xt70zp3vt865_70 https://exploreuk.uky.edu/dips/xt70zp3vt865/data/mets.xml https://exploreuk.uky.edu/dips/xt70zp3vt865/data/63m46.dao.xml unknown 14 Cubic Feet 31 boxes archival material 63m46 English University of Kentucky Copyright has not been assigned to the University of Kentucky.  Contact the Special Collections Research Center for information regarding rights and use of this collection. Harkins Family papers Mineral rights -- Kentucky -- Floyd County -- History. Law reports, digests, etc. -- Kentucky. Mining leases -- Kentucky -- Floyd County -- History. Practice of law -- Kentucky. Bankers -- Kentucky. Banks and banking -- Kentucky -- Prestonsburg. Coal trade -- Kentucky -- Floyd County -- History. Lawyers -- Kentucky. May 1918 text May 1918 2016 https://exploreuk.uky.edu/dips/xt70zp3vt865/data/63m46/Box_11/Folder_4/0001.pdf section false xt70zp3vt865_70 xt70zp3vt865 , - ., .',. a!
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‘ Spscific an; of our orn mouoy.

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at present 03o of 133 Rd lTO&d gﬁuiniétzglxxa.

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is most attr;ctive, but that ii nouli he ioposui lo to interact any
of the Tinanoiors at ila Lrgzant ti.e, since tlay absolutely rifuse
to outer into development projects.

Yr.TLomyson, ho 2vur, suggested thit ﬁlo tyges of or-_
ﬁmnizatjons thigh would be yTObdbly intergstoi in ﬁlm‘s 330,3ots'ioulo
Be Inuuptri l Eonoerns who at} usinﬁ gas and oil, 331 'ith pniajloo
in View my brother-in-law, togetVe: “13h hlo a: ooxutos, are biﬁlgg ”’
the Same up rith several large In ﬁctrlal cow unlos 71th ”hon zilg ;19
co 1ooteﬂ, ugﬂ 33 ms of tle opinion taut there hQFOtlithLS w112 me
Urodnctive of ﬂofinito results.

' sincerely, A , , _
9 1 ,1

 I ’
.'.
PAUL M. WARBURG. CHAIRMAN > ADVISORY COMMITTEE:
FREDERIC A. DELANO ALLEN B. FORBES. CHAIRMAN
CHARLES s.HAMLxN CAPITAL ISSUES COMMITTEE F'H‘G°"
)n HENRYC,FLOWER
OF THE __
w. T. CHAPMAN, sEanmny BRADLEY w. PALMER. COUNSEL
‘ FEDERAL RESERVE BOARD smmmmm
EXECUTIVE SECRETARY
JAMES C}. NEWTON
WASHINGTON ASST.EXECUTIVESECRETARY
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' 11:1.

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[PUBLIC—NO. 121—65TH CONGRESS.]
Is. 3714.]

An Act To provide further for the national security and defense,
and, for the purpose of assisting in the prosecution of the war, to provide credits for
industries and enterprises in the United States necessary or contributory to the
prosecution of the war, and to supervise the issuance of securities, and for other
purposes.

' Be it enacted by the Senate and House of Representatives of the United

'f States of America in Congress assembled,

' TITLE I.—WAR FINANCE CORPORATION.

That the Secretary of the Treasury and four additional persons (who
shall be the directors ﬁrst appointed as hereinafter provided), are
hereby created a body corporate and politic in deed and in law by
the name, style, and title of the “War Finance Corporation” (herein
called the Corporation), and shall have succession for a period of
ten years: Provided, That in no event shall the Corporation exercise
any of the powers conferred by this Act, except such as are incidental
to the liquldation of its assets and the winding up of its affairs, after
six months after the termination of the war, the date of such ter-
mination to be ﬁxed by proclamation of the President of the United
States.

