1. (a) If the state requires the loan of any part or all of the fund, the state is a preferred borrower of as much of the fund as is not loaned at the time.

2. (b) The treasurer of state shall cause to be executed, as evidence of a loan under this section, a nonnegotiable bond of the state for the amount borrowed, in the following manner:

   1. (1) The bond must be signed by the governor and treasurer of state and attested by the secretary of state and the seal of the state.
   2. (2) The bond must be made payable in fifty (50) years after the date of execution, at the option of the state.
   3. (3) The bond shall bear five percent (5%) interest from the date of execution until paid.

   4. (4) The interest on the bond must be:

      1. (A) paid semiannually on May 1 and November 1 of each year;
      2. (B) applied to the current and extraordinary expenses of Indiana University; and

      3. (C) paid to the board of trustees under the same rules and regulations as is required by law in the payment of the revenues of Indiana University.

         The nonnegotiable bond provided for in this section, when executed, must remain in the custody of the treasurer of state.

3. (c) If Indiana University is consolidated with any other educational institution or institutions of the state, or is removed from the location of the university as of June 5, 1883, for any cause, the funds raised under this chapter shall be held and used for the benefit of the institution, as consolidated or changed, notwithstanding the change or consolidation.

   [Pre-2007 Higher Education Recodification Citation: 21-7-3-6.]

As added by P.L.2-2007, SEC.244.