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I, § 1421(a)(2), (b)(2), Aug. 23, 1988, 102 Stat. 1243, 1244.)

AMENDMENT OF SUBSECTION (c)(1)(C) Sections 1421(b)(2), 1430(d) of Pub. L. 100-418 provided that, effective one year after the first date on which section 2397 of this title applies with respect to any articles, subsection (c)(1)(C) of this section is amended to read as follows:

(C) increases of imports of articles like or directly competitive with articles

(i) which are produced by such firm, or

(ii) for which such firm provides essential goods or essential services, contributed importantly to such total or partial separation, or threat thereof, and to such decline in sales or production.

TERMINATION OF SECTION For termination of section by section 285 of Pub. L. 93-618, see Termination Date note set out preceding section 2271 of this title.

AMENDMENTS

may be filed with the Secretary of Commerce (hereinafter in this part referred to as the “Secretary") by a firm (including any agricultural firm) or its representative. Upon receipt of the petition, the Secretary shall promptly publish notice in the Federal Register that he has received the petition and initiated an investigation. (b) Public hearing

If the petitioner, or any other person, organization, or group found by the Secretary to have a substantial interest in the proceedings, submits not later than 10 days after the date of the Secretary's publication under subsection (a) of this section a request for a hearing, the Secretary shall provide for a public hearing and afford such interested persons an opportunity to be present, to produce evidence, and to be heard. (c) Certification

(1) The Secretary shall certify a firm (including any agricultural firm) as eligible to apply for adjustment assistance under this part if the Secretary determines

(A) that a significant number or proportion of the workers in such firm have become totally or partially separated, or are threatened to become totally or partially separated, (B) that,

(i) sales or production, or both, of such firm have decreased absolutely, or

(ii) sales or production, or both, of an article that accounted for not less than 25 percent of the total production or sales of the firm during the 12-month period preceding the most recent 12-month period for which data are available have decreased absolutely, and

(C) increases of imports of articles like or directly competitive with articles which are produced by such firm contributed importantly to such total or partial separation, or threat thereof, and to such decline in sales or production. (2) For purposes of paragraph (1)(C)

(A) The term "contributed importantly” means a cause which is important but not necessarily more important than any other cause.

(B)(i) Any firm which engages in exploration or drilling for oil or natural gas shall be considered to be a firm producing oil or natural gas.

(ii) Any firm that engages in exploration or drilling for oil or natural gas, or otherwise produces oil or natural gas, shall be considered to be producing articles directly competitive with imports of oil and with imports of

natural gas. (d) Allowable period for determination

A determination shall be made by the Secretary as soon as possible after the date on which the petition is filed under this section, but in any event not later than 60 days after that date. (Pub. L. 93-618, title II, § 251, Jan. 3, 1975, 88 Stat. 2030; Pub. L. 99-272, title XIII, § 13002(b), Apr. 7, 1986, 100 Stat. 300; Pub. L. 100-418, title

1988–Subsec. (c). Pub. L. 100-418, § 1421(a)2), amended subsec. (c) generally. Prior to amendment, subsec. (c) read as follows: "The Secretary shall certify a firm (including any agricultural firm) as eligible to apply for adjustment assistance under this part if he determines

“(1) that a significant number or proportion of the workers in such firm have become totally or partially separated, or are threatened to become totally or partially separated. (2) that

"(A) sales or production, or both, of the firm have decreased absolutely, or

"(B) sales or production, or both, of an article that accounted for not less than 25 percent of the total production or sales of the firm during the 12month period preceding the most recent 12-month period for which data are available have decreased absolutely, and

"(3) that increases of imports of articles like or directly competitive with articles produced by such firm contributed importantly to such total or partial separation, or threat thereof, and to such decline in

sales or production. For purposes of paragraph (3), the term 'contributed importantly' means a cause which is important but not necessarily more important than any other cause."

1986–Subsecs. (a), (c). Pub. L. 99-272, § 13002(b)(1), inserted "(including any agricultural firm)" after "firm".