SEC. 2. That the capital stock of the Corporation shall be
$500,000,000, all of which shall be subscribed by the United States
of America, and such subscription shall be subject to call upon the
vote of three-ﬁfths of the board of directors of the Corporation, with
the approval of the Secretary of the Treasury, at such time or times
as may be deemed advisable; and there is hereby appropriated, out
of any money in the Treasury not otherwise appropriated, the sum
of $500,000,000, or so much thereof as may be necessary for the ur-
ﬁose of making payment upon such subscription when and as caﬁed.

eceipts for payments by the United States of America for or on
account of such stock shall be issued by the Corporation to the Sec-
retary of the Treasury, and shall be evidence of stock ownership.

SEC. 3. That the management Of the Corporation shall be vested
in a board of directors, consisting of the Secretar of the Treasury,
who shall be chairman of the board, and four otiier persons, to be
appointed by the President of the United States, by and With the
advice and consent of the Senate. No director, ofﬁcer, attorne ,
agent, or employee Of the Corporation shall in any manner, directly
or indirectly, participate in the determination of any question
affecting his personal interests, or the interests of any corporation,

, partnership, or association, in which he is directly or indirectly
interested; and each director shall devote his time, not otherwise
required by the business of the United States, principally to the
business of the Corporation. Before entering upon his duties, each
of the four directors so appointed, and each ofﬁcer, shall take an
oath faithfully to discharge the duties of his ofﬁce. Nothing con-

 2 IP03. 121.1
‘ tained in this or any other Act shall be construed to revent the
appointment as a director of the Corporation of any otlicer or em-
ployee under the United States or of a director of a Federal reserve"
an c.

Of the four directors so appointed, the President of the United
States shall designate two to serve for two years, and two for four
years; and thereafter each direct-or so appointed shall serve for four
years. Whenever a vacancy shall occur among the directors so
appointed, the person appointed director to fill an such vacancy
Siall hold ofﬁce for the unexpired term of the memlier whose place
he is selected to ﬁll. Any director shall be subject to remOval by
the President of the United States. Three members of the board
of directors shall constitute a quorum for the transaction of business. ‘

SEC. 4. That the four directors of the Corporation appointed as
hereinbefore provided shall receive annual salaries, payable monthly, '
of $12,000. Any director receiving from the United States any
salary or compensation for services shall not receive as salary from
the Corporation any amount which, together with an salary or
compensation received from the United States, wouldy make the
tota amount paid to him by the United States and by the Corporation
exceed $12,000.

SEC. 5. That the principal ofﬁce of the Corporation shall be located
in the District of Columbia, but there may be established agencies
or branch ofﬁces in any city or cities of the United States under
rules and regulations prescribed by the board of directors.

SEC. 6. That the Corporation shall be empowered and authorized
to adopt, alter, and use a coriorate seal; to make contracts; to pur—
chase or lease and hold or dispose of such real estate as may be
necessary for the prosecution of its business; to sue and be sued; to
complain and defend in any court of competent jurisdiction, State
or l‘ederal: to a point, by its board of directors, and ﬁx the com-
pensation of sucli ofﬁcers, employees, attorneys, and agents as are
necessar for the transaction of the business of the Corporation, to
deﬁne tlieir duties, require bonds of them and ﬁx the penalties
thereof, and to dismiss at pleasure such ofﬁcers, employees, attorneys,
and agents; and to prescribe, amend, and repeal, by its board of
directors, subject to the approval of the Secretary of the Treasury,

i by-laws regulating the manner in which its general business may be
l conducted and the privileges granted to it by law may be exercised
‘ and enjoyed, and prescribing the powers and duties of its ofﬁcers
‘ and agents.

