LAC 4:XXV.107. Loan Conditions and Repayment

A. Each loan shall be evidenced by a loan agreement on a form prescribed and approved by the division. The loan agreement shall include: 1. the term of the loan which shall not exceed the term of that current charter agreement; 2. the repayment schedule of the loan which shall be repaid through monthly principal and interest payments directly to the fund administrator. The division shall credit any payments received to the fund for additional lending under this Chapter; 3. the interest rate and amortization of the loan which shall be established by the division at the time of approval and shall be an interest rate that is at least one hundred basis points less than the US Prime Rate, as published in the 'Money Rates' section of The Wall Street Journal; and 4. financial reporting requirements which shall include quarterly financial statements and the supplemental reporting schedule as mandated in R.S. 24:514(I)(2) as part of its annual financial reporting to the legislative auditor pursuant to R.S. 24:513 et seq. B. In the event of default, the division may enforce escalation and repayment subject to the terms of the loan and intercreditor agreement, as applicable. C. If the charter agreement of an eligible charter school is revoked or the eligible charter school ceases to operate prior to repayment of the loan, all cash assets, equipment, property, facilities, or other physical assets purchased or constructed exclusively with loan funds shall be transferred to the division. D. In the event a loan made to an eligible charter school whose charter agreement is revoked or who ceases to operate prior to repayment of the loan is a subordinate loan, the division will recapture assets acquired by loan proceeds according to the intercreditor agreement between the division and senior lender. E. In the event a loan made to an eligible charter school whose charter agreement is not renewed by its Authorizer or who announces plans to cease operations prior to full repayment of the loan is an unsecured loan, the division may direct the department of education to withhold future minimum foundation payments to repay the loan. F. The division may by suit, action, mandamus, or other proceedings, protect and enforce any covenant relating to and the security provided in connection with any indebtedness issued pursuant to R.S. 39:1357, and may by suit, action, mandamus, or other proceedings enforce and compel performance of all of the duties required to be performed by the governing body or officials of any political subdivision hereunder and in any proceedings authorizing the issuance of the loan agreement.