Subsec. (c)(2). Pub. L. 99-272, § 13002(b)(2), amended par. (2) generally, designating existing provisions as subpar. (A), substituting "of the firm have decreased absolutely, or” for “of such firm have decreased absolutely, and", and iding subpar. (B).

EFFECTIVE DATE OF 1988 AMENDMENT

Amendment by section 1421(a)(2) of Pub. L. 100-418 effective Aug. 23, 1988, and amendment by section 1421(b)(2) of Pub. L. 100-418 effective on the date that is one year after the first date on which section 2397 of this title applies with respect to any articles, see section 1430(a), (b), (d) of Pub. L. 100-418, set out as an Effective Date note under section 2397 of this title. SECTION REFERRED TO IN OTHER SECTIONS This section is referred to in sections 2342, 2343, 2345, 2346, 2355, 2395 of this title; title 28 sections 1581, 2631, 2636, 2640, 2643.

(c) which authorized the Secretary to assist an eligible firm in the preparation of a viable adjustment proposal.

SECTION REFERRED TO IN OTHER SECTIONS This section is referred to in section 2346 of this title.

8 2343. Technical assistance

8 2342. Approval of adjustment proposals (a) Application for adjustment assistance

A firm certified under section 2341 of this title as eligible to apply for adjustment assistance may, at any time within 2 years after the date of such certification, file an application with the Secretary for adjustment assistance under this part. Such application shall include a proposal for the economic adjustment of such firm. (b) Technical assistance

(1) Adjustment assistance under this part consists of technical assistance. The Secretary shall approve a firm's application for adjustment assistance only if the Secretary determines that the firm's adjustment proposal

(A) is reasonably calculated to materially contribute to the economic adjustment of the firm,

(B) gives adequate consideration to the interests of the workers of such firm, and

(C) demonstrates that the firm will make all reasonable efforts to use its own resources for economic development.

(2) The Secretary shall make a determination as soon as possible after the date on which an application is filed under this section, but in no event later than 60 days after such date. (c) Termination of certification of eligibility

Whenever the Secretary determines that any firm no longer requires assistance under this part, he shall terminate the certification of eligibility of such firm and promptly have notice of such termination published in the Federal Register. Such termination shall take effect on the termination date specified by the Secretary. (Pub. L. 93-618, title II, § 252, Jan. 3, 1975, 88 Stat. 2030; Pub. L. 99-272, title XIII, $ 13006(a)(1), (2), Apr. 7, 1986, 100 Stat. 304.)

TERMINATION OF SECTION For termination of section by section 285 of Pub. L. 93-618, see Termination Date note set out preceding section 2271 of this title.

AMENDMENTS 1986–Subsec. (b)(1). Pub. L. 99-272, § 13006(a)(1), amended par. (1) generally. Prior to amendment, par. (1) read as follows: “Adjustment assistance under this part consists of technical assistance and financial assistance, which may be furnished singly or in combination. The Secretary shall approve a firm's application for adjustment assistance only if he determines

“(A) that the firm has no reasonable access to financing through the private capital market, and "(B) that the firm's adjustment proposal

(i) is reasonably calculated materially to contribute to the economic adjustment of the firm,

“(ii) gives adequate consideration to the interests of the workers of such firm, and

"(iii) demonstrates that the firm will make all reasonable efforts to use its own resources for eco

nomic development." Subsecs. (c), (d). Pub. L. 99-272, § 13006(a)(2), redesignated subsec. (d) as (c) and struck out former subsec.

(a) Discretion of Secretary; types of assistance

The Secretary may provide a firm, on terms and conditions as the Secretary determines to be appropriate, with such technical assistance as in his judgment will carry out the purposes of this part with respect to the firm. The technical assistance furnished under this part may consist of one or more of the following:

(1) Assistance to a firm in preparing its petition for certification of eligibility under section 2341 of this title.

(2) Assistance to a certified firm in developing a proposal for its economic adjustment.

(3) Assistance to a certified firm in the implementation of such a proposal. (b) Utilization of existing agencies, private individ

uals, etc., in furnishing assistance; grants to in

termediary organizations (1) The Secretary shall furnish technical assistance under this part through existing agencies and through private individuals, firms, or institutions (including private consulting services), or by grants to intermediary organizations (including Trade Adjustment Assistance Centers).

