University of Virginia Library

MARY WISHINGTON COLLEGE MATTERS

RESOLUTION AUTHORIZING DORMITORY REVENUE BONDS

Mr. Camp made a motion, seconded by Mrs. Lantor, that the following resolution be adopted:

WHEREAS, by Article 4, Chapter 9, Title 23, Code of Virginia, 1950, as amended, the Rector
and Visitors of the University of Virginia (hereinafter sometimes called the "Board"), is vested
with the supervision, management and control of Mary Washington College of the University of
Virginia at Fredericksburg, Virginia, and

WHEREAS, by Chapter 3, Title 23, Code of Virginia, 1950, as amended (hereinafter sometimes
called the "Act"), Mary Washington College of the University of Virginia at Fredericksburg,
Virginia (hereinafter sometimes called the "Institution"), is classified as an educational institution,
is declared to be a public body and is constituted a governmental instrumentality for
the dissemination of education, and

WHEREAS, by virtue of the Act the Board, with the consent and approval of the Governor
of the State of Virginia, is authorized and empowered.

• (a) to build, construct, reconstruct, erect, extend, better, equip and
  improve any building, facility, addition, extension or improvement of a
  capital nature required by or convenient for the purpose of an educational
  institution, including, without limitation, administration, teaching, lecture
  and exhibition halls, libraries, dormitories, student apartments, faculty
  dwellings, dining halls, cafeterias, snack bars, laundries, hospitals, laboratories,
  research centers, infirmaries, field houses, gymnasiums, auditoriums,
  student unions, recreation centers, stadiums, athletic facilities, garages,
  parking facilities, warehouses and storage buildings, book and student
  supplies centers and all buildings, lands and any other appurtenances and
  equipment necessary or desirable in connection therewith or incidental thereto,

• (b) to borrow money and make, issue and sell bonds of the Institution for
  any of such purposes, such bonds to be issued and sold through the Treasury
  Board of the State of Virginia (hereinafter sometimes called the "Treasury
  Board") and to be payable solely from any one or more of the revenue sources
  provided therefor in the Act and pledged for their payment, and

• (c) to fix and revise from time to time and to charge and collect:

  • (i) fees, rents and charges for or in connection with
    the use, occupation or services of each project for which
    bonds are issued and increases in fees, rents and charges from
    any existing facilities at the Institution,

  • (ii) fees, rents and charges for or in connection with the
    use, occupation or services of any existing facilities at the
    Institution, and

  • (iii) student building fees and other student fees from
    students enrolled at the Institution,

and to pledge the same to the payment of the principal of and the interest on
such bonds, and

WHEREAS, in order to alleviate the shortage of housing facilities at the Institution, the
Board has heretofore determined to construct and equip two new dormitories (said two new dormitories
being hereinafter sometimes collectively called the "Project"); and

WHEREAS, by Chapter 640 of the Acts of Virginia of 1962 and Chapter 658 of the Acts of
Virginia of 1964, there has been appropriated and reappropriated by the General Assembly Two
Hundred Ninety-five Thousand Dollars ($295,000) to pay a part of the cost of the Project, and

WHEREAS, the Board has proceeded with all practicable dispatch with the construction and
equipment of the Project from the appropriated and reappropriated funds, and

WHEREAS, the Board has estimated that one of the two new dormitories will be completed
and placed in operation by September, 1965, and the other will be completed and placed in
operation by February, 1967, and

WHEREAS, for the purpose of paying the remaining part of the cost of the Project, the
Board has determined to issue dormitory revenue bonds of the Institution in the aggregate
principal amount of One Million Three Hundred Thirty-five Thousand Dollars ($1,335,000), the
proceeds of such amount of bonds, together with the appropriation and reappropriation referred
to above, being required and being estimated to be sufficient to pay the cost of the Project,
now, therefore,

BE IT RESOLVED by the Rector and Visitors of the University of Virginia.

ARTICLE I

Definitions

Section 101. In addition to words and terms elsewhere defined in this resolution, the
following words and terms as used in this resolution shall have the following meanings, unless
some other meaning is plainly intended:

Section 102. Words of the masculine gender shall be deemed and construed to include
correlative words of the feminine and neuter genders. Unless the context shall otherwise indicate,
the words "bond", "coupon", "owner", "holder", and "person" shall include the plural as well as the
singular number, the word "person" shall include corporations and associations, including public
bodies, as well as natural persons, and the word "holder" or "bondholder" when used herein with
respect to bonds issued hereunder shall mean the holder of bonds at the time issued and outstanding
hereunder.

