collateral which directly secures outstanding consolidated debentures of the banks for cooperatives, shall be held either by a Custodian of collateral, a bank for cooperatives, or a local custodian employed by a bank for cooperatives. When subcollateral is not held by the Custodian, he shall be furnished with a statement by the holder that it is held in trust for the Custodian's account, and with periodic reports by the holder of the subcollateral thus held. $ 73.9 Disposition of collateral and sub

collateral in the event of default on

consolidated debentures. In the event of default by any bank for cooperatives in the payment of principal or interest on any consolidated debentures outstanding on its behalf, all collateral and subcollateral held by or for the Custodian under assignment by such bank shall automatically with the occurrence of the default be held subject to the order of the Governor of the Farm Credit Administration for the protection of debenture holders, and the withdrawal and substitution provisions of 8 73.7 shall be suspended. $ 73.10

Accounts and reports. Each Custodian shall keep a separate account of all his transactions relating to consolidated debentures of the banks for cooperatives and the collateral security, and shall furnish such reports and other documents as may be required by the Governor of the Farm Credit Administration. § 73.11 Audits.

The books and records of each Custodian and the collateral held by him relating to banks for cooperatives consolidated debentures shall be audited at least once each year by the Examination Division of the Farm Credit Administration.

$ 73.12 Authorization for relief.

Whenever a consolidated debenture of the banks for cooperatives, or a coupon detached from such a debenture, is lost, stolen, destroyed, or so mutilated or defaced as to impair its value to the owner, the Director of Cooperative Bank Service may authorize the issuance of a new debenture or payment for the coupon at maturity, upon the owner's compliance with the requirements set forth in $$ 73.13 through 73.18. Wherever the term “owner" is used in said sections, it shall be deemed to include the authorized representative of the owner. $ 73.13 Application.

In the event of the loss, theft, destruction, mutilation, or defacement of a consolidated debenture or coupon, the owner should file an application with the Director of Cooperative Bank Service for the issuance of another debenture or for payment of the coupon at maturity. Such application must be filed within a reasonable time after the loss, theft, destruction, mutilation, or defacement is discovered. $ 73.14 Affidavit.

The owner of the consolidated debenture or coupon which has been lost, stolen, destroyed, mutilated, or defaced shall furnish to the Director of Cooperative Bank Service his affidavit duly acknowledged before a notary public or other officer authorized by law to administer oaths, setting for

(a) That he is the lawful owner of such debenture or coupon and that he is legally entitled to its possession;

(b) A complete identification of such debenture or coupon including serial number, date of issue, face amount, date of maturity, and interest rate;

(c) A detailed statement of the circumstances surrounding the loss, theft, destruction, mutilation, or defacement of such debenture or coupon;

(d) A statement that the affidavit is made for the purpose of obtaining a new debenture or payment for the coupon at maturity and an undertaking that should the original debenture or coupon come into the possession or control of the deponent, he will immediately surrender it to the Director of Cooperative Bank Service.

$ 73.15 Bond of indemnity.

covered by the owner prior to the is(a) The owner of a lost, stolen, or de

suance of a new debenture or payment stroyed consolidated debenture, or cou

for the coupon, the Director of Coopera

tive Bank Service should be notified impon, or his authorized representative, shall also furnish to the Director of Co

mediately whereupon the application for

relief will be canceled and any bond or operative Bank Service a bond of in

afidavit relative to it will be returned to demnity in a penal amount equal to 110 percent of the principal and interest to

the owner. If the original debenture or maturity of the said debenture, or equal

coupon is recovered by the owner after to 110 percent of the face amount of

relief has been granted, the said original

shall be returned to the Director of Cosaid coupon, with corporate surety satisfactory to the Director of Cooperative

operative Bank Service for cancellation, Bank Service and with conditions to

whereupon the bond and afidavit relaindemnify and save harmless the Farm

tive to it will be returned to the owner. Credit Administration and the 13 banks $ 73.18 Immaterial mutilation or defor cooperatives and any and all of their facement. officers, employees, or representatives,

Where a mutilation or defacement from all liability, loss, claims, or de

of a consolidated debenture or a coumands arising in any manner by reason or on account of the debenture or coupon

pon is such that the debenture or concerning which relief is requested.