(2) In the case of assistance furnished through private individuals, firms, or institutions (including private consulting services), the Secretary may share the cost thereof (but not more than 75 percent of such cost for assistance described in paragraph (2) or (3) of subsection (a) of this section may be borne by the United States).

(3) The Secretary may make grants to intermediary organizations in order to defray up to 100 percent of administrative expenses incurred in providing such technical assistance to a firm. (Pub. L. 93-618, title II, § 253, Jan. 3, 1975, 88 Stat. 2031; Pub. L. 97-35, title XXV, § 2521, Aug. 13, 1981, 95 Stat. 890; Pub. L. 99-272, title XIII, § 13006(a)(3), Apr. 7, 1986, 100 Stat. 304.)

TERMINATION OF SECTION For termination of section by section 285 of Pub. L. 93-618, see Termination Date note set out preceding section 2271 of this title.

AMENDMENTS 1986–Subsec. (b)(2). Pub. L. 99-272 substituted “such cost for assistance described in paragraph (2) or (3) of subsection (a) of this section" for "such cost".

1981–Subsec. (a). Pub. L. 97-35 amended subsec. (a) generally, incorporating provisions formerly contained in subsec. (b) and, in those provisions, substituted discretionary language for non-discretionary language relating to the assistance furnished and allowed the giving of assistance to firms in the preparation of their petitions for certification of eligibility under section 2341 of this title.

Subsec. (b), Pub. L. 97-35 amended subsec. (b) generally, incorporating in pars. (1) and (2) provisions for. merly contained in subsec. (c), inserted reference to grants to intermediary organizations (including Trade Adjustment Assistance Centers) in par. (1), and added par. (3). Provisions formerly contained in subsec. (b) were transferred to subsec. (a).

Subsec. (c). Pub. L. 97-35 struck out subsec. (c) and transferred the provisions to subsec. (b)(1) and (2).

TERMINATION OF SECTION For termination of section by section 285 of Pub. L. 93-618, see Termination Date note set out preceding section 2271 of this title.

AMENDMENTS 1986–Subsec. (d). Pub. L. 99-272 added subsec. (d).

1981–Subsec. (c), Pub. L. 97-35 substituted provi. sions relating to limitation on direct loans on the basis of interest rates on loans under section 636(a) of title 15 for provisions relating to limitation on direct loans on the basis of interest rates under section 2345(b) of this title.

EFFECTIVE DATE OF 1981 AMENDMENT Section 2529 of Pub. L. 97-35 provided that:

"(a) Subject to subsection (b), the amendments made by this subtitle Cenacting section 2355 of this title, amending sections 2343 to 2347 of this title, and repealing section 2353 of this title) shall take effect on the date of the enactment of this Act (Aug. 13, 1981).

"(b) Applications for adjustment assistance under chapter 3 of title II of the Trade Act of 1974 (this part) which the Secretary of mmerce accepted for processing before the date of the enactment of this Act (Aug. 13, 1981) shall continue to be processed in accordance with the requirements of such chapter as in effect before such date of enactment."

EFFECTIVE DATE OF 1981 AMENDMENT Amendment by Pub. L. 97-35 effective Aug. 13, 1981, except as otherwise provided with respect to applications for adjustment assistance, see section 2529 of Pub. L. 97-35, set out as a note under section 2343 of this title.

SECTION REFERRED TO IN OTHER SECTIONS This section is referred to in sections 2345, 2347, 2350 of this title.

SECTION REFERRED TO IN OTHER SECTIONS This section is referred to in section 2350 of this title.