ARTICLE II.

Authorization, Form, Execution and Delivery of Bonds

Section 201. For the purpose of paying the remaining part of the cost of the Project, there
shall be issued dormitory revenue bonds of the Institution in the aggregate principal amount of
One Million Three Hundred Thirty-five Thousand Dollars ($1,335,000). The bonds shall be designated
"Mary Washington College of the University of Virginia Dormitory Revenue Bonds (Series 1965)",
shall consist of 267 bonds of the denomination of $5,000 each, numbered 1 to 267, inclusive, shall
be dated as of the 1st day of May, 1965, shall be stated to mature (without right of prior redemption),
in numerical order, lowest numbers first, on the 1st day of May in the following years and in the
following amounts, respectively:

                                         

Year of Maturity	Principal Amount
1966	$ 5,000
1967	45,000
1968	55,000
1969	55,000
1970	60,000
1971	60,000
1972	65,000
1973	65,000
1974	70,000
1975	70,000
1976	$ 75,000
1977	75,000
1978	80,000
1979	80,000
1980	85,000
1981	85,000
1982	90,000
1983	95,000
1984	95,000
1985	25,000

and shall bear interest from their date until their payment at a rate or rates not exceeding six per
centum (6%) per annum, as shall hereafter be determined by the Board and by the Treasury Board, such
interest to the respective maturities of the bonds being payable semi-annually on the 1st days of
May and November in each year. Both the principal of and the interest on the bonds shall be payable
at the office of the State Treasurer in the City of Richmond, Virginia, in any coin or currency of
the United States of America which, on the respective dates of payment thereof, is legal tender for
the payment of public and private debts.

Section 202. The bonds shall bear the facsimile signature of the Rector of the University
of Virginia and shall be signed by the Bursar of the Institution, and the official seal of The Rector
and Visitors of the University of Virginia shall be impressed on the bonds. The interest coupons to
be attached thereto shall be executed with the facsimile signature of the Rector of the University
of Virginia. The bonds and coupons shall be, respectively, in substantially the following forms:

(Form of Bonds)

 

No.

$ 5,000

United States of America
State of Virginia

MARY WASHINGTON COLLEGE OF THE UNIVERSITY OF VIRGINIA
DORMITORY REVENUE BOND (SERIES 1965)

Mary Washington College of the University of Virginia, the educational institution at Fredericksburg,
Virginia, for value received, hereby promises to pay, solely from the special fund
provided therefor as hereinafter set forth, to the bearer on the 1st day of May, 19  , upon
the presentation and surrender hereof, the principal sum of

FIVE THOUSAND DOLLARS

and to pay, solely from said special fund, interest thereon from the date hereof at the rate of
                per centum (  %) per annum until payment of such principal sum, such
interest to the maturity hereof being payable semi-annually on the 1st days of May and November
in each year upon the presentation and surrender of the attached coupons representing such
interest as the same respectively become due. Both the principal of and the interest on this bond
are payable at the office of the State Treasurer in the City of Richmond, Virginia, in any coin or
currency of the United States of America which, on the respective dates of payment thereof, is
legal tender for the payment of public and private debts.

This bond shall not be deemed to constitute a debt of the State of Virginia or a pledge of
the faith and credit of the State, but shall be payable as to both principal and interest solely
from the special fund provided therefor as hereinafter set forth.

This bond is one of a duly authorized issue of $1,335,000 dormitory revenue bonds (hereinafter
called the "bonds"), known as "Mary Washington College of the University of Virginia
Dormitory Revenue Bonds (Series 1965)", consisting of bonds maturing in annual instalments on the
1st day of May in the years 1966 to 1985, inclusive, and issued for the purpose of paying a part
of the cost of constructing and equipping two new dormitories at Mary Washington College of the
University of Virginia, Fredericksburg, Virginia (said two new dormitories being herein collectively
called the "Project"). The proceeds of the bonds, together with an appropriation and reappropriation
of $295,000 by the General Assembly of the State of Virginia, are estimated to be
sufficient to pay the cost of the Project.

All of the bonds are issued under and pursuant to a resolution (herein called the "Resolution")
duly adopted by the Rector and Visitors of the University of Virginia (herein sometimes called the
"Board") on June 24, 1965. Reference is hereby made to the Resolution for the provisions, among
others, with respect to the custody and application of the proceeds of the bonds, the collection
and disposition of revenues, the fund charged with and pledged to the payment of the interest on
and the principal of the bonds, the nature and extent of the security, the rights, duties and
obligations of the Board and the rights of the holders of the bonds, and, by the acceptance of
this bond, the holder hereof assents to all of the provisions of the Resolution.

