SEVE NTIETH CONGRESS . SESS. I. CFr. 675. 1928 . the best and most efficient type for the establishment or maintenance of service on lines deemed desirable or necessary by the board, provided such vessels shall be fitted and equipped with the most modern, the mos t effici ent, and the mos t econom ical eng ines, ma chin- ery, and commercial appliances ; o r in the outfitt ing and equipmen t by them in private shipyards or navy yards in the United States of vessels already built, with engines, machinery, and commercial appliances of the type and kind mentioned ; or in the reconditioning, remodeling, or improvement by them in private shipyards or navy yards in the United States of vessels already built . "(b) The term `vessel' or `vessels', where used in this section, shall be construed to mean a vessel or vessels to aid in whose con- struction, equipment, reconditioning, remodeling, or improvement, a loan is made from the construction loan fund of the board . All such ve ssels sh all be d ocumente d under the laws of the United S tates and shall remain documented under such laws for not less than twenty years from the date the loan is made, and so long as there remains due the United States any principal or interest on account of such loan . "(c) No loan shall be made for a longer time than twenty years . If it is not to be repaid w ithin two years from the date when the first advance on the loan is made by the board, the principal shall be payable in equal annual installments to be definitely prescribed in the instruments . The loan may be paid at any time, on thirty days' written notice t o the bo ard, wit h intere st compu ted to d ate of paym ent . "(d) All such loans shall bear interest at rates as follows, payable not less frequently than annually : During any period in which the vessel is operated exclusively in coastwise trade, or is inactive, the rate of interest shall be as fixed by the board, but not less than 51/ 4 per centum per annum . During any period in which the vessel is operated in foreign trade the rate shall be the lowest rate of yield (to the nearest one-eighth of 1 per centum) of any Government obligation bearing a date of issue subsequent to April 6, 1917 (except postal-savings bonds), and outstanding at the time the loan is made by the board, as certified by the Secretary of the Treasury to the board upon its request . The board may prescribe rules for determin- ing the amount of interest payable under the provisions of this paragraph . " (e) No loan shall be for a greater sum than three-fourths the cost of the vessel or vessels to be constructed or than three-fourths the cost of the reconditioning, remodeling, improving, or equipping herein before a uthorize d for a vessel a lready b uilt . "(f) The board shall require such security as it shall deem neces- sary to insure the completion of the construction, reconditioning, remodeling, improving, or equipping of the vessel within a reason- able time and the repayment of the loan with interest ; when the construction, reconditioning, remodeling, improving, or equipping of the vessel is com pleted the security shall include a pref erred mortgage on the vess el, complying with the provisions of the Ship Mortgage Act, 1920 [U. S. C., Title 46, Chap . 25], which mortgage sh all cont ain appr opri ate cove nant s an d pr ovis ions to insure the proper physical maintenance of the vessel, and its protection against liens for taxes, penalties, claims, or liabilities of any kind whatever, which might impair the security for the debt . It shall als o con tain any other covenants and provisions the board may prescribe, includ- ing a provision for the summary maturing of the entire debt, for causes to be enumerated in the mortgage . 691 Outfitting in Ameri- can yard s of vessels al rea dy built, with engines, etc . Reconditioning, etc., in private or na vy yards. Term of "vessel" construed to be one aided by loan. Vol . 43, p .467, amend- ed. Documenting for twenty years under United States laws . Time limit for loans . Vol. 43, p . 467, amend- ed. Installment intervals . Payment in full al- lowed . Interest rates. Whi le in coa stwi se trade, or inactive . Vol . 43, p .468, amend- ed. In foreign trade. Limit of loans . Security for comple. tion and repayments. Preferred mortgage on completion of ves- sel . Vol.41,p.1000. U.S. Code, p.1543. Additiona l covenants to be prescribed .
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