La. Admin. Code tit. 7 § V-125

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

Section V-125 - Prohibitions

A. The market commission shall not approve any loan or loan guaranty for any applicant who fails to submit all required information.

B. The market commission shall not approve any loan or loan guaranty for any person, firm, corporation, partnership, or association which is not domiciled in Louisiana.

C. The market commission shall not approve any loan or loan guaranty if the amount so loaned shall result in the property offered as security thereunder having an indebtedness in excess of 75 percent of the appraised value of such property.

D. The market commission shall not approve any loan or loan guaranty for any person, firm, corporation, partnership, or association with any pending or outstanding charge or liability relating to failure or inability to pay promissory notes or other evidence of indebtedness.

E. The market commission shall not approve any loan or loan guaranty for any person, firm, partnership, corporation, or association, which has presently pending, at the federal, state, or local level, any proceeding concerning the denial or revocation of a necessary license or permit.

F. The market commission shall not approve any loan or loan guaranty when the security offered for the loan consists of livestock and/or commodities.

G. The market commission shall not approve any loan or loan guaranty the proceeds of which are to be, or may be, used for the consolidation of existing, previous financial obligations.

H. The market commission shall not approve any loan or combination of loans to a single person, firm, partnership, corporation or association which is in excess of 10 percent of the commission's total assets (net of loan guarantees).

I. The market commission shall not approve any loan or loan guaranty for any facility constructed or to be constructed on leased land except as follows.

1. The lease is for a term extending five years beyond the period of the loan.

2. The market commission receives an assignment on the lease and the right of re-assignment.

3. If the loan repayment schedule includes a balloon note, the market commission, at its discretion, may require a lease running for 20 years from the date of the approval of the loan.

4. A waiver of landlord's lien and privilege on movables must be provided.

J. The market commission shall not make any loan or loan guarantee on equipment unless the property on which it is located is secured by a first mortgage to the market commission. The market commission shall give a low priority on loans secured by a mortgage on specialized equipment.

K. The terms or conditions imposed and made part of any loan or guaranty agreement authorized by vote of the market commission shall not be amended or altered by any member of the commission or employee of the Department of Agriculture except by subsequent vote of approval by the market commission in open session with full explanation for such action.

L. The market commission shall not subordinate its interests if such subordination will result in any risk to its security position.

La. Admin. Code tit. 7, § V-125

Promulgated by the Department of Agriculture, Market Commission, LR 6:257 (June 1980).

AUTHORITY NOTE: Promulgated in accordance with R.S. 3:408 and R.S. 3:404.