Page:United States Statutes at Large Volume 79.djvu/963

 79 STAT. ]

PUBLIC LAW 89-237-OCT. 4, 1965

additional class B stock in the bank to be subscribed for by the production credit associations in the farm credit district served by the bank in order to provide capital to meet the credit needs of the bank. The amount so determined shall be allotted among the production credit associations in the district upon such basis that, as nearly as may be practicable, the sum or the class B stock already owned and the additional amount to be subscribed for by each association will be in the same proportion to the total amount of class B stock already owned and to be subscribed for by all of the associations in the district that the average indebtedness (loans and discounts) of each association to the bank during the immediately preceding three fiscal years is of the average of such indebtedness of all production credit associations to the bank during such three-year period. Each production credit association shall subscribe for class B stock in the bank in the amount so allotted to it. Such subscriptions shall be subject to call and payment therefor shall be made at such times and in such amounts as may be determined by the bank. "Whenever the relative amounts of class B stock in a Federal intermediate credit bank owned by the production credit associations differ substantially from the proportion indicated in the preceding paragraph, and additional subscriptions to class B stock through which such proportion could be reestablished are not contemplated, the Federal intermediate credit bank, with the approval of the F a r m Credit Administration, may direct either separately or in combination such transfers, retirements, and reissuance of outstanding class B stock among the associations as will reestablish the aforesaid proportion as nearly as may be practicable. Outstanding class B stock which is transferred or retired for this purpose shall be the oldest stock held by the association and the bank shall pay the association therefor at the fair book value thereof not exceeding par and collect therefor from any production credit association to which such stock is transferred or reissued."; and (d) in section 206 thereof (12 U.S.C. 1072) — (i) by striking out "equal to 25 per centum of the outstanding capital stock and participation certificates of the bank" from clause (3) of the first sentence of subsection (a); (ii) by striking out the second sentence of subsection (a) and inserting in lieu thereof as a separate paragraph the following: "Amounts applied to reserve account as p r o v i d ^ in (3) above, either heretofore or hereafter, shall be allocated on the same patronage basis and have the same tax treatment as is provided in subsection (b) of this section for patronage refunds. Such allocations of reserve account shall be subject to a first lien as additional collateral for any indebtedness of the holders thereof to the bank and in any case where such indebtedness is in default may be retired and canceled for application on such indebtedness, and, in case of liquidation or dissolution of a holder thereof, such reserve account allocations may be retired, all as is provided for capital stock and participation certificates in section 205 of this Act. At the end of any fiscal year that the reserve account of any bank exceeds 25 per centum of its oultstanding capital stock and participation certificates, such excess may be distributed, oldest allocations first, in class B stock and participation certificates issued as of the date of the allocations and, whenever the bank has no class A stock outstanding, also in money."; and (iii) by inserting immediately before the last sentence of subsection (c) the following new sentence: "Any of the reserve estab-

923

7o Stat. 662.

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