Resolution to Approve the Issuance of $17
million in State Institutional bonds for the Construction of
the Lois Rhame West Health and Physical Education Center
STATE OF SOUTH CAROLINA
WINTHROP UNIVERSITY
A RESOLUTION REQUESTING THE ISSUANCE OF NOT
EXCEEDING SEVENTEEN MILLION DOLLARS ($17,000,000) OF GENERAL OBLIGATION
STATE INSTITUTION BONDS FOR WINTHROP UNIVERSITY PURSUANT TO CHAPTER 107,
TITLE 59, CODE OF LAWS OF SOUTH CAROLINA 1976, AS AMENDED.
April 8, 2005
TABLE OF CONTENTS
Section 1. Findings of Fact
Section 2. Application for Issuance of State Institution Bonds
Section 3. Use of Proceeds
Section 4. Tuition Fees Received in Previous Fiscal Year
Section 5. Current Schedule of Tuition Fees
Section 6. Maturity Schedule for Bonds
Section 7. Debt Service on Outstanding State Institution Bonds
Section 8. Debt Service on Outstanding Bonds Including Bonds Authorized
Hereby
Section 9. Covenant to Impose Tuition Fees Sufficient to Pay Bonds
Section 10. Tax Covenants
Section 11. Secretary to Present Resolution to State Board
Section 12. Execution of Closing Documents and Certificates
Section 13. Reimbursement Declaration
Section 14. Law and Place of Enforcement of the Resolution
Section 15. Effect of Section Headings
Section 16. Repeal of Inconsistent Resolutions
Section 17. Effectiveness of this Resolution
Exhibit A Schedule of Tuition and Fees
Exhibit B Pro Forma Debt Service Table
Exhibit C Debt Service Requirements on Outstanding Debt
Exhibit D Combined Debt Service Table
Exhibit E Proof of Compliance
A RESOLUTION
REQUESTING THE ISSUANCE OF NOT EXCEEDING SEVENTEEN MILLION DOLLARS
($17,000,000) OF GENERAL OBLIGATION STATE INSTITUTION BONDS FOR WINTHROP
UNIVERSITY PURSUANT TO CHAPTER 107, TITLE 59, CODE OF LAWS OF SOUTH
CAROLINA 1976, AS AMENDED.
BE IT RESOLVED BY THE BOARD OF TRUSTEES OF WINTHROP UNIVERSITY IN
MEETING DULY ASSEMBLED:
SECTION 1. Findings of Fact. As an incident to the adoption of
this Resolution, the Board of Trustees (the “Board of Trustees”) of
Winthrop University (the “University”) hereby finds and determines as
follows:
(a) This Resolution is adopted by the Board of Trustees pursuant to
Title 59, Chapter 107, Code of Laws of South Carolina 1976, as amended
(the “Enabling Act”).
(b) Pursuant to Section 59-107-40 of the Enabling Act, the Board of
Trustees is authorized to make application to the South Carolina State
Budget and Control Board (the “State Board”) for funds: (i) to
construct, reconstruct, maintain, improve, furnish, and refurnish the
buildings of and other permanent improvements to the University, (ii) to
defray the costs of acquiring or improving land needed as sites for such
improvements or for the campus of the University, and (iii) to reimburse
the University for expenses incurred in anticipation of the issuance of
such bonds.
(c) The Board of Trustees has determined to construct the Lois Rhame
West Health, Physical Education and Wellness Center (the “Project”) The
Project includes the demolition of the existing 1915 Peabody Building
structure, the construction of a new Health, Physical Education and
Wellness building, and all site work associated with the new building as
well as the new Campus Center, which will be constructed after the
completion of the West Center. The Lois Rhame West Center is a 137,000
square feet building. The building will house the academic departments
of Physical Education, Sport Management and some dance studios. The
second floor will house all the faculty offices and classrooms. The
lower areas will include an eight-lane, 25-yard pool with seating for
300, four racket ball courts, a two story climbing wall, extensive
locker room facilities, an 8,000 square feet weight room, two
multipurpose aerobics/dance studios, four full size basketball courts, a
suspended jogging track, and treadmills. The building will ultimately be
connected to the new Campus Center facility via a covered plaza. The
estimated total cost of the Project is $24,900,000.
