§690e Issuance and guarantee of trust certificates

Summary

Allows the Administrator to sell trust certificates that show ownership of all or part of debentures from a Renewable Fuel Capital Investment company, as long as the certificates come from a trust or pool made only of those guaranteed debentures. The Administrator can guarantee timely payment of principal and interest on those certificates, but the guarantee cannot exceed the principal and interest on the debentures in the trust. If a debenture is prepaid or defaults, the guarantee is cut back in proportion to that debenture’s share, and interest is guaranteed only up to the payment date. If all debentures are prepaid or default, the trust certificates can be called for redemption. The U.S. government backs payments under these guarantees. The Administrator must not charge a fee for the guarantee, though approved agents may charge fees for their work. If the Administrator pays a claim, it takes the rights the payment covered. Federal, state, or local law cannot stop the Administrator from using ownership rights in the debentures. The Administrator may run a central registry for the certificates and hire agents to handle pooling, registration, bank accounts, and issuing certificates. Agents must carry bonds or insurance to protect the United States. The Administrator may regulate brokers and dealers, and electronic or book-entry registration is allowed.