8 2345. Conditions for financial assistance

8 2344. Financial assistance

(a) Direct loans and guarantees of loans

The Secretary may provide to a firm, on such terms and conditions as he determines to be appropriate, such financial assistance in the form of direct loans or guarantees of loans as in his judgment will materially contribute to the economic adjustment of the firm. The assumption of an outstanding indebtedness of the firm, with or without recourse, shall be considered to be the making of a loan for purposes of this section. (b) Allowable purposes

Loans or guarantees of loans shall be made under this part only for the purpose of making funds available to the firm

(1) for acquisition, construction, installation, modernization, development, conversion, or expansion of land, plant, buildings, equipment, facilities, or machinery, or

(2) to supply such working capital as may be necessary to enable the firm to implement

its adjustment proposal. (c) Limitation on direct loans

No direct loan may be provided to a firm under this part if the firm can obtain loan funds from private sources (with or without a guarantee) at a rate no higher than the maximum interest per annum that a participating financial institution may establish on guaranteed loans made pursuant to section 636(a) of title 15. (d) Limitations on loans and guarantees

Notwithstanding any other provision of this part, no direct loans or guarantees of loans may be made under this part after April 7, 1986. (Pub. L. 93-618, title II, § 254, Jan. 3, 1975, 88 Stat. 2031; Pub. L. 97-35, title XXV, $ 2522, Aug. 13, 1981, 95 Stat. 891; Pub. L. 99-272, title XIII, § 13006(b), Apr. 7, 1986, 100 Stat. 304.)

(a) Unavailability of firm's resources; reasonable as

surance of repayment No financial assistance shall be provided under this part unless the Secretary determines

(1) that the funds required are not available from the firm's own resources; and

(2) that there is reasonable assurance of repayment of the loan. (b) Interest rates

(1) The rate of interest on direct loans made under this part shall be

(A) a rate determined by the Secretary of the Treasury taking into consideration the current average market yield on outstanding marketable obligations of the United States with remaining periods of maturity that are comparable to the average maturities of such loans, adjusted to the nearest one-eighth of 1 percent, plus

(B) an amount adequate in the judgment of the Secretary of Commerce to cover administrative costs and probable losses under the program.

(2) The Secretary may not guarantee any loan under this part if

(A) the rate of interest on either the portion to be guaranteed, or the portion not to be guaranteed, is determined by the Secretary to be excessive when compared with other loans bearing Federal guarantees and subject to similar terms and conditions, and

(B) the interest on the loan is exempt from Federal income taxation under section 103 of

title 26. (c) Maturity of loans

The Secretary shall make no loan or guarantee of a loan under section 2344(b)(1) of this title having a maturity in excess of 25 years or the useful life of the fixed assets (whichever period is shorter), including renewals and extensions; and shall make no loan or guarantee of a loan under section 2344(b)(2) of this title having a maturity in excess of 10 years, including extensions and renewals. Such limitations on maturities shall not, however, apply

(1) to securities or obligations received by the Secretary as claimant in bankruptcy or equitable reorganization, or as creditor in other proceedings attendant upon insolvency of the obligor, or

(2) to an extension or renewal for an additional period not exceeding 10 years, if the Secretary determines that such extension or renewal is reasonably necessary for the order

ly liquidation or servicing of the loan. (d) Priority for small firms; servicing of loans

(1) In making guarantees of loans, and in making direct loans, the Secretary shall give priority to firms which are small within the meaning of the Small Business Act (15 U.S.C. 631 et seq.) (and regulations promulgated thereunder).

(2) For any direct loan made, or any loan guaranteed, under the authority of this part, the Secretary may enter into arrangements for the servicing, including foreclosure, of such loans or evidences of indebtedness on terms which are reasonable and which protect the fi. nancial interests of the United States. (e) Loan guarantee conditions

The following conditions apply with respect to any loan guaranteed under this part:

(1) No guarantee may be made for an amount which exceeds 90 percent of the outstanding balance of the unpaid principal and interest on the loan.

(2) The loan may be evidenced by multiple obligations for the guaranteed and nonguaranteed portions of the loan.

