Page:United States Statutes at Large Volume 86.djvu/958

 PUBLIC LAW 92-507-OCT. 19, 1972

916 Appropriations 68 Stat. 1276; 73 Stat. 269. 73 Stat. 272. 81 Stat. 580. E s c r o w fund.

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p. 910.

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p. 910.

[86

STAT.

SEC. 4. Section 1110 of the Merchant Marine Act, 1936 (46 U.S.C. 1279), is redesignated "SEC. 1107." SEC. 5. Sections 1111 through 1112 of the Merchant Marine Act, 1936 (46 U.S.C. 1279a; 1279b) are amended by striking such sections and inserting the following in lieu thereof: "SEC. 1108. (a) If the proceeds of an obligation guaranteed under this title are to be used to finance the construction, reconstruction, or reconditioning of a vessel or vessels which will serve as security for the guarantee of the Secretary of Commerce, the Secretary of Commerce is authorized to accept and hold, in escrow under an escrow agreement with the obligor, a portion of the proceeds of all obligations guaranteed under this title whose proceeds are to be so used which IS equal to: (i) the excess of the principal amount of all obligations whose proceeds are to be so used over 75 per centum, or 87i/^ per centum, whichever is applicable under section 1104 of this title, of the amount paid by or for the account of the obligor for the construction, reconstruction, or reconditioning of the vessel or vessels; (ii) with such interest thereon, if any, as the Secretary of Commerce may require: Provided, That in the event the security for the guarantee of an obligation by the Secretary of Commerce relates both to a vessel or vessels to be constructed, reconstructed or reconditioned and to a delivered vessel or vessels, the principal amount of such obligation shall be prorated for purposes of this subsection (a) under regulations prescribed by the Secretary of Commerce. " (b) The Secretary of Commerce shall, as specified in the escrow agreement, disburse the escrow fund to pay amounts the obligor is obligated to pay as interest on such obligations or for the construction, reconstruction, or reconditioning of the vessel or vessels used as security for the guarantee of the Secretary of Commerce under this title, to redeem such obligations in connection with a refinancing under paragraph (4) of subsection (a) of section 1104 or to pay to the obligor at such times as may be provided for in the escrow agreement any excess interest deposits, except that if payments become due under the guarantee prior to the termination of the escrow agreement, all amounts m the escrow fund at the time such payments become due (including realized income which has not yet been paid to the obligor) shall be aid into the Fund and (i) be credited against any amounts due or to ecome due to the Secretaryjr of Commerce from the obligor with respect to the guaranteed obligations and (ii) to the extent not so required, be paid to the obligor. "(c) If payments under the guarantee have not become due prior to the termination of the escrow agreement, any balance of the escrow fund at the time of such termination shall be disbursed to prepay the excess of the principal of all obligations whose proceeds are to oe used to finance the construction, reconstruction, or reconditioning of the vessel or vessels which serve or will serve as security for such guarantee over 75 per centum or 87V^ per centum, whichever is applicable under section 1104 of this title, of the actual cost of such vessel or vessels to the extent paid, and to pay interest on such prepaid amount of principal, and the remainder of such balance of the escrow fund shall be paid to the obligor. " (d) The Secretary of Commerce may invest and reinvest all or any part of the escrow fund in obligations of the United States with such maturities that the escrow fund will be available as required for purposes of the escrow agreement. "(e) Any income realized on the escrow fund shall, upon receipt, be paid to the obligor. ...., ,.,

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