Disclaimer: The contents of this guidance document does not have the force and effect of law and is not 

meant to bind the public in any way. This document is intended only to provide clarity to the public 

regarding existing requirements under the law or agency policies. 

UNITED STATES DEPARTMENT OF AGRICULTURE 

RURAL DEVELOPMENT

Rural Utilities Service

BULLETIN 1717M-2 

RD-GD-2005-52 

SUBJECT: Sale or Transfer of Capital Assets by Electric Borrower

TO: RUS Electric Borrowers and RUS Electric Staff

EFFECTIVE DATE: Date of Approval

OFFICE OF PRIMARY INTEREST: Office of Portfolio Management and Risk Assessment, 

Office of the Assistant Administrator, Electric Program

INSTRUCTIONS: This supersedes RUS Bulletin 1717M-2, Sale or Transfer of Capital Assets by 

Electric Borrower, dated February 9, 2005. 

AVAILABILITY: This bulletin can be accessed via the internet at: 

https://www.rd.usda.gov/sites/default/files/UEP_Bulletin_1717M-2.pdf

PURPOSE: To set forth Rural Utilities Service guidelines to be followed in the sale of capital 

assets of electric borrowers

______________________ __________________ 

Christopher A. McLean Date 

Assistant Administrator Electric

Rural Utilities Service
2 

TABLE OF CONTENTS

1 PURPOSE ........................................................................................................................... 4 

2 GENERAL .......................................................................................................................... 4 

3 REQUIREMENTS FOR ALL SALES ............................................................................... 4 

4 METHOD OF HANDLING SALES .................................................................................. 5 

5 DISPOSITION OF PROCEEDS ........................................................................................ 7 

6 INFORMATION REQUIRED FOR RUS APPROVAL OF A SALE OF PROPERTY.... 8 

7 EXPENDITURES OF SALES .......................................................................................... 10 

8 PREPARTION OF RELEASE ......................................................................................... 10 

Exhibits 

Exhibit A – Sample format Partial Release for Use Where Capital Assets Secured Only by Mortgages

Exhibit B – Sample format Partial Release for Use Where Capital Assets Secured Only by Deeds of 

Trust

Exhibit C – Sample format Partial Release for Use Where Capital Assets Secured by Both Mortgages 

and Deeds of Trust 

Exhibit D – Sample format Partial Release for Use Where Uniform Commercial Code Provision 

Applies 

Exhibit E – RUS Form 369, “Request for Approval to Sell Capital Assets”

Exhibit F – Sample format Transmittal Letter for Sales that do not require RUS Approval

ABBREVIATIONS

The following abbreviations are defined in § 1710.2: 

DSC Debt Service Coverage 

ODSC Operating Debt Service Coverage 

OTIER Operating Times Interest Earned Ratio 

RUS Rural Utilities Service

TIER Times Interest Earned Ratio
3

DEFINITIONS

Construction Fund Trustee Account shall mean (unless otherwise defined in the “RUS Loan 

Contract” between the borrower and RUS, hereinafter the RUS Loan Contract) a bank account where 

the borrower shall hold all moneys advanced to it by RUS in trust for RUS and shall deposit such 

moneys received by it promptly after receipt thereof in a bank or banks which are insured by the 

Federal Deposit Insurance Corporation.

Disposition shall have the meaning as such term is defined in § 1717.616(a).

Mortgagee shall mean (unless otherwise defined in the RUS Loan Contract) RUS and any other lender 

that is a party of the “RUS Mortgage” (hereinafter the RUS Mortgage) between or among the borrower 

and RUS and any such other lender, their successors and assigns, as well as all other lenders pursuant 

to Article II of the RUS Mortgage that enter into a supplemental mortgage in accordance with Article 

II of the RUS Mortgage, their successors and assigns.

Net Utility Plant shall have the meaning as such term is defined in § 1717.602

Sales Agreement shall mean a legal agreement between the purchaser and seller stating the 

terms and conditions of a sale.

SO2 allowances shall mean those allowances authorizing a unit within a utility or industrial 

source to emit one ton of sulfur dioxide during a given year thereafter. Allowances are fully 

marketable commodities, and once allocated, may be bought, sold, traded, or banked for use in 

future years.

FORMS

RUS Form 369, "Request for Approval to Sell Capital Assets"
4

1 PURPOSE

The purpose of this bulletin is to set forth Rural Utilities Service (RUS) policies and 

procedures to be followed in the sale of capital assets of electric borrowers. Capital 

assets include all tangible and intangible utility plant, SO2 allowances, construction in 

progress, non-utility property, material supplies and equipment normally used in the 

system. For purposes of this bulletin, sales include: sales, either voluntary or resulting 

from condemnation procedures; transfers by assumption of indebtedness; exchanges or 

trades of properties between RUS borrowers or between RUS borrowers and non-RUS 

borrowers. This bulletin applies to materials, supplies and equipment used in borrowers' 

systems, but not to materials, supplies, appliances, and equipment held primarily for 

merchandising.

