University of Virginia Library

ATTACHMENT I
Assistant Vice President
for Finance

TELEPHONE
(804) 979-3294
May 28, 1982

Mr. Myron E. Tremain

Senior Vice President

Virginia National Bank

300 East Main Street

P. O. Box 1328

Charlottesville, Virginia 22902

Re: Banking Services under the University's Amended Request for Proposal Dated April 9, 1982

Dear Mike:

The University wishes to contract with Virginia National Bank for banking services, subject to the terms described in this letter. If these terms are acceptable to VNB, the contract with the University would be formed by VNB signing the enclosed copy of this letter where indicated and returning it to me. VNB would thereupon be the bank selected by the University under the University's Request for Proposal dated April 9, 1982 (the "RFP").

The terms of the parties' Agreement are as described in Attachments C and D to the RFP with only the following specific changes or elaborations:

1. This Agreement is entirely contingent on approval of it by the University's Board of Visitors at its meeting which begins next Thursday, June 3, 1982. The effective date of this Agreement, referred to in Section 1 of Attachment C to the RFP, will be the date the University's Board of Visitors approves the Agreement.

2. The "Services" referred to in Section 1 of Attachment C to the RFP will consist of all the services described in Attachment E to the RFP, as elaborated upon in Section IV of VNB's initial proposal (dated May, 1982), and its amendment dated May 26, 1982 as it relates to investment custody services.

3. The "term" of the Agreement will begin July 1, 1982, rather than on the date for beginning the Services as described in the first sentence of Section 2 of Attachment C to the RFP.

4. With regard to the second sentence of Section 2 of Attachment C to the RFP, it is agreed that the initial two-year term will be automatically extended for an additional two-year period, subject to that sentence's termination provision. If VNB decides that it will invoke the termination provision if its prices are not increased, the parties will discuss the proposed increases and the University will determine whether this Agreement should be modified or whether another request for proposal should be issued.

5. With regard to Section 3(a) of Attachment C to the RFP, the University will compensate VNB for the Services in the manner described in Section 3(a)(i), using the "fee prices" described in the pricing form contained in Section VII of VNB's initial proposal, as amended by VNB's May 26, 1982 amendment relating to investment custody services. VNB reserves the right to increase the fee prices for particular Services in the amount of any future price increase which VNB is charged in connection with those Services by regulatory authorities such as the Federal Reserve Bank of Richmond. Also, any earnings on the University's balances with VNB during each month will be credited against the total fees for Services provided by VNB during the same month. For the purpose of determining these balances earnings credits, the parties will use the average moving discount rate for the prior month of the 91-day U. S. Treasury Bills. The account analyses referred to in Section 3(a)(i) will be modified appropriately to indicate the amount of, and method of computing, these credits.

6. With regard to Section 9 of Attachment D to the RFP, the name and address of the person to whom notices to VNB will be sent will be your name and address as shown at the beginning of this letter.

The Agreement described in this letter does not, of course, constitute the terms which VNB and the Treasurer of Virginia may decide to agree to for the Treasurer's account as described in the

RFP. You should deal directly with the Treasurer's Office concerning any such agreement.

After I receive from you the executed copy of this letter, I will proceed to submit this Agreement to the Board of Visitors for its consideration. Thank you and the University certainly looks forward to dealing with VNB.