This bond is issued and the Resolution was adopted under and pursuant to the Constitution and
laws of the State of Virginia, particularly Chapter 3, Title 23, Code of Virginia, 1950, as
amended. The Resolution provides for the fixing, revising, charging and collecting by the Board
of fees, rents and charges for or in connection with the use, occupation or services of the
Project and a student building fee in order that such fees, rents and charges and such student
building fee will be sufficient to provide funds to pay the cost of maintaining, repairing and
operating the Project and to pay the principal of and the interest on the bonds as the same shall
become due and payable. The Resolution also provides for the deposit of a sufficient amount of
such fees, rents and charges and such student building fee, over and above such cost of maintenance,
repair and operation, to the credit of a special fund designated "Mary Washington College
of the University of Virginia Dormitory Revenue Bonds (Series 1965) Interest and Sinking Fund",
to pay the principal of and the interest on the bonds as the same shall become due and payable,
and said special fund is pledged to and charged with the payment of such principal and interest.

As declared by said Chapter 3, this bond shall be fully negotiable within the meaning and
for all the purposes of Chapter 10, Title 6, Code of Virginia, 1950, as amended.

All acts, conditions and things required by the Constitution and laws of the State of
Virginia and the rules and regulations of the Board to happen, exist and be performed precedent
to and in the issuance of this bond have happened, exist and have been performed as so required.

IN WITNESS WHEREOF, the Rector and Visitors of the University of Virginia have caused this
bond to be issued in the name of Mary Washington College of the University of Virginia and have
caused this bond to bear the facsimile signature of the Rector of the University of Virginia and
to be signed by the Bursar of Mary Washington College of the University of Virginia, and the
official seal of The Rector and Visitors of the University of Virginia to be impressed hereon,
and the attached interest coupons to be executed with the facsimile signature of said Rector, all
as of the 1st day of May, 1965.

.................................
Bursar of Mary Washington College

....................................
Rector of the University of Virginia

(Form of Coupons)

 

No. ..........

$ ............

On ......................... 1, 19.......,

Mary Washington College of the University of Virginia, the educational institution at
Fredericksburg, Virginia, will pay to the bearer at the office of the State Treasurer in the
City of Richmond, Virginia, upon presentation and surrender hereof, the sum of ................
............................................. Dollars in any coin or currency of the United
States of America which at the time of payment is legal tender for the payment of public and
private debts, solely from the special fund referred to in, and for the semi-annual interest
then due upon, its Dormitory Revenue Bond (Series 1965), dated as of May 1, 1965, No. .......... .

....................................
Rector of the University of Virginia

Section 203. The proceeds (including accrued interest) of the bonds shall be paid into the
State Treasury and deposited to the credit of the special fund hereinafter created and designated
"Mary Washington College of the University of Virginia Dormitory Revenue Bonds (Series 1965) Construction
Fund" (hereinafter sometimes called the "Construction Fund").

Section 204. In case any bond issued hereunder shall become mutilated or be destroyed or
lost, the Board shall cause to be executed a new bond of like date, number and tenor in exchange
and substitution for and upon the cancellation of such mutilated bond and its interest coupons,
if any, or in lieu of and in substitution for such bond and its coupons, if any, destroyed or
lost, upon the holder's paying the reasonable expenses and charges of the Board in connection
therewith and, in the case of a bond destroyed or lost, his filing with the Board evidence satisfactory
to the Board that such bond and coupons, if any, were destroyed or lost, and of his ownership
thereof, and furnishing the Board with indemnity satisfactory to the Board.

ARTICLE III.

Custody and Application of Proceeds of Bonds.

Section 301. A special fund is hereby created in the State Treasury and designated "Mary
Washington College of the University of Virginia Dormitory Revenue Bonds (Series 1965) Construction
Fund" (herein sometimes called the "Construction Fund"), to the credit of which there shall be
deposited the proceeds of the bonds required to be so deposited by Section 203 of this resolution
The moneys in the Construction Fund shall be held in trust and applied to the payment of the cost
of the Project and, pending such application, shall be subject to a lien and charge in favor of
the holders of the bonds issued and outstanding under this resolution and for the future security
of such holders until paid out or transferred as herein provided.