2 GENERAL

All capital assets of RUS borrowers are ordinarily mortgaged or pledged to the Federal 

Government as security for RUS loans. Loans made by the National Rural Utilities 

Cooperative Finance Corporation (CFC), or other lenders are generally secured by a 

mortgage containing similar pledges to such supplemental lenders. The Rural 

Electrification Act of 1936, as amended, and the various security instruments limit a 

borrower's right to dispose of its capital assets without appropriate prior approval of RUS 

and any secured lenders. If a sale involves two borrowers, the borrower who is the seller 

should contact RUS through the Office of Portfolio Management and Risk Assessment 

(OPMRA) for information to request approval for the sale transaction.

3 REQUIREMENTS FOR ALL SALES

a The borrower shall receive fair market value for the disposition or sale of 

capital assets; 

b The sale shall be in the best interests of the creditors or mortgagee(s);

c All approvals required by law, by the articles of incorporation, by the bylaws of 

the seller or by all the creditors or the mortgagee(s), shall be obtained prior to 

delivery of the asset;

d In the case of dispositions or transactions involving exchanges or trades of plant 

in place between an RUS borrower and a non-RUS borrower, the borrower must 

provide evidence, satisfactory to RUS, that the exchange or trade is equitable to 

the RUS borrower and that the plant acquired in the exchange or trade can be 

economically integrated into the borrower's system (See paragraph 3e of this 

bulletin); and

e Unless the seller, as an existing RUS borrower, is dissolved, its electric system 

after the sale will constitute a satisfactory operating unit and the disposition or 

sale of the asset will not jeopardize the repayment of the seller's RUS loan and 
5

other loans or impair the collateral serving as security for all RUS loans. If the 

purchaser is a RUS borrower, the same determinations shall also be made with 

respect to the purchaser's operations and loan repayment.

4 METHOD OF HANDLING SALES

Dispositions or sales of capital assets generally shall be for cash except as otherwise 

approved by RUS in writing. If the disposition of the asset is not subject to RUS 

approval, but the purchaser requires the government to release its lien, a release of 

capital assets from the Government's lien and liens of other secured lenders may be 

required for the consummation of the sale even in cases where general RUS approval is 

hereby given in accordance with all applicable regulations and as indicated below. 

Where a release of lien is required (see Section 8).

a Sales for which RUS approval is not required:

(1) A borrower may without the prior approval of RUS sell, lease, transfer or 

otherwise dispose of any capital asset if the following conditions are

met:

(a) The borrower is not in default on any of its obligations to RUS and is not 

a restructured borrower;

(b) In the most recent year for which data is available, the 

borrower has met its coverage ratios as set in 7 CFR 

1710.114(b) or other financial requirements as established by 

their Mortgages, Loan Contracts, or other Security 

instruments;

(c) The sale, lease, transfer, or disposition of assets will not reduce 

the borrower's existing or future requirements for energy or 

capacity being furnished to the borrower under any wholesale 

power contract which has been pledged as security to the

government;

(d) Fair market value is obtained for the assets;

(e) No employee or board member of the organization has a direct 

personal financial interest in the sale of the capital asset;

(f) The aggregate value of assets sold, leased, transferred, or disposed 

of in any 12-month period is less than 10 percent of the borrower's net 

utility plant prior to the disposition and not to exceed $10,000,000; and 

(g) If the disposition or sale of the capital asset:

i. Results in the borrower not retaining interest in the asset; or

ii. Constitutes a ‘‘capital lease’’ under 7 CFR 1767.15(s)(1) and the 
6 

borrower does not retain the right to utilize the asset during the 

term of the lease, and the borrower disposes of the proceeds, less 

ordinary and reasonable expenses incident to such disposition, in 

a manner consistent with paragraph (e) of this section.

b Dispositions or Sales of Capital Assets for Which RUS Approval is not Required 

but Where the Purchaser Requests a Partial Release of Lien: A transmittal letter or 

RUS Form 369, Request to Sell Capital Assets, should be provided to RUS. The 

partial release of lien should be prepared by the borrower's attorney or by the 

attorney of the purchaser of the property. It is the borrower’s responsibility to 

assure the accuracy and legal effectiveness of a proposed release. When a partial 

release of lien requires execution and acknowledgement by a mortgagee, such 

execution and acknowledgment by the other mortgagee should be obtained by the 

borrower. If the borrower elects to submit a transmittal letter it should contain the 

following information:

(1) Insert address of property or assets being sold; 

(2) Name and address of purchaser;

(3) Approximate original cost or book value; 

(4) Selling Price or the consideration that the borrower is receiving in exchange for 

the disposition or sale of the asset’s price; 

(5) A statement that the borrower received fair market value for the property 

being sold or disposed; 

