42 U.S.C. § 292x — Distribution of assets from loan funds

(a) Distribution after termination of fund: If a school ends its loan fund set up under section 292q(b), or if the Secretary ends the agreement with the school for good cause, the money left in the fund is split in two steps: (1) The Secretary is paid first. The Secretary's share is figured as a ratio: the total Federal capital contributions ever made to the fund under section 292q(b)(2)(A), divided by the fund's total money from both those Federal contributions and the deposits made under section 292q(b)(2)(B). That ratio is applied to the fund's balance on the date the fund ends. (2) Whatever is left of that balance after the Secretary is paid goes to the school. (b) Payment of proportionate share to Secretary: After that one-time split, the school must keep paying the Secretary — at least once every three months — the same proportional share (as figured in (a)) of any future principal and interest payments it receives on loans from the fund set up under section 292q(b).