Section 302. Payment of the cost of the Project shall be made from the Construction Fund and
from the appropriation and reappropriation referred to in the preambles of this resolution, all as
provided by law.

Section 303. For the purposes of this resolution the cost of the Project shall include,
without intending thereby to limit or restrict or to extend any proper definition of such cost
under any applicable laws of this resolution, the following:

• (a) obligations incurred for labor and materials and to contractors,
  builders and materialmen in connection with the Project,

• (b) interest accruing upon the bonds prior to and during construction
  of the Project,

• (c) taxes or other municipal or governmental charges lawfully levied or
  assessed during construction upon the Project or any property acquired
  therefor, and premiums on insurance, if any, in connection with the
  Project during construction,

• (d) fees and expenses of engineers and architects for surveys and
  estimates and other preliminary investigations, preparation of plans,
  drawings and specifications and supervising construction, as well as
  for the performance of all other duties of engineers and architects
  in relation to construction of the Project or the issuance of bonds
  therefor,

• (e) expenses of administration properly chargeable to the Project,
  legal expenses and fees, financing charges, cost of audits and of
  preparing and issuing the bonds, and all other items of expense not
  elsewhere in this Section specified incident to the construction of the
  Project and the placing of the Project in operation, and

• (f) any obligation or expenses heretofore or hereafter incurred by the
  Board or by any other agency of the State of Virginia for any of the
  foregoing purposes.

Section 304. The Board covenants that no part of the Project will be constructed on lands
other than lands owned by the Board or the State of Virginia in fee simple.

Section 305. When the Project shall have been completed and placed in operation, as
evidenced by a certificate signed by the President or the Bursar of the Institution and filed
with the Secretary of the Board, any balance in the Construction Fund not deemed by the Board
to be necessary to be reserved and so reserved by it for the payment of any remaining part of
the cost of the Project shall be transferred to the credit of the Sinking Fund.

ARTICLE IV.

Revenues and Funds.

Section 401. The Board covenants that it will at all times fix, charge and collect fees,
rents and charges for or in connection with the use, occupation or services of the Project and
a student building fee and that from time to time and as often as it shall appear to be necessary
it will revise such fees, rents and charges and such student building fee in order that such
fees, rents and charges and such student building fee will at all times be sufficient to provide
for the payment of the Current Expenses and to provide for making deposits to the credit of the
Sinking Fund in each fiscal year under the provisions of Section 404 of this Article of an amount
equal to one hundred ten per centum (110%) of the interest which will become due and payable on
November 1 of such fiscal year and of the principal and interest which will become due and payable
on May 1 of such fiscal year.

Section 402. The Board covenants that, notwithstanding any other facilities which may now or
hereafter be available for the housing of students at the Institution and subject to the parietal
rules now in effect at the Institution as set forth in Section 402 of the resolution, adopted by
the Board on April 8, 1961, authorizing the issuance of $500,000 Mary Washington College of the
University of Virginia Dormitory Revenue Bonds (Series 1961), it will require a sufficient number
of students at the Institution to use and occupy the Project and will adopt and enforce such
parietal rules and other regulations as will assure that the Project will be fully utilized at
all times during the regular school session at the Institution and will be utilized to the
fullest extent practicable at all times during any summer school session at the Institution
The Board further covenants that there shall be no free student occupancy of the Project.

Section 403. A special fund is hereby created in the State Treasury and designated "Mary
Washington College of the University of Virginia Dormitory Revenue Bonds (Series 1965) Revenue
Fund" (hereinafter sometimes called the "Revenue Fund"). The Board covenants that all fees,
rents and charges and other revenues derived from the operation or ownership of the Project and
the student building fee will be collected by the Board and deposited to the credit of the Revenue
Fund. Payment of Current Expenses shall be made from the Revenue Fund as provided by law.