(3) The guarantee agreement shall be conclusive evidence of the eligibility of any obligation guaranteed thereunder for such guarantee, and the validity of any guarantee agreement shall be incontestable, except for

fraud or misrepresentation by the holder. (f) Operating reserves

The Secretary shall maintain operating reserves with respect to anticipated claims under guarantees made under this part. Such reserves shall be considered to constitute obligations for purposes of sections 1108(c) and (d), 1501, and 1502(a) of title 31. (8) Fees to lenders which make loan guarantees

The Secretary may charge a fee to a lender which makes a loan guaranteed under this part in such amount as is necessary to cover the cost of administration of such guarantee. (h) Maximum aggregate amount of outstanding guar.

anteed or direct loans (1) The aggregate amount of loans made to any firm which are guaranteed under this part and which are outstanding at any time shall not exceed $3,000,000.

(2) The aggregate amount of direct loans made to any firm under this part which are outstanding at any time shall not exceed $1,000,000.

(i) Preference for firms having employee stock own

ership plans (1) When considering whether to grant a direct loan or to guarantee a loan to a corporation which is otherwise certified under section 2341 of this title, the Secretary shall give pref. erence to a corporation which agrees with respect to such loan to fulfill the following requirements,

(A) 25 percent of the principal amount of the loan is paid by the lender to a qualified trust established under an employee stock ownership plan established and maintained by the recipient corporation, by a parent or subsidiary of such corporation, or by several corporations including the recipient corporation,

(B) the employee stock ownership plan meets the requirements of this subsection, and

(C) the agreement among the recipient corporation, the lender, and the qualified trust relating to the loan meets the requirements of this section.

(2) An employee stock ownership plan does not meet the requirements of this subsection unless the governing instrument of the plan provides that,

(A) the amount of the loan paid under paragraph (1)(A) to the qualified trust will be used to purchase qualified employer securities,

(B) the qualified trust will repay to the lender the amount of such loan, together with the interest thereon, out of amounts contributed to the trust by the recipient corporation, and

(C) from time to time, as the qualified trust repays such amount, the trust will allocate qualified employer securities among the individual accounts of participants and their beneficiaries in accordance with the provisions of paragraph (4).

(3) The agreement among the recipient corporation, the lender, and the qualified trust does not meet the requirements of this subsection unless

(A) it is unconditionally enforceable by any party against the others, jointly and severally,

(B) it provides that the liability of the qualified trust to repay loan amounts paid to the qualified trust may not, at any time, exceed an amount equal to the amount of contributions required under paragraph (2)(B) which are actually received by such trust,

(C) it provides that amounts received by the recipient corporation from the qualified trust for qualified employer securities purchased for the purpose of this subsection will be used exclusively by the recipient corporation for those purposes for which it may use that portion of the loan paid directly to it by the lender,

(D) it provides that the recipient corporation may not reduce the amount of its equity capital during the one year period beginning on the date on which the qualified trust purTERMINATION OF SECTION For termination of section by section 285 of Pub. L. 93-618, see Termination Date note set out preceding section 2271 of this title.

REFERENCES IN TEXT

The Small Business Act, referred to in subsec. (d)(1), is Pub. L. 85-536, July 18, 1958, 72 Stat. 384, as amended, which is classified generally to chapter 14A (8 631 et seq.) of Title 15, Commerce and Trade. For complete classification of this Act to the Code, see Short Title note set out under section 621 of Title 15 and Tables.

The Employee Retirement Income Security Act of 1974, referred to in subsec. (i)(5)(B), is Pub. L. 93-406, Sept. 2, 1974, 88 Stat. 832, as amended. Title I of the Employee Retirement Income Security Act of 1974 is classified generally to subchapter I ($ 1001 et seq.) of chapter 18 of Title 29, Labor. For complete classification of this Act to the Code, see Short Title note set out under section 1001 of Title 29 and Tables.

CODIFICATION In subsec. (f), "sections 1108(c) and (d), 1501, and 1502(a) of title 31" was substituted for "section 1311 of the Supplemental Appropriation Act, 1955 (31 U.S.C. 200)" on authority of Pub. L. 97-258, § 4(b), Sept. 13, 1982, 96 Stat. 1067, the first section of which enacted Title 31, Money and Finance.

