The official minutes of the University of South Carolina Board of Trustees are maintained by the Secretary of the Board. Certified copies of minutes may be requested by contacting the Board of Trustees’ Office. Electronic or other copies of original minutes are not official Board of Trustees' documents.
The Board of Trustees of the University of South Carolina met on Friday, October 14, 1999, at 1:00 p.m. in Ballroom C of the Russell House University Union.
Members present were: Mr. William C. Hubbard, Chairman; Mr. Herbert C. Adams; Mr. Arthur S. Bahnmuller; Mr. James Bradley; Mr. Alexander English; Dr. C. Edward Floyd; Mr. Samuel R. Foster, II; Mr. Toney J. Lister; Mr. Miles Loadholt; Mr. Robert N. McLellan; Mr. J. DuPre Miller; Ms. Darla D. Moore; Mr. Michael J. Mungo; Mr. M. Wayne Staton; and Mr. John C. von Lehe, Jr. Members absent were: Mr. William W. Doar, Jr.; Mrs.. Helen C. Harvey; Mrs. Inez M. Tenenbaum; Mr. Othniel H. Wienges, Jr; and Mr. Mack I. Whittle, Jr., Vice Chairman. Faculty representative, Professor Caroline Strobel, and student representative, Mr. Malik Husser, were also present.
Others present were: President John M. Palms; Secretary Thomas L. Stepp; Executive Vice President for Academic Affairs and Provost Jerome D. Odom; Vice President and Chief Operating Officer J. Lyles Glenn; Vice President for Business and Finance John L. Finan; Vice President for Student and Alumni Services Dennis A. Pruitt; Vice President for Human Resources Jane M. Jameson; Vice President for Development Charles D. Phlegar; General Counsel Walter (Terry) H. Parham; Director of Facilities Management Charles G. Jeffcoat; Director of Housing Gene Luna; Assistant Director of Facilities Planning Services Donna Collins; Director of Law Enforcement and Safety Ernest L. Ellis; Dean, College of Pharmacy, Farid Sadik; Vice Provost and Executive Dean, Regional Campuses and Continuing Education, Chris P. Plyler; Interim Dean, College of Applied Professions, Patricia G. Moody; Dean, College of Nursing, Mary Ann Parsons; Dean, School of Public Health, Harris Pastides; Dean, College of Liberal Arts, Joan Hinde Stewart; Chancellor, USC Spartanburg, John C. Stockwell; Vice Chancellor for Academic Affairs, USC Aiken, Blanche Premo-Hopkins; Vice Chancellor for Academic Affairs, USC Spartanburg, Jane Stephens; Dean, USC Lancaster, Joseph Pappin; Dean, USC Sumter, C. Leslie Carpenter; Dean, USC Salkhatchie, Carl Clayton; Dean, USC Beaufort, Jane Upshaw; Acting Dean, College of Engineering, Joseph H. Gibbons; Associate Dean, Administration and Finance, School of Medicine, Brian J. Jowers; Interim Director, Office of Research, Stanley D. Fowler; Director of Public Affairs Russell McKinney; Executive Director, Bicentennial Office, Sally T. McKay; Director, Department of Internal Audit, Alton McCoy; Director of Presidential Communications and Research, Peter F. Mackey; Director of Student Life, Jerry T. Brewer; recipients of honorary faculty titles: Steven D. Hinckley, Jon P. Thames and Phillip Lacy; University Unitarian Universalists Chaplain, The Reverend Patrick Price; Associate Director of Periodicals, University Publications, Chris Horn; representative from Media Relations Jason Snyder; and a representative from the media.
Chairman Hubbard called the meeting to order and stated that notice of the meeting had been posted and the press notified as required by the Freedom of Information Act; the agenda and supporting materials had been circulated to the members; and a quorum was present. Mr. Hubbard welcomed everyone to the meeting. He especially welcomed Caroline Strobel to her first board meeting as the representative of the Faculty Senate; Ms. Darla D. Moore; and Mr. Alex English. The members of the University family were invited to introduce themselves. Mr. Snyder introduced the member of the media who was present. The Reverend Patrick Price was invited to deliver the Invocation.
Mr. Hubbard then recognized the following faculty members who had recently been awarded honorary faculty titles: Professor Harry E. Barrineau, III; Dr. Edward W. Ernst; Dr. Donald E. Saunders, Jr. (Mr. Stepp extended Dr. Saunders' regret that he was teaching and could not be present); Professor Jon P. Thames; and Dr. Carol A. Williams. The professors were thanked for their service to the University. Chairman Hubbard expressed the deep appreciation for all they had done over the years to promote education in South Carolina and to enhance the quality of life in this state.
Mr. Hubbard congratulated Mr. Loadholt on his election as Chairman of the Buildings and Grounds Committee and also Mr. Bahnmuller on his election as Chairman of the Student-Trustee Liaison Committee.
Mr. Hubbard stated that there were contractual matters with respect to gift naming opportunities, and personnel matters with respect to honorary faculty titles, appointments with tenure, and promotion and tenure which were appropriate for Executive Session. Mr. Hubbard called for a motion to enter Executive Session. Mr. Bradley so moved, and Mr. Mungo seconded the motion. The vote was taken, and the motion carried.
The following persons were invited to remain: Dr. Palms, Mr. Stepp, Dr. Odom, Mr. Glenn, Mr. Finan, Ms. Jameson, Dr. Pruitt, Mr. Phlegar, Mr. Parham, Dr. Plyler, Dr. Premo-Hopkins, Dr. Stephens, Dr. VanHuss, Mr. McKinney, Ms. Hyatt, and Ms. Mayfield.
Executive Session
Return to Open Session
Mr. Bradley thanked everyone in the room for all the support, concern, and love that had come his way for the past eight weeks as he recovered from heart surgery.
I. Approval of Minutes: The following five set of minutes had been circulated by mail to the Board for review and were presented for approval:
A. Academic Affairs and Faculty Liaison Committee, August 6, 1999
B. Executive Committee, August 6, 1999
C. Board of Trustees, August 6, 1999
D. Fiscal Policy Committee, September 9, 1999
E. Buildings and Grounds Committee, September 9, 1999
There were no additions, deletions, or corrections to the minutes. They stood approved as distributed.
II. Committee Reports
A. Fiscal Policy Committee
(The Honorable Robert N. McLellan, reporting)
The Fiscal Policy Committee met on September 9, 1999, and received Internal Audits for the College of Science and Mathematics; the Controller's Office and Accounting Services; the University Purchasing Department; and the Regional Campuses Administrative Financial Aid Office.
An external audit of the Financial Statements of the School of Medicine Educational Trust and Clinical Faculty Practice Plan for year end December 31, 1998; the Bookstore Endowment Report for Fiscal Year; and the Designated Fund Report for Fiscal Year 1999 were also presented.
Both the internal and external audits were reviewed by the Committee and were mailed to the Board in accordance with established procedures.
The Provost gave a report on the status of the University's year 2000 computer compliance as of September 1999. Dr. Odom reported that the University's preparation appeared to be going well.
The dissolution of the Russell History Lecture Fund was on hold. The adminis-tration was not inclined to change the use of the Russell History Lecture Fund, and it appeared that the fund would be used by the Department of History in the future.
B. Buildings and Grounds Committee
(The Honorable Miles Loadholt, reporting)
The Building and Grounds Committee met on September 9 and heard several reports. The status of ongoing construction and renovation projects was reviewed. Details were included in the minutes of the meeting.
USC Spartanburg had been approached by the S.C. National Guard with the prospect of building an armory on the campus. The Guard was still exploring opportunities at USC Spartanburg and at other locations.
The University had $69,265,500 in Capital Project Requests to present to the Legislature for funding during the year 2000 session. The list of the priorities was sent to the Board in a Tuesday Mailing.
USC Columbia requested $34 million in projects for LeConte, the new law school, the energy master plan, and Thomas Cooper Library. The School of Medicine had requested funds to renovate its library and Building #3. Other campus requests were: $6 million for USC Aiken's Convocation Center; $19.5 million for USC Spartanburg's Information Resources Center and $3 million for an administration building; $1.5 million for USC Beaufort's New River Project; $415,500 for the Beaufort College Building; and $1.95 million for USC Lancaster's Medford Library.
In keeping with established Board Policy, it was reported that the administration had approved an increase of $75,000 to the Deferred Maintenance and Renovation project of the Beaufort College Building to provide necessary contingency funds. This resulted in a total budget of $1,575,000 funded with $1,084,500 in Capital Improvement Bonds, $415,500 in Private Funds, and $75,000 in State Appropriated Funds.
In addition, the administration approved an increase of $180,000 for the USC Aiken Ruth Patrick Science Education Center Expansion to purchase and install laboratory casework, fume hoods, and workstation modules. This action resulted in a total project budget of $4,130,000 funded with $2.5 million in Capital Improvement Bonds; $1.4 million from a Department of Energy grant; $50,000 in Institutional Capital Project Funds; and $180,000 in private funds.
1. USC Aiken Ruth Patrick Science Education Center Expansion, Budget Increase: Because the USC Aiken Nursing Building was complete and a balance remained in its budget, USC Aiken requested that the remaining funds be transferred to the Science Education Center project in order to purchase additional items including a telescope, pendulum, food service equipment, and high density storage systems. The budget of the Science Center would be increased by an amount not to exceed $240,000 which would be funded with the Capital Improvement Bonds transferred from the Nursing Building.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved to increase the budget of the USC Aiken Ruth Patrick Science Center Expansion by an amount not to exceed $240,000, resulting in a total project budget not to exceed $4,370,000 funded with $2,740,000 in Capital Improvement Bonds, $1.4 million from a Department of Energy grant, $50,000 in Institutional Capital Project Funds, and $180,000 in private funds. Mr. Miller second the motion. The vote was taken, and the motion carried.
2. Report on Budget Increase, Growth System Laboratory Renova-tion, College of Engineering, Emergency Procurement: This project was reported to the Board in April 1999, with a budget of $500,000 and had been established as an emergency procurement. When the design was completed and estimates were developed, the budget was increased to $890,000 (funded with indirect cost recovery from grants). In July, the emergency procurement was further modified to include the renovation of the second floor of the 300 Main Street building to provide two clean rooms and laboratory space. Related grant funding was anticipated to be $3 million this year, $2.5 million next year, and $2 million per year on a continuing basis thereafter.
The current budget was $1,340,000 funded with indirect cost recovery from grants. The funding agency required that the facilities be completed by November 1999. Therefore, the emergency procurement was modified under the "critical economy" standard. This was received as information.
3. School of Medicine Building #3 Renovation, Change in Source of Funds: In February 1999, the Board approved an increase in the existing budget for this project by $450,000 funded with institutional capital project funds for a total budget of $1,545,000. The School of Medicine requested to change the source of funding to state appropriated funds.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved to approve the requested change in the source of funding for the School of Medicine Building #3 Renovation. The total budget would be $1,545,000, funded with $350,000 in Capital Improvement Bonds, $1,047,6000 in appropriated state funds and $147,000 in institutional capital project funds. Mr. Miller seconded the motion. The vote was taken, and the motion carried.
4. Energy Master Plan: This plan was to use energy efficient methods to operate USC Columbia and determine where money could be saved. There were three goals: 1) to provide a cost effective means to serve current and future campus utility needs, 2) to replace/upgrade aging equipment and distribution systems, and 3) to reduce utility operating costs. Nine specific project categories were created.
The plan would cost $31 million over an 11 year period. The combined annual energy savings would total $14,785,972 over an 11 year period and would continue to accrue at the rate of $2 million per year thereafter. Also, $22 million in previously identified deferred maintenance projects would be resolved. The plan would provide a safer, more efficient system and would require less daily maintenance. The administration would ask the General Assembly to fund $6.5 million (21% of the plan) during its upcoming session. Proposed other sources of funding were: $8.8 million (28%) from internal facilities funds; $10.9 million (35%) from energy savings generated by implementation of the plan; $0.9 million (3%) in capital reimbursement from the National Advocacy Center; and $3.9 million (13%) from other sources.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval of the concept of the overall Energy Master Plan as discussed by the Committee and as reported in the minutes of the Committee's meeting. Mr. von Lehe seconded the motion.
