Page:United States Statutes at Large Volume 90 Part 1.djvu/130

 90 STAT. 8 0

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PUBLIC LAW 9 4 - 2 1 0 — F E B. 5, 1976 (b) VALIDITY.—No guarantee or commitment to guarantee under section 511 of this title may be terminated, suspended, canceled, or otherwise revoked, except in accordance with lawful terms and conditions prescribed by the Secretary. Such a guarantee or commitment shall be conclusive evidence that the underlying obligation is in compliance with the provisions of such sections of this title, and that such obligation has been approved and is legal as to principal, interest, and other terms. Such a guarantee or commitment to guarantee shall be valid and incontestable in the hands of the holder thereof, as of the date when the Secretary granted the application therefor, except as to fraud or material misrepresentation by such holder. (c) DEFINITION. — A s used i n this section, the term "Secretary of the Treasury " includes any designated representative of such Secretary. DEFAULT ON GUARANTEED OBLIGATIONS

45 USC 833.

SEC. 513. (a) GENERAL.—If there is a default by the obligor in any payment of principal or interest due under an obligation guaranteed under section 511 of this title, and if such default continues for 30 days, the holder of such obligation or his agent has the right to demand payment by the Secretary of the unpaid interest on, and the unpaid principal of, such obligation consistent wnth the terms of the guarantee of such obligation. Such payment may be demanded after or before the expiration of such period as may be specified in the guarantee or related agreements, b u t not later than 90 days from the date of such default. W i t h i n such specified period, b u t not later than 60 days from the date of such demand, the Secretary shall p a y to such holder the unpaid interest on, and the unpaid principal of, such obligation, consistent with the terms of the guarantee of such obligation, except that (1) the Secretary shall not be required to make any such payment if he finds, prior to the expiration of such period, that there was no default by the obligor in the payment of interest or principal or that such default has been remedied, and (2) no such holder shall receive payment or be entitled to retain payment in a total amount which, together with an other recovery (including any recovery based upon a security interest in equipment or facilities) exceeds the actual loss of such holder. (b) R I G H T S OF THE SECRETARY.— (1) I f the Secretary makes payment

to a holder under subsection (a) of this section, the Secretary shall thereupon— (A) have all of the rights granted to him by law or agreement with the obligor; and (B) be subrogated to all of the rights which v»ere granted such holder, by law, assignment, or security agreement betAveen such holder and the obligor. (2) The Secretary may, in his discretion, complete, recondition reconstruct, renovate, repair, maintain, operate, charter, rent, sell, or otherwise dispose of any property or other interests obtained by him pursuant to this section. The terms of any such sale or other disposition shall be as approved by the Secretary. (c) FORM OF P A Y M E N T. — Any amount required to be paid by the Secretary pursuant to subsection (a) of this section shall be paid in cash. (d) ACTION A G A I N S T OBLIGOR.—If the r e is a default by the obligor

in any payment due under an obligation guaranteed under section 511 of this title, the Secretary shall take such action against such obligor

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