University of Virginia Library

SECTION 605. Application of Money in Reserve Account; Replenishment of Reserve Account.

(a) Simultaneous with the delivery of the Bonds, an amount equal to the Reserve Account Requirement shall be deposited in the Reserve Account from funds

ontributed by the University and/or the proceeds of the Bonds; rovided, however, that the amount so deposited from the proceeds of the Bonds shall be not less than the amount of interest accruing on the Bonds from November 1, 1984 through May 31, 1985. Any funds contributed by the University for deposit to the credit of the Reserve Account shall be deposited in the Equity Subaccount, and any of the proceeds of the Bonds deposited to the credit of the Reserve Account shall be deposited to the credit of the Proceeds Subaccount.

(b) Prior to and on the Fixed Rate Date, if either proceeds of the Bonds or Aged Money is not available in the Interest Account, the State Treasurer shall transfer from the Reserve Account to the Paying Agent, on the Business Day preceding each Interest Payment Date, the amount required to pay interest becoming due on such Interest Payment Date on all Bonds Outstanding which are not Bank Bonds and interest on Bank Bonds in an amount not exceeding the interest payable at the Maximum Interest Rate. Amounts on deposit to the credit of the Proceeds Subaccount shall be exhausted prior to the transfer of any amount on deposit to the credit of the Equity Subaccount.

(c) After the Fixed Rate Date, the State Treasurer shall use amounts in the Reserve Account to make transfers to the Interest Account and the Sinking Fund Account to the extent necessary to pay interest on and principal (whether at maturity, by acceleration or in satisfaction of the Sinking Fund Requirement) of the Bonds, whenever and to the extent that the money on deposit to the Interest Account and the Sinking Fund Account is insufficient for such purposes. Amounts on deposit to the credit of the Proceeds Subaccount shall be exhausted prior to the transfer of any amount on deposit to the credit of the Equity Subaccount.

(d) Prior to the Fixed Rate Date, the State Treasurer shall transfer from the Special Fund to the Equity Subaccount on each Interest Payment Date an amount equal to the amount of any transfer made pursuant to paragraph (b) of this Section. If on any Interest Payment Date there shall not be sufficient Net Revenues available to enable the State Treasurer to make the transfer required by this subsection (d), he shall so notify the Paying Agent in writing on such Interest Payment Date.

(e) From and after the Fixed Rate Date, the State Treasurer shall transfer from the Special Fund to the Equity Subaccount, in twelve (12) equal monthly installments, the amount of any transfer made from the Reserve Account pursuant to paragraph (c) of this Section.

(f) The University may at any time after the Fixed Rate Date withdraw amounts on deposit to the credit of the Proceeds Subaccount

for any lawful Hospital purpose so long as, simultaneously therewith, it shall deposit an equal amount of its funds to the credit of the Equity Subaccount.

(g) Prior to the effective date of any amendment to the Resolution which would increase the Maximum Interest Rate, the University shall deposit to the credit of the Equity Subaccount an amount equal to the increase in the Reserve Account Requirement resulting from such amendment.