Mr. Mungo asked what "other sources" meant. Mr. Finan stated that it was hoped to obtain private grant money, private donations, and to obtain funds from other University sources. The vote was taken, and the motion carried.
The following five specific projects of the first phase of the Energy Master Plan had been approved for recommendation to the Board.
a. Boiler Replacement - Phase I: This project would replace three aging and inefficient boilers with new, high efficiency ones. This project would improve steam generation efficiency, increase system reliability, reduce air emissions, increase safety, and reduce energy usage.
On behalf of the Building and Grounds Committee, Mr. Loadholt moved to establish this project, as presented, with a budget of $942,047 funded with $940,000 in State Institution Bonds and $2,047 in state appropriated funds. Mr. Foster seconded the motion. The vote was taken, and the motion carried.
b. Energy Management System Expansion - Phase I: This project would expand the campus energy management system (which controls the main HVAC systems in buildings connected to the central energy facilities). The project would improve comfort control, create savings in staffing costs through instigation of central controls, bring about faster response and resolution of heating and air conditioning problems, and reduce energy usage.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved to establish this project, as presented, with a budget of $600,000 funded with State Institution Bonds. Mr. Bahnmuller seconded the motion. The vote was taken, and the motion carried.
c. Electrical Infrastructure Upgrade - Phase I: This project would replace old wiring and switchgear in the campus high voltage electrical distribution system. The benefits of this project were to increase safety and reliability.
On behalf of the Building and Grounds Committee, Mr. Loadholt moved to establish this project, as presented, with a budget of $273,000 funded with $43,953 in National Advocacy Center Capital Replacement Funds and $229,047 in state appropriated funds. Mr. Miller seconded the motion. The vote was taken, and the motion carried.
d. Campus Wide Lighting Retrofit - Phase I: This project would replace the lighting in campus buildings with more efficient fixtures. Occupancy sensors would be installed in selected areas.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved to establish the project, as presented, with a budget of $242,065, funded with utility reserve funds (state appropriated funds). Mr. Bahnmuller seconded the motion. The vote was taken, and the motion carried.
e. Steam Infrastructure Upgrade - Phase I: This project would replace aging steam and condensate piping in the heat distribution system. It would increase safety and reliability, as well as reduce steam loss.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved to establish the project, as presented, with a budget of $200,000 funded with deferred maintenance funds (state appropriated funds). Mr. Staton seconded the motion. The vote was taken and the motion carried.
5. School of Law, New Building: The project was to construct a new building with approximately 250,000 square feet near the National Advocacy Center to accommodate approximately 600 students. The anticipated budget was $30 million, of which $15 million would come from state funds and $15 million from private funds.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved to establish the project with an initial budget of $5 million to be funded with Capital Improvement Bonds. Mr. Lister seconded the motion. The vote was taken, and the motion carried.
6. USC Aiken Student Activities Center: This project would renovate the existing facility to create student organization and recreation space, upgrade Student Life offices, and renovate the cafeteria and bookstore.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved to establish this project with a budget of $3.2 million to be funded with Capital Improvement Bonds. Mr. Bahnmuller seconded the motion. The vote was taken, and the motion carried.
7. USC Beaufort New River Facility: This project for the initial building on the New River Site was approved by the Board in June 1997 with a budget of $370,000. Since then additional county funds had been received to replace the Renovation Reserve Funds, and $2.5 million was added in Capital Improvement Bonds.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved to change the sources of funding for the project and to increase the current budget by $2.5 million to reflect the funding level provided by the state. This would result in a total project budget of $2.87 million funded with $2.5 million in Capital Improvement Bonds and $370,000 in County Appropriations. Mr. Adams seconded the motion. The vote was taken, and the motion carried.
8. USC Spartanburg - Information Resource Center: This project would construct a new building at USC Spartanburg with an information and high-tech focus for both the campus and the larger Upstate community. The facility would house the Learning Research Center (university library), the Information Systems Center, curricular support laboratories and facilities, and business information technology centers.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved to establish this project with an initial budget of $1 million to be funded with Capital Improvement Bonds. Mr. Lister seconded the motion. The vote was taken, and the motion carried.
9. USC Union Truluck Activity Center Deferred Maintenance: This project was originally approved by the Board in June 1997 with a budget of $300,000. USC Union requested additional state funding to expand the gymnasium and to continue basic renovations to the facility. The state awarded $200,000 in state appropriated funds (Supplemental Part IV).
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved to increase the existing budget by $200,000 for a total project of $500,000 to be funded with $300,000 in Capital Improvement Bonds and $200,000 in state appropriated funds (Supplemental Part IV). Mr. Lister seconded the motion. The vote was taken, and the motion carried.
10. USC Salkehatchie Facility Deferred Maintenance: USC Salkehatchie has received supplemental appropriation (Part IV) funding to address deferred maintenance of its facilities.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved to estab-lish this project with a budget of $1 million to be funded with state appropriated funds (Supplemental Part IV) for various deferred maintenance items on USC Salkehatchie campus. Mr. von Lehe seconded the motion. The vote was taken, and the motion carried.
11. Patterson Hall Air Handler/Piping Replacement: This project would replace a 36 year old air handler and piping system and renovate Patterson Hall with a budget of $550,000. It had been discovered that some existing equipment and piping could not be re-used as had been originally planned. Approval was requested to increase the current project budget.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved to increase the budget by $72,500 for a total project budget of $622,500 funded with $311,684 in Housing Maintenance Reserve Funds, $197,500 in Auxiliary Capital Project Funds, $75,364 in Food Service Funds, and $37,952 in state appropriated funds. Mr. McLellan seconded the motion. The vote was taken, and the motion carried.
12. National Advocacy Center TV Studio/Computer Room Renovations Budget Increase: This project would create a television studio, with supporting office space, in the basement of the National Advocacy Center. The Department of Justice had agreed to fund the project, and it was presented to the Board because the facility belonged to the University.
On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved to establish this project as presented with a budget of $450,000 to be funded by the Department of Justice. Mr. Miller seconded the motion. The vote was taken, and the motion carried.
13. Gift Naming Opportunities: During the Executive Session, the Board heard the following three items:
a. USC Lancaster, Dedication of a Fitness Room in Honor of Edward R. Khoury: USC Lancaster requested the dedication of the room in conjunction with donations. On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval of the naming of a fitness room in honor of Edward R. Khoury. Mr. Bradley seconded the motion. The vote was taken, and the motion carried.
b. Establish the Merline & Thomas, P.A., Study Room: This naming was a contingency of donations made for the new law school facility and was endorsed by the School of Law. On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval of establishing the "Merline & Thomas, P.A., Study Room." Mr. Miller seconded the motion. The vote was taken, and the motion carried.
c. Naming a Trail in Belser Arboretum for Wade T. Batson, Jr.: This naming was requested by the Department of Biological Sciences as a contingency of a gift made by Dr. Batson's sister. On behalf of the Buildings and Grounds Committee, Mr. Loadholt moved approval of naming a trail in Belser Arboretum
for Distinguished Professor Emeritus Wade T. Batson, Jr. Mr. Bradley seconded the motion. The vote was taken, and the motion carried.
C. Executive Committee
(The Honorable William C. Hubbard, reporting)
The Executive Committee met on September 30, 1999, and took action on two matters. Trustee Darla D. Moore was appointed as the Board of Trustees' representative to the USC Business Partnership Foundation Board of Directors, and the Executive Committee requested an increase in President Palms' compensation from the USC Educational Foundation.
The Executive Committee met earlier this day and voted to recommend the following matters for consideration by the Board.
1. Housing Revenue Bond Resolution: This resolution provided the underlying financial arrangements and terms for issuance of revenue bonds to finance the construction of the South Campus - East Quad Apartments on the Columbia Campus and renovations to other Columbia Campus housing buildings. Mr. Mungo seconded the committee's motion. The vote was taken, and the motion carried. (See Exhibit A)
2. School of Medicine, Revenue Bond Resolution: This resolution provides for the extension of the maturity dates for the financing for Medical Park II, which is utilized by the School of Medicine. Mr. Mungo seconded the committee's motion. The vote was taken, and the motion carried. (See Exhibit B)
3. Quasi Endowment Holding Account: The Administration requested the establishment of a permanent, quasi-endowed holding account for gifts and bequests. The Executive Committee unanimously supported the request. Mr. Foster seconded the committee's motion. The vote was taken, and the motion carried.
4. Revision to the Williams-Brice Scoreboard Contract to Reduce the Cost to the University: Mr. Parham reported that at the last Executive Committee meeting, the Committee approved the Athletics Department's request to purchase a new message center for the scoreboard at Williams-Brice Stadium. To finance the purchase, the Athletics Department advised that it would borrow $591,000 from the USC Development Foundation, to be repaid over a 10 year period at 7.94% interest.
Subsequently, the Athletics Department learned that the S.C. State Treasurer had entered into a contract with First Union National Bank which allowed state agencies to borrow funds at a reduced interest rate for equipment purchases. As a result, the Athletics Department proposed to borrow the necessary funds from First Union to finance the message center purchase at 5.13% interest.
The Athletics Department requested approval to change the funding source for the purchase of the Williams-Brice Stadium message center scoreboard and to borrow $591,000 from First Union National Bank, to be repaid over a seven year period at 5.13% interest. The Executive Committee unanimously recommended the change in the contract. Mr. Miller seconded the committee's motion. The vote was taken, and the motion carried.
D. Academic Affairs & Faculty Liaison Committee
(The Honorable Herbert C. Adams, reporting)
1. Honorary Faculty Titles: The following seventeen requests for honorary faculty titles were mailed with the materials for the meeting. They were presented without objection to the Academic Affairs and Faculty Liaison Committee and to the full Board in Executive Session. They had received all appropriate academic and administrative approvals and were presented for action.
The following persons would be awarded the title Distinguished Professor during their final year of service. That title would change to Distinguished Professor Emerita effective upon retirement:
a. Ann W. Engin, Department of Psychology, College of Liberal Arts, retiring June 30, 2000.
b. Beverly F. Heisner, Department of Art, College of Liberal Arts, retiring June 30, 2000.
The following persons would be awarded the title Distinguished Professor Emeritus:
c. Walter Bailey, Department of Educational Psychology, College of Education, retired June 30, 1999.
d. John D. Spooner, Department of Biology & Geology, USC Aiken, retired June 30, 1999.
The following persons would be awarded the title Distinguished Professor during their final year of service. That title would change to Distinguished Professor Emeritus effective upon retirement:
e. Morgan D. Maclachlan, Department of Anthropology, College of Liberal Arts, retiring June 20, 2000.
f. Philip E. Mullen, Department of Art, College of Liberal Arts, retiring June 30, 2000.
g. James A. Patterson, Department of Theatre, Speech & Dance, College of Liberal Arts, retiring June 30, 2000.
h. S. Travis Pritchett, Darla Moore School of Business, retiring June 30, 2000.
i. Ted A. Rathbun, Department of Anthropology, College of Liberal Arts, retiring June 30, 2000.
j. Thomas E. Smith, Department of Sociology, College of Liberal Arts, retiring June 30, 2000
k. William R. Stanley, Department of Sociology, College of Liberal Arts, retiring June 30, 2000.
l. Gunars Strazdins, Department of Art, College of Liberal Arts, retiring June 30, 2000.
m. Thomas E. Terrill, Department of History, College of Liberal Arts, retiring June 30, 2000.
n. Robert G. Wirsing, Department of Government and International Studies, College of Liberal Arts, retiring June 30, 2000.
The following person would be awarded the title Emerita Professor effective upon her retirement:
o. Jayne F. Mulvaney, Department of Theatre, Speech & Dance, College of Liberal Arts, retiring June 30, 2000.
The following persons would be awarded the title Emeritus Professor effective upon retirement:
p. James M. Steven, Department of Art, College of Liberal Arts, retiring December 31, 1999.
q. Foster E. Tait, Department of Philosophy, College of Liberal Arts, retiring June 30, 2000.
