xt744j09w944 https://exploreuk.uky.edu/dips/xt744j09w944/data/mets.xml Lexington, Kentucky University of Kentucky 1935117 minutes English University of Kentucky Contact the Special Collections Research Center for information regarding rights and use of this collection. Minutes of the University of Kentucky Board of Trustees Minutes of the University of Kentucky Board of Trustees, 1935-11-dec7. text Minutes of the University of Kentucky Board of Trustees, 1935-11-dec7. 1935 2011 true xt744j09w944 section xt744j09w944 










     Minutes of Called Meeting of the Board of Trustees, Univer-
sity of Kentucky, December 7, 1935.


     The Board of Trustees of the University of Kentucky met in
President IMicVeyts office at the University of Kentucky, December
7, at 2:30 p. m., with Ruby Laffoon, Chairman of the Board, in
the Chair,  Upon roll call the following members answered pres-
ent: Governor Ruby Laffoon, Judge Richard C. Stoll, R. Miller
Holland, Joe B. Andrews, G-. C. Wells, Louis Hillenmeyer, Dr.
George H. Wilson, John S. Cooper, 0. C. Whitfield, and James Park.
Those absent were Eugene T, Flowers, W. C. Hanna, James H. Rich-
mond, James Rash and Robert G. Gordon.

     Upon motion duly made and seconded, the notice of call for
this meeting was ordered placed in the Minutes by the Secretary.



                  COPY OF LETTER OF CALL


     November
     Twenty-six
     1 9 3 5


     The undersigned, Ruby Laffoon, Chairman of the Board of
     Trustees of the University of Kentucky, hereby calls a
     special meeting of the Board of Trustees of the Univer-
     sity of Kentucky, to be held in President McVey's office,
     Administration Building, University of Kentucky Campus,
     Lexington, Kentucky, at 2:30 p. m. , Saturday, December
     7, 1935.   The object and the purpose of the meeting is
     stated as follows:

     1. To consider and accept an offer from the United
     States of America to aid by way of loan and grant in
     financing the construction of several buildings upon
     the campus of the University of Kentucky at Lexington,
     Kentucky, consisting of a Central Heating Plant, En-
     gineering Group Buildings, a Student Union Building and
     a Law Building.

     2. To authorize the construction of the aforesaid
     buildings upon plans prepared by the College of En-
     gineering and approved by the Director of the Federal
     Emergency Administration of Public Works.




 






2.



3. To consider and approve by proper resolutions i'_ne
issuing of the special obligations of the University
to defray the cost of the construction of these build-
ings not represented by the "grantn to be made by the
United States of America.

4. To consider and approve a schedule of rates, rents,
etc., to be charged for the use, occupancy, and service
to be rendered by the aforesaid buildings.

5. To authorize the Secretary of the Board of Trustees
to advertise for contract bids for the construction of
said buildings as and when the need shall arise, and
to authorize the Executive Committee of the Board of
Trustees to receive and allocate said contract bids
and to authorize the Vice Chairman to execute same,

6. To consider and approve such other matters as may
arise in connection with the construction of the afore-
said buildings, and such other questions of business
as  may be brought before the meeting.

It is absolutely necessary that a quorum be present and
the presezie of each member is earnestly desired.

Very truly yours,

(Signed) Ruby Laffoon

Chairman of the Board of Trustees
   University of Kentucky


(SEAL)

ATTEST:


D. H. Peak
Secretary




 









     president McVey presented the offer of the United 2tates of
America to the University of Kentucky to aid by way of loan and
grant in financing the construction of three university buildings
and a steam heating plant. the following Resolution, numbered one,
and entitled "A RESOLUTION ACCEPTING THE OFFER OF THE UNITED
STATES TO THE UNIVERSITY OF KENTUCKY TO AID BY WAY OF LOAN AND
GRANT IN FINANCING THE CONSTRUCTION OF THREE UNIVERSITY BUILD-
INGS AND A STEAM HEATING PLANT" was proposed by 0. C. Whitfield,
and read in full:


                     RESOLUTION NO. 1

     A RESOLUTION ACCEPTING THE OFFER OF THE UNITED STATES
     TO THE UNIVERSITY OF KENTUCKY TO AID BY WAY OF LOAN
     AND GRANT IN FINANCING THE CONSTRUCTION OF THREE UTTI-
     VERSITY BUILDINGS AND A STEAM HEATING PLANT


     Be it resolved by the Board of Trustees of the University of
Kentucky:

     Section 1. That the offer of the United States of America
to the University of Kentucky to aid by way of loan and grant
in financing the construction of three university buildings, and
a steam heating plant, a copy of which reads as follows:

