696 
to the private capital of the applicant, as 
determined by the Secretary. 
‘‘(e) DEBENTURES.— 
‘‘(1) IN GENERAL.—The Secretary may guar-
antee the timely payment of principal and interest, 
as scheduled, on debentures issued by any rural 
business investment company. 
‘‘(2) TERMS AND CONDITIONS.—The Secretary 
may make guarantees under this subsection on such 
terms and conditions as the Secretary considers ap-
propriate, except that the term of any debenture 
guaranteed under this section shall not exceed 15 
years. 
‘‘(3) FULL FAITH AND CREDIT OF THE UNITED 
STATES.—Section 3901 shall apply to any guarantee 
under this subsection. 
‘‘(4) MAXIMUM GUARANTEE.—Under this sub-
section, the Secretary may— 
‘‘(A) guarantee the debentures issued by a 
rural business investment company only to the 
extent that the total face amount of out-
standing guaranteed debentures of the rural 
business investment company does not exceed 
the lesser of— 
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sroberts on DSK5SPTVN1PROD with BILLS
697 
‘‘(i) 300 percent of the private capital 
of the rural business investment company; 
or 
‘‘(ii) $105,000,000; and 
‘‘(B) provide for the use of discounted de-
bentures. 
‘‘(f) ISSUANCE AND GUARANTEE OF TRUST CERTIFI-
CATES.— 
‘‘(1) ISSUANCE.—The Secretary may issue trust 
certificates representing ownership of all or a frac-
tional part of debentures issued by a rural business 
investment company and guaranteed by the Sec-
retary under this section, if the certificates are 
based on and backed by a trust or pool approved by 
the Secretary and composed solely of guaranteed de-
bentures. 
‘‘(2) GUARANTEE.— 
‘‘(A) IN
GENERAL.—The Secretary may, 
under such terms and conditions as the Sec-
retary considers appropriate, guarantee the 
timely payment of the principal of and interest 
on trust certificates issued by the Secretary or 
agents of the Secretary for purposes of this 
subsection. 
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698 
‘‘(B) LIMITATION.—Each guarantee under 
this paragraph shall be limited to the extent of 
principal and interest on the guaranteed deben-
tures that compose the trust or pool. 
‘‘(C) PREPAYMENT OR DEFAULT.— 
‘‘(i) IN GENERAL.— 
‘‘(I) AUTHORITY TO PREPAY.—A 
debenture may be prepaid at any time 
without penalty. 
‘‘(II) 
REDUCTION
OF
GUAR-
ANTEE.—Subject to subclause (I), if a 
debenture in a trust or pool is pre-
paid, or in the event of default of such 
a debenture, the guarantee of timely 
payment of principal and interest on 
the trust certificates shall be reduced 
in proportion to the amount of prin-
cipal and interest the prepaid deben-
ture represents in the trust or pool. 
‘‘(ii) INTEREST.—Interest on prepaid 
or defaulted debentures shall accrue and be 
guaranteed by the Secretary only through 
the date of payment of the guarantee. 
‘‘(iii) REDEMPTION.—At any time 
during the term of a trust certificate, the 
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