On behalf of the Academic Affairs and Faculty Liaison Committee, Mr. Adams moved to approve these Honorary Faculty Titles. Mr. Staton seconded the motion. The vote was taken, and the motion carried.
2. Appointments with Tenure: The following appointments with tenure had been presented to the Academic Affairs and Faculty Liaison Committee and to the full Board in Executive Session without objection. They had received all appropriate academic and administrative approvals and were presented for action.
a. Dr. Austin L. Hughes would be awarded tenure at the rank of Professor in the Department of Biological Sciences, College of Science and Mathematics. On behalf of the Academic Affairs and Faculty Liaison Committee, Mr. Adams moved approval of Dr. Hughes' appointment, and Mr. von Lehe second the motion. The vote was taken, and the motion carried.
b. Dr. Priscilla Tucker would be awarded tenure at the rank of Associate Professor in the Department of Biological Sciences, College of Science and Mathematics. On behalf of the Academic Affairs and Faculty Liaison Committee, Mr. Adams moved approval of Dr. Tucker's appointment, and Mr. von Lehe second the motion. The vote was taken, and the motion carried.
3. Promotion and Tenure: The following items had been presented to the Academic Affairs and Faculty Liaison Committee and to the full Board in Executive Session without objection. They have received all appropriate academic and administrative approvals and were presented for action.
a. Dr. Warren J. Carson, Jr. would be promoted to the rank of Associate Professor with tenure at USC Spartanburg, retroactive to August 16, 1999. On behalf of the Academic Affairs and Faculty Liaison Committee, Mr. Adams moved approval of Dr. Carson's promotion with tenure, and Mr. Lister second the motion. The vote was taken, and the motion carried.
b. Dr. Richard Creswick would be promoted to the rank of Professor in the Department of Physics and Astronomy, College of Science and Mathematics, retroactive to August 16, 1999. On behalf of the Academic Affairs and Faculty Liaison Committee, Mr. Adams moved approval of Mr. Creswick's promotion, and Mr. Bahnmuller second the motion. The vote was taken, and the motion carried.
4. Program Modification to Bachelor of Science Degree in Nursing, USC Aiken: USC Aiken requested modifications of its four-year Bachelor of Science Degree in Nursing program; the proposed modifications were mailed to the members of the Board. This request had received all appropriate faculty and administrative approvals and was consistent with the mission of the USC Aiken campus and the University. On behalf of the Academic Affairs and Faculty Liaison Committee, Mr. Adams moved approval of the modification to the Bachelor of Science Degree in Nursing program, as mailed, and Mr. Loadholt second the motion. The vote was taken, and the motion carried.
5. Name Change for College of Applied Professions: The College of Applied Professions requested to change the name of the College to reflect more accurately the mission of the College and its academic programs. The proposed name was College of Hospitality, Retail, and Sport Management. The request had received all appropriate academic and administrative approvals. On behalf of the Academic Affairs and Faculty Liaison Committee, Mr. Adams moved approval of the name change to the College of Hospitality, Retail and Sport Management, effective January 1, 2000. Mr. Foster second the motion. The vote was taken, and the motion carried. 6. Changes to the USC Columbia Faculty Manual: The proposed changes to the USC Columbia Faculty Manual were mailed to the Board with the materials for this meeting. The changes were not substantive and addressed spelling, punctuation, and syntax. The General Counsel reviewed the modifications and stated that they were legally sufficient and not objectionable on legal grounds. The changes had received appropriate academic and administrative approvals. On behalf of the Academic Affairs and Faculty Liaison Committee, Mr. Adams moved approval of the proposed changes to the USC Columbia Faculty Manual, and Mr. von Lehe seconded the motion. The vote was taken, and the motion carried. (The document would be maintained in the permanent meeting file.)
7. Change to USC Aiken Faculty Manual: The proposal would change the USC Aiken Faculty Manuel, Article VII, Section 4, to read as follows:
8. USC Spartanburg Revised Tenure and Promotion Criteria and Procedures: The proposed revisions to the USC Spartanburg Tenure and Promotion Criteria and Procedures were mailed to the Board Members with the materials for this meeting. These changes resulted from five years of work and eliminated weak terms and made stylistic and grammatical changes. On behalf of the Academic Affairs and Faculty Liaison Committee, Mr. Adams moved approval of the revisions to the USC Spartanburg Tenure and Promotion Criteria and Procedures. Mr. Lister second the motion. The vote was taken, and the motion carried. (The document would be maintained in the permanent meeting file.)
On behalf of the Academic Affairs and Faculty Liaison Committee, Mr. Adams expressed the Board's sympathy to the family of Mr. Tandy Willis, USC Union. Mr. Willis passed away unexpectedly on Saturday, September 18, 1999, after suffering an aneurysm. Mr. Willis was the Representative from the Regional Campuses for the Faculty Liaison Committee and taught English for 29 years.
E. Student-Trustee Liaison Committee
(The Honorable Arthur S. Bahnmuller, reporting)
The Student-Trustee Liaison Committee met on September 30, 1999, with student representatives from most of the University's campuses in attendance.
Students continue to be heavily involved with their campuses' activities and in their communities. Most campuses were conducting fund-raising for scholarships and other educational opportunities.
Jerry Brewer, the Director of Student Life, reported on Greek Housing and displayed diagrams of the proposed Fitness/Wellness Center and the Greek Housing Development for the Columbia Campus.
Dr. Gene Luna, the Director of Housing, reported on Crisis Response Systems and the excellent job faculty, staff and students did to insure the safety of everyone during Hurricane Floyd.
F. Ad Hoc Committee on Advancement
(The Honorable J. DuPre Miller, reporting)
The Ad Hoc Committee on Advancement met on September 30, 1999. It was reported that the Bicentennial Campaign had its best cash year in 1998-1999 with $45.7 million raised. The total fundraising for the year was $65.3 million which raised the Campaign total to $236,547,221.54.
It had cost 6.5 cents to raise each fundraising dollar at Carolina during the 1998-1999 year. That figure compared very favorably with the University's peer institutions.
It was reported that Carolina's Endowment had reached $243,775,223. A report distributed to the Board at the time of the meeting updated that total to the revised, higher total of $257,020,223.
The USC Educational Foundation reported on the return on investment of USC Funds. Of some $250 million, 70 percent was invested in equities and 30 percent in fixed income. The effective annualized return was 12.26%. It was noted that if the same funds were held by the S.C. Treasurer, the effective annualized return would have been 7.13%.
III. Bicentennial Celebration Update: Ms. Sally T. McKay, Executive Director of the University's Bicentennial Office, presented an update on the plans for the Bicentennial Year. She thanked the Board for the opportunity to meet with each of them. The Bicentennial Celebration was designed to reconnect the University with people of the state. The Bicentennial logo had been approved at the August meeting of the Bicentennial Commission. All plans were proceeding according to schedule, including dynamic initiatives related to education in this state, various publica-tions, the creation of a website, and the public unveiling of the Bicentennial logo in January of 2000.
The staff and committees were looking forward to January 10, 2001 and the major, public opening ceremony on the Horseshoe, and a very full year ending on December 19, 2001. Ms. McKay thanked the Board for the opportunity to share the Bicentennial logo and to keep the Trustees informed.
IV. Report of the Chairman: Mr. Hubbard reminded the Board of several key initiatives facing the University including the following:
- Insufficient funding of Higher Education by the General Assembly. USC received $2,000 less per student per year than North Carolina.
- The Board of Trustees needed to assist with Legislative contacts. President Palms agreed to provide more information in order to make the involvement of the members of the Board more effective.
- The University needed $150 million in annual outside research funding to achieve AAU status. The current level was $97 million annually. The Board needed to support these efforts so Carolina could attain that status.
- Student recruitment needed to be a priority of this institution at all times. Other institutions were vigorously active; some planned advertising campaigns. Still, Carolina's reputation is its greatest asset. Board Members need to make sure that they do everything they can to get the word out. Since Board Members are from all the different parts of the state, they need to take a leadership role in their communities to make sure that they have communicated with parents. Board members need to continue to host the recruiting receptions in their respective communities. They need to take better advantage of the alumni network; they need a more formal structure to utilize alumni to reach out to the high schools in this state. All of the efforts for the future really start with the recruitment of the best students.
- The Chairman noted that the Board had just received a lengthy report from the Buildings and Grounds Committee about many different items that had needed attention. The Board needed also to remind itself of some of the major projects in the Master Plan that were still not complete. He reported that the University needed a concerted effort to make the campus more beautiful, to work on narrowing streets, to eliminate through traffic, and to create a more pedestrian-friendly campus. The "green space" initiatives in the Master Plan needed to be funded. A number of relatively minor items could greatly enhance the appearance of the campus and make it more attractive for prospective students.
- Regarding the Bicentennial Campaign, the Trustees needed to look in their pocketbooks and hearts to be sure that, as the University tries to close out the capital campaign, all members of the Board are in a leadership position.
- There were also issues that had arisen from the non-Columbia campuses of the University. The Board needed to be attentive to those issues, to listen to those concerns, and to make sure that all members of this University family feel that they are getting a fair shake and are getting their issues heard. The Chairman assured all campuses that the Board and the Administration were interested in making certain that all elements of the University family were appropriately represented and would have their concerns addressed.
- The University needed further to enhance its reputation, not just statewide, but nationally. Efforts were currently underway, but as this institution seeks to remain competitive as an institution where young people can come in order to compete in the world, the reputation of this institution needs to be promoted.
- Knowing that the President had substantial comments to make about the subject following this report, the Chairman stated that campus safety was still "job one." Without that it could not function as it ought to function as an institution. The Board had taken appropriate actions and approved funds for safety projects, whenever asked. The Board would welcome any initiatives that the experts and the administration feel would be appropriate to promote campus safety.
V. Report of the President: Dr. Palms thanked everyone for the actions taken during this very productive meeting, reflecting a tremendous amount of work by the Board's committees.
He commented that students were the first focus of attention of the University. In that light he expressed his concern about a rape case that had happened the previous Friday. He spoke of his personal communication with the family of the student involved and thanked them for their cooperation which led to the arrest of a suspect. He expressed his determination to help this family with the counselors and professionals available at the University. He further expressed his determination to continue the commitment of the University to see to it that students, staff, faculty, and visitors were safe on this campus. The concerns were reflected on all campuses in this country.
He reminded the Board that the University had fifty officers, uniformed and plain clothed, patrolling the campus 24 hours a day in cars, on bicycles, and walking. He reminded the Board of the national accreditation of the University's law enforcement system and the excellent training all officers received. USC police and a fraternity provide an escort service for students, and free parking was available in "pay sections" of the Bull Street garage from 7:00 p.m. until 9:00 a.m. every day. This provided for free central parking for all women in the women's residence hall area. Dr. Palms reported that there was good lighting, especially on the streets bordering the city and 62 emergency call boxes on campus. Housing staff and campus police had regularly provided safety presentations in residence hall meetings, orientation programs, and University 101, and posters and other handouts were provided in addition to reports by the student newspaper, student radio, and student cable TV. A "travelways" map was distributed throughout the campus to highlight the most well lighted routes. Next week was the annual safety walk for students.
Dr. Palms reported that all these efforts were applied to help keep students aware of how to be smart about their own safety. These efforts were largely successful. The University had less than ten crimes against persons reported every year. He noted that Carolina was one of the safest campuses in the United States. But the University was not satisfied, obviously, from last week's events. It stays vigilant. The administration tries to be aware of problems and proactively eliminate them.
The University will be determined in its efforts to be sure that the campus stays safe. Therefore these additional steps are being taken:
- Over the next three weeks, at sporadic times, University officers will make themselves especially visible in high traffic areas and garages. The also will be sure that people on the campus have business or obligations on this campus. If not, these individuals will be asked to leave.
- A lighting survey was completed to insure that all lights were working on University property, garages, and the city streets along the perimeter.
- The University will work with the City of Columbia to make sure that people recognize they have entered or are leaving campus by creating a better definition of the campus surroundings. There will be discussions with the Mayor regarding additional measures that the City and University can take to improve safety on and around the campus.
