Contractual agreement of recipients; penalties for breach.

(a) Each recipient of a scholarship loan under the provisions of this article shall enter into a contract with the Board of Dental Scholarship Awards whereby he or she agrees to repay the scholarship loan in a manner prescribed by the board not inconsistent with any provision of this article. Breach of contract by the recipient shall make him or her immediately liable for the unpaid balance of the loan and shall constitute a ground for the revocation of his or her certificate or license to practice dentistry in the State of Alabama. In the event of death or total and permanent disability of the recipient to engage in the practice of dentistry, repayment of the loan may be excused by the board. The Attorney General of Alabama, upon request of the Board of Dental Scholarship Awards, shall institute proceedings in the name of the state for the purpose of recovering any amount due the state under the provisions of this article. The proceedings to have such dentist's certificate or license revoked shall be commenced upon the written complaint of the Board of Dental Scholarship Awards to the State Board of Dental Examiners. The proceedings shall be in accordance with the provisions of Alabama law pertaining to the revocation of licenses to practice dentistry. Notwithstanding any other provision of this section, applicants and participants in the Alabama Dental Service Program shall repay loans as called for in written contracts outlined in subsection 16-47-79 (d).

(b) In addition to penalties for breach of contract outlined above in this section, participants in the program shall pay an additional penalty for breach of contract as specified:

(1) For breach of contract under which a year's worth of loans has been received, a penalty equal to 20 percent of the total principal amount of the loan.

(2) For breach of contract under which two years' worth of loans have been received, a penalty equal to 30 percent of the total principal amount of the loan.

(3) For breach of contract under which three years' worth of loans have been received, a penalty equal to 40 percent of the total principal amount of the loan.

(4) For breach of contract under which four years' worth of loans have been received, a penalty equal to 50 percent of the total principal amount of the loan.

(5) If breach of contract occurs after graduation from dental school but prior to completion of the repayment obligation set forth in Section 16-47-79 (d), a penalty equal to 100 percent of the total principal amount of all loans received by the participant from the program.

(Acts 1977, No. 662, p. 1121, §6; Act 2016-261, §1.)