Section 404. A special fund is hereby created in the State Treasury and designated "Mary
Washington College of the University of Virginia Dormitory Revenue Bonds (Series 1965) Interest and
Sinking Fund" (herein sometimes called the "Sinking Fund"). The Board covenants that, on or before
the 20th day of October in each fiscal year, it will provide for the transfer from moneys held for
the credit of the Revenue Fund to the credit of the Sinking Fund of an amount equal to one hundred
ten per centum (110%) of the interest which will become due and payable on November 1 of such
fiscal year and that, on or before the 20th day of April in each fiscal year, it will provide for
the transfer from moneys held for the credit of the Revenue Fund to the credit of the Sinking Fund
of an amount equal to one hundred ten per centum (110%) of the principal and interest which will
become due and payable on May 1 of such fiscal year, provided, however, that if the amount so
transferred to the credit of the Sinking Fund in any October or April shall be less than the
required amount, the requirement therefor shall nevertheless be cumulative and the amount of any
deficiency in any October or April shall be added to the amount otherwise required to be transferred
in each October or April thereafter until such time as such deficiency shall have been made
up, and provided, further, that when the moneys held for the credit of the Sinking Fund shall equal
the principal of the outstanding bonds and the interest which will become due and payable thereon
to their respective maturities, no further transfer need be made to the credit of the Sinking Fund.
The balance in the Revenue Fund, if any, after making the transfer provided to be made on or
before April 20 in any fiscal year under the provisions of this Section shall be used for the
purposes of the Institution as provided by law.

Section 405. Subject to the provisions of this resolution, moneys held for the credit of the
Sinking Fund shall be held in trust and applied (a) to the payment of interest upon the bonds as
such interest becomes due and payable, or (b) to the payment of the principal of the bonds at their
respective maturities, and such moneys are hereby pledged to and charged with the payments mentioned
in this Section.

Section 406. The moneys in the Revenue Fund and the Sinking Fund shall be held in trust and
applied as hereinabove provided and, pending such application, shall be subject to a lien and charge
in favor of the holders of the bonds issued and outstanding under this resolution and for the
further security of such holders until paid out or transferred as herein provided.

Section 407. All bonds and interest coupons shall be cancelled upon their payment. Such
bonds and coupons shall be cremated by the State Treasurer.

ARTICLE V.

Investment of Funds.

Section 501. Moneys held for the credit of the Construction Fund shall, as nearly as may be
practicable, be invested and reinvested by the State Treasurer in securities which are defined as
legal investments for public funds or deposited and redeposited in interest bearing time deposits
and certificates of deposit of national banks located within the State of Virginia and of banks
organized pursuant to Chapter 2 (§6-5 et seq.) of Title 6, Code of Virginia, 1950, as amended,
all as provided in and subject to the terms, limitations and conditions of Sections 298, 299 of
Title 2, Chapter 17, Code of Virginia, 1950, as amended, which shall mature, or which shall be
subject to redemption or withdrawal by the holder or depositor thereof at the option of such holder
or depositor, not later than the respective dates when the moneys held for the credit of the Construction
Fund will be required for the purposes intended.

Moneys held for the credit of the Revenue Fund and the Sinking Fund shall, as nearly as may
be practicable, be invested and reinvested by the State Treasurer in direct obligations of, or
obligations the principal of and the interest on which are unconditionally guaranteed by, the United
States Government which shall mature, or which shall be subject to redemption by the holder thereof
at the option of such holder, not later than the respective dates when the moneys held for the
credit of said Funds will be required for the purposes intended.

Section 502. Obligations so purchased as an investment of moneys in any such Fund shall be
deemed at all times to be a part of such Fund, and the interest accruing thereon and any profit
realized from such investment shall be credited to such Fund, and any loss resulting from such
investment shall be charged to such Fund. The State Treasurer shall sell at the best price obtainable
or present for redemption any obligations so purchased whenever it shall be necessary so to do
in order to provide moneys to meet any payment or transfer from any such Fund. Neither the State
Treasurer nor the Board shall be liable or responsible for any loss resulting from any such
investment.

ARTICLE VI.

Particular Covenants.

Section 601. The Board covenants that it will promptly pay the principal of and the interest
on each and every bond issued under the provisions of this resolution at the place, on the dates
and in the manner provided herein and in said bonds and in the coupons appertaining thereto,
according to the true intent and meaning thereof. The principal and interest are payable solely
from the revenues derived from the ownership or operation of the Project and from the student
building fee, which revenues are hereby pledged to the payment thereof in the manner and to the
extent hereinabove particularly specified, and nothing in the bonds or in this resolution shall
be deemed to constitute the bonds a debt of the State of Virginia or a pledge of the faith and
credit of the State, nor shall the bonds ever be or become a charge against the State of Virginia.

Section 602. The Board covenants that it will forthwith proceed to construct the Project
in conformity with law and all requirements of all governmental authorities having jurisdiction
thereof, and that it will complete such construction with all expedition practicable.

