572 



including but not limited to, marine inspection 

 certificates of the United States Coast Guard, with 

 all outstanding requirements and recommenda- 

 tions necessary for retention of class accomplished, 

 unless the Secretary of Commerce permits a defer- 

 ment of such repairs, and shall be tight, stanch, 

 strong, and well and sufficiently tackled, appareled, 

 furnished, and equipped, and in every respect sea- 

 worthy and in good running condition and repair, 

 and in all respects fit for service; and 



(7) may provide, or a related agreement may 

 provide, if the vessel used as security for the guar- 

 antee of the Secretary of Commerce is a passenger 

 vessel having the tonnage, speed, passenger accom- 

 modations and other characteristics set forth in 

 subchapter V of this chapter, and if the Secretary 

 of Commerce appixives, that the sole recourse 

 against the obligor by the United States for any 

 payments under the guarantee shall be limited to 

 repossession of the vessel and the assignment of 

 insurance claims and that the liability of the obli- 

 gor for any payments of principal and interest un- 

 der the guarantee shall be satisfied and discharged 

 by the surrender of the vessel and all right, title, 

 and interest therein to the United States: Pro- 

 vided, That the vessel upon surrender shall be <i> 

 free and clear of all liens and encumbrances what- 

 soever except the security interest conveyed to the 

 Secretary of Commerce under this subchapter, (ii) 

 in class, and (ili) in as good order and condition, 

 ordinary wear and tear excepted, as when ac- 

 quired by the obligor, except that any deficiencies 

 with respect to freedom from encumbrances, con- 

 dition and class may, to the extent covered by 

 valid policies of insurance, be satisfied by the as- 

 signment to the Secretary of Commerce of claims 

 of the obligor under such policies. 



(c) Security. 



(1) The security for the guarantee of an obliga- 

 tion by the Secretary of Commerce under this sub- 

 chapter may relate to more than one vessel and may 

 consist of any combination of types of security. The 

 aggregate principal amount of obligations which 

 have more than one vessel as security for the guar- 

 antee of the Secretary of Commerce under this sub- 

 chapter may equal, but not exceed, the sum of the 

 principal amount of obligations pennissible with 

 respect to each vessel. 



(2) If the security for the guarantee of an obliga- 

 tion by the Secretary of Commerce under this sub- 

 chapter relates to more than one vessel, such obliga- 

 tion may have the latest maturity date permissible 

 under subsection (b) of this section with respect to 

 any of such vessels : Provided. That the Secretary of 

 Commerce may require such payments of principal, 

 prior to maturity, with respect to all related obliga- 

 tions as he deems necessary in order to maintain 

 adequate security for his guarantee. 



(d) Restrictions. 



No commitment to guarantee an obligation shall 

 be made by the Secretary of Commerce unless he 

 finds, at or prior to the time such commitment is 

 made, that the property or project with respect to 

 which the obligation will be executed will be, in his 

 opinion, economically sound and in the case of fish- 



ing vessels, that the purpose of the financing or re- 

 financing is consistent with the wise use of the 

 fisheries resources and with the development, ad- 

 vancement, management, conservation, and protec- 

 tion of the fisheries resources, and no obligation, 

 unless made pursuant to a prior commitment, shall 

 be guaranteed unless the Secretary of Commerce 

 finds, at or prior to the time the guarantee becomes 

 effective, that the property or project with respect 

 to which the obligation is executed will be, in his 

 opinion, economically sound and in the case of fishing 

 vessels, that the purpose of the financing or refinanc- 

 ing is consistent with the wise use of the fisheries 

 resources and with the development, advancement, 

 management, conservation, and protection of the 

 fisheries resources. 



(e) Guarantee fees. 



The Secretary of Commerce is authorized to fix a 

 fee for the guarantee of an obligation under this sub- 

 chapter. If the security for the guarantee of an 

 obligation under this subchapter relates to a de- 

 livered vessel, such fee shall not be less than one- 

 half of 1 per centum per annum nor more than 1 

 per centum per annum of the average principal 

 amount of such obligation outstanding, excluding the 

 average amount ('except interest) on deposit In an 

 escrow fund created imder section 1279a of this title. 

 If the security for the guarantee of an obligation 

 under this subchapter relates to a vessel to be con- 

 'structed, reconstructed, or reconditioned, such fee 

 shall not be less than one-quarter of 1 per centum 

 per annum nor more than one-half of 1 per centum 

 per aimum of the average principal amount of such 

 obligation outstanding, excluding the average 

 amoimt (except interest) on deposit In an 

 escrow fund created under section 1279a of this 

 title. For purposes of this subsection (e), If the se- 

 curity for the guarantee of an obligation imder this 

 subchapter relates both to a delivered vessel or ves- 

 sels and to a vessel or vessels to be constructed, re- 

 constructed, or reconditioned, the principal amount 

 of such obligation shall be prorated in accordance 

 with regulations prescribed by the Secretary of Com- 

 merce. Pee payments shall be made by the obligor 

 to the Secretary of Commerce when moneys are 

 first advanced under a guaranteed obligation and at 

 least sixty days prior to each anniversary date there- 

 after. All fees shall be computed and shall be pay- 

 able to the Secretary of Commerce under such 

 regiilations as the Secretary of Commerce may 

 prescribe. 



(f) Investigation of applications. 



The Secretary of Commerce shall charge and col- 

 lect from the obligor such amounts as he may deem 

 reasonable for the investigation of applications for 

 a guarantee, for the appraisal of properties offered 

 as security for a guarantee, for the issuance of com- 

 mitments, for services in connection with the escrow 

 fund authorized by section 1279a of this title and 

 for the inspection of such properties during con- 

 struction, reconstruction, or reconditioning: Pro- 

 vided, That such charges shall not aggregate more 

 than one-half of 1 per centum of the original princi- 

 pal amount of the obligations to be guaranteed. 