(6) For sales with gross proceeds of $50,000 or greater, a statement from the 

borrower that the net proceeds have been or will be deposited into the 

Construction Fund Trustee Account or will be applied as a prepayment on 

all debt secured under the mortgage or other security instrument 

applicable to the assets being disposed, equally and proportionally; 

(7) A statement from the borrower’s manager stating that there was no 

distribution of funds to any employees and/or board members. If any 

amount of funds arising from the sale have been distributed to employees 

and/or board members, specific identification of the employees and/or 

board members, and reasons why funds were provided to those persons (if 

applicable) must be stated in the transmittal letter. Include borrower 

contact information and email address for questions, and 

(8) A statement of how or if the disposition or sale will affect the borrower’s 

existing customers. 

Note: In lieu of including this information in the transmittal letter the borrower 
7 

may provide an informational copy of the RUS Form 369, “Request for Approval 

to Sell Capital Assets” (See Exhibit E). 

c Sales for Which RUS Approval is Required 

(1) If the Federal Government is the sole lien holder on the borrower's capital 

assets, approval of the sale by the Federal Government will be indicated 

on RUS Form 369, when returned to the seller.

(2) If the Federal Government holds a lien jointly with supplemental lenders, 

joint approval for the sale will be necessary and the borrower will forward 

the following: 

(a) Information should be forwarded directly to RUS and one copy to 

all supplemental lenders;

(b) When approved by RUS, the information will be forwarded by 

RUS to the supplemental lenders (and a notice letter advising that 

RUS has forwarded this information to supplemental lenders will 

be issued by RUS to the borrower), and

(c) The supplemental lenders will be instructed, in the RUS transmittal 

memorandum, to execute the documents and return them to the 

seller. The supplemental lenders will also be instructed to notify 

RUS when the completed documents are returned to seller.

5 DISPOSITION OF PROCEEDS

The disposition of proceeds from the disposition, sale or transfer of a capital asset should 

be the same regardless of whether or not RUS approval of the sale is required. 

If the gross proceeds from the disposition or sale of the assets total less than $50,000, the 

borrower shall deposit the proceeds in its General Fund Account to be used for purposes 

related to the utility business as determined by the management of the borrower. 

Proceeds from individual dispositions or sales of property where the gross proceeds total 

$50,000 or more, should be distributed and accounted for as follows: 

a Deposited into the Construction Fund Trustee Account. When funds are 

deposited into the Construction Fund Trustee Account, the borrower shall

notify RUS in writing so that the budget records can be adjusted. The funds are 

to be used for the construction or acquisition of the borrower’s Utility System. 

b Paid to RUS and any secured supplemental lenders if the borrower has concurrent 

loans outstanding, by application of such funds as a prepayment on the notes of 

all lenders pro-rata according to the aggregate unpaid principal amount of the 
8 

notes then outstanding, as designated by the noteholders, and in accordance with 

the borrower’s loan documents. 

c If the borrower has no concurrent supplemental loans outstanding, applied to 

RUS as a payment to be applied to the note or notes issued with respect to loans 

made or guaranteed by RUS, or any portion of a note with respect to a loan made 

by RUS, and designated by the borrower or RUS, or 

d In the case of dispositions of SO2 allowances, the funds from the sale of 

allowances should be deposited into the Construction Fund Trustee Account. If 

any entity desires to deposit the funds into the General Fund Account, specific 

RUS approval may be given on a case-by-case basis. Accompanying any request 

for approval to deposit the funds into the General Fund Account should be a 

completed RUS Form 369 along with a summary of the anticipated disposition 

of funds from the General Fund Account. 

e In the case of dispositions of equipment, materials, or scrap, all net proceeds 

(regardless of the amount) from the sale should be deposited into the General 

Fund Account to be used for the purchase of other property useful in the 

mortgagor’s utility business, not necessarily of the same kind as the property 

disposed of, which is subject to the lien of the mortgage.

f The Administrator or designee may allow a borrower to deposit the proceeds of 

the disposition of the asset directly into the General Funds Account instead of the 

Construction Fund Trustee Account if the borrower has no ‘Balance in Reserve’ 

on its most recent loan advances 605 report and does not anticipate submitting 

any new loan applications to RUS. The borrower must receive written approval 

from RUS before it deposits any proceeds into the General Fund Account. 

6 INFORMATION REQUIRED FOR RUS APPROVAL OF A SALE OF PROPERTY 

(The borrower will send one copy of the following items to the supplemental lenders, if 

applicable.) 

a All Sales: 

(1) RUS Form 369 with original signature (See Exhibit E). 

(2) If a condemnation is involved, attach a copy of the petition or complaint 

in the condemnation suit to RUS Form 369. Items 10, 11 and 12 of the 

RUS Form 369 may be completed by referring to the attachment. Item 14 

need not be completed. The RUS Form 369 and a copy of the petition or 

complaint in the condemnation case should be submitted to RUS promptly 

after the petition or complaint has been received by the borrower.