- It is hoped the City will permit and help the University to identify distinctively the current invisible borders at which the immediate campus begins and ends. It is not the intention to seek to "wall off" the campus. It is the intention to seek to make clear, in an aesthetically appealing way, that one has entered the grounds of the University. With the City's cooperation, this will be accomplished with the addition of even more lighting, more signage, and other features along Greene, Sumter, Blossom, and Pickens Streets. These features will help to remind students of their need for safe practices. It will also remind everyone that within the University attention is high, and we shall look out for our students with great care.
Dr. Palms concluded his comments on campus safety by noting that some of these safety practices were worth emphasizing again and again. This basic advice really boiled down to two things the students need to remember: time and location. He assured the Board that all efforts would be continued and enhanced including the preparation of safety information to students, faculty and staff.
Dr. Palms commended the students, faculty, and staff for assisting with Hurricane Floyd and the victims of it.
The ribbon cutting to open McMaster College as the new home of the Department of Art had been held. There were 220 undergraduate art majors and 70 graduate student majors, but 4,000 students take art courses every year.
Dr. Palms welcomed Dr. Joan Hinde Stewart, Dean of the College of Liberal Arts, and announced that Dr. Jane Upshaw was the newly appointed Dean of USC Beaufort.
USC Lancaster is soon to dedicate its new arts and science building, named in honor of Trustee James Bradley. Campus student enrollment at Lancaster had increased by 12 percent. USC Aiken had dedicated the new Penland Building, and USC Spartanburg had broken ground for its athletic facility. USC Salkhatchie was searching for a new dean. USC Sumter had updated its handicap access to facilities. Enrollment for USC Union had increased 10 percent and work had begun on renovating the Truluck Activities Center.
Dr. Palms recognized Dean Mary Ann Parsons and said that the USC College of Nursing was one of seven school in the United States designated as a research center by the NIH, receiving a $1.7 million grant. The University had reached the level of $97 million in research money with 1,500 proposals made annually. The faculty had published 125 books and 1,100 papers in reference publications. Dr. Palms congratulated Ardis Savory, Associate Vice Provost for Sponsored Programs and Research for her national recognition for providing outstanding service to faculty, the first non-AAU official ever to receive this recognition.
Chairman Hubbard asked the Trustees to remember that a tour of the USC Library Annex and Preservation Facility led by Dr. George Terry was scheduled immediately following the meeting.
There being no further matters to come before the Board, Mr. Hubbard declared the meeting adjourned at 3:00 p.m.
Respectfully submitted
Thomas L. Stepp
Secretary
Exhibit A
Approved in final form by Board of Trustees on
October 14, 1999
SERIES 1999B RESOLUTION
(OR SERIES 2000A RESOLUTION DEPENDING
UPON YEAR OF ISSUE)
ARTICLE I
FINDINGS OF FACT
Section 1.01. Findings.
As an incident to the adoption of this Resolution (the "Series 1999B Resolution") and the issuance of the revenue bonds provided for herein, the Board of Trustees of the University of South Carolina (the "Board of Trustees"), the governing body of the University of South Carolina (the "University"), a body politic and corporate of the State of South Carolina (the "State") find, as a fact, that each of the statements hereinafter set forth in this Article I is in all respects true and correct.
(A) The Board of Trustees has made general provision for the issuance of University of South Carolina Revenue Bonds (the "Bonds") through the means of a resolution adopted on June 21, 1996, entitled "AN AMENDATORY AND RESTATED RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF THE UNIVERSITY OF SOUTH CAROLINA REVENUE BONDS AND OTHER MATTERS RELATING THERETO" (the "Bond Resolution").
(B) It is provided in and by the Bond Resolution that, upon adoption of a Series Resolution (as defined in the Bond Resolution), there may be issued one or more series of Bonds for the purpose of financing or refinancing in whole or in part the cost of acquiring, constructing, reconstructing, renovating and improving of land, buildings and other improvements to real property and equipment for the purpose of providing facilities serving the needs of the University (the "Facilities," as more particularly defined in the Bond Resolution).
(C) The Board of Trustees has determined the need to provide additional student housing facilities of the University to accommodate current and projected needs and to renovate and upgrade certain existing housing facilities and to install certain fire and safety systems therein, to wit: (i) construct a new student housing facility containing approximately 140,000 square feet which will house approximately 444 students and related amenities, including a pedestrian walk, parking and emergency vehicle access, on the East Quadrangle of the Columbia, South Carolina campus of the University; (ii) renovate the interior and mechanical systems of Bates West and install Sprinkle-Life Safety system therein; (iii) upgrade the interior of McBryde and install sprinklers/fire alarm system therein; (iv) upgrade the exterior of Wade Hampton; and (v) renovate, upgrade or equip other student housing facilities located on the Columbia, South Carolina campus of the University as part of the University's housing renovation program (collectively, the "Project"). The Project will constitute a part of the Facilities of the University. In order to finance such Project, it is anticipated that debt in the amount of not exceeding $25,000,000 must be incurred, which sum, together with the earnings received from the investment thereof pending the use of such moneys and other funds available to the University, will produce sufficient funds to defray the costs of construction, acquisition and equipping of the Project.
(D) Accordingly, the Board of Trustees has determined to issue not exceeding $25,000,000 aggregate principal amount of University of South Carolina Revenue Bonds, Series 1999B (the "Series 1999B Bonds"), to be applied with other funds available to the University to defray costs of constructing, acquiring and equipping the Project, to pay the capitalized interest on the Series 1999B Bonds, if any, and to pay the cost of issuance of the Series 1999B Bonds. In the event the Series 1999B Bonds are issued in calendar year 2000, the Series 1999B Bonds shall be designated as the "Series 2000A Bonds", and any and all references herein to "Series 1999B" as it describes this resolution and any construction fund, debt service fund, debt service reserve fund or reserve requirement established or required herein shall be amended, automatically and without further instrument or action, to "Series 2000A".
(E) In accordance with Section 4.01(B)(16) of the Bond Resolution, the Board of Trustees further has determined that the applicable Reserve Requirements (as defined in the Bond Resolution), if any, for all Series of Bonds Outstanding (as defined in the Bond Resolution) have been met.
(F) The University is authorized under the Enabling Act (as such term is defined in the Bond Resolution), to borrow such sums as are necessary to acquire, construct, and equip the Project.
DEFINITIONS AND AUTHORITY
(A) All terms which are defined in Article II of the Bond Resolution shall have the same meanings, respectively, in this Series 1999B Resolution as such terms are given in the Bond Resolution.
(B) In addition, as used in this Series 1999B Resolution, unless the context shall otherwise require, the following terms shall have the following respective meanings:
"Bond Insurer" shall mean the issuer, if any, of a Municipal Bond Insurance Policy.
"Bond Payment Date" shall mean each date, as determined pursuant to Section 3.04 hereof, on which interest on any Series 1999B Bonds shall be payable or on which both a principal installment and interest on the Series 1999B Bonds shall be payable.
"Bond Resolution" shall mean the resolution adopted by the Board of Trustees on June 21, 1996, as supplemented or amended by the Series 1996 Resolution, the Series 1997 Resolution, the Series 1999A Resolution, this Series 1999B Resolution, and any other Series Resolution or Amendatory Bond Resolution hereafter adopted.
"Continuing Disclosure Undertaking" shall mean that certain Disclosure Certifi-cate substantially in the form attached hereto as Exhibit B, as originally executed and as it may be amended from time to time in accordance with the terms thereof.
"Corporate Trust Office," when used with respect to the Paying Agent and the Registrar, shall mean the office at which the principal corporate trust business of such party shall be administered and to the extent the State Treasurer shall act as Paying Agent and Registrar, "Corporate Trust Office" shall mean the office of the State Treasurer.
"Date of Issue" shall mean the date from which the Series 1999B Bonds bear interest, as determined pursuant to Section 3.04 hereof.
"Depository" shall mean The Depository Trust Company, New York, New York, or other recognized securities depository selected by the University, which securities depository maintains a book-entry system with respect to the Series 1999B Bonds, and shall include any substitute for or successor to the securities depository initially acting as Depository.
"Municipal Bond Insurance Policy" shall mean the municipal bond insurance policy, if any, issued by a Bond Insurer, insuring the payment when due of the principal of and interest on the Series 1999B Bonds as provided therein.
"Official Notice of Sale" shall be the offer for sale of the Series 1999B Bonds containing the terms and conditions for the sale and award thereof, as established by the Chief Financial Officer and the State Treasurer.
"Official Statement" shall mean the Official Statement of the University to be prepared and distributed in connection with the sale and delivery of the Series 1999B Bonds in such form as approved by the Chief Financial Officer and as more particularly described in Section 7.02 hereof.
"Participants" shall mean those broker-dealers, banks and other financial institutions for which the Depository holds Series 1999B Bonds as depository.
"Preliminary Official Statement" shall mean the Preliminary Official Statement of the University to be prepared and distributed in connection with the sale and delivery of the Series 1999B Bonds, in such form as approved by the Chief Financial Officer and as more particularly described in Section 7.02 hereof.
"Project" shall have the meaning ascribed thereto in Section 1.01(C) hereof.
"Record Date" shall mean the 15th day of the month preceding each Bond Payment Date.
"Securities Depository Nominee" shall mean, as to any Depository, such Depository or the nominee of such Depository in whose name there shall be registered on the registration books maintained by the Registrar the Series 1999B Bonds to be delivered to and immobilized at such Depository during the continuation with such Depository of participation in its book-entry system. The initial Securities Depository Nominee shall be Cede & Co.
"Series 1996 Resolution" shall mean the Series Resolution adopted by the Board of Trustees on June 21, 1996, supplementing the Bond Resolution.
"Series 1997 Resolution" shall mean the Series Resolution adopted by the Board of Trustees on April 17, 1997, supplementing the Bond Resolution.
"Series 1999A Resolution" shall mean the Series Resolution adopted by the Board of Trustees on February 25, 1999, supplementing the Bond Resolution.
"Series 1999B Bonds" shall mean the Bonds of the University designated as "University of South Carolina Revenue Bonds, Series 1999B," authorized and issued pursuant to the Bond Resolution and this Series 1999B Resolution.
"Series 1999B Construction Fund" shall mean the Series 1999B Construction Fund established pursuant to Section 5.01 hereof.
"Series 1999B Debt Service Fund" shall mean the fund created pursuant to Section 6.02 hereof.
"Series 1999B Debt Service Reserve Fund" shall mean the Debt Service Reserve Fund for the Series 1999B Bonds created under Section 6.03 hereof.
"Series 1999B Reserve Requirement" shall mean the least of (a) the greatest remaining Annual Principal and Interest Requirement for the then-current and each future Fiscal Year with respect to the Series 1999B Bonds or (b) 10% of the proceeds from the sale of the Series 1999B Bonds at the time of issuance of the Series 1999B Bonds or (c) one hundred twenty-five percent (125%) of the average Annual Principal and Interest Requirements for the then-current and each future Fiscal Year with respect to the Series 1999B Bonds Outstanding or (d) the maximum amount permitted by the Code to be funded with sales proceeds of an issue and to be invested without restriction, other than the obligation, if any, to pay arbitrage rebate to the United States Government. Provided, however, that if for any Fiscal Year the sum of the Reserve Requirements as established by the respective Series Resolutions for all Series of Bonds Outstanding that have Reserve Requirements exceeds the maximum Combined Annual Principal and Inter-est Requirement for such Series of Bonds then Outstanding (and excluding any Series of Bonds that does not have a Reserve Requirement), then the Series 1999B Reserve Requirement may, at the option of the University, be reduced to the Series 1999B Bonds' proportionate amount of the maximum Combined Annual Principal and Interest Requirement for all such Series of Bonds then Outstanding. For purposes of this definition, a Series 1999B Bonds' "proportionate amount" shall be a fraction (i) the numerator of which is the Annual Principal and Interest Requirement for the Series 1999B Bonds in such Fiscal Year and (ii) the denominator of which is the Combined Annual Principal and Interest Requirement on all such Series of Bonds in such Fiscal Year.
"Series 1999B Resolution" shall mean this resolution and any supplements or amendments hereto.
"Sinking Fund Date" has the meaning given that term in Section 3.06 hereof.
