Open main menu

Page:United States Statutes at Large Volume 61 Part 1.djvu/218

This page needs to be proofread.

PUBLIC LAWS-CH. 163-JUNE 30, 1917 "(3) The borrower shall establish to the satisfaction of the Administrator that he has or will have adequate plant facilities, sufficient capital funds, taking into account the loan applied for, and the experience necessary, to achieve the required production schedule; "(4) The loan shall involve a principal obligation in an amount not to exceed 90 per centum of the amount which the Adminis- trator estimates will be the necessary current cost of manufactur- ing such houses, exclusive of profit. The loan shall be secured by an assignment of the aforesaid purchase contracts for the houses to be manufactured with the proceeds of the loan, and of all sums payable under such purchase contracts, with the right in the assignee to proceed against such security in case of default as provided in the assignment, which assignment shall be in such form and contain such terms and conditions, as may be prescribed by the Administrator; and the Administrator may require such other agreements and undertakings to further secure the loan as he may determine, including the right, in case of default or at any time necessary to protect the lender, to compel delivery to the lender of any houses manufactured with the proceeds of the loan and then owned and in the possession of the borrower. The loan shall have a maturity not in excess of one year from the date of the note, except that any such loan may be refinanced and extended in accordance with such terms and conditions as the Administrator may prescribe for an additional term not to exceed one year, and shall bear interest (exclusive of premium charges for insurance) at not to exceed 4 per centum per annum on the amount of the principal obligation outstanding at any time. elease oftproPert "(C) The Administrator may consent to the release of a part or parts of the property assigned or delivered as security for the loan, upon such terms and conditions as he may prescribe and the security docu- ments may provide for such release. Failure ett make "(d) The failure of the borrower to make any payment due under or provided to be paid by the terms of a loan under this section, or the failure to perform any other covenant or obligation contained in any assignment, agreement, or undertaking executed by the borrower in connection with such loan, shall be considered as a default unldr this section, and if such default continues for a period of thirty days, the lender shall be entitled to receive the benefits of the insurance herein- after provided upon assignment, transfer, and delivery to the Adminis- trator within a period and in accordance with the rules and regulations prescribed by the Administrator of (1) all rights and interest arising with respect to the loan so in default; (2) all claims of the lender against the borrower or others arising out of the loan transaction; (3) any cash or property held by the lender, or to which it is entitled, as deposits made for the account of the borrower and which have not been applied in reduction of the principal of the loan; and (4) all records, documents, books, papers, and accounts relating to the loan transaction. Upon such assignment, transfer, and delivery, the Administrator shall, subject to the cash adjustment provided for in si stat. 1739(c). section 604 (c), issue to the lender debentures having a face value equal to the unpaid principal balance of the loan. tsuance of deben- "(e) Debentures issued under this section shall be issued in accord- 85 Stat.59 . ance with the provisions of section 604 (d) except that such debentures shall be dated as of the date of default as determined in subsection (d) of this section and shall bear interest from such date. 52 stat. 20; 55 Stat. "(f) The provisions of section 207 (k) and 603 (a) of this Act shall 2 U. s . c. § 1713 be applicable to loans insured under this section, except that as applied An(),p. 13; post, to such loans (1) all references in section 207 (k) to the 'Housing PP. m7 9M. Fund' shall be construed to refer to the 'War Housing Insurance Fundc 194 [61 STAT.