(3) Partial release of lien (if applicable). The partial release of lien should be 

prepared by the borrower's attorney or by the attorney of the purchaser of 

the property. It will be the responsibility of the borrower and the 
9 

borrower’s attorney to ensure the accuracy and legal effectiveness of a 

proposed release. When a partial release of lien requires execution and 

acknowledgement by a mortgagee, such execution and acknowledgment 

by the mortgagee should be obtained. 

b Sales of Real Estate and Plant in Place: In addition to the information required 

for all dispositions or sales, the seller will provide a brief description of the

property being disposed or sold and a statement explaining why the asset is no 

longer needed for the borrower’s system. The borrower shall also provide the 

following information to RUS for the disposition or sales of real estate and 

plant in place:

(1) Except in condemnation cases, a statement of agreement between the 

seller and the purchaser on the proposed selling price. When applicable, 

include adjustments such as capital additions and retirements, 

depreciation, taxes, distribution of membership fees, deposits and 

contributions, prepaid and delinquent bills and accounts, insurance, 

assignment of easements, the proposed closing date and other pertinent 

information. Generally, the closing date selected should not be less than 

90 days after the date the required information is forwarded to RUS;

(2) A complete legal description supported by key and detail maps showing 

the location of lines or other capital assets to be disposed or sold;

(3) A breakdown of consumers by classification showing number, mileage, 

average kWh usage, and revenues for the portion of lines being disposed 

or sold; 

(4) An inventory of lines on a priced assembly or record unit basis, or, in the 

case of facilities other than lines, a detailed breakdown of separable units 

and their costs;

(5) Description and estimated costs of changes, if any, which must be made in 

the seller's system in order to maintain satisfactory operations after the 

sale has been completed;

(6) Other pertinent data such as the physical condition of the property to be 

disposed or sold, a copy of the lease, if facilities to be disposed or sold 

are on leased land, and the approval of appropriate regulatory bodies 

where required; 

(7) The retail rates to be applied to the consumers on the lines being 

disposed or sold (comparative rate schedules), and

(8) If the purchaser is another RUS borrower or a borrower from a 

supplemental lender, a description and the estimated costs of the changes, 
10

if any, necessary to integrate the properties being acquired with the 

purchaser's existing system for satisfactory operations. 

c Installment Sales: If the purchaser is to pay the seller in installments, such 

information should be noted on Item 9 of the RUS Form 369. A sales agreement 

between the seller and the purchaser, a note or other debt instrument in favor of 

the seller, and a security agreement in favor of the seller should be executed and 

the said security agreement should be assigned to the U. S. Government and the 

supplemental lenders, if applicable. The partial release of lien will not be 

executed by RUS, if applicable, until the final installment payment has been 

received by the seller (however, see paragraph d of this section for the sale of 

Direct Broadcast Satellite (DBS) and Satellite TV systems). The disposition of the 

net proceeds from installment sales will be the same as from cash sales (See 

Section 4 of this bulletin).

d Direct Broadcast Satellite (DBS) and Satellite TV Sales: These types of sales 

normally result in a significant profit by the borrower. As a result, RUS has 

adopted a policy whereby only an amount equal to the original cost of the 

property being sold is required to be deposited into the Construction Fund Trustee 

Account. The balance from the sale may be deposited into the borrower's general 

fund account. Because of the amount involved many borrowers elect to receive

the net proceeds from the sale over a period of time (installments). In such cases, 

RUS will release its lien on the property being sold when the required funds (an 

amount equal to the original cost) have been deposited into the Construction Fund 

Trustee Account. 

e Exchanges: Transactions involving exchanges or trades of real estate or plant in 

place between a borrower and a non-RUS borrower will be considered on an 

individual case-by-case basis. The items listed Section 6 of this bulletin, will be 

required, as applicable. 

7 EXPENDITURES FOR SALES

Expenditures by the seller in conjunction with the disposition or sale of capital assets 

will be properly accounted for and all associated documents shall be retained for review 

when RUS conducts its next Loan Fund and Accounting Review. 

8 PREPARATION OF THE RELEASE

In utilizing the appropriate sample formats of partial release, attorneys preparing a release 

of lien should give the following matters considerations: 

a A proper, exact legal description of the property to be released should be inserted. 