AMENDMENTS

chases qualified employer securities for purposes of this subsection, and

(E) it provides that the recipient corporation will make contributions to the qualified trust of not less than such amounts as are necessary for such trust to meet its obligation to make repayments of principal and interest on the amount of the loan received by the trust without regard to whether such contributions are deductible by the corporation under section 404 of title 26 and without regard to any other amounts the recipient corporation is obligated under law to contribute to or under the employee stock ownership plan.

(4) At the close of each plan year, an employee stock own hip plan shall allocate to the accounts of participating employees that portion of the qualified employer securities the cost of which bears substantially the same ratio to the cost of all the qualified employer securities purchased under paragraph (2)(A) of this subsection as the amount of the loan principal and interest repaid by the qualified trust during that year bears to the total amount of the loan principal and interest payable by such trust during the term of such loan. Qualified employer securities allocated to the individual account of a participant during one plan year must bear substantially the same proportion to the amount of all such securities allocated to all participants in the plan as the amount of compensation paid to such participant bears to the total amount of compensation paid to all such participants during that year.

(5) For purposes of this subsection, the term

(A) “employee stock ownership plan" means a plan described in section 4975(e)(7) of title 26,

(B) “qualified trust” means a trust established under an employee stock ownership plan and meeting the requirements of title I of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1001 et seq.) and section 401 of title 26,

(C) “qualified employer securities” means common stock issued by the recipient corporation or by a parent or subsidiary of such corporation with voting power and dividend rights no less favorable than the voting power and dividend rights on other common stock issued by the issuing corporation and with voting power being exercised by the participants in the employee stock ownership plan after it is allocated to their plan accounts, and

(D) “equity capital” means, with respect to the recipient corporation, the sum of its money and other property (in an amount equal to the adjusted basis of such property but disregarding adjustments made on account of depreciation or amortization made during the period described in paragraph

(3)(D)), less the amount of its indebtedness. (Pub. L. 93-618, title II, $ 255, Jan. 3, 1975, 88 Stat. 2031; Pub. L. 97-35, title XXV, § 2523, Aug. 13, 1981, 95 Stat. 891; Pub. L. 98-120, § 4(a), Oct. 12, 1983, 97 Stat. 809; Pub. L. 99-514, $ 2, Oct. 22, 1986, 100 Stat. 2095.)

1986–Subsecs. (b)(2)(B), (i)(3)(E), (5)(A), (B). Pub. L. 99-514 substituted "Internal Revenue Code of 1986" for "Internal Revenue Code of 1954", which for purposes of codification was translated as "title 26" thus requiring no change in text.

1983–Subsec. (i). Pub. L. 98-120 added subsec. (i).

1981–Subsec. (b). Pub. L. 97-35, $ 2523(1), amended subsec. (b) generally, substituting provisions limiting the maximum rate of interest on loans guaranteed under this part on the basis of comparison with other Federally guarantee loans for provisions limiting the maximum interest rate on the basis of 15 U.S.C. 636(a) and inserting provisions prohibiting the guarantee of loans if the interest is tax exempt.

Subsec. (c). Pub. L. 97-35, § 2523(2), inserted references to section 2344 of this title, alternative limitation of useful life of asset, and prohibition of guarantees in excess of 10 years in provisions preceding par. (1) and inserted "or servicing” in par. (2).

Subsec. (d). Pub. L. 97-35, $ 2523(3), designated existing provisions as par. (1) and added par. (2).

Subsec. (e). Pub. L. 97-35, $ 2523(4), substituted provisions respecting conditions applicable to loan guarantees for provisions relating to percentage maximum on loan guarantees which are covered in par. (1).

EFFECTIVE DATE OF 1983 AMENDMENT

Section 4(b) of Pub. L. 98-120 provided that: “The amendment made by subsection (a) (amending this section) shall become effective on the date of the enactment of this Act (Oct. 12, 1983).”

EFFECTIVE DATE OF 1981 AMENDMENT Amendment by Pub. L. 97-35 effective Aug. 13, 1981, except as otherwise provided with respect to applications for adjustment assistance, see section 2529 of Pub. L. 97-35, set out as a note under section 2343 of this title.

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