SEC. 7. That the Corporation shall be empowered and authorized
to make advances, upon such terms, not inconsistent herewith, as
it may prescribe, for periods not exceeding ﬁve years from the re-
spective dates of such advances:

(1) To any bank, banker, or trust company, in the United States,
which shall have made after April sixth, nineteen hundred and sev-
enteen, and which shall have outstanding, any loan or loans to any
person, ﬁrm, corporation, or association, conducting an established
and going business in the United States, Whose operations shall be
necessary or contributory to the prosecution of the war. and evi-
denced by a note or notes, but no such advance shall exceed seventy-
five per centum of the face value of such loan or loans; and

l
l

 IR)». 1211‘ 3

(2) To any bank, banker, or trust company, in the United States,
which shall have rendered ﬁnancial assistance, directly or indirectly,
to any such person, ﬁrm, corporation, or association by the purchase
after April sixth, nineteen hundred and seventeen, of its bonds or
other obligations, but no such advance shall exceed seventy-five per
centum of the value of such bonds or other obligations at the time
of such advance, as estimated and determined by the board of
directors of the Corporation.

All advances shall be made upon the promissory note or notes of
such bank, banker, or trust company, secured by the notes, bonds, or
other obligations, which are the basis of any such advance by the

" Cor oration, together with all the securities, if any, which such bank,

, banlker, or trust company may hold as collateral for such notes,

'. bonds, or other obligations.

l‘ The Corporation shall, however. have power to make advances (a)
up to one hundred per centum of the face value of any such loan
made by any such bank, banker, or trust company to any such per-
son, ﬁrm, corporation, or association, and (b) up to one hundred per

; centum of the value at the time of any such advance (as estimated

and determined by the board of directors of the Corporation) of such

' bonds or other obligations by the purchase of which ﬁnancial assist-

. ance shall have been rendered to such person, ﬁrm, corporation, or

1' association: Protidrd, That every such advance shall be secured in

‘ the manner described in the preceding part of this section, and in

’ addition thereto by collateral security, to be furnished by the bank,

| banker, or trust company, of such character as shall be prescribed

’ . by the board of directors. of a value. at the time of such advance (as

. estimated and determined by the board of directors of the Corpora—
tion), equal to at least thirty-three per centum of the amount ad-
vanced by the Corporation. The Corporation shall retain power to

' require additional security at any time.

‘ SEC. 8. That the Corporation shall be empowered and authorized

1 to make advances from time to time, upon such terms. not incon—

; sistent herewith, as it may prescribe, for periods not exceeding one

; year, to any savings bank, banking institution or trust company, in
the United States, which receives savings deposits, or to any building

‘ and loan association in the United States, on the promissory note
or notes of the borrowing institution, whenever the Corporation shall

‘ deem such advances to be necessary or contributory to the prosecu—

t tion of the war or im ortant in the public interest: I’rmrided, That

e such note or notes shall be secured by the pledge of securities of such
character as shall be prescribed by the board of directors of the Cor—

' poration, the value of which, at the time of such advance, (as esti-
mated and determined by the board of directors of the Corporation)
shall be equal in amount to at least one hundred and thirty—three

. per centum of the amount of such advance. The rate of interest
charged on any such advance shall not be less than one per centum

1 per annum in excess of the rate of discount for ninety—da)r commer—

‘ cial paper revailing at the time of such advance at the Federal

‘ reserve bank of the district in which the borrowing institution is

‘ located, but such rate of interest shall in no case be greater than the
average rate receivable by the borrowing institution on its loans and
investments made during the six months prior to the date of the

l advance, except that where the average rate so. receivable by the

i

ll _‘. 7” _, , ,,_,

 l.

l

‘, 4 [151.111.1214

borrowing institution is less than such rate of discount for ninety-
day commercial paper the rate of interest on such advance shall he,

1 equal to such rate of discount. The Corporation shall retain power
to require additional security at any time.