coupon may be clearly identified and the

missing fragments could not by any pos(b) The owner of a mutilated or de

sibility form the basis of a claim against faced consolidated debenture or coupon

the 13 banks for cooperatives, the Farm shall, before relief is granted, surrender

Credit Administration, or the Directorie such debenture or coupon or as much thereof as remains to the Director of

of Cooperative Bank Service, the Director

of Cooperative Bank Service may auCooperative Bank Service and shall, if

thorize the issuance of a new debenture, required by him, also furnish a bond of

upon application therefor and the surindemnity in a penal sum satisfactory to

render of the defaced or mutilated dethe Director of Cooperative Bank Sery

benture or coupon, without requiring an ice with corporate surety and conditions

affidavit or indemnity bond, or may auas stated in paragraph (a) of this

thorize that such debenture or coupon section.

be accepted and paid at maturity as (c) A bond of indemnity which is

if no mutilation or defacement had otherwise satisfactory will be accepted

occurred. if the corporation which is surety thereon holds a certificate from the Secretary § 73.19 Restrictive endorsements of of the Treasury as being acceptable on bearer securities. surety bonds. A list of such corpora- When consolidated debentures issued tions may be obtained from the Surety

by the 13 banks for cooperatives are Bonds Branch, Bureau of Accounts, being presented to Federal Reserve United States Treasury Department, Banks or Branches, or to the TreasWashington, D. C.

urer of the United States, by or through

banks (including banks for coopera$ 73.16 Additional evidence.

tives) for redemption, such debentures The owner of a lost, stolen, mutilated, may be restrictively endorsed. The redefaced, or destroyed consolidated de- strictive endorsement shall be placed benture or coupon shall also furnish thereon in substantially the same mansuch other and further evidence relating ner and with the same effects as preto the loss, theft, destruction, mutilation, scribed in United States Treasury Deor defacement of the debenture or cou- partment regulations, now or hereafter pon for which relief is requested as may in force, governing like transactions in be required by the Director of Coopera- United States bonds; and consolidated

debentures issued by the 13 banks for tive Bank Service in any specific case.

cooperatives so endorsed shall be pre§ 73.17 Recovery of debenture or cou- pared for shipment and shipped in the pon reported lost, stolen, or de

manner prescribed in such regulations stroyed

for United States bonds. (See 31 CFR

328.1-328.6.) If a consolidated debenture or coupon

[23 F.R. 3139, May 13, 1958] reported lost, stolen, or destroyed is re

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CHAPTER 11-RURAL ELECTRIFICATION
ADMINISTRATION, DEPARTMENT OF

AGRICULTURE

PART 200-PROCEDURES

sisted, as necessary, in perfecting their Sec.

organization, in the conduct of their sur200.1 Loans pursuant to section 4 of Rural veys and in the preparation of the loan Electrification Act.

application. After the information pro200.2 Loans pursuant to section 5 of Rural

vided by the application has been examElectrification Act. 200.3 Loans pursuant to section 201 of

ined, the applicant is notified of any Rural Electrification Act.

further steps to be taken. If an applica200.4 Studies, investigations, and reports.

tion is acceptable after legal, engineer200.5 Loan security activities.

ing, economic, and financial studies, 200.6 Issuances implementing procedure. funds are obligated by a loan contract AUTHORITY: $$ 200.1 to 200.6 issued under

and the borrower gives a note, mortgage, 49 Stat. 1363, as amended; 7 U.S.C. 901-915, and, in some cases, other security. 921-924.

(c) Construction. Under the loan SOURCE: $ $ 200.1 to 200.6 appear at 28 F.R.

agreements REA reserves the right to 117, Jan. 4, 1963.

approve the design and construction of

the facilities, and to require progress re$ 200.1 Loans pursuant to section 4 of

ports on construction and audits of the Rural Electrification Act.

borrower's records relating to construc(a) General. These loans are made tion. to finance the construction and operation (d) Advance of loan funds. Loan of generating plants, electric transmis- funds are advanced on the basis of reqsion and distribution lines or systems to uisitions submitted by borrowers in acprovide initial and continued adequate

cordance with the loan contract. electric service to persons in rural areas. The loans must be self-liquidating within