The Board further covenants that it will require each person, firm or corporation with whom
it may contract for labor or materials in connection with construction of the Project to furnish
a performance bond in the full amount of any contract exceeding Five Thousand Dollars ($5,000) in
amount, and to carry such public liability, property damage and builders' risk insurance, if any,
as may be recommended by the Bursar of the Institution. The Board further covenants that in the

event of any default under any such contract and the failure of the surety to complete the contract,
the proceeds of such performance bond will forthwith, upon receipt of such proceeds, be deposited to
the credit of the Construction Fund and will be applied toward the completion of the contract in
connection with which such performance bond shall have been furnished.

Section 603. The Board covenants that it will provide and maintain competent and adequate
architectural or engineering services covering the supervision and inspection of the development
and construction of the Project, and will obtain all approvals and permits required by law as a
condition precedent to the construction, development and operation of the Project.

Section 604. The Board covenants that it will establish and enforce reasonable rules and
regulations governing the use of the Project and the operation thereof, that all compensation,
salaries, fees and wages paid by it in connection with the maintenance, repair and operation of the
Project will be reasonable, that it will maintain and operate the Project in an efficient and
economical manner, that from the revenues derived from the Project and from the student building fee,
it will at all times maintain the same in good repair and in sound operating condition and will make
all necessary repairs, renewals and replacements, that it will observe and perform all of the terms
and conditions contained in the Act, and that it will comply with all valid acts, rules, regulations,
orders and directions of any legislative, executive, administrative or judicial body applicable to the
Project.

Section 605. The Board covenants that it will not create or suffer to be created any lien or
charge upon the Project or any part thereof or upon the revenues therefrom or from the student building
fee ranking equally with or prior to the lien and charge of the bonds secured hereby upon such revenues,
and that, from such revenues or other available funds it will pay or cause to be discharged, or will
make adequate provision to satisfy and discharge, within sixty (60) days after the same shall accrue,
all lawful claims and demands for labor, materials, supplies or other objects which, if unpaid, might
by law become a lien upon the Project or any part thereof or the revenues derived therefrom or from
the student building fee, provided, however, that nothing in this Section contained shall require the
Board to pay or cause to be discharged, or make provision for, any such lien or charge so long as the
validity thereof shall be contested in good faith and by appropriate legal proceedings.

Section 606. The Board covenants that if at any time the moneys held for the credit of the
Sinking Fund shall be insufficient for the purpose of paying the interest on and the principal of
the bonds as such interest and principal becomes due and payable, the Board will deposit to the
credit of the Sinking Fund an amount sufficient, together with the amount then held for the credit of
the Sinking Fund, to pay such interest and principal from any moneys available for the use of the
Institution and which are not required by law or by previous binding contract to be devoted to some
other purpose.

Section 607. Notwithstanding any other provision of this resolution, nothing herein shall be
construed to prevent the Board from paying all or any part of the Current Expenses from any funds
available to the Board for such purpose.

Section 608. The Board covenants that from and after the time when the contractors or any
of them engaged in constructing the Project or any part thereof shall cease to be responsible,
pursuant to the provisions of the respective contracts for the construction of the Project or such
part for loss or damage to the Project or such part, occurring from fire or lightening, it will insure and at all times keep the Project or such
part insured with a responsible insurance company or companies, qualified to assume the risk thereof,
against physical loss or damage caused by fire or lightening, with such exceptions as are ordinarily
required by insurers of structures or facilities of similar type, in an amount not less than eighty
per centum (80%) of the replacement value of the Projector such part, less depreciation, provided,
however, that such amount of insurance shall at all times be sufficient to comply with any legal
or contractual requirement which, if breached, would result in assumption by the Board of a portion
of any loss or damage as a co-insurer, and such insurance may provide for the deduction from each
claim for loss or damage (except in case of a total loss) of not more than two per centum (2%) of
the total amount of insurance required by the application of the co-insurance clause, and provided,
further, that if at any time the Board shall be unable to obtain such insurance to the extent above
required, either as to amount of such insurance or as to the risks covered thereby or the deductible
provision thereof, it will not constitute an event of default under the provisions of this
resolution if the Board shall carry such insurance to the extent reasonably obtainable.

The proceeds of such insurance shall be available for, and shall to the extent necessary
be applied to, the repair, replacement or reconstruction of the damaged or destroyed property. If
such proceeds are more than sufficient for such purpose, the balance remaining shall be deposited
to the credit of the Sinking Fund. If such proceeds, with other available funds, shall be insufficient
for such purpose, such proceeds shall be deposited to the credit of the Sinking Fund or
shall be used to purchase bonds, as the Board by resolution may determine.