This description should correspond to the description contained in the instrument 

conveying the borrower's property to the grantee.
11

b All mortgages, deeds of trust, and supplements thereto securing RUS or 

supplemental loans, where applicable, should be listed in the form. It is important 

that underlying security instruments be included, as well as current security 

instruments, since the mortgages and deeds of trust contain after-acquired 

property clauses and thus cover all property of the borrower theretofore and 

thereafter acquired. Security documents have generally been filed for record in 

all counties in which property of the borrower is located; the underlying security 

instruments are generally described in the "Whereas'" clauses of the most recent 

mortgage or deed of trust.

c The attorney should determine whether it is necessary or advisable to add, for 

each of the security instruments listed in the release, the recordation data relating 

to the particular county in which the property to be released is located.

d An adequate number of copies of the partial release for recordation and for the 

records of the borrower, the purchaser, other mortgagees, and the trustee, if any, 

should be prepared for execution by RUS and other mortgagees. In addition, 

please furnish one copy for RUS records and for the records of any supplemental 

lenders.

e Where a successor trustee has been appointed to succeed a trustee named in a 

deed of trust, a "Whereas" clause of the release should refer to this fact and to the 

recorded evidence of such appointment. Where a trustee corporation named in a 

deed of trust has merged with another institution, or has changed its name, a 

"Whereas" clause in the release should explain the variance in names between the 

named trustee and the trustee executing the partial release.

f If a partial release of lien has recently been prepared and executed by RUS for the 

borrower, a review of this partial release will be helpful to the attorney in 

preparing the proposed new release. Any additional security instruments or 

supplements that may have been executed by the borrower subsequent to the 

earlier release should, of course, also be listed in the new release.

g In order that RUS and other secured lenders may be in a position to execute the 

proposed release, the release must include the specific provision in the attached 

Exhibits A, B, and C to the effect that the release will not affect or impair the 

Government's liens or liens of supplemental financing organizations on other 

properties of the borrower not expressly released, and that the release is made 

without warranties and without recourse.

h In the attached Exhibits A through D where an asterisk (*) appears after 

references to the Government, and in the margins indicating the appropriate line 

of each exhibit, insert the names of supplemental lenders who held mortgages 

and/or deeds of trust when the borrower has secured loans with CFC or other 

supplemental lenders.

i Exhibits A through D are sample formats that have been included for guidance 
12

and assistance to attorneys preparing partial release of lien for execution byRUS, 

and where applicable, by other secured lenders.

j
Exhibit A

1 

EXHIBIT A

Partial Release for Use Where Capital Assets Secured Only by Mortgages 

(For use where the lien of one or more mortgages is involved)

PARTIAL RELEASE, dated as of , made by the UNITED STATES 

OF AMERICA (hereinafter called the "Government"),* to (hereinafter 

called the "Corporation") 

WHEREAS, the Corporation, to evidence loans made to the Corporation by the 

Government pursuant to the Rural Electrification Act of 1936, as amended, has executed certain 

mortgage notes (hereinafter collectively called the "Notes"), all payable to the order of the 

Government,* and 

WHEREAS, the Corporation, to secure the Notes, has executed and delivered the 

following instruments to the Government* (hereinafter collectively called the "Security 

Instruments"):

Instrument Date as of

(Here list all mortgages and supplemental mortgages securing RUS loans); 

and 

WHEREAS, the indebtedness evidenced by the Notes is the only indebtedness as of the 

date hereof secured by the Security Instruments; and 

WHEREAS, the Corporation has requested that certain property hereinafter described be 

released from the liens of the Security Instruments;

NOW, THEREFORE, THESE PRESENTS WITNESSETH that, in consideration of the 

sum of one dollar in hand paid by the Corporation to the Government* at the time of the delivery 

of these presents, the receipt whereof is hereby acknowledge, the Government* does (do) hereby 

release and discharge unto the Corporation, its successors and assigns, all right, title, interest, 

claim or demand whatsoever which the Government* may have acquired by or through the 

Security Instruments, or any of them, in and to the following described property, and does hereby 

quitclaim said property unto the Corporation, its successors and assigns forever: 

(Add exact legal description of property to be released.) 

TO HAVE AND TO HOLD said property unto the Corporation, its successors and assigns 

forever, free, clear, and discharged of and from any and all liens and claims of the 

Government* under and by virtue of any or all the Security Instruments. 
Exhibit A

2

THIS RELEASE is made by the Government* and accepted by the Corporation on the 

express condition that it shall not in any way affect or impair the liens and security of the 

Security Instruments, or any of them, upon other premises and properties now subject thereto and 

not expressly released hereby. This release is made accepted without covenant or warranty, 

express or implied, at law or in equity, and without recourse to the Government,* in any event or 

in any contingency.

IN WITNESS WHEREOF, the Government* has (have) caused this instrument to be 

duly executed in its (their) behalf, all as of the day and year first above written.

Remainder of Page Left Intentionally Blank (If Applicable)
Exhibit A

3 

UNITED STATES OF AMERICA

By: 

Name: 

Title: ________________________________

DISTRICT OF COLUMBIA ) SS

On this ___ day of ______________, 20___, personally appeared before me ________________________, who, being 

duly sworn, did say that he/she is the ____(Insert Title)________________________of the Rural Utilities Service, an 

agency of the United States of America, and acknowledged to me that, acting under a delegation of authority duly given 

and evidenced by law and presently in effect, he/she executed said instrument as the act and deed of the United States 

of America for the uses and purposes therein mentioned.

