 | Board of Visitors minutes June 7, 1957 |  |
CLINCH VALLEY COLLEGE LOAN
The President laid before the Board resolutions prepared by Mr. C. Venable
Minor, Special Counsel to the University, for use in the procurement of a loan for
the erection of faculty housing units at Clinch Valley College. It was the
consensus of opinion on the Board that the resolutions should be adopted and the
Governor's approval sought, and that the President should then use at his own
discretion the authority thus obtained
The Board accordingly adopted, on motion of Mr. Hartfield, duly seconded, the
following resolution
WHEREAS, the application of The Rector and Visitors of the University of
Virginia to the Federal Housing and Home Finance Agency of the United States for
loan assistance under Title IV of the Housing Act of 1950, in the amount of
$150,000.00 has been approved by that Agency, said loan to be used for the erection
at Clinch Valley College of the University of Virginia, of ten faculty housing
units, consisting of one apartment house of four units and six single family homes
at Wise, Virginia, designated as Project Va. 44-CH-9(D), and,
WHEREAS, it will be necessary for The Rector and Visitors of the University of
Virginia to issue its bond or bonds evidencing said indebtedness of $150,000.00,
and,
WHEREAS, under the provisions of Section 23-19 of the Code of Virginia, 1950,
this institution has power and is authorized and empowered, by resolution of this
Board, approved by the Governor of the Commonwealth of Virginia, to issue its bonds
evidencing said indebtedness of $150,000.00 for the purposes hereinabove set forth,
said bonds bearing such date or dates, maturing at such time or times, bearing
interest at such rate or rates not exceeding three per centum per annum, payable at
such time or times, being in such denominations, being in such form, either coupon
or registered, carrying such registration privileges, executed in such manner,
payable in such medium of payment, at such place or places, subject to such terms of
redemption, with or without premium, and containing such additional provisions, as
such resolution or resolutions may provide, and are authorized under the provisions
of said Section 23-19 of said Code of Virginia, and,
WHEREAS, a Loan Agreement, dated as of April 1, 1957 by and between The Rector
and Visitors of the University of Virginia, and the United States of America,
acting by and through the Housing and Home Finance Administrator, describing in
detail the bonds to be issued, the amount, purchase price and purpose, their method
of sale, a description of the project for which they are to be issued, audit and
inspection expenses, and special conditions of issuance, has been submitted to this
Board for approval, and,
WHEREAS, this Board has given careful consideration of said Loan Agreement,
and, after full discussion thereof, has reached the conclusion that execution of
said Loan Agreement on behalf of The Rector and Visitors of the University of
Virginia should be approved and authorized and that the issue of bonds evidencing
said indebtedness of $150,000.00 for the purposes hereinabove set forth, under the
terms and conditions set forth in said Loan Agreement should be approved and
authorized by this Board,
NOW THEREFORE, BE IT RESOLVED by the Board of Visitors of The Rector
and Visitors of the University of Virginia
(1) That said Loan Agreement dated as of April 1, 1957, by and
between The Rector and Visitors of the University of Virginia, and the
United States of America, acting by and through the Housing and Home
Finance Administrator, in the form presented to this meeting, be and the
same is hereby approved, and the Honorable Colgate W. Darden, Jr.,
President, be and he hereby is, authorized and empowered to execute said
Loan Agreement in three counterparts in the name and on behalf of The
Rector and Visitors of the University of Virginia, and Francis L.
Berkeley, Jr., Secretary, be and he hereby is authorized and directed to
affix thereto the seal of the corporation and to attest the same,
(2) That the bonds which The Rector and Visitors of the University
of Virginia (hereinafter sometimes referred to as the "University"),
agrees to issue and to sell under the terms of said Loan Agreement shall
be as follows
(a) Designation Clinch Valley College Faculty Housing Bonds of 1957.
(b) Date November 1, 1957.
(c) Principal Amount $150,000, being all of an authorized issue of
such bonds.
(d) Denomination $1,000, however, until such time as the purchaser or
purchasers of the bonds request(s) the preparation of
the definitive bonds, a single bond or bonds shall be
issued in an amount equal to the bonds contracted for
by said purchaser or purchasers
(e) Type Negotiable, serial, coupon bond, payable to bearer.
(f) Interest Rate 2-7/8% per annum, payable semi-annually on May 1 and
November 1 in each year, first interest payable May 1,
1958
(g) Maturities November 1, in years and amounts as follows
| Year | Amount | Year | Amount |
| 1959-64 | $2,000 | 1986-91 | $5,000 |
| 1965-76 | 3,000 | 1992-97 | 6,000 |
| 1977-85 | 4,000 |
(h) Numbers 1 to 150 inclusive, in order of maturity
(i) Security Special obligations of The Rector and Visitors of the
University of Virginia, secured by and payable only
from (1) a first lien on and pledge of the net
revenues of the Project, as hereafter defined, and (2)
a first lien on and pledge of the income and principal
of a $15,000 Debt Service Reserve, as hereinafter
described, consisting of direct obligations of the
United States of America or negotiable securities
listed on the New York Stock Exchange, with market
value to be maintained at the lesser of $15,000 or the
unpaid principal of the loan.