Section 609. The Board covenants that it will at all times carry in a responsible insurance
company or companies qualified to assume the risks thereof property damage insurance in such amount
and covering such risks as the Board shall deem to be reasonable and desirable.

Section 610. The Board covenants that no contract or contracts will be entered into or any
action taken by which the rights of the bondholders might be impaired or diminished.

Section 611. The Board covenants that it will keep an accurate record of the total cost of
the Project, of the fees and other revenues collected, and of the application thereof. Such
records shall be open at all reasonable times to the inspection of all interested persons.

The Board further covenants that, if so requested in writing by any bondholder within the
month of July after the close of any fiscal year, it will cause the Bursar of the Institution to
make a report from the books and accounts relating to the Project for the preceding fiscal year.
Within the next two months copies of such report shall be filed with the Secretary of the Board
and the State Treasurer and shall be mailed by the Bursar to all bondholders who shall have filed
their names and addresses with the Bursar for such purpose. Each such report shall set forth in
respect of the preceding fiscal year an income and expense account for the Project, a record of
the revenues derived from the student building fee, the details of all bonds paid, the amount on
deposit at the end of such fiscal year to the credit of each fund created under the provisions of
this resolution and the details of any investment thereof, a schedule of all insurance policies
which are then in effect, stating with respect to each policy the name of the insurer, the amount,
number and expiration date, and the hazards and risks covered thereby, and also the findings of

the Bursar as to whether the moneys received by the Board under the provisions of this resolution
during such fiscal year have been applied in accordance with the provisions of this resolution and
whether the Board is in default of any of the covenants contained in Section 401 of this resolution.

Section 612. The Board covenants that it will not sell or otherwise dispose of or encumber
the Project or any part thereof and will not create or permit to be created any charge or lien on
the revenues therefrom or from the student building fee ranking equally with or prior to the
charge or lien of the bonds secured hereby on such revenues. The Board may, however, sell or
dispose or permit the sale or disposal by the Institution of any furniture, fixtures, apparatus,
tools, instruments or other movable property acquired for or in connection with the Project or any
materials used in connection therewith, if the Board shall determine by resolution that such
articles are no longer needed or are no longer useful in connection with the construction of the
Project or the operation and maintenance of the Project. The proceeds of any sale made under the
authority of this Section shall be deposited to the credit of the Sinking Fund.

ARTICLE VII

Remedies

Section 701. In case the time for the payment of any coupon shall be extended, whether or
not such extension be by or with the consent of the Board, such coupon shall not be entitled in
case of default hereunder to the benefit or security of this resolution except subject to the
prior payment in full of the principal of all bonds then outstanding and of all coupons the time
for the payment of which shall not have been extended.

Section 702. Each of the following events is hereby declared as "event of default", that is
to say. If

• (a) payment of the principal of any of the bonds shall not be made
  when the same shall become due and payable, or

• (b) payment of any instalment of interest shall not be made within
  thirty (30)days after the same shall become due and payable, or

• (c) the Board shall discontinue for more than thirty (30) days or
  unreasonably delay or fail to carry on with reasonable dispatch the construction
  of the Project, or

• (d) the Board shall for any reason be rendered incapable of fulfilling
  its obligations hereunder, or

• (e) the Project or any part thereof shall be destroyed or damaged and
  shall not be promptly repaired, replaced or reconstructed (whether such failure
  promptly to repair, replace or reconstruct the same be due to the impracticability
  of such repair, replacement or reconstruction or to lack of funds therefor or for
  any other reason), or

• (f) final judgment for the payment of money shall be rendered against
  the Board as a result of its ownership or operation of the Project and any such
  judgment shall not be discharged within sixty (60) days from the entry thereof
  or an appeal shall not be taken therefrom or from the order, decree or process
  upon which or pursuant to which such judgment shall have been granted or entered,
  in such manner as to stay the execution of or levy under such judgment, order,
  decree or process or the enforcement thereof, or

• (g) an order or decree shall be entered, with the consent or acquiescence
  of the Board, appointing a receiver or receivers of the Project or any part thereof
  or of the revenues derived therefrom or from the student building fee, or if such
  order or decree, having been entered without the acquiescence or consent of the
  Board, shall not be vacated or discharged or stayed on appeal within sixty (60)
  days after entry thereof, or

• (h) the Board shall default in the due and punctual performance of any
  other of the covenants, conditions, agreements, and provisions contained in the
  bonds or in this resolution on the part of the Board to be performed, and such
  default shall continue for thirty (30) days after written notice specifying such
  default and requiring same to be remedied shall have been given to the Board by
  any bondholder.