             "Federal Emergency Administration
                      of Public Works

                                          Washington, D. C.
                                          November 6, 1935

                                          State file No. Ky. 1013

Board of Trustees of the University of Kentucky,
Lexington, Kentucky

     1. Subject to the Rules and Regulations (PWA Form No. 166,
July 22, 1935, as amended to date) which are made a part there-
of, the United States of America, hereby offers to aid in financ-
ing the construction and equipping of three (3) university build-
ings and central heating plant (herein called the "Project") by
making a grant to the Board of Trustees of the University of Ken-
tucky (herein called the "Applicant") in the amount of forty-
five per cent (45%) of the cost of the Project upon completion,
as determined by the Federal Emergency Administrator of Public
Works, but not to exceed, in any event, the sum of 8165,000
and by purchasing, at the principal amount thereof plus accrued
interest thereon, from the Applicant, obligations of the de-
scription set forth below (or such other description as shall
be mutually satisfactory) in the aggregate Principal amount of
$600 0OO:




 





4.



(a) Obligor: Board of Trustees of the University of
             Kentucky;

(b) Type: Special obligation college building revenue,
    coupon bonds;

(c) Denomination: $1,000; (d) Date: October 1, 1935;

(e) Interest rate and interest payment dates: Four per
    cent (4%) per annum, payable semi-annually on April
    1 and October 1 of each year;

(f) Place of payment: At the office of the Treasurer
    of the University of Kentucky in Lexington, Kentucky,
    or at the option of the holder at a bank or trust
    company in the Borough of Manhattan, City and State
    of New York;

(g) Registration privileges: Registerable, at the option
    of the holder, as to principal or as to the principal
    and interest;

 (h) Maturities: Maturing on October 1 in years and amounts
    as follows:

         1938 to 1939, inclusive, $15,000
         1940 to 1960, inclusive, $20,000
         1961 to 1965, inclusive, $30,000

 (i) Security: Payable as to both principal and interest
    from and secured by a first lien on and an exclusive
    pledge of a fixed amount of the gross revenues to be
    derived from the operation of the Project, which
    fixed amount shall at all times be sufficient to pay
    the interest on and principal of the bonds, as and
    when they nraturf, and further secured by a statutory
    mortgage lien on the Project.

2. This offer is conditioned upon -

(a) The Applicant's adopting a resolution or resolutions f x
    reasonable and adequate rates to be charged for the
    facilities and services afforded by the Project, in-
    cluding those afforded to the applicant:

 (b) The Applicant's adopting, prior to the payment by
     the United States of America for any obligations
     which it herein offers to purchase, resolution cov-
     enanting to establish and enforce, so long as any
     obligations which the United States of America
     herein offers to purchase remain outstanding sand
     unpaid, such parietal rules and regulations as will
     insure maximum occupancy of the facilities and




 





5.



         services afforded by the Project.

                           UNITED STATES OF AMERICA

                           Federal Emergency Administrator
                           of Public Works

                         By (Sgd.) Horatio B. Hackett
                                   Assistant Administrator"


be and the same is hereby in all respects accepted.

     Section 2. That said University of Kentucky agrees to abide
by all the rules and regulations relating to such loan and grant
a copy of which rules and regulations was annexed to the Govern-
ment's offer and made a part thereof.

     Section 3. That the Secretary be and he is hereby author-
ized and directed forthwith to send to the Federal Emergency Ad-
ministration of Public Works three certified copies of this
Resolution and three certified copies of the proceedings of this
Board in connection with the adoption of this Resolution, and
such further documents or proofs in connection with the accept-
ance of said offer as may be requested by the Federal Emergency
Administration of Public Works.

                                (Signed) Ruby Laffoon
                                          Chairman

(SEAL)
ATTEST:

D. H. Peak Secretary


     The above resolution was seconded by G. C. Wells.    The
Secretary then called the roll and each member present voted aye.

     The Chairman thereupon declared said Resolution carried and
thereupon signed said Resolution in approval thereof.

     The Secretary was authorized to certify as follows:

     I, D. H. Peak, the duly chosen, qualified and acting Secre-
tary of the Board of Trustees of the University of Kentucky,
do hereby certify that the attached copy of the extracts of the
minutes of a special meeting of the Board of Trustees of the Uni-
versity of Kentucky held on the 7th day of December, 1935, is
a true, correct, and compared copy of the original minutes of
said meeting on file and of record, and I do further certify
that the copy of the Resolution, appearing in such minutes en-
titled "A RESOLUTION ACCEPTING THE OFFER OF THE UNITED STATES




 







6,.



T20 THE UNIVERSITY OF KENTUCKY TO AID BY WAY OF LOAN AND CRANT
IN FINANJING THE CONSTRUCTICN OF TEMEE UNIVERSITY BUILDINGS AND
A STEAM HEATING PLANT" is a true, correct, and compared copy of
the original RESOLUTION adopted at said meeting, which Resolution
is on file and of record in my office.

     WITNESS my hand and the seal of the said University this
ninth day of December, 1935.


                            D. H. Peak
                            Secretary, Board of Trustees of the
                            University of Kentucky.