(C) Notwithstanding anything to the contrary contained herein, if the Series 1999B Bonds are issued in calendar year 2000, all of the following designations and terms defined above shall be amended, automatically and without further instrument or action, to the following:
(1) the "Series 1999B Bonds" shall be amended to the "Series 2000A Bonds";
(2) the "Series 1999B Construction Fund" shall be amended to the "Series
2000A Construction Fund";
(3) the "Series 1999B Debt Service Fund" shall be amended to the "Series
2000A Debt Service Fund";
(4) the "Series 1999B Debt Service Reserve Fund" shall be amended to the
"Series 2000A Debt Service Reserve Fund";
(5) the "Series 1999B Reserve Requirement" shall mean the "Series 2000A
Reserve Requirement"; and
(6) the "Series 1999B Resolution" shall mean the "Series 2000A Resolution".
Section 2.02. Authority for this Series 1999B Resolution.
This Series 1999B Resolution is adopted pursuant to the provisions of the Enabling Act and the Bond Resolution.
AUTHORIZATION AND TERMS OF SERIES 1999B BONDS
Pursuant to the provisions of the Bond Resolution, a Series of Bonds of the University entitled to the benefits, protection, and security of the provisions thereof is hereby authorized in the aggregate principal amount not exceeding $25,000,000. The Series 1999B Bonds shall be designated "University of South Carolina Revenue Bonds, Series 1999B" or, if such Series of Bonds are issued in calendar year 2000, "University of South Carolina Revenue Bonds, Series 2000A."
Section 3.02. Purposes.
The Series 1999B Bonds, together with other funds available to the University, are authorized for the purposes of:
(A) defraying a portion of the costs of constructing, acquiring, renovating, and equipping the Project, including capitalized interest on the Series 1999B Bonds, if any;
(B) paying certain costs and expenses related to the issuance of the Series 1999B Bonds;
(C) providing for the Series 1999B Reserve Requirement, if any; and
(D) providing for credit enhancement with respect to the Series 1999B Bonds, if any.
Section 3.03. Direction to Chief Financial Officer and State Treasurer.
The Chief Financial Officer and the State Treasurer are hereby authorized to effect the issuance of the Series 1999B Bonds upon the terms and conditions set forth herein in an amount necessary to meet the purposes set forth in Section 3.02 hereof, not in excess of $25,000,000.
Section 3.04. Maturity Schedule: Interest Payment Dates.
The Series 1999B Bonds shall mature in the principal amounts and on the dates and the years as shall be determined by the Chief Financial Officer and the State Treasurer; provided that the final maturity of the Series 1999B Bonds shall occur no later than December 1, 2031. The Series 1999B Bonds shall bear interest at rates determined in the manner prescribed by Section 3.08 and Article VII hereof on the basis of a 360-day year of twelve 30-day months. The Series 1999B Bonds shall be dated either (i) as of the first day of the month in which the same are offered for sale or (ii) the first day of the month in which the Series 1999B Bonds are delivered, as determined by the Chief Financial Officer (the "Date of Issue"). Interest on the Series 1999B Bonds shall be payable on such days as shall be determined by the Chief Financial Officer.
Section 3.05. Optional Redemption.
(A) The Chief Financial Officer, in his discretion, shall determine whether the Series 1999B Bonds shall be subject to redemption prior to maturity at the option of the University, including applicable redemption dates and prices.
(B) In the event that the University shall from time to time, in accordance with the provisions of Section 3.05 (A) hereof, elect to redeem Series 1999B Bonds, it shall give notice to the Registrar and Paying Agent of each optional redemption. Such notice shall specify the date fixed for redemption and the amount and maturities of the Series 1999B Bonds which are to be redeemed.
Section 3.06. Mandatory Sinking Fund Redemption.
(A) Certain of the Series 1999B Bonds, as determined by the successful bidder therefor in accordance with conditions established prior to the sale of the Series 1999B Bonds by the Chief Financial Officer and the State Treasurer, or as determined in accordance with conditions established by them prior to such sale, may be subject to mandatory redemption on such dates (hereinafter, the "Sinking Fund Dates") and under the terms and conditions determined by the Chief Financial Officer and the State Treasurer, through the operation of sinking fund provisions, at the principal amount thereof, plus interest thereon to the applicable Sinking Fund Date.
(B) If a portion of the Series 1999B Bonds is subject to mandatory sinking fund redemption as provided in Paragraph (A) above, there shall be deposited with the Paying Agent on or before each Sinking Fund Date an amount sufficient to redeem or to pay (after credit as provided below) those principal amounts of Series 1999B Bonds so designated for mandatory redemption on the applicable Sinking Fund Date.
(C) The University, at its option, to be exercised prior to the forty-fifth (45th) day immediately preceding any Sinking Fund Date, may:
(1) cause to be paid to the Trustee as a prepayment of sums then to become due, such amount of funds as the University may determine, with written instructions to the Trustee, signed in the name of the University, to be applied prior to said forty-fifth (45th) day to the purchase of Series 1999B Bonds which are subject to mandatory redemption, or
(2) deliver any principal amount of Series 1999B Bonds which are subject to mandatory redemption to the Registrar for cancellation, and shall receive a credit in respect of its next ensuing sinking fund payment for any such Series 1999B Bond; which prior to said Sinking Fund Date have been purchased or redeemed by the University (otherwise than through the operation of the sinking fund) and canceled by the Registrar and not theretofore applied as a credit against any sinking fund payment.
(D) Upon receipt of the funds and instructions specified in paragraph (C)(1) above, the Trustee shall use all reasonable efforts to expend such funds in the purchase of such Series 1999B Bonds, at a price not exceeding the principal amount thereof plus interest accrued to such Sinking Fund Date. Any such funds not so expended by the Trustee shall be delivered by the Trustee to the Paying Agent to be applied to the payment of the Series 1999B Bonds maturing on such Sinking Fund Date or thereafter. The Series 1999B Bonds so purchased or presented for cancellation as provided above shall be canceled by the Registrar as provided in Section 4.14 of the Bond Resolution and shall be credited, at their principal amount, until the full amount thereof has been so credited against the next ensuing and future sinking fund payments in chronological order to the extent otherwise payable by the University.
Section 3.07. Partial Redemption.
If less than all of the Series 1999B Bonds are to be redeemed pursuant to any section of this Series 1999B Resolution, the particular Series 1999B Bonds or portions of Series 1999B Bonds to be redeemed shall be selected not less than forty-five (45) days prior to the date fixed for redemption in the manner determined prior to the sale of the Bonds by the Chief Financial Officer.
Section 3.08. Conditions Relating to Naming Interest Rates.
(A) The Series 1999B Bonds shall bear such rate or rates of interest as shall at the sale of such Series 1999B Bonds referred to in Section 7.01 hereof reflect the lowest interest cost to the University calculated in the manner hereinafter prescribed; provided, however, that:
(1) all Series 1999B Bonds of the same maturity shall bear the same rate of interest;
(2) each interest rate named shall be a multiple of 1/20th or 1/8th of one percentage point;
(3) no interest rate named shall be more than two (2) percentage points (or such other percentage points as determined by the State Treasurer and the Chief Financial Officer prior to the sale of the Bonds) higher than the lowest interest rate named; and
(4) all other restrictions as may be imposed by the State Treasurer and the Chief Financial Officer prior to the sale of the Bonds shall apply.
(B) The method of determining the lowest interest cost (whether true or net) on the Series 1999B Bonds will be established by the State Treasurer and the Chief Financial Officer prior to the sale thereof.
Section 3.09. Series 1999B Reserve Requirement.
If so determined by the Chief Financial Officer in his discretion prior to the sale of the Series 1999B Bonds, the Series 1999B Reserve Requirement shall be in effect with respect to the Series 1999B Bonds. In such event, the Series 1999B Debt Service Reserve Fund shall be established by the Trustee; and the Series 1999B Reserve Requirement therefor shall be satisfied by the deposit therein of available funds of the University that are not proceeds of the Series 1999B Bonds, by the deposit therein of proceeds of the Series 1999B Bonds to the extent available, or by the deposit therein of a reserve fund substitute as permitted by Section 7.05(D) of the Bond Resolution and by Section 6.03 hereof, such reserve fund substitute having been purchased with available funds of the University that are not proceeds of the Series 1999B Bonds or with proceeds of the Series 1999B Bonds to the extent available.
Section 3.10. Authentication; Payment of Interest.
(A) Each of the Series 1999B Bonds shall be authenticated on such date as it shall be delivered and shall bear interest from the Date of Issue, if no interest has yet been paid; otherwise from the last Bond Payment Date to which interest has been paid and which Bond Payment Date is on or prior to the authentication date thereof.
(B) The interest on all Series 1999B Bonds shall be paid by check or draft mailed from the office of the Paying Agent to the person in whose name the Series 1999B Bond is registered at the close of business on the applicable Record Date. Any Holder of $1,000,000 or more in principal amount of Series 1999B Bonds shall be entitled by written request to the Paying Agent (which notice shall be valid for all future payments until rescinded) to direct that any payments of interest on such Series 1999B Bonds be transmitted to such Holder by wire transfer. Such request shall provide the Paying Agent with specific direction as to the manner of making such payment.
Section 3.11. Denomination; Numbering.
The Series 1999B Bonds shall be issued in the denomination of $5,000 or any integral multiple thereof. Each Series 1999B Bond shall be numbered by the Registrar in such a fashion as to reflect the fact that it is one of the Series 1999B Bonds, and to identify the Holder thereof on the books kept by the Registrar.
Section 3.12. Maintenance of Trustee, Paying Agent and Registrar.
As long as any Series 1999B Bonds remain Outstanding, the University shall maintain a Trustee, Paying Agent and a Registrar therefor, and any successor or substitute Trustee, Paying Agent and Registrar shall be selected in accordance with Article XV of the Bond Resolution. The Series 1999B Bonds shall be presented for payment, and notices and demands to or upon the Trustee, and the University in respect of the Series 1999B Bonds may be served, at the Corporate Trust Office of the Paying Agent. The Series 1999B Bonds shall be presented for registration of transfers and exchanges in accordance with the provisions of the Bond Resolution at the Corporate Trust Office of the Registrar. The University hereby appoints the State Treasurer as Trustee for the Series 1999B Bonds.
Section 3.13. Form of Bonds.
The Series 1999B Bonds shall be substantially in the form attached hereto as Ex-hibit A, with such changes, modifications, or amendments from the form attached hereto as Exhibit A as the person executing the Series 1999B Bonds in accordance with the Bond Resolution shall approve, his execution and delivery of such Series 1999B Bonds being conclusive evidence of his approval to such changes, modifications, and amendments.
Section 3.14. Book-Entry System.
Unless otherwise determined by the Chief Financial Officer and the State Treas-urer prior to the publication of the Official Notice of Official Sale, the Series 1999B Bonds will be eligible securities for the purposes of the Book-Entry System of transfer maintained by the Depository, and transfers of beneficial ownership of the Series 1999B Bonds shall be made only through the Depository and its Participants in accordance with rules specified by the Depository. Such beneficial ownership must be of a $5,000 prin-cipal amount of the Series 1999B Bonds of the same maturity or any integral multiple of $5,000, with each increment of $5,000 being separately of a single maturity.
The Series 1999B Bonds shall be issued in fully registered form, one certificate for each of the maturities of the Series 1999B Bonds, in the name of Cede & Co., as Securities Depository Nominee. When any principal of, premium, if any, or interest on the Series 1999B Bonds becomes due, the Trustee shall cause the Paying Agent to trans-mit to the Depository an amount equal to such installment of principal, premium, if any, and interest. Such payments will be made to the Securities Depository Nominee as long as it is owner of record on the applicable Record Date. The Securities Depository Nominee shall be considered to be the owner of the Series 1999B Bonds so registered for all purposes of this Series 1999B Resolution, including, without limitation, payments as aforesaid and receipt of notices and exercise of rights of Series 1999B Bond owners.
The Trustee shall notify the Depository of any notice of redemption required to be given pursuant to this Series 1999B Resolution not less than thirty (30) nor more than sixty (60) days prior to the date fixed for redemption.