IN TESTIMONY WHEREOF I have heretofore set me hand and official seal the day and year last above 

written.

Notary Public

Printed Name: 

(Notarial Seal)

My commission expires: 
Exhibit A

4 

NATIONAL RURAL UTILITIES COOPERATIVE FINANCE 

CORPORATION

By: 

Name: 

Title: 

(seal)

Attest: 

Assistant Secretary-Treasurer

COMMONWEALTH OF VIRGINIA ) 

) SS

COUNTY OF LOUDOUN ) 

I, _________________________, a Notary Public in and for the Commonwealth of Virginia, County of Loudoun, do 

certify that __________________________________________, whose name is signed to the writing above, has 

acknowledged the same before me in my county aforesaid.

Given under my hand this ______ day of ________________, 20___. 

Notary Public

Printed Name: 

(Notarial Seal)

My commission expires: 
Exhibit A

5 

CoBANK, ACB

By: 

Name: 

Title: ________________________________

(seal)

Attest: 

Assistant Corporate Secretary

STATE OF COLORADO ) 

) SS

COUNTY OF ARAPAHOE ) 

The foregoing instrument was acknowledged before me this _________ day of __________________, 

20___, by __________________________ as Assistant Corporate Secretary of CoBank, ACB.

IN WITNESS WHEREOF I have heretofore set my hand and official seal the day and year last above written.

Notary Public

Printed Name: 

(Notarial Seal)

My commission expires: 
Exhibit B

1

EXHIBIT B

Partial Release for Use Where Capital Assets Secured Only by Deeds of Trust

(For use of were the lien of one or more deeds of trust is involved)

PARTIAL RELEASE, dated as of , made by the (hereinafter called 

the "Trustee"), as trustee, to (hereinafter called the "Corporation"). 

WHEREAS, the Corporation, to evidence loans made pursuant to the Rural 

Electrification Act of 1936, as amended, has executed certain mortgage notes (hereinafter 

collectively called the "Notes"), all payable to the order of United States of America (hereinafter 

called the "Government"),* and 

WHEREAS, the Corporation, to secure the Notes, has executed and delivered the 

following instruments to the Trustee (hereinafter collectively called the "Security Instruments"):

Instrument Date as of

(Here list all deeds of trust and supplemental indentures securing RUS loans); 

and 

WHEREAS, the indebtedness evidenced by the Notes is the only indebtedness as of the 

date hereof secured by the Security Instruments; and 

WHEREAS, the Corporation has requested that certain property hereinafter described be 

released from the liens of the Security Instruments;

NOW, THEREFORE, THESE PRESENTS WITNESSETH that, in consideration of the 

sum of one dollar in hand paid by the Corporation to the Trustee at the time of the delivery of 

these presents, the receipt whereof is hereby acknowledged, the Trustee does hereby release and 

discharge unto the Corporation, its successors and assigns, all right, title, interest, claim or 

demand whatsoever which the Trustee may have acquired by or through the Security 

Instruments, or any of them, in and to the following described property, and does hereby 

quitclaim said property unto the Corporation, its successors and assigns forever: 

(Add exact legal description of the property to be released.) 

TO HAVE AND TO HOLD said property unto the Corporation, its successors and 

assigns forever, free, clear, and discharged of and from any and all liens and claims of the 

Trustee under and by virtue of any or all of the Security Instruments. 
Exhibit B

2

THIS RELEASE is made by the Trustee, consented to by the Government,* and accepted 

by the Corporation on the express condition that it shall not in any way affect or impair the liens 

and security of the Security Instruments, or any of them, upon other premises and properties now 

subject thereto and not expressly released hereby. This release is made and accepted without 

covenant or warranty, express or implied, at law or in equity, and without recourse to the Trustee 

or the Government,* in any contingency. 

IN WITHNESS WHEREOF, the Trustee has executed this instrument, and the 

Government* as holder of all of the Notes, has (have) caused this instrument to be duly executed 

in token of its (their) consent to the execution thereof by the Trustee, all as of the day and year 

first above written.

by (Insert name of Trustee)

(Seal) (title) 

Attest: 

Remainder of Page Left Intentionally Blank (If Applicable)
Exhibit B

3

UNITED STATES OF AMERICA

By: 

Name: 

Title: ________________________________

DISTRICT OF COLUMBIA ) SS

On this ___ day of ______________, 20___, personally appeared before me ________________________, who, being 

duly sworn, did say that he/she is the ____(Insert Title)__________________________ of the Rural Utilities Service, 

an agency of the United States of America, and acknowledged to me that, acting under a delegation of authority duly 

given and evidenced by law and presently in effect, he/she executed said instrument as the act and deed of the United 

States of America for the uses and purposes therein mentioned.

