[Code of Federal Regulations]
[Title 7, Volume 11]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1703.68]

[Page 57-58]
 
                          TITLE 7--AGRICULTURE
 
    CHAPTER XVII--RURAL UTILITIES SERVICE, DEPARTMENT OF AGRICULTURE
 
PART 1703--RURAL DEVELOPMENT--Table of Contents
 
      Subpart B--Rural Economic Development Loan and Grant Program
 
Sec. 1703.68  Loan and grant termination provisions.

    (a) Termination for cause. The Administrator may terminate any loan 
and/or grant in whole, or in part, at any time before the date of 
completion of loan and/or grant disbursement, whenever the Borrower has 
failed to comply with the conditions of the loan and/or grant. The 
Administrator will promptly notify the Borrower in writing of the 
determination and the reasons for the termination, together with the 
effective date. The termination date will be no less than 30 days 
following receipt of the termination notice. The Borrower will have such 
time to cure the default, or to state why it feels the loan and/or grant 
should not be terminated. The Administrator will stay the termination 
upon the curing of the default, and may delay termination if, sufficient 
cause has been given by the Borrower.
    (b) Termination for convenience. The Administrator or the Borrower 
may terminate a loan and/or grant in whole, or in part, when both 
parties agree that the continuation of the project would not produce 
beneficial results commensurate with further expenditure of funds. The 
two parties will agree upon termination conditions, including the 
effective date, and in the case of partial terminations, the portion to 
be terminated. The Borrower will not incur new obligations for the 
terminated portion after the effective date, and will cancel as many 
outstanding

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obligations as possible. The Administrator will allow full credit to the 
Borrower for the Federal share of unfulfilled contractual obligations 
which were incurred in good faith by the Borrower prior to grant 
termination.

[59 FR 11712, Mar. 14, 1994]