The Depository is expected to maintain records of the positions of Participants in the Series 1999B Bonds, and the Participants and persons acting through Participants are expected to maintain records of the beneficial owners in the Series 1999B Bonds. The University makes no assurances that the Depository and its Participants will act in accordance with such rules or expectations on a timely basis, and the University shall have no responsibility for any such maintenance of records of transfer or payments by the Depository to its Participants, or by the Participants or persons acting through Participants to the beneficial owners.
If (a) the Depository determines not to continue to act as Depository for the Series 1999B Bonds, or (b) the University has advised the Depository of the University's determination that the Depository is incapable of discharging its duties, the University shall attempt to retain another qualified securities depository to replace the Depository. Upon receipt by the University of the Series 1999B Bonds together with an assignment duly executed by the Depository, the University shall execute and deliver to the successor depository, Series 1999B Bonds of the same principal amount, interest rate and maturity.
If the University is unable to retain a qualified successor to the Depository or the University has determined that it is in the best interest of the University not to continue the Book-Entry System of transfer or that the interest of the beneficial owners of the Series 1999B Bonds might be adversely affected if the Book-Entry System of transfer is continued (the University undertakes no obligation to make any investigation to determine the occurrence of any events that would permit it to make any such determination), and has made provision to so notify beneficial owners of the Series 1999B Bonds by mailing an appropriate notice to the Depository, upon receipt by the University of the Series 1999B Bonds together with an assignment duly executed by the Depository, the University shall execute, and cause to be authenticated and delivered pursuant to the instructions of the Depository, Series 1999B Bonds in fully-registered form, in substantially the form set forth in this Series 1999B Resolution, and in denominations of $5,000 or any integral multiple thereof.
Section 3.15. Designation of Source or Sources of Revenue for Repayment of Bonds.
The Board of Trustees of the University hereby designates Net Revenues and Additional Funds as the sources of revenue designated for the repayment of the Series 1999B Bonds in accordance with Section 59-147-110 of the Enabling Act.
EXECUTION; NO RECOURSE
The Series 1999B Bonds shall be executed and authenticated in accordance with the applicable provisions of the Bond Resolution.
Section 4.02. No Recourse.
All covenants, stipulations, promises, agreements, and obligations of the University contained in the Bond Resolution or in this Series 1999B Resolution shall be deemed to be the covenants, stipulations, promises, agreements, and obligations of the University and not those of any officer or employee of the University in his individual capacity, and no recourse shall be had for the payment of the principal or redemption price of or interest on the Series 1999B Bonds or for any claim based thereon or on the Bond Resolution or in this Series 1999B Resolution, either jointly or severally, against any officer or employee of the University or any person executing the Series 1999B Bonds.
SERIES 1999B CONSTRUCTION FUND
(A) There is hereby established a Series 1999B Construction Fund which shall be maintained by the Trustee for the benefit of the University. The net proceeds of the Series 1999B Bonds, including proceeds to be used to pay costs of issuance of the Series 1999B Bonds, but excluding those amounts set forth in Subsections 6.01(A)(1), (A)(2), (A)(3), and (A)(4) hereof, shall be deposited in the Series 1999B Construction Fund. All earnings on moneys in the Series 1999B Construction Fund shall accrue to the benefit of the Series 1999B Construction Fund. The Trustee may provide from time to time for the investment of moneys in the Series 1999B Construction Fund in Authorized Investments having suitable maturities consonant with the need for application of the moneys in the Series 1999B Construction Fund; provided, however, that as long as the State Treasurer shall serve as Trustee, the State Treasurer shall have the discretion, with due regard for the rebate compliance provisions set forth in Section 8.05 hereof, to invest moneys in the Series 1999B Construction Fund in Authorized Investments having suitable maturities consonant with the need for the application of such moneys.
(B) Upon completion of construction, acquisition, and equipping of the Project, and the expenditure of all sums necessary therefor, any moneys remaining in the Series 1999B Construction Fund at such time shall, at the discretion of the Chief Financial Officer, be used to acquire, construct, renovate, repair, equip, or improve additional Facilities as may be approved by the Board of Trustees, or be used to fund any amounts required to be paid into the Rebate Fund described in Section 8.05 hereof, or be used to pay interest or principal on the Series 1999B Bonds.
DISPOSITION OF PROCEEDS
(A) Upon the delivery of the Series 1999B Bonds, the net proceeds received by the Trustee for the benefit of the University shall be applied as follows:
(1) any premium shall be deposited in the Series 1999B Debt Service Fund and applied to the payment of the first installment of principal to become due on the Series 1999B Bonds;
(2) in the event such sums are required and borrowed (as provided in Section 3.09 hereof), so much as shall be required to fully fund the Series 1999B Debt Service Reserve Fund shall be deposited therein;
(3) into the Capitalized Interest Account of the Series 1999B Debt Service Fund, amounts, if any, to pay capitalized interest on the Series 1999B Bonds; (4) any accrued interest shall be deposited in the Series 1999B Debt Service Fund and applied to the first interest payment to become due on the Series 1999B Bonds; and
(5) the remaining net proceeds of the sale of the Series 1999B Bonds, including sums to be used to pay costs of issuance of the Series 1999B Bonds as shall be deemed necessary by the Chief Financial Officer, shall be deposited in the Series 1999B Construction Fund to be applied to the payment of costs of issuance of the Series 1999B Bonds and costs of acquisition, renovation, and equipping of the Project.
(B) Neither the purchaser of the Series 1999B Bonds nor any Holder of the Series 1999B Bonds shall be liable for the proper application of the proceeds of the Series 1999B Bonds.
Section 6.02. Establishment and Funding of Series 1999B Debt Service Fund.
The Board of Trustees hereby establishes, pursuant to Section 7.04 of the Bond Resolution, the Series 1999B Debt Service Fund for the purposes set forth in said Section 7.04.
Section 6.03. Establishment and Funding of Series 1999B Debt Service Reserve Fund.
If determined necessary by the Chief Financial Officer as set forth in Section 3.09 hereof, the Board of Trustees shall establish prior to the sale of the Series 1999B Bonds, pursuant to Section 7.05 of the Bond Resolution, a Debt Service Reserve Fund, to be funded in the amount of the 1999B Reserve Requirement. The following pro-visions of this Section 6.03 shall govern in the event any mechanism contemplated by Section 7.05(D) of the Bond Resolution is used to fund the Series 1999B Debt Service Reserve Fund, either in whole or in part. In the event the Series 1999B Debt Service Reserve Fund is funded with both moneys and a surety bond, insurance policy, or letter of credit, any withdrawals from such Series 1999B Debt Service Reserve Fund pursuant to the provisions of this Series 1999B Resolution shall be made first from such moneys (or the liquidation of investments made therewith) and second from such surety bond, insurance policy, or letter of credit. The surety bond, insurance policy, or letter of credit shall be payable (upon the giving of notice as required thereunder) on any Bond Payment Date on which moneys will be required to be withdrawn from such Series 1999B Debt Service Reserve Fund and applied to the payment of the principal of or interest on the Series 1999B Bonds and such payments cannot be made by amounts credited to the Series 1999B Debt Service Fund. The insurer providing such surety bond or insurance policy shall be an insurer whose insurance policies or guaranties insuring the payment of the principal of and interest on municipal bond issues results in such issues being rated in the highest rating category by S & P or Moody's or Fitch or their respective successors. The letter of credit issuer shall be a bank or trust company, acceptable to the Bond Insurer, if any, and which is rated not lower than the second highest rating category by S & P or Moody's or Fitch or their successors, and the letter of credit itself shall be rated in the highest category of either such rating agency. The insurance policy or surety bond must extend for the life of the Series 1999B Bonds and must be unconditional and irrevocable. If a disbursement is made pursuant to a surety bond, an insurance policy, or a letter of credit provided pursuant to this paragraph, the University shall be obligated either (a) to reinstate the maxi-mum limits of such surety bond, insurance policy, or letter of credit, or (b) to depos-it into the Series 1999B Debt Service Reserve Fund cash in the amount of the disburse-ment made under such surety bond, insurance policy, or letter of credit, or a combin-ation of such alternatives, as shall provide that the amount credited equals the Series 1999B Reserve Requirement within a time period not longer than one (1) year after such disbursement. If a letter of credit is provided under the provisions of this para-graph, then within sixty (60) days of the expiration date of any said letter of credit, (1) the University shall, after giving written notice to the Trustee, obtain another letter of credit; or (2) the Trustee shall, at the written direction of the University, draw upon the letter of credit in order to fund the Series 1999B Debt Service Reserve Fund with cash; or (3) the University shall, after giving written notice to the Trustee, fully fund the Series 1999B Debt Service Reserve Fund with cash. The Trustee shall receive such opinions, including legal opinions, certificates, and other documen-tation, as the Trustee shall request, prior to receipt of such surety bond, letter of credit, or insurance policy by the Trustee. If the issuer of a surety bond, insurance policy, or letter of credit on deposit in the Series 1999B Debt Service Reserve Fund shall cease to have a rating described in this paragraph, the University shall either (a) replace such surety bond, insurance policy, or a letter of credit with one issued by an issuer having a rating so described within ninety (90) days and shall pay, or commit to pay, any increased fees, expenses, or interest in connection with such replacement or (b) shall deposit Gross Revenues, in the priority established by Article VIII of the Bond Resolution, in the Series 1999B Debt Service Reserve Fund in two (2) equal semi-annual payments that will, at the end of one (1) year, equal the Series 1999B Reserve Requirement. In the event the Series 1999B Debt Service Reserve Fund is funded with both moneys and a surety bond, insurance policy, or letter of credit as the latter are contemplated herein and by Section 7.05(D) of the Bond Resolution, any available revenues to replenish the Series 1999B Debt Service Reserve Fund shall be used, first, to reimburse the provider of such surety bond, insurance policy, or letter of credit for any amounts advanced, and, second, to replenish said moneys.
AUTHORIZATION TO SELL AND AWARD THE SERIES 1999B BONDS
The Series 1999B Bonds shall be sold in the manner and at the price prescribed by the State Treasurer and the Chief Financial Officer, all as may be permitted under the Enabling Act. In this connection, the Series 1999B Bonds may be offered at public sale, or pursuant to such other procedure for requesting bids as the State Treasurer and the Chief Financial Officer shall determine. In the event the Series 1999B Bonds shall be sold at public sale, bids for such sale shall be received until a time and on a date to be selected by the State Treasurer and the Chief Financial Officer.
Section 7.02. Distribution of Official Statement.
In the event a public sale of the Series 1999B Bonds is conducted or if the terms of any other form of sale authorized hereunder shall require, the Chief Financial Officer is hereby authorized to cause to be prepared a Preliminary Official Statement with respect to the offering and sale of the Series 1999B Bonds and, subsequent to the sale of the Series 1999B Bonds, a final Official Statement. The Chief Financial Officer is hereby authorized to deem final any Preliminary Official Statement pursuant to Securities and Exchange Commission Rule 15c2-12.
Section 7.03. Award of the Bonds.
The Chief Financial Officer and the State Treasurer are hereby authorized and empowered to award the sale of the Series 1999B Bonds to the bidder naming the lowest cost in accordance with the provisions of this Article and Section 3.08 hereof.
MISCELLANEOUS
If any one or more of the covenants or agreements provided in this Series 1999B Resolution on the part of the University, the Trustee, the Paying Agent, or the Registrar to be performed should be contrary to law, then such covenant or covenants or agreement or agreements shall be deemed severable from the remaining covenants and agreements, and shall in no way affect the validity of the other provisions of this Series 1999B Resolution.
Section 8.02. Table of Contents and Section Headings Not Controlling.
The Table of Contents and the Headings of the several Articles and Sections of this Series 1999B Resolution have been prepared for convenience of reference only and shall not control, affect the meaning of, or be taken as an interpretation of any provision of this Series 1999B Resolution.
Section 8.03. Repealing Clauses.
All resolutions, or parts thereof, inconsistent herewith, are hereby rescinded and repealed to the extent of such inconsistencies, except to the extent the provisions of the resolutions constitute official intent for purposes of Section 1.150-2 of the regulations promulgated under the Code.