(d) Of the projected costs of the Project as described above, Capital
Improvement Bond proceeds in the amount of $6,400,000 have been
appropriated by the State of South Carolina and $1,500,000 has been
identified from the institution’s capital project funds to fund a
portion of the project. The Board of Trustees, in order to fund the
remaining projected costs of the Project, and having exhausted all other
sources, now desires to make application to the State Board to issue not
exceeding Seventeen Million Dollars ($17,000,000) principal amount State
Institution Bonds (Issued on Behalf of Winthrop University) of the State
of South Carolina (the “Bonds”) pursuant to the Enabling Act, on the
basis that a definite and immediate need exists for acquiring,
constructing, reconstructing, maintaining, improving, furnishing, and
refurnishing the Project, and therefore for issuing such Bonds. The
proceeds of the Bonds shall be applied to defray a portion of the costs
of the Project and to pay the costs of issuance of the Bonds.
(e) Accordingly, this Resolution is adopted pursuant to Section
59-107-40 of the Enabling Act, in order to make formal application to
the State Board for the issuance of the Bonds, the proceeds of which
will be used for the purposes set forth in paragraph (d) of this Section
1.SECTION 2. Application
for Issuance of State Institution Refunding Bonds. The Board of Trustees
hereby makes formal application to the State Board for funds through the
issuance of the Bonds pursuant to the provisions of the Enabling Act, in
order that the proceeds thereof may be used for the purposes set forth
in paragraph (d) of Section 1 hereof.
SECTION 3. Use of Proceeds. All
of the proceeds of the proposed issue of the Bonds will be applied for
the purposes set forth in paragraph (d) of Section 1 hereof.
SECTION 4. Tuition Fees Received
in Previous Fiscal Year. The aggregate sum received by the University
from tuition fees available to pay debt service on State Institution
Bonds for the preceding fiscal year (July 1, 2003 through June 30, 2004)
is not less than $3,299,296.
SECTION 5. Current Schedule of
Tuition Fees. The schedule of tuition fees as defined in the Enabling
Act and as now in effect at the University is as set forth as Exhibit A
to this Resolution, which schedule is hereby reaffirmed and approved.
SECTION 6. Maturity Schedule for
Bonds. The suggested maturity schedule for the Bonds requested to be
issued pursuant to this Resolution is set forth as Exhibit B to this
Resolution. Said Exhibit B assumes that the principal amount of the
Bonds will be Seventeen Million Dollars ($17,000,000), as set forth
above.
SECTION 7. Debt Service on
Outstanding State Institution Bonds. A statement showing all State
Institution Bonds heretofore issued on behalf of the University now
outstanding and not defeased, together with the annual interest and
principal payments to become due thereon, is set forth as Exhibit C to
this Resolution.
SECTION 8. Debt Service on
Outstanding Bonds Including Bonds Authorized Hereby. A table showing
debt service on all State Institution Bonds to be outstanding for the
University following the issuance of the Bonds (at an assumed principal
amount of the Bonds of Seventeen Million Dollars ($17,000,000) and an
average interest rate on the Bonds of 4.38%) is set forth as Exhibit D
to this Resolution. Upon the issuance of the Bonds, the maximum annual
debt service on all State Institution Bonds secured by tuition fees of
the University will not be greater than 90% of the tuition fees received
by the University for the fiscal year ended June 30, 2004.
A calculation establishing the right of the University to seek the
issuance of Bonds to the extent set forth in this Resolution is set
forth as Exhibit E to this Resolution.
SECTION 9. Covenant to Impose
Tuition Fees Sufficient to Pay Bonds. The Board of Trustees hereby
covenants and agrees that the schedule of tuition fees now in effect at
the University will be revised from time to time and whenever necessary
in order to provide the annual principal and interest requirements of
all State Institution Bonds now or hereafter to be outstanding, which
have been or will be issued on behalf of the University.
SECTION 10. Tax Covenants.
(a) Federal Guarantee Prohibition. The University shall not take any
action or permit or suffer any action to be taken if the result of the
same would be to cause the Bonds to be “federally guaranteed” within the
meaning of Section 149(b) of the Internal Revenue Code of 1986, as
amended (the “Code”), and regulations promulgated thereunder (the
“Regulations”).
