1. (a) Form of agreement. An agreement evidencing a loan or other financial assistance may be in the form of a contract or similar document, or may be in the form of a bond, note, or other obligation issued by the applicant.
2. (b) Negotiation of terms. The executive director will negotiate the terms of agreements deemed necessary to comply with any requirements of preliminary approval, to protect the public's safety, and to prudently provide for the protection of public funds while furthering the purposes of this chapter. These agreements shall include, but not be limited to, terms provided for in this subchapter, as applicable to a particular project.
3. (c) Initial repayment date. Unless the commission defers the beginning of repayment, repayment of any financial assistance from the bank will begin on the earliest reasonable date consistent with applicable federal and state law, rules, and regulations. If approved by the commission, the initial repayment of financial assistance may be deferred to the date specified by the commission, which may not be later than the fifth anniversary of the date of the initial funding of the financial assistance. The term for repaying any financial assistance will not exceed 30 years after the date of the first scheduled payment.
4. (d) Payment dates. Interest shall be paid semiannually, on February 1 and August 1. Principal shall be paid annually on February 1. If a date for payment is not a business day the payment shall be made on the next following business day.
5. (e) Prepayments. Principal and interest may be prepaid without penalty on the first business day of any February or August as provided in, and after the date specified in, the financial assistance agreement.

6. (f) Terms for assistance from general obligation bond proceeds. Agreements for loans from general obligation bond proceeds also must require that the applicant will provide:

   1. (1) a certified copy of the resolution of the applicant, in the form specified by the executive director, authorizing execution of the financial assistance agreement and containing, if applicable, covenants relating to the status of the applicant's repayment obligation in relation to federal tax law;
   2. (2) any other certification of the applicant concerning federal tax law, federal securities law, and state law in relation to authorization of the financial assistance agreement as specified by the executive director;
   3. (3) if requested by the executive director, a bond counsel opinion from a recognized bond counsel in a form satisfactory to the executive director;
   4. (4) a certification that the applicant will, if requested by the executive director, cooperate with the department and make all reasonable efforts requested by the department for obtaining the approval of the financial assistance agreement by the Public Finance Division of the Office of the Attorney General of the State of Texas.
7. (g) Assurances. The department will provide in a financial assistance agreement assurances that are reasonably and customarily required by the applicant and that are necessary for obtaining financing for, developing, or operating a particular project, if, in the department's reasonable judgment, the assurances are consistent with the agreement.

Source Note:The provisions of this §6.41 adopted to be effective January 8, 1998, 23 TexReg 151; amended to be effective October 21, 2010, 35 TexReg 9361.