Section 8.04. Compliance with the Code Generally.
The Board of Trustees hereby represent and covenant that they will comply with all requirements of the Code, and that they will not take any action which will, or fail to take any action (including, without limitation, filing the required information report with the Internal Revenue Service) which failure will, cause interest on the Series 1999B Bonds to become includable in the gross income of the Holder thereof for federal income tax purposes pursuant to the provisions of the Code. Without limiting the generality of the foregoing, the Board of Trustees represent and covenant that:
(A) All property provided by the net proceeds of the Series 1999B Bonds will be owned by the University in accordance with the rules governing the ownership of property for federal income tax purposes.
(B) The Board of Trustees shall not permit the proceeds of the Series 1999B Bonds or any Facilities financed with the proceeds of the Series 1999B Bonds to be used in any manner that would result in (a) ten percent (10%) or more of such proceeds being considered as having been used directly or indirectly in any trade or business carried on by any natural person or in any activity carried on by a person other than a natural person other than a governmental unit as provided in Section 141(b) of the Code, or (b) five percent (5%) or more of such proceeds being considered as having been used directly or indirectly to make or finance loans to any person other than a governmental unit as provided in Section 141(c) of the Code.
(C) The University is not and will not become a party to any contracts with any person for the use or management of any facility provided with the proceeds of the Series 1999B Bonds that do not conform to the guidelines set forth in Revenue Procedures 97-13 or 97-14 of the Internal Revenue Service.
(D) The University will not sell or lease the Project or any leasehold interest in the Project site, or any property the acquisition of which was funded in whole or in part, with proceeds from the sale of the Series 1999B Bonds to any person unless it obtains the opinion of nationally recognized bond counsel that such lease or sale will not affect the tax exemption of the Series 1999B Bonds.
(E) The Series 1999B Bonds will not be federally guaranteed within the meaning of Section 149(b) of the Code. The University shall not enter into any leases or sales or service contracts with any federal government agency and will not enter into any such leases or contracts unless it obtains the opinion of nationally recognized bond counsel that such action will not affect the tax exemption of the Series 1999B Bonds.
Section 8.05. Rebate.
(A) In addition to the covenants contained in Section 8.04 hereof, the Board of Trustees covenant that they will comply with the provisions of Section 148(f) of the Code pertaining to the rebate of certain investment earnings on the proceeds of the Series 1999B Bonds to the United States Government. In this connection, the Board of Trustees covenant to compute, on or before the dates required of them in Section 148(f) of the Code, the rebatable amounts, if any, pertaining to the Series 1999B Bonds and to establish a Rebate Fund pursuant to the Rebate Certificate referred to in paragraph (B) of this Section wherein shall be deposited in a timely fashion all amounts required under said Section 148(f) with respect to the Series 1999B Bonds and to pay to the United States Government from the Rebate Fund in the manner and the amounts prescribed in Section 148(f) of the Code.
(B) In order to comply with the requirements of paragraph (A) of this Section, the University further agrees to execute a Rebate Certificate on or before the delivery of the Series 1999B Bonds pursuant to which the Rebate Fund will be established, and from which Fund the University will pay the necessary amounts to the United States Government.
(C) Notwithstanding anything in this Section to the contrary, the University will not be obligated to comply with any or all of the provisions set forth above in this Section if the University and the Trustee shall receive a written opinion of Bond Counsel to the effect that such non-compliance will not adversely affect the federal tax-exempt status of the Series 1999B Bonds.
(D) Notwithstanding the prior provisions of this Section, the Chief Financial Officer, if applicable, is hereby authorized to make the necessary findings and elections to enable the University to proceed under the spending exceptions contained in Section 148(f)(4)(C) of the Code and Section 1.148-7 of the Regulations, should he determine in his discretion the same to be in the best interests of the University.
Section 8.06. Continuing Disclosure Undertaking.
(A) Pursuant to Section 11-1-85 of the State Code ("Section 11-1-85"), the University covenants to file with a central repository for availability in the secondary bond market when requested:
(1) An annual independent audit, within thirty days of the University's receipt of the audit; and
(2) Event specific information within thirty days of an event adversely affecting more than five percent of the aggregate of Gross Revenues plus Additional Funds. The only remedy for failure by the University to comply with the covenant in this Section 8.06(A) shall be an action for specific performance of this covenant. The University specifically reserves the right to amend this covenant to reflect any change in Section 11-1-85, without the consent of any Bondholder.
(B) In addition, the University hereby authorizes the Chief Financial Officer on behalf of the Board of Trustees to execute the Continuing Disclosure Certificate with changes therein as may be approved by the Chief Financial Officer to be dated as the date of issuance and delivery of the Series 1999B Bonds. The Board of Trustees further hereby covenant and agree to comply with and carry out all of the provisions of the Continuing Disclosure Certificate. Notwithstanding any other provision of this Resolution, failure of the University to comply with the Continuing Disclosure Certificate shall not be considered an Event of Default; however, any Bondholder may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the University to comply with its obligations under this paragraph.
Adopted this 14th day of October, 1999.
___________________________________
(SEAL) Chairman, Board of Trustees of
the University of South Carolina
_____________________________________
Secretary, Board of Trustees of
the University of South Carolina
[FORM OF BOND]
No. R - CUSIP:
UNITED STATES OF AMERICA
STATE OF SOUTH CAROLINA
UNIVERSITY OF SOUTH CAROLINA
REVENUE BOND, SERIES 1999B
[OR SERIES 2000A]
MATURITY DATE:
REGISTERED HOLDER:
PRINCIPAL AMOUNT:
The University of South Carolina, an institution of higher learning and a body politic and corporate of the State of South Carolina (the "University"), for value received, hereby promises to pay, solely from the revenues described and pledged to the payment of this Bond, to the Registered Holder named above, or registered assigns, upon presentation and surrender of this Bond to the principal corporate trust office of (the "Paying Agent"), in the City of , , the Principal Amount set forth above on the Maturity Date set forth above, and to pay solely from said revenues, interest on said Principal Amount from at the annual Interest Rate set forth above (calculated on the basis of a 360 day year of twelve 30_day months) on the first day of and of each year here-after, commencing , until said principal sum is paid. Principal of, premium, if any, and interest on this Bond are payable in any coin or currency of the United States of America which is, at the time of payment, legal tender for the payment of public and private debts. Payments of interest shall be by check or draft mailed by the Paying Agent at the times provided herein to the registered holder of this Bond at the address shown on the registration books without the necessity of surrendering this Bond, and all such payments shall fully discharge the obligation of the University hereon to the extent of the payments so made. Any Registered Holder of $1,000,000 or more in principal amount of the Bonds of this series shall be entitled by written request to the Paying Agent (which notice shall be valid for all future payments until rescinded) to direct that any payments of interest on such Bonds be transmitted to such Registered Holder by wire transfer. Such request shall provide the Paying Agent with specific direction as to the manner of making such payment. The Paying Agent shall keep a record of all such payments. The principal of and premium, if any, on this Bond are payable to or upon the order of the registered holder or his legal representative at the above_named office of Paying Agent upon presentation and surrender of this Bond for cancellation and, if appropriate, exchange for a Bond in the principal amount equal to the balance of the principal amount of this Bond remaining unpaid, having the same Maturity Date and Interest Rate.
The Bonds of this series shall in no event constitute an indebtedness of the State of South Carolina, within the meaning of any provision, limitation or restriction of the Constitution or laws of the State of South Carolina (other than Article X, Section 13 of the South Carolina Constitution authorizing obligations payable solely from a revenue-producing source not involving any tax), nor a charge, lien or encumbrance, legal or equitable, upon any property of the University or the State of South Carolina or upon any income, receipts or revenues of the University or the State of South Carolina save and except the pledge of the Net Revenues (as such term is defined in the Resolution (hereinafter defined)) and Additional Funds (as such term is defined in the Resolution) to secure the payment of the principal of and interest on the Bonds, and neither the full faith and credit nor the taxing power of the State of South Carolina is pledged therefor. No member of the Board of Trustees of the University, nor any person required by the provisions of the Resolution to sign the Bonds, shall be liable thereon.
REFERENCE IS MADE TO THE FURTHER PROVISIONS OF THIS BOND SET FORTH IN THE REVERSE HEREOF WHICH SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS THOUGH FULLY SET FORTH HEREIN.
This Bond shall not be valid or obligatory until the Certificate of Authenti-cation shall have been duly executed by the Registrar.
IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions and things required by the Constitution and laws of the State of South Carolina to exist, to happen and to be performed precedent to or in the issuance of this Bond, exist, have happened and have been done and performed in regular and due time, form and manner, and that the amount of this Bond, and the series of which this Bond is one, does not exceed any constitutional or statutory limitation thereon.
IN WITNESS WHEREOF, the University has caused this Bond to be signed by the man-ual or facsimile signature of its Chairman of the Board of the University, its corpor-ate seal, or facsimile thereof, to be reproduced hereon and the same to be attested by the manual or facsimile signature of its Vice President for Business and Finance.
UNIVERSITY OF SOUTH CAROLINA (SEAL)
By:
Chairman, Board of Trustees of the
University of South Carolina
ATTEST:
By:
Vice President for Business and Finance
Authorized Officer
Date of Authentication:
THIS BOND is one of a series of Bonds in the aggregate principal amount of Twenty-Five Million and No/100 Dollars ($25,000,000) issued pursuant to an Amendatory and Restated Bond Resolution adopted by the Board of Trustees of the University (the "Board of Trustees") on June 21, 1996 (the "Bond Resolution") and a Series Resolution (the "Series Resolution," which, together with the Bond Resolution will be referred to herein as the "Resolution") adopted by the Board of Trustees on October 14, 1999, pursuant to and in full compliance with the Constitution and laws of the State of South Carolina, including particularly Title 59, Chapter 147 of the Code of Laws of South Carolina 1976, as amended (the "Enabling Act"), in order to provide the funds with which to (i) defray the cost of the Project; (ii) fund, if required, the Series 1999B Debt Service Reserve Fund; (iii) pay capitalized interest on the Bonds; (iv) fund the cost of credit enhancement with respect to this Bond, if any; and (v) pay costs of issuance of the Bonds.
Certain capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in the Resolution. Certified copies of the Resolution are on file at the Corporate Trust Office of the Paying Agent and at the office of the Secretary of State of South Carolina.
This Bond is transferable, at the times and as otherwise provided in the Resolution, only upon the registration books kept for that purpose at the office of the Registrar by the Registered Holder in person or by his duly authorized attorney, upon (i) surrender of this Bond together with a written instrument of transfer satisfactory to the Registrar duly executed by the Registered Holder or his duly authorized attorney and (ii) payment of the charges, if any, prescribed in the Resolution. Thereupon a new fully registered Bond or Bonds of like maturity, interest rate, and redemption pro-visions and in a like aggregate principal amount will be issued to the transferee in exchange therefor as provided in the Resolution. The University and the Paying Agent may deem and treat the person in whose name this Bond is registered as the absolute owner hereof for the purpose of receiving payment of or on account of the principal or redemption price hereof and interest due hereon and for all other purposes. For every exchange or transfer of the Bonds, the University, the Paying Agent and the Registrar may make a charge sufficient to reimburse it for any tax, fee or other governmental charge required to be paid with respect to such exchange or transfer.
The Bonds are issuable in the form of fully registered Bonds, or shall be maintained in Book-Entry System format by The Depository Trust Company in accordance with the Resolution, in the denominations of $5,000 or any whole multiple of $5,000.
The Bonds of this series are subject to optional redemption by the University prior to maturity in whole at any time or in part on any interest payment date on or after , 20 at a redemption price equal to the par amount thereof, together with interest accrued thereon to the redemption date.
Portions of any fully registered Bond of this series in an authorized denomination of more than $5,000 to be redeemed shall be selected by the Registrar in such manner as is set forth in the Bond Resolution in a principal amount of $5,000 or a whole multiple thereof, and upon the surrender of such Bond there will be issued to the registered holder thereof, without charge, for the unredeemed balance, if any, of the principal amount of such Bond of this series in any of the authorized denominations as provided in the Bond Resolution.