(SEAL)


     Thereupon the President presented Resolution No. 2, which
was read and discussed.   The motion for this resolution was made
by Richard C. Stoll and  seconded by 0. C. Whitfield.  The secre-
tary then called the roll and each member present voted aye.

     The Chairman thereupon declared the Resolution carried and
thereupon signed said Resolution in approval thereof,


                     RESOLUTION NO. 2

     A RESOLUTION APPROVING THE TENTATIVE PLANS AND SPECI-
     FICATIONS PREPARED BY THE COLLEGE OF ENGINEERING OF
     THE UNIVERSITY OF KENTUCKY FOR THE CONSTRUCTION OF
     ENGINEERING BUILDINGS, A STUDENT UNION BUILDING, A
     HEATING PLANT FOR THE UNIVERSITY AND A COLLEGE OF LAW
     BUILDING AND DIRECTING THE COLLEGE OF ENGINEERING TO
     PREPPPE DETAIL PLAN7J AND SPECIFICATIONS FOR THE CON-
     STRUCTION OF SUCH BUILDINGS AND AUTHORIZING THE EXECU-
     TIVE COMMITTEE OF THE BOARD OF TRUSTEES OF THE UNIVER-
     SITY OF KENTUCKY TO APPROVE FOR AND ON BEHALF OF THE
     BOARD OF TRUSTEES FINAL DETAIL PLANS AND SPECIFICATIONS
     FOR THE CONSTRUCTION OF SAID BUILDINGS


     WHEREAS, Colonel James H. Graham, Dean of the College of
Engineering,has presented to this Board of Trustees tentative
plans and specifications for the construction of College of
Engineering Buildings, a Student Union Building, a College of Law
Building and a Central Heating Plant for the University, and this
Board having considered such tentative plans and specifications
submitted by the Dean of the College of Engineering, and




 






7.



    WBEREAS, the United States Government has by a certain Offer,
adopted by this Board of Trustees, proposed to finance the cost
of constructing such buildings by making a Loan and Grant to the
University of Kentucky in the sum of $765,000.00;


     NOW, THEREFORE, THE BOARD OF TRUSTEES OF THE UNIVERSITY OF
KENTUCKY RESOLVES, AS FOLLOWS:

     Section 1. That the tentative plans and specifications pre-
pared by the College of Engineering of the University and submitted
to this Board of Trustees by the Dean of the College of Engineer-
ing, be, and the same are hereby approved, and James H. Graham,
Dean of the College of Engineering, is hereby authorized and di-
rected to cause to be prepared final detail plans and specifica-
tions for the construction of College of Engineering Buildings,
a Student Union Building, a College of Law Building an'. a Central
Heating Plant substantially in accordance with said preliminary
plans and specifications herein approved.

     Section 2. That James H. Graham, Dean of the College of En-
gineering, when said plans and specifications have been completed
as provided in Section 1 hereof, is hereby directed to submit said
final detail plans and specifications to the Executive Committee
of the Board of Trustees of the University of Kentucky, and said
Executive Committee is hereby authorized and directed to approve
said plans and specifications for and on behalf of this Board,
which approval of said Committee is hereby ratified and confirmed.

     Section 3. This Resolution shall take effect from and after
its passage by the Board of Trustees, and approval by its Chair-
man.

Passed by the Board of Trustees of the University of Kentucky and
approved, this 7th day of December, 1935.

                                 (Signed) Ruby Laffoon
                                           Chairman

 (SEAL)
 ATTEST:

 D. H. Peak. Secretary


     The Secretary was authorized to certify as follows:

     I, D. H. Peak, certify that the above is a true and correct
copy of the Resolution as passed by the Board of Trustees of the
University of Kentucky and signed by Ruby Laffoon, Chairman.




 







8.



    WITNESS, my hand and the seal of the said University this
ninth Jay of December, 1935.

                                       D. H. Peak
                              Secretary, Board of Trustees of the
                              University of Kentucky.

(SEAL)

     Thereupon the President presented Resolution No. 3, which
was read and discussed.  The motion for this Resolution was made
by E. Miller Holland and seconded by James Park. The Secretary
then called the roll and each member present voted aye.

     The Chairman thereupon declared the Resolution carried and
thereupon signed said Resolution in approval thereof.

                      RESOLUTION NO. 3

     A RESOLUTION PROVIDING FOR THE CONSTRUCTION OF UNI-
     VERSITY BUILDINGS, CONSISTING OF BUILDINGS FOR THE
     COLLEGE OF ENGINEERING, A HEATING PLANT, A STUDENT
     UNION BUILDING AND A BUILDI.NG FOR THE COLLEGE OF LAW
     BY THE BOARD OF TRUSTEES OF THE UNIVERSITY OF KEN-
     TUCKY: DECLARING SAID CONSTRUCTION TO BE A NECESSITY;