(b) Private Business Limitation. The University shall ensure that (i)
not in excess of ten percent of the face amount of the Bonds, plus
accrued interest and premium, if any (“Net Proceeds”) or of the
facilities financed or refinanced thereby (which, for purposes of this
covenants in this Resolution, shall be included within the definition of
“Net Proceeds”), is used directly or indirectly in a trade or business
carried on by a natural person or in any activity carried on by a person
other than a natural person, excluding, however, use by a state or local
governmental unit and use as a member of the general public (“Private
Business Use”), if, in addition, the payment of more than ten percent of
the principal or ten percent of the interest due on the Bonds during the
term thereof is, under the terms thereof or any underlying arrangement,
directly or indirectly, secured by any interest in property used or to
be used for a Private Business Use or in payments in respect of property
used or to be used for a Private Business Use or is to be derived from
payments, whether or not to the State, in respect of property or
borrowed money used or to be used for a Private Business Use; and (ii)
in the event that both (a) in excess of five percent of the Net Proceeds
are used for a Private Business Use, and (b) an amount in excess of five
percent of the principal or five percent of the interest due on the
Bonds during the term thereof is, under the terms thereof or any
underlying arrangement, directly or indirectly, secured by any interest
in property used or to be used for said Private Business Use or in
payments in respect of property used or to be used for said Private
Business Use or is to be derived from payments, whether or not to the
State, in respect of property or borrowed money used or to be used for
said Private Business Use, then said excess over said five percent of
Net Proceeds used for a Private Business Use shall be used for a Private
Business Use related to the governmental use of a portion of the
facilities financed with the proceeds of the Bonds and shall not exceed
the proceeds used for the governmental use of the portion of the
undertaking to which such Private Business Use is related.
(c) Private Loan Limitation. The University shall ensure that not in
excess of 5% of the proceeds of the Bonds will be used, directly or
indirectly, to make or finance a loan to persons other than state or
local government units.
(d) No Arbitrage. The University represents that it does not expect any
portion of the proceeds of the Bonds to be used directly or indirectly
to acquire higher yielding investments, or to replace funds which were
used directly or indirectly to acquire higher yielding investments for
other than a “temporary period” as defined in the Code and the
Regulations. The University further covenants that it will not
intentionally use any portion of the proceeds of the Bonds to acquire
higher yielding investments or to replace funds which were used directly
or indirectly to acquire higher yielding investments. In making the
foregoing representation and covenant, the University understands and
intends that words or phrases contained herein have meanings provided
therefor under Section 148 of the Code and under the Regulations.
SECTION 11. Secretary to Present
Resolution to State Board. The Secretary of the Board of Trustees is
hereby directed to present a certified copy of this Resolution, together
with the Exhibits, to the State Board, as evidence of the Board of
Trustees’ formal request for the issuance of the Bonds on behalf of the
University, and as evidence that all conditions precedent to the
issuance of such Bonds have been met prior to the issuance of the Bonds.
SECTION 12. Execution of Closing
Documents and Certificates. The Chairman and the Secretary of the Board
of Trustees, and all other officers of the University, are fully
authorized and empowered to take such further action and to execute and
deliver such closing documents as may be necessary and proper in order
to complete the borrowing herein authorized and the action of such
officers or anyone or more of them in executing and delivering any of
such documents in such form as he or they shall approve, is hereby fully
authorized. In particular, such officers of the University are
authorized to abide by covenants made by or on behalf of the State Board
in connection herewith relating to Sections 9, 10, 11, and 12 hereof or
relating to Rule 15c2-12 of the United States Securities and Exchange
Commission or relating to Section 11-1-85 of the Code of Laws of South
Carolina 1976, as amended.
SECTION 13. Reimbursement
Declaration. The University hereby declares its intention to reimburse
itself for a portion of the costs of the Project with the proceeds of
the Bonds requested to be issued herein. To that end, the Board of
Trustees determines and declares as follows:
(a) no funds from any sources other than the Bonds are, or are
reasonably expected to be, reserved, allocated on a long-term basis or
otherwise set aside by the University pursuant to the budget or
financial policies of the University for the financing of the portion of
the costs of acquisition, construction, and equipping of the Project to
be funded with the Bonds;
(b) the University reasonably expects that all or a portion of the
expenditures incurred for the Project and the issuance of the Bonds will
be paid prior to the issuance of the Bonds;
(c) the University intends and reasonably expects to reimburse itself
for all such expenditures paid by it with respect to the Project prior
to the issuance of the Bonds from the proceeds of the Bonds and such
intention is consistent with the budgetary and financial circumstances
of the University;
(d) all of the costs to be paid or reimbursed from the proceeds of the
Bonds will be for costs incurred in connection with the issuance of the
Bonds or will, at the time of payment thereof, be properly chargeable to
the capital account of the Project (or would be so chargeable with a
proper election) under general federal income tax principles; and
(e) this resolution shall constitute a declaration of official intent
under United States Department of the Treasury Regulation Section
1.150-2.