If any of the Bonds of this series, or portions thereof, are called for redemption, the Registrar will give notice to the Registered Holders of any such Bonds to be redeemed, in the name of the University, of the redemption, of such Bonds, or portions thereof, which notice will specify the Bonds and maturities to be redeemed, the redemption date, the redemption price and the place or places where amounts due upon such redemption will be payable and, if less than all of the Bonds of this series are to be redeemed, the numbers of such Bonds so to be redeemed, and, in the case of Bonds to be redeemed in part only, such notice will also specify the respective portions of the principal amount thereof to be redeemed. Such notice will be given by mailing a copy of the redemption notice by first class mail at least thirty (30) days but not more than sixty (60) days prior to the date fixed for redemption to the appropriate Paying Agent or Agents and the Registered Holder of each Bond to be redeemed, at the address shown on the registration books; provided, however, that failure to give such notice by mail, or any defect in the notice mailed to the Registered Holder of any Bond of this series, shall not affect the validity of the proceedings for the redemption of any other Bond of this series. Provided funds for their redemption are on deposit with the Paying Agent, all Bonds of this series so called for redemption will cease to bear interest on the specified redemption date and shall no longer be deemed to be Outstanding.
For the payment of the principal of, principal, if any, and interest on this Bond and the issue of which it forms a part, there are hereby irrevocably pledged the Net Revenues and Additional Funds on a parity with the pledge of the Net Revenues and Additional Funds pledged for the payment of the principal of and interest on the Parking Facilities Revenue Bonds (as such term is defined in the Resolution) and all other Bonds issued under the Resolution.
The University has covenanted in the Resolution to continuously operate and maintain the Facilities and fix and maintain such rates for the use of the Facilities as shall at all times be sufficient (a) to provide for the payment of the expenses of the administration, operation and maintenance of the Facilities as may be necessary to preserve the same in good repair and condition, (b) to provide for the punctual payment of the principal of and interest on the Bonds and all Junior Lien Bonds that may from time to time be outstanding, (c) to maintain all Debt Service Funds and thus provide for the punctual payment of the principal of and interest on the Bonds that may from time to time be outstanding, (d) to maintain, if required, the Debt Service Reserve Funds in the manner prescribed in the applicable Series Resolutions, (e) to provide a reserve for contingencies and for improvements, renovations and expansions of the Facilities other than those necessary to maintain the same in good repair and condition, (f) to pay all amounts owing under a reimbursement agreement with any provider of a surety bond, line of credit, insurance policy or letter of credit as contemplated by the Resolution, and (g) to discharge all obligations imposed by the Enabling Act and the Resolution.
As provided in the Resolution and on the conditions set forth therein, the University may issue additional Bonds secured by a pledge of the Net Revenues and the Additional Funds, and Parity Bonds secured by a pledge of the Additional Funds, on a parity in all respects with the pledge thereof and lien thereon securing the Bonds of this Series. All such pledges and liens are or shall be on parity with the Bonds of this issue with respect to such pledge and lien, if such other Bonds are issued under the conditions prescribed in the Resolution.
The Bond Resolution provides that upon the occurrence of any Event of Default, the Trustee may, and upon the written request of Registered Holders and not less than twenty-five percent (25%) aggregate principal amount of Bonds outstanding shall, declare the principal of all Bonds outstanding immediately due and payable and may exercise the remedies provided in the Bond Resolution.
THIS BOND and the interest hereon are exempt from all State, county, municipal school district and all other taxes or assessments of the State of South Carolina, direct or indirect, general or special whether imposed for the purpose of general revenue or otherwise, except estate and transfer taxes.
CONTINUING DISCLOSURE UNDERTAKING
SECTION 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the Issuer for the benefit of the Registered Holders and Beneficial Owners and in order to assist the Participating Underwriters in complying with S.E.C. Rule 15c2-12(b)(5).
SECTION 2. Definitions. In addition to the definitions set forth in the Resolution, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings:
["__________________________" shall mean __________________, a _________-domiciled stock insurance company.]
"Annual Report" shall mean any Annual Report provided by the Issuer pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate.
"Beneficial Owner" shall mean any person which (a) has the power, directly or in-directly, to vote or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds through nominees, depositories or other intermedi-aries), or (b) is treated as the owner of any Bonds for federal income tax purposes.
"Dissemination Agent" shall mean the Issuer or any successor Dissemination Agent designated in writing by the Issuer and which has filed with the Issuer a written acceptance of such designation.
"Holders" or "Holders of the Bonds" shall mean the registered owners of the Bonds.
"Listed Events" shall mean any of the events listed in Section 5(a) of this Disclosure Certificate.
"National Repository" shall mean any Nationally Recognized Municipal Securities Information Repository for purposes of the Rule. The National Repositories currently approved by the Securities and Exchange Commission are set forth in Exhibit B.
"Participating Underwriter" shall mean any of the original underwriters of the Bonds required to comply with the Rule in connection with the offering of the Bonds.
"Repository" shall mean each National Repository and each State Repository.
"Rule" shall mean Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time.
"State" shall mean the State of South Carolina.
"State Repository" shall mean any public or private repository or entity designated by the State as a state repository for the purpose of the Rule, and recognized as such by the Securities and Exchange Commission. As of the date of this Certificate, there is no State Repository.
SECTION 3. Provision of Annual Reports.
(a) The Issuer shall, or shall cause the Dissemination Agent to, not later than seven (7) months after the end of the Issuer's fiscal year (currently, June 30) commencing with the report for fiscal year ending June 30, 2000, provide to _________________ and each Repository an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Certificate. Not later than fifteen (15) business days prior to said date, the Issuer shall provide the Annual Report to the Dissemination Agent (if other than the Issuer). The Annual Report may be submitted as a single document or as separate documents comprising a package, and may cross-reference other information as provided in Section 4 of this Disclosure Certificate; provided that the audited financial statements of the Issuer may be submitted separately from the balance of the Annual Report and later than the date required above for the filing of the Annual Report if they are not available by that date. If the Issuer's fiscal year changes, the Issuer shall give notice of such change in the same manner as for a Listed Event under Section 5(c).
(b) If the Issuer is unable to provide to ___________________ and the Repositories an Annual Report by the date required in subsection (a), the Issuer shall send a notice to the Municipal Securities Rulemaking Board and the State Repository, if any, in substantially the form attached as Exhibit A.
(c) The Dissemination Agent shall:
(i) determine each year prior to the date for providing the Annual Report the name and address of each National Repository and the State Repository, if any; and
(ii) (if the Dissemination Agent is other than the Issuer) file a report with the Issuer certifying that the Annual Report has been provided pursuant to this Disclosure Certificate, stating the date it was provided and listing all the Repositories to which it was provided.
SECTION 4. Content of Annual Reports. The Issuer's Annual Report shall contain or include by reference the Issuer's complete audited financial statements for the preceding fiscal year prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board. If the Issuer's audited financial statements are not available by the time the Annual Report is required to be filed pursuant to Section 3(a), the Annual Report shall contain unaudited financial statements in a format similar to the financial statements contained in the final Official Statement and the audited financial statements shall be filed in the same manner as the Annual Report when they become available, and changes in and current information with respect to those matters discussed in the Official Statement dated _____________, 1999 with respect to the Bonds, under the captions "THE SERIES 1999B BONDS" and "THE FACILITIES" and "THE UNIVERSITY - Enrollment."
Any or all of the items listed above may be included by specific reference from other documents, including official statements of debt issues of the Issuer or related public entities which have been submitted to each of the Repositories, the Securities and Exchange Commission or _____________________. If the document included by reference is a final official statement, it must be available from the Municipal Securities Rulemaking Board. The Issuer shall clearly identify each such other document so included by reference.
SECTION 5. Reporting of Significant Events.
(a) Pursuant to the provisions of this Section 5, the Issuer shall give or cause to be given notice of the occurrence of any of the following events with respect to the Bonds, if material:
1. Delinquency in payment when due of any principal of or interest on the Bonds.
2. Occurrence of any event of default under the Resolution (other than as described in clause (1) above).
3. Amendment to the Resolution or this Disclosure Certificate modifying the rights of the Holders of the Bonds.
4. Giving of a notice of optional or unscheduled redemption of any Bonds.
5. Defeasance of the Bonds or any portion thereof.
6. Any change in any rating on the Bonds.
7. Adverse tax opinions or events affecting the tax-exempt status of the Bonds.
8. Any unscheduled draw reflecting financial difficulties on any reserve fund established by the Issuer to secure further the timely repayment of the Bonds.
9. Any unscheduled draw reflecting financial difficulties on any credit enhancement device obtained by the Issuer to secure further the timely repayment of the Bonds.
10. Any change in the provider of any credit enhancement device described in item 9 above, or any failure by the provider to perform under such a credit enhancement device.
11. The release, substitution or sale of any property hereafter leased, mortgaged or pledged by the Issuer securing repayment of the Bonds.
(b) Whenever the Issuer obtains knowledge of the occurrence of a Listed Event, the Issuer shall as soon as possible determine if such event would be material under applicable federal securities laws.
(c) If the Issuer determines that knowledge of the occurrence of a Listed Event would be material under applicable federal securities laws, the Issuer shall promptly file a notice of such occurrence with _____________________, the Municipal Securities Rulemaking Board and the State Repository. Notwithstanding the foregoing, notice of Listed Events described in subsections (a) (4) and (5) need not be given under this subsection any earlier than the notice (if any) of the underlying event is given to Holders of affected Bonds pursuant to the Resolution.
SECTION 6. Termination of Reporting Obligation. The Issuer's obligations under this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. If such termination occurs prior to the final maturity of the Bonds, the Issuer shall give notice of such termination in the same manner as for a Listed Event under Section 5(c).
SECTION 7. Dissemination Agent. The Issuer may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The Dissemination Agent shall not be responsible in any manner for the content of any notice or report prepared by the Issuer pursuant to this Disclosure Certificate. The initial Dissemination Agent shall be the Issuer.
SECTION 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the Issuer may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied:
(a) If the amendment or waiver relates to the provisions of Sections 3(a), 4, or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature, or status of an obligated person with respect to the Bonds, or the type of business conducted;
(b) This Disclosure Certificate, as amended or taking into account such waiver, would, in the opinion of nationally-recognized bond counsel, have complied with the requirements of the Rule at the time of the original issuance of the Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and
(c) The amendment or waiver either (i) is approved by the Holders of the Bonds in the same manner as provided in the Resolution for amendments to the Resolution with the consent of Holders, or (ii) does not, in the opinion of said nationally-recognized bond counsel, materially impair the interests of the Holders or Beneficial Owners of the Bonds.
In the event of any amendment or waiver of a provision of this Disclosure Certificate, the Issuer shall describe such amendment in the next Annual Report, and shall include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type (or in the case of a change of accounting principles, on the presentation) of financial information or operating data being presented by the Issuer. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements, (i) notice of such change shall be given in the same manner as for a Listed Event under Section 5(c), and (ii) the Annual Report for the year in which the change is made should present a comparison (in narrative form and also, if feasible, quantitative form) between the financial statements as prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles.
SECTION 9. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Issuer from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the Issuer chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the Issuer shall have no obligation under this Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event.
SECTION 10. Default. In the event of a failure of the Issuer to comply with any provision of this Disclosure Certificate, ___________________ or any Bondholder or Beneficial Owner may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Issuer to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Resolution, and the sole remedy under this Disclosure Certificate in the event of any failure of the Issuer to comply with this Disclosure Certificate shall be an action to compel performance.
SECTION 11. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the Issuer, the Dissemination Agent, the Participating Underwriters, _________________, Holders and Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or entity.
THE UNIVERSITY OF SOUTH CAROLINA
By:
Vice President for Business and Finance
Date: , 1999
THE UNIVERSITY OF SOUTH CAROLINA
$_____________ REVENUE BONDS, SERIES 1999B
Date of Issuance: ________________, 1999
NOTICE IS HEREBY GIVEN that the Issuer has not provided an Annual Report with respect to the above-named Bonds as required by Section 8.06 of the Series 1999B Resolution adopted on October 14, 1999. The Issuer anticipates that the Annual Report will be filed by .