Section 1. The Board of Visitors of the University of
Virginia (the "Board") (a) covenants to fix, revise, charge and
collect rentals for or in connection with the occupancy, use or
services of all its University-owned student housing system,
including the Student Housing Project, and (b) pledges such
rentals, to the payment of the principal of, premium, if any, and
interest on that portion of the Bonds issued to finance the
Student Housing Project; provided that the current expenses of
operating the University-owned student housing system (the
"Housing Current Expenses") shall be a first charge on such
rentals. The Board further covenants that such rentals will be
fixed, revised, charged and collected so that the net revenues
therefrom, after payment of the Housing Current Expenses, will as
all times be sufficient to pay the principal of, premium, if any,
and interest on that portion of the Bonds issued to finance the
Student Housing Project as and when the same become due, and to
pay debt service on any outstanding obligations that have been
previously issued to provide funds for the University-owned
student housing system, that portion of the Bonds issued to
finance the Student Housing Project to be secured on a parity
with such obligations (except the University's $3,000,000
Dormitory Revenue Bonds (Series 1962) and its $4,100,000 Student
Apartment and Dormitory Buildings Revenue Bonds (Series 1965)
which are secured by a prior right in the revenues to be derived
from those projects). Any such revenues in excess of the amounts
required for the payment of the Housing Current Expenses, the
payment of the principal of, premium, if any, and interest on
that portion of the Bonds issued to finance the Student Housing
Project when due, and debt service on any outstanding obligations
issued to provide funds for the University-owned student housing
system may be used by the University for any other proper
purpose.