Section 703. Upon the happening and continuance of any event of default specified in
Section 702 of this Article, then and in every such case any bondholder may proceed, subject to
the provisions of Section 705 of this Article, to protect and enforce the rights of the bondholders
by a suit, action or special proceeding in equity or at law, either for the specific
performance of any covenant or agreement contained herein or in aid or execution of any power
herein granted or for the enforcement of any proper legal or equitable remedy as such bondholder
shall deem most effectual to protect and enforce such rights.

Section 704. In case any proceeding taken by any bondholder on account of any default
shall have been discontinued or abandoned for any reason, then and in every such case the Board
and the bondholders shall be restored to their former positions and rights, respectively, and all
rights and remedies of the bondholders shall continue as though no such proceeding had been taken.

Section 705. No holder of any of the bonds shall have any right in any manner whatever to
affect, disturb or prejudice the security of this resolution or to enforce any right hereunder,
except in the manner herein provided, and all proceedings at law or in equity shall be instituted,
had and maintained for the equal benefit of all bondholders.

Section 706. No remedy herein conferred on the bondholders is intended to be exclusive of
any other remedy or remedies, and each and every remedy conferred shall be cumulative and shall be
in addition to every other remedy given hereunder or under the Act or now or hereafter existing at
law or in equity or by statute.

Section 707. No delay or omission of any bondholder to exercise any right or power accruing
upon any default occurring and continuing as aforesaid shall impair any such right or power or
shall be construed to be a waiver of any such default or an acquiescence therein, and every power
and remedy given by this Article to the bondholders may be exercised from time to time and as
often as may be deemed expedient.

ARTICLE VIII

Miscellaneous Provisions

Section 801. All covenants, stipulations, obligations and agreements of the Board contained
in this resolution shall be deemed to be covenants, stipulations, obligations and agreements of
the Board to the full extent authorized or permitted by law and all such covenants, stipulations,
obligations and agreements shall be binding upon the successor or successors thereof from time to
time and upon any officer, board, body or commission to whom or to which any power or duty affecting
such covenants, stipulations, obligations and agreements shall be transferred by or in accordance
with law.

No covenant, stipulation, obligation or agreement herein contained shall be deemed to be a
covenant, stipulation, obligation or agreement of any present or future member, agent or employee
of the Board in his individual capacity, and neither the Governor of the State of Virginia nor the
members of the Board or of any other agency of the State of Virginia nor any officer thereof,
present or future, executing the bonds shall be liable personally on the bonds or be subject to any
personal liability or accountability by reason of the issuance thereof.

Section 802. Any notice, demand, direction, request or other instrument authorized or required
by this resolution to be given to or filed with the Board shall be deemed to have been sufficiently
given or filed for all purposes of this resolution if and when sent by registered mail, return
receipt requested, to the Rector and Visitors of the University of Virginia, Charlottesville,
Virginia.

Section 803. The officers and agents of the Board are hereby authorized and directed to do
all acts and things required of them by the provisions of the bonds and this resolution for the
full, punctual and complete performance of all the terms, covenants, provisions and agreements
contained in the bonds and this resolution.

Section 804. In case any one or more of the provisions of this resolution or of the bonds or
coupons issued hereunder shall for any reason be held to be illegal or invalid, such illegality or
invalidity shall not affect any other provision of this resolution or of the bonds or coupons, but
this resolution and the bonds and coupons shall be construed and enforced as if such illegal or
invalid provision had not been contained therein. In case any covenant, stipulation, obligation
or agreement contained in the bonds or in this resolution shall for any reason be held to be in
violation of law, then such covenant, stipulation, obligation or agreement shall be deemed to be
the covenant, stipulation, obligation or agreement of the Board to the full extent permitted by law.

Section 805. The Secretary of the Board is hereby authorized and directed to file a certified
copy of this resolution with the Governor and the Treasury Board.

A vote being taken, said resolution was adopted by the following recorded vote. Ayes. Charles
R. Fenwick, Thomas H. Blanton, William M. Camp, Hunter Faulconer, Raynell G. Lantor, Lawrence Lewis, Jr.,
E. Sclater Montague, Lewis M. Walker, Jr., and Woodrow W. Wilkerson. Nays. None.