IN TESTIMONY WHEREOF I have heretofore set me hand and official seal the day and year last above 

written.

Notary Public

Printed Name: 

(Notarial Seal)

My commission expires: 
Exhibit B

4

NATIONAL RURAL UTILITIES COOPERATIVE FINANCE 

CORPORATION

By: 

Name: 

Title: 

(seal)

Attest: 

Assistant Secretary-Treasurer

COMMONWEALTH OF VIRGINIA ) 

) SS

COUNTY OF LOUDOUN ) 

I, _________________________, a Notary Public in and for the Commonwealth of Virginia, County of Loudoun, do 

certify that __________________________________________, whose name is signed to the writing above, has 

acknowledged the same before me in my county aforesaid.

Given under my hand this ______ day of ________________, 20___. 

Notary Public

Printed Name: 

(Notarial Seal)

My commission expires: 
Exhibit B

5

CoBANK, ACB

By: 

Name: 

Title: ________________________________

(seal)

Attest: 

Assistant Corporate Secretary

STATE OF COLORADO ) 

) SS

COUNTY OF ARAPAHOE ) 

The foregoing instrument was acknowledged before me this _________ day of __________________, 

20___, by __________________________ as Assistant Corporate Secretary of CoBank, ACB.

IN WITNESS WHEREOF I have heretofore set my hand and official seal the day and year last above written.

Notary Public

Printed Name: 

(Notarial Seal)

My commission expires: 
Exhibit C

1

EXHIBIT C

Partial Release for Use Where Capital Assets Secured by Both Mortgages and Deeds of Trust

(For use where the lien of one or more mortgages and the lien of one or 

more deeds of trust are involved)

PARTIAL RELEASE, dated as of , made by the (hereinafter called 

the "Trustee"), as trustee, and the UNITED STATES OF AMERICA (hereinafter called the 

"Government)*, to (hereinafter called the "Corporation").

WHEREAS, the Corporation, to evidence loans made to the Corporation by the 

Government pursuant to the Rural Electrification Act of 1936, as amended, has executed certain 

mortgage notes (hereinafter collectively called the "Notes"), all payable to the order of the 

Government,* and 

WHEREAS, the Corporation, to secure the Notes, has executed and delivered the 

following instruments (hereinafter collectively called the "Security Instruments") to the Trustee 

or the Government,* as the cause may be:

Instrument Date as of 

(Here list all deeds of trust, supplemental indentures, mortgages, and 

supplemental mortgages securing RUS loans); 

and 

WHEREAS, the indebtedness evidenced by the Notes is the only indebtedness as of the 

date hereof secured by the Security Instruments; and 

WHEREAS, the Corporation has requested that certain property hereinafter described be 

released from the liens of the Security Instruments;

NOW, THEREFORE, THESE PRESENTS WITNESSETH that, in consideration of the 

sum of one dollar in hand paid by the Corporation to the Trustee, and the sum of one dollar in 

hand paid by the Corporation to the Government,* at the time of the delivery of these presents, 

the receipt whereof is hereby acknowledged by the Trustee and the Government,* the Trustee 

and Government* do hereby release and discharge unto the Corporation, its successors and 

assigns, all right, title, interest, claim or demand whatsoever which the Trustee and the 

Government,* or either (any) of them, may have acquired by or through the Security 

Instruments, or any of them, in and do the following described property, and do hereby quitclaim 

the property unto the Corporation, its successors and assigns forever:

(Add exact legal description of property to be released.) 

TO HAVE AND TO HOLD said property unto the Corporation, its successors and 

assigns forever, free, clear, and discharged of and from any and all liens and claims of the 

Trustee and the Government* under and by virtue of any of all of the Security Instruments. 
Exhibit C

2

THIS RELEASE is made by the Trustee, made and consented to by the Government,* 

and accepted by the Corporation on the express condition that it shall not in any way affect or 

impair the liens and security of the Security Instruments, or any of them, upon other premises 

and properties now subject thereto and not expressly released hereby. This release is made and 

accepted without covenant or warranty, express or implied, at law or in equity, and without 

recourse to the Trustee or the Government,* in any event or in any contingency. 

IN WITNESS WHEREOF, the Trustee has executed this instrument, and the 

Government* has (have) caused this instrument to be duly executed in its (their) own behalf and, 

as holder of all of the Notes, in token of its (their) consent to the execution thereof by the 

Trustee, all as of the day and year firs above written.

by(Insert Name of Trustee)_______ 

(title) ___________________ 

(Seal)

Attest: 

Remainder of Page Left Intentionally Blank (If Applicable)
Exhibit C

3

UNITED STATES OF AMERICA

By: 

Name: 

Title: ________________________________

DISTRICT OF COLUMBIA ) SS

On this ___ day of ______________, 20___, personally appeared before me ________________________, who, being 

duly sworn, did say that he/she is the ______(Insert Title)______________________of the Rural Utilities Service, an 

agency of the United States of America, and acknowledged to me that, acting under a delegation of authority duly given 

and evidenced by law and presently in effect, he/she executed said instrument as the act and deed of the United States 

of America for the uses and purposes therein mentioned.