SEC. 9. That the Corporation shall be empowered and authorized,
in exceptional cases, to make advances directly _to any person, firm,
corporation, or association, conducting an established and going
business in the United States, whose operations shall be necessary or
contributory to the prosecution of the war (but only for the purpose

. of conducting such usiness in the United States and only when in
the opinion of the board of directors of the Corporation such person,
ﬁrm, corporation, or association is unable to obtain funds upon

. reasonable terms through banking channels or from the general .
‘ public), for periods not exceeding ﬁve years from the respective dates .
of such advances, upon such terms. and subject to such rules and
regulations as may e prescribed by the board of directors of the
Corporation. In no case shall the aggregate amount of the advances
made under this section exceed at any one time an amount equal to
twelve and one—half per centum of the sum of t 1) the authorized
capital stock of the Corporation plus (2) the aggreo'ate amount of
bonds of the Corporation authorized to be outstanding at any one
time when the capital stock is fully paid in. Every such advance
shall be secured by adequate security of such character as shall be
prescribed by the board of directors of a value at the time of such
advance (as estimated and determined by the board of directors),
equal to (except in case of an advance made to a railroad in the os-
session and control of the President, for the urpose of making
1 additions, betterments or road extensions to such railroad) at least
one hundred and twenty-ﬁve per centum of the amount advanced
,1" by the Corporation. The Corporation shall retain power to re uire
l _ additional security at any time. The rate of interest charged on
3 any such advance shall not be less than one per centum per annum
1 in excess of the rate of discount for ninety-day commercial paper
T prevailing at the time of such advance at the Federal reserve bank
1 of the district in which the borrower is located.

SEC. 10. That in no case shall the aggregate amount of the advances
made under this title to any one person, ﬁrm, corporation, or associ-
ation exceed at any one time an amount equal to ten per centum of p
the authorized capital stock of the Corporation, but this section shall
not apply in the case of an advance made to a railroad in the posses~
sion and control of the President, forthe purpose of making additions,
betterments or road extensions to such railroad.

SEC. 11. That the Corporation shall be empowered and authorized
to subscribe for, acquire, and own, buy, sell, and deal in bonds and
obligations of the United States issued or converted after September
twenty-fourth, nineteen hundred and seventeen, to such extent as
the board of directors, with the approval of the Secretary of the
Treasury, may from time to time determine.

SEC. 12. That the Corporation shall be empowered and authorized
to issue and have outstanding at any one time its bonds in an amount
aggregating not more than six times its paid—in capital, such bonds
to mature not less than one year nor more than ﬁve years from the
respective dates of issue, and to bear such rate or rates of interest,

. and may be redeemable before maturity at the option of the Corpo-

 r (Fun, 121.] 5
ration, as may be determined by the board of directors, but such rate
' or rates of interest shall be subject to the approval of the Secretary
of the Treasury. Such bonds shall have a ﬁrst and paramount ﬂoat-
ing charge on all the assets of the Corporation, and the Corporation
shall not at any time mortgage or pledge any of its assets. Such
bonds may be issued at not less than par in payment of any advances
authorized by this title, or may be offered for sale publicly or to any
individual, ﬁrm, corporation, or association, at such price or prices
as the board of directors, with the approval of the Secretary of the
'l‘reasury, may determine.

i Upon such terms not inconsistent herewith as may be determined
from time to time by the board of directors, With the approval of the
‘r‘ Secretary of the Treasury, at or before the issue thereof, any of such
,' bonds may be issued ayable in any foreign money or foreign moneys,
or issued payable at tLhe option of the respective holders thereof either
in dollars or in any foreign money or foreign moneys at such ﬁxed
rate of exchange as may be stated in any such bonds. For the pur-
pose of determining the amount of bonds issued payable in any
oreign money or foreign moneys the dollar equivalent shall be deter-
mined by the par of exchange at the date of issue thereof, as estimated
by the Director of the Mth and proclaimed by the Secretary of the
Treasury in pursuance of the provisions of section twenty—live of the
Act entitled “An Act to reduce taxation, to provide revenue for the
Government, and for other purposes,” approved August twenty—

seventh, eighteen hundred and ninety-four.

SEC. 13. That the Federal reserve banks shall be authorized,
subject to the maturity limitations of the Federal reserve Act and
to regulations of the Federal Reserve Board, to discount the direct
obligations of member banks secured by such bonds of the Corpora—
tion and to rediscount eligible paper secured by such bonds and
indorsed by a member bank. No discount or rediscount under this
section shall be granted at a less interest charge than one per centum
per annum above the prevailing rates for eligible commercial paper
of corresponding maturity.