(j) Place and Medium of Payment Payable as to both principal and
interest at the principal office of the Treasurer of
the Commonwealth of Virginia, Richmond, Virginia, or,
at the option of the holder, at a bank or trust
company in the Borough of Manhattan, City and State of
New York, in any coin or currency which, on the
respective dates of payment of such principal and
interest, is legal tender for payment of debts due the
United States of America.
(k) Registerability Registerable, at the option of the holder, as to
principal only.
(l) Redemption Provisions Bond numbered 1 through 21 inclusive,
maturing November 1, 1959, through November 1, 1967
inclusive, to be non-callable. Bonds numbered 22
through 120 inclusive, maturing November 1, 1968
through November 1, 1992 inclusive, to be callable at
the option of the University prior to the stated
maturities thereof, in whole or in part and in inverse
numerical order on any interest payment date after
November 1, 1967 upon at least thirty (30) days' prior
notice, at the principal amount thereof, plus accrued
interest to the date of redemption and a premium for
each bond as follows
| 3% | if redemmed May 1, 1968 through November 1, 1972 inclusive |
| 2 1/2% | if redemmed May 1, 1973 through November 1, 1977 inclusive |
| 2% | if redemmed May 1, 1978 through November 1, 1982 inclusive |
| 1 1/2% | if redemmed May 1, 1983 through November 1, 1987 inclusive |
| 1% | if redemmed after November 1, 1987 |
Bonds 121 through 150 inclusive, maturing November 1, 1993 through
November 1, 1997 inclusive, to be callable at the option of the
University in whole or in part and in inverse numerical order on any
interest payment date during the entire life of the loan, upon at least
thirty (30) days' prior notice, at par plus accrued interest to the date
of redemption
Priority as to call shall extend to bonds numbered 121 through 150
inclusive over bonds numbered 22 through 120 inclusive.
(3) That all said bonds shall be issued and sold through the Treasury
Board which is hereby designated the issuing, sales and paying agent of
the University. The bonds are to be sold at public sale, the call for
bids specifying that bids will be received and considered on the
following basis
(a) For (1) all maturities in the years 1959 through 1973, (2)
all maturities in the years 1974 through 1988, (3) all
maturities in the years 1989 through 1997, and (4) the entire
issue
(b) The University, at the option of the purchaser or purchasers,
shall issue single bonds with face values in the amount of the respective
purchases in lieu of individual bonds. Such single bonds shall be nonnegotiable,
registered as to principal and interest and payable as
directed by the purchaser or purchasers, but otherwise complying with the
description set forth in Paragraph (2) hereof. The University covenants
that if such single bond is issued, it shall, upon request of the holder
of a single bond, issue at its own expense and within 90 days from the
date of such request, negotiable bearer coupon bonds in denominations of
$1,000.00, as described in Paragraph (2) hereof, in aggregate amount
equal to that amount of the single bond still outstanding,
(4) That the Project for the erection of which said bonds aggregating
$150,000.00 are to be issued shall consist of six single family dwellings
and a four unit apartment building, each with necessary appurtenant
facilities, to house ten faculty families at Wise, Virginia, said project
being designated as Project No. Va. 44-CH-9(D),
(5) That the University covenants and agrees as follows
(a) As soon as any portion of the Project becomes revenue-producing,
all rentals, charges, income and revenue arising from the
operation or ownership of the Project shall be deposited monthly to the
credit of a special fund with the Treasurer of the Commonwealth of
Virginia (State Treasurer), to be known as the "Project Revenue Fund
Account" (herein called the "Revenue Fund") and held separate and apart
from all other funds. The Revenue Fund shall be maintained, so long as
any of the bonds are outstanding, and shall be expended and used only in
the manner and order specified in (b), (c), (e) and (f) below
(b) Current expenses of the Project, as herein defined, shall be
payable as a first charge from the Revenue Fund as the same become due
and payable. "Current Expenses of the Project" (herein called "Current
Expenses") shall include only the reasonable and necessary operating
expenses, current maintenance charges, reasonable expenses of upkeep,
repairs and replacements, a properly allocated share of charges for
insurance and all other direct expenses incident to the operation of the
Project including water for all Project buildings and heat for the
apartment building only, but shall exclude electricity, depreciation, all
general administrative expenses of the University and any payments into
the "Reserve for Major Repairs" hereinafter provided.