IN TESTIMONY WHEREOF I have heretofore set me hand and official seal the day and year last above 

written.

Notary Public

Printed Name: 

(Notarial Seal)

My commission expires: 
Exhibit C

4

NATIONAL RURAL UTILITIES COOPERATIVE FINANCE 

CORPORATION

By: 

Name: 

Title: 

(seal)

Attest: 

Assistant Secretary-Treasurer

COMMONWEALTH OF VIRGINIA ) 

) SS

COUNTY OF LOUDOUN ) 

I, _________________________, a Notary Public in and for the Commonwealth of Virginia, County of Loudoun, do 

certify that __________________________________________, whose name is signed to the writing above, has 

acknowledged the same before me in my county aforesaid.

Given under my hand this ______ day of ________________, 20___. 

Notary Public

Printed Name: 

(Notarial Seal)

My commission expires: 
Exhibit C

5

CoBANK, ACB

By: 

Name: 

Title: ________________________________

(seal)

Attest: 

Assistant Corporate Secretary

STATE OF COLORADO ) 

) SS

COUNTY OF ARAPAHOE ) 

The foregoing instrument was acknowledged before me this _________ day of __________________, 

20___, by __________________________ as Assistant Corporate Secretary of CoBank, ACB.

IN WITNESS WHEREOF I have heretofore set my hand and official seal the day and year last above written.

Notary Public

Printed Name: 

(Notarial Seal)

My commission expires: 
Exhibit D 

1

EXHIBIT D

For Use Where Uniform Commercial Code Provision Applies

The following form of paragraph inserted just before the "In Witness Whereof" paragraph of the 

proper form of Partial Release, should be used where the Partial Release also covers personal 

property described in a filed financing statement. The Partial Release could then be used for 

required filing under the Uniform Commercial Code, as well as for recordation in real property 

records.

From the collateral described in the financing statement bearing File No. , 

filed in the office of , and the financing statement bearing File No.

 , filed in the office of , (1) the Government, the 

address of which is Rural Utilities Service, Washington, D.C. 20250, (2) as the Secured Parties 

in such financing statement release(s) the property described above. The Corporation is the 

Debtor, as shown in said financing statement, and its address is . 

(1) The pertinent filing office (such as the applicable county recording office and the office 

of the Secretary of State) and the respective filing numbers should be shown. 

(2) Where a deed of trust rather than a mortgage has been previously filed as a financing 

statement, the Trustee should be inserted as the Secured Party, and its address should appear in 

the place of the Government and other lenders and their addresses.
Exhibit 

E1

EXHIBIT E
Exhibit E 

2
Exhibit E 

3
Exhibit E 

4

(Print on Cooperative’s Letterhead)

This Transmittal Letter can be used in cases where RUS approval is NOT required. 

Modify text as needed to fit cooperative’s specific situation, secured lender(s) and Partial Release. 

Note this can be emailed to: RUSElectric@usda.gov and not mailed. 

Date

Deputy Assistant Administrator

Office of Portfolio Management & Risk Assessment

1400 Independence Ave, SW

Room 0270-S, Stop1568 

Washington, DC 20250-1568

Dear: 

In accordance with Bulletin 1717M-2, “Sale or Transfer of Capital Assets by Electric Borrower” (the Bulletin) the 

criteria outlined on page 5, section 4(a) has been reviewed, and it has been determined that RUS approval for this 

transaction is not required.

Therefore, the following information is being provided in accordance with page 6 section 4(b) of the Bulletin in lieu 

of completing an informational copy of RUS Form 369 “Request for Approval to Sell Capital Assets” in order to 

complete the process on the sale of ____________________ (insert address of property or assets being sold). 

• Purchaser is _________________ of (insert their name and address) ____________.

• Approximate original cost of the property or book value was $_____________.

• Selling price is $_____________.

• (Name of Cooperative) received fair market value for the property being sold.

• There was no distribution of funds related to this sale to any employees or board members.

• The net proceeds from this transaction in the amount of $_____________ have been deposited into the 

Construction Fund Trustee Account and will be used for RUS approved purposes. Please make the 

appropriate adjustments to our current loan budget records.

Please execute the enclosed Partial Releases of Lien related to this transaction. 

Include your applicable supplemental lenders here (CFC/CoBank or both): Once executed please forward to (insert 

applicable supplemental lender) for their consideration. We understand that CFC will forward counterparts of the 

Partial Release to CoBank and CoBank will forward to (Name of Cooperative) upon completion of the execution 

process.

Sincerely,

General Manager / CEO

Include Contact Information and e-mail Address

enclosures