La. Admin. Code tit. 7 § III-135

Current through Register Vol. 50, No. 11, November 20, 2024

Section III-135 - Procedure Required for Funding Agricultural Loans with Proceeds of the Bonds

A. Initiation of Eligible Loan Purchase. A lender may submit to the issuer, the trustee and the co-trustee a proposal to sell agricultural loans in substantially the form attached as Exhibit B hereto. Such form shall include a description of the rates, fees and terms of the loans made by the lender to the borrower and a description of the project financed, including its location and characteristics The lender shall also describe the security for the loan. Upon receipt of a proposal to sell agricultural loans, the issuer, the trustee and the co-trustee, on behalf of the issuer, shall review such proposal. If the issuer determines that the loans to be purchased are agricultural loans and that the loans to be purchased are eligible loans meeting the requirements of the Act, the issuer shall be empowered to send a conditional approval, in substantially the form attached as Exhibit C hereto, to the lender. The form of agreement shall be enclosed with the conditional approval.

B. Initiation of Repurchase Obligation. A national bank may submit to the issuer, the trustee and the co-trustee a proposal to enter into repurchase obligation in substantially the form attached as Exhibit D hereto. Such form shall include a description of the rates, fees, and terms of the loans to be made by the national bank to the borrower and a description of the project financed, including its location and characteristics. The national bank shall also describe the security for the loan. Upon receipt of a proposal to enter into repurchase obligation, the issuer, the trustee and the co-trustee, on behalf of the issuer, shall review such proposal. If the issuer determines that the loans to be made by the national bank are agricultural loans and determines that the loans to be made by the national bank are eligible loans meeting the requirements of the Act, the issuer shall be empowered to send a conditional approval, in substantially the form attached as Exhibit E hereto, to the national bank. The form of the repurchase obligation shall be enclosed with the conditional approval.

C. Procedure to Purchase Eligible Loan. Upon execution of the agricultural loan purchase agreement by the lender, the lender shall return and the trustee, on behalf of the issuer, shall receive the agreement, which must be signed by the lender within 14 days of postmark date of the conditional approval. The issuer shall then sign the agreement and notify the trustee. The trustee shall establish a loan closing date. The trustee shall, by date telephonic notice, inform the issuer and the lender of such date. Such date is referred to herein as the "Loan Purchase Date". On the loan purchase date, and upon completion of the program checklist by the trustee, which shall be forwarded to the issuer and Standard and Poor's Corporation, the issuer shall direct the trustee to disburse moneys from the loan fund for loan purchase.

D. Procedure to Enter into Repurchase Obligation. Upon execution of the repurchase obligation by the national bank, the national bank shall return and the trustee, on behalf of the issuer, shall receive the repurchase obligation which must be signed by the national bank with 14 days of postmark date of the conditional approval. The issuer shall then sign the repurchase obligation and notify trustee. The trustee shall establish a loan closing date. The trustee shall, by telephonic notice, inform the issuer and the national bank of such purchase date, and upon completion of the program checklist by the trustee, which shall be forwarded to the issuer and Standard and Poor's Corporation, the issuer shall direct the trustee to disburse moneys from the loan fund for the purpose of making a loan to the national bank.

La. Admin. Code tit. 7, § III-135

Promulgated by the Department of Agriculture and Forestry, Agricultural Finance Authority, LR 17:166 (February 1991).

AUTHORITY NOTE: Promulgated in accordance with R.S. 3:266(4).