(c) The University shall establish with the State Treasurer as a
trust fund for the benefit of the Bondholders, and maintain so long as
any of the bonds are outstanding, a separate account or accounts (known
collectively as the "Bond and Interest Sinking Fund Account" and herein
called the "Bond Fund") into which shall be deposited all accrued
interest received from the sale of the bonds. Thereafter, as soon as
any portion of the project becomes revenue-producing, and after providing
for the payment of Current Expenses, the University shall transfer from
the Revenue Fund, and from the Debt Service Reserve if needed, and
deposit to the credit of the Bond Fund on or before each April 15 and
October 15, such sums as may be necessary to meet one-half of the debt
service on the outstanding bonds for the then current year
(d) The University shall, prior to the release to it of any loan
funds, establish with the State Treasurer as a trust fund a separate "Debt
Service Reserve Fund Account" (herein called the "Debt Service Reserve")
into which shall be deposited at least $15,000.00 market value of
marketable direct obligations of the United States of America, or
negotiable securities listed on the New York Stock Exchange. The income
from such securities and, if necessary, the proceeds of sale of all or
part of such securities shall be deposited in the Bond Fund to the extent
that on any April or October 15 the amounts deposited therein from the
Revenue Fund may be insufficient to meet the current semi-annual debt
service on the outstanding bonds. Should the Debt Service Reserve become
impaired by shrinkage in market value or by withdrawals to meet debt
service, and not be made whole before the next June 30th from other
available funds of the University, the rentals charged for use of the
Project for the next college year shall be increased by amounts
sufficient to make up the impairment by the next following June 30th
and to preclude further impairment. The funds in Debt Service Reserve
shall be continuously invested as nearly as practicable and the
University may direct substitution therein or may withdraw securities
therefrom so long as the market value of the remaining securities in the
judgment of the State Treasurer is at least equal to the lesser of
$15,000 or the principal amount of the bonds then outstanding.
(e) The University shall establish with the State Treasurer as a
trust fund a separate account called the Building Maintenance and
Equipment Reserve Account (herein called the "Repairs Reserve") into
which shall be deposited on or before the close of each fiscal year the
entire balance in the Revenue Fund until the funds and investments in the
Repairs Reserve shall aggregate $3,000. All monies in the Repairs
Reserve may be drawn on and used by the University for the purpose of
paying the cost of unusual or extraordinary renovation or replacement of
the Project fixed equipment, kitchen ranges and refrigerators, and
buildings, including maintenance, repairs, renewals and replacements not
paid as part of the Current Expenses, and any such withdrawals shall be
made up as soon as possible. However, in the event that the funds in the
Bond Fund and the Debt Service Reserve should be reduced below the amount
required to meet the then current semi-annual debt service on the
outstanding bonds and the $15,000 Debt Service Reserve, funds on deposit
in the Repairs Reserve shall be transferred to the Bond Fund to the
extent required to eliminate the deficiency in that account.
(f) As soon as the required $3,000 has been accumulated in the
Repairs Reserve, the University shall establish with the State Treasurer
as a trust fund a separate Bond Redemption Fund Account (herein called
the "Redemption Fund") into which shall be deposited any balance remaining
in the Revenue Fund at the close of each fiscal year. Whenever the
accumulated funds in the Redemption Fund are equal to $1,000 or more plus
accrued interest and redemption premiums, if any, on bonds subject to
redemption, such fund shall be used to redeem bonds in their inverse
numerical order. When the funds and investments in the Bond Fund, the
Debt Service Reserve, the Repairs Reserve and the Redemption Fund are
together sufficient to redeem all of the outstanding redeemable bonds,
such funds and investments shall be applied to redeem all such bonds.
(6) That the bonds to be issued shall be payable only from the revenues
and receipts derived directly or indirectly from said project for the
erection of which the bonds are to be issued. Such bonds shall in no
event constitute an indebtedness of the University, excepting to the
extent of the collection of such revenues and receipts and the University
shall not be liable to pay such bonds or interest thereon from any other
funds, except said "Debt Service Reserve"; no contract entered into by
the University pursuant to this resolution shall be construed to require
the costs or expenses of operation and maintenance of said Project for
the erection of which said bonds are to be issued to be paid out of any
funds other than the revenues and receipts derived directly or indirectly
from said Project,
(7) That neither the Governor of the Commonwealth of Virginia, nor the
members of this Board, nor any person executing such bonds shall be
liable personally on said bonds or be subject to any personal liability
or accountability by reason of the issuance thereof,
(8) That the University shall have power out of funds available therefor
to purchase any bonds issued by it at a price not more than the principal
amount thereof and the accrued interest. All bonds so purchased shall be
cancelled unless purchased as an endowment fund investment. This
paragraph shall not apply, however, to the redemption of bonds,
(9) These resolutions shall not be effective unless and until they and
the issuance of said bonds for the erection of said Project are approved
by the Governor of the Commonwealth of Virginia.
| Board of Visitors minutes June 7, 1957 | |