$ 200.2 Loans pursuant to section 5 of a period of not to exceed thirty-five

Rural Electrification Act. years, bear interest at the rate of two (a) General. These loans are made per centum per annum, and must be to the borrowers of funds loaned under reasonably secured in the judgment of section 4 of the Rural Electrification Act the Administrator. They may be made for financing the wiring of the premises to persons, corporations, public bodies, of persons in rural areas and for purand to cooperative, non-profit, or limited chase and installation of electrical and dividend associations. Preference is to plumbing appliances and equipment, inbe given to public bodies and to coopera- cluding machinery. The loans are retive, non-profit, or limited dividend as- quired to be repaid, generally over a sociations.

period of ten years, and bear interest at (b) Loan applications. Applications

two per centum per annum. The funds for these loans are made on forms pre- made available to REA borrowers under scribed by REA and supported by a reso- these loans are reloaned to their conlution of the applicant's board of direc- sumers. tors. Copies of these standard forms (b) Loan applications. There is no are made available by REA on request. standard or prescribed form of applicaApplicants for loans from the Rural tion for this type of loan. A letter acElectrification Administration are as- companied by a resolution of the board

of directors is submitted in support of the application setting forth the purposes for which the loan is requested and the amounts required for each purpose. Supplemental data is required of the applicant as necessary to complete the particular application. If the Administrator approves a loan proposal, the applicant is notified and loan documents are forwarded for the signature of the borrower.

(c) Advance of loan funds. Loan funds are advanced on the basis of requisitions submitted by borrowers in accordance with the loan contract. $ 200.3 Loans pursuant to section 201 of

Rural Electrification Act. (a) General. These loans are made for the purpose of financing the improvement, expansion, construction, acquisition, and operation of telephone lines, facilities, or systems to furnish or improve telephone service in rural areas. Borrowers may be required to provide a portion of the investment themselves. The loans must be self-liquidating within a period of not to exceed thirty-five years, bear interest at the rate of two per centum per annum and must be reasonably secured in the judgment of the Administrator. The loans may be made to any type of commercial or non-profit corporation now providing or who may hereafter provide telephone service in rural areas. Preference is to be given to persons providing telephone service in rural areas, and to cooperative, nonprofit, limited dividend, mutual associations.

(b) Loan applications. Applications for these loans are made on forms prescribed by REA, copies of which are made available by REA on request. Applicants for loans from the Rural Electrification Administration are assisted as necessary in perfecting their organization, in the conduct of their surveys and in the preparation of loan applications. After the information provided by the application has been examined, the ap

plicant is notified of any further steps to be taken. If an application is aceeptable after legal, engineering, economic, and financial studies, funds are obligated by a loan contract and the borrower gives a note, mortgage, and, in some cases, other security. (c) Construction. Under

the loan agreements, REA reserves the right to approve the design and construction of the facilities, and to require progress reports on construction and audits of the borrower's records relating to construction.

(d) Advance of loan funds. Loan funds are advanced on the basis of requisitions submitted by borrowers in accordance with the loan contract. $ 200.4 Studies, investigations, and re

ports. Pursuant to section 2 of the Act, the agency may make or cause to be made studies, investigations, and reports concerning the condition and progress of electrification and telephony in rural areas in the several States and territories and may publish and disseminate information with respect thereto. $ 200.5 Loan security activities.

In carrying out the program of rural electrification and rural telephony provided by the Act, and in the interest of loan security, the agency requires of borrowers periodic reports on operations, annual audits, etc., and provides specialized and technical accounting, engineering, and other managerial assistance to borrowers in respect to the construction and operation of their facilities, and to help them establish efficient and economical service in rural areas. $ 200.6 Issuances implementing pro

cedure. There are available from REA, upon request, (a) basic forms of loan agreements, and (b) bulletins issued from time to time which implement the loan agreements and the procedures herein set forth.

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Part

300 Administrative provisions.
301 Receiving and processing applications.
302 Supervision and year-end analysis.
303 Supervised bank accounts.
304 Planning and performing development work.
305 Voluntary debt adjustment.
306

Real property insurance. 307 Title clearance and loan closing. 308 Nondiscrimination in multiple-unit housing. 309 Appraisal of farms. 310 Interest, annual charge and repurchase agreement for insured loans.

SUBCHAPTER B-LOANS AND GRANTS PRIMARILY FOR

REAL ESTATE PURPOSES

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