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DCCUIMENT ESUIIE
01922 - [A1172175]
Implementation of Emergency Loan Guarantee act. PSAD-77-101;
B-169300. April 25, 1977. 17 pp.
Report to the Congress; by !Elmer B. Staats, Comptrc.ller General.
Issue Area: Accounting and Fiaancial Rp3rting '2800).
Contact: Procurement and Systems Acqt, ition Div.
Budget Function: National Defense: Depactment of Defense -
Procurement & Contracts (058); General Government: Central
Fiscal Operationo (803).
Organizaticn Concerned: Lockheed Corp.; Department of the
Treasu.y; Departsent of Defense.
congressional Relevance: House Committee on Banking, Finance and
Urban Affairs; Scnate Committee on Banking, iOusing and
Urban Affairs; Ccngress.
Authority: Emergency Loan Guarantee Act of 1971 (15 U.S.C.
1846(b) (Supp. I)) .
Lockheed Ccrporation is the only hclder of a guaranteed
loan and has $80 million outstanding. The Government's
commitment terminates at yearend unless ter-inated earlier by
the lending banks' icluntary release, but the commitment can
also be extended. Lirdings/Conclusions: Lockheed plans to have
the guaranteed loan terminated at yearend and then switch to a
normal revolving line of bank credit. Corporate assets, totaling
$178.7 zillion in 1975, were pledged as security for the
guaranteed loans, and the lending kanks have agreed to
subordinate their irterest to those of the Government. The
emergency loan guarantee fund, used to pay expenses and fulfill
board obligaticns, had accrued up to $6,607,152 in September
1976. Lockheed and its lending banks consummated a financial
restructuring program to improve its equity position and extend
the period of nonguaranteed bank loans. Lockheed's management
policy, established in Octcber 1975, to institute more effective
controls over foreign payrent practices, offers reasnable
assurances against compaiy payments t. foreign officiils but
cannot control all external factors. (SS)](ViewImageLocal?handle=hein.gao/gaobaacdq0001&div=1&collection=&method=preview&ext=.png&size=3)