SECTION 14. Law and Place of
Enforcement of the Resolution. This Resolution shall be construed and
interpreted in accordance with the laws of the State of South Carolina.
All suits and actions arising out of this Resolution shall be instituted
in a court of competent jurisdiction in the State.
SECTION 15. Effect of Section
Headings. The heading or titles of the several Sections hereof are
solely for convenience of reference and shall not affect the meaning,
construction, interpretation or effect of this Resolution.
SECTION 16. Repeal of
Inconsistent Resolutions. All resolutions of the Board of Trustees, and
any party of any resolution, inconsistent with this Resolution are
hereby repealed to the extent of such inconsistency.
SECTION 17. Effectiveness of this
Resolution. This Resolution shall become effective upon its adoption.
Done in meeting duly assembled this 8th day of April, 2005.
BOARD OF TRUSTEES OF
WINTHROP UNIVERSITY
------------------------------------------------------------------------------------------------------------------
EXHIBIT A
WINTHROP UNIVERSITY
SCHEDULE OF TUITION FEES IN EFFECT FOR PURPOSES OF
SECTION 59-107-10 ET SEQ., CODE OF LAWS OF
SOUTH CAROLINA 1976, AS AMENDED
In-State Out-of-State
Undergraduate $3,908 $7,205
Graduate 3,764 6,922
Graduate-Certification 3,764 5,427
For the fiscal year ended June 30, 2004, the amount of receipts
designated as tuition fees for state institution bonds purposes is
$3,299,296. The tuition and fees generated for the 2004 summer term are
not included.
The maximum principal and interest debt service payment prior to the
issuance contemplated herein is $1,317,741, which occurs in the fiscal
year ending June 30, 2007.
The maximum principal and interest debt service payment after the
issuance contemplated herein is anticipated to be $2,611,811, which
occurs in the fiscal year ending June 30, 2007.
EXHIBIT B
WINTHROP UNIVERSITY
PRO FORMA DEBT SERVICE TABLE ON THE PROPOSED ISSUE OF
SEVENTEEN MILLION DOLLARS ($17,000,000)
GENERAL OBLIGATION STATE INSTITUTION BONDS
PRINCIPAL AND INTEREST PAYABLE AS INDICATED
COMPUTED AT AN ASSUMED AVERAGE INTEREST RATE OF 4.38%
EXHIBIT C
DEBT SERVICE REQUIREMENTS
ON ALL GENERAL OBLIGATION STATE INSTITUTION BONDS ISSUED BY
THE STATE OF SOUTH CAROLINA ON BEHALF OF WINTHROP UNIVERSITY
EXHIBIT D
COMPOSITE PRO FORMA DEBT SERVICE
ON ALL GENERAL OBLIGATION STATE INSTITUTION BONDS
ISSUED BY THE STATE OF SOUTH CAROLINA ON BEHALF OF WINTHROP UNIVERSITY
INCLUDING THE PROPOSED ISSUE OF SEVENTEEN MILLION DOLLARS ($17,000,000)
OF GENERAL OBLIGATION STATE INSTITUTION BONDS
COMPUTED AT AN ASSUMED AVERAGE RATE OF INTEREST OF 4.38%
EXHIBIT E
WINTHROP UNIVERSITY
PROOF OF COMPLIANCE WITH
CHAPTER 107, TITLE 59, SOUTH CAROLINA CODE OF LAWS 1976, AS AMENDED
Aggregate of tuition fees received by the University during preceding
fiscal year ended June 30, 2004 $ 3,299,296
Multiplied by 90%
Produces 2,969,366
Maximum annual debt service on all State Institution Bonds of the
University (including the proposed issue of Seventeen Million Dollars
$17,000,000 State Institution Bonds herein requested)
2,611,811
Margin $ 357,555
April 8, 2005 |
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