Any Federal reserve bank may, With the approval of the Federal
Reserve Board, use any obligation or paper so acquired for any pur-

ose for which it is authorized to use obligations or paper secured by
bonds or notes of the United States not bearing the circulation privi—
lege: Provided, however, That Whenever Federal reserve notes are issued
against the security of such obligations or paper the Federal Reserve
Board may make a special interest charge on such notes, which, in
the discretion of the Federal Reserve Board, need not be applicable
to other Federal reserve notes which may from time to time be issued
and outstanding. All provisions of law, not inconsistent herewith,
" in respect to the acquisition by any Federal reserve bank of obliga-
tions or paper secured by such bonds or notes of the United States,
and in respect to Federal reserve notes issued against the security
i of such obligations or paper, shall extend, in so far as applicable, to
the acquisition of obligations or paper secured by the bonds of the
Corporation and to the Federal reserve notes issued against the
security of such obligations or paper.

SEC. 14. That the Corporation shall not exercise any of the powers
granted by this title or perform any business except such as is inci-
dental and necessarily preliminary to its organization until it has

I

 I
a
i .
11 6 (PUB. 121.,
been authorized by the President of the United States to commence
business under the provisions of this title. '
, SEC. 15. That all net earnings of the Corporation not required for
f its operations shall be accumulated as a reserve fund until such time
1. as the Corporation liquidates under the terms of this title. Such
‘ reserve fund shall, upon the direction of the board of directors, with
the approval of the Secretary of the Treasury, be invested in bonds
and obligations of the United States, issued or converted after
5 September twenty—fourth, nineteen hundred and seventeen, or upon
: like direction and approval may be deposited in member banks of
the Federal Reserve System, or in any of the Federal reserve banks, t,
1 or be used from time to time, as well as any other funds of the Cor— .
Ex poration, in the purchase or redemption of any bonds issued _by the ',
-i Corporation. The Federal reserve banks are hereby authorized to F
Il act as depositaries for and as fiscal agents of the Corporation in the
i general performance of the powers conferred by this title. Begin-
i ning six months after the termination of the war, the date of such
1 termination to be fixed by a proclamation of the President of the
1 United States, the directors of the Corporation shall proceed to liqui—
1 date its assets and to wind up its affairs, but‘the directors of the Cor—
poration, in their discretion, may, from time to time, prior to such
3,7 date, sell and dispose of any securities or other property acquired by
33 the Corporation. Any balance remaining after the payment of all
1 its debts shall be paid into the Treasury of the United States as
' miscellaneous receipts, and thereupon the Corporation shall be dis—
‘: solved.
;, SEC. 16. That any and all bonds issued by the Corporation shall be
exempt, both as to principal and interest, from all taxation now or
‘; hereafter imposed by the United States, any State, or any of the pos—
1 sessions of the United States, or by any local taxing authority,
1% except (a) estate or inheritance taxes, and (b) graduated additional
1 income taxes, commonly known as surtaxes, and excess—profits and
5g war—profits taxes, now or hereafter imposed by the United States,
.~; upon the income or proﬁts of individuals, partnerships, corporations,
1,, or associations. The interest on an amount of such bonds the prin—
cipal of which does not exceed in the aggregate $5,000, owned by
f. any individual, partnership, corporation, or association, shall be
exempt from the taxes referred to in clause (b). The Corporation,
, including its franchise and the capital and reserve or surplus thereof,
1:} and the income derived therefrom, shall be exempt from all taxation
3 now or hereafter imposed by the United States, any State, or any of
g; the possessions of the United States, or by any local taxing authority,
“if except that any real property of the Corporation shall be subject to
3' State, county, or municipal taxes to the same extent, according to
3, its value, as other real property is taxed.
1“, SEC. 17. That the United States shall not be liable for the pay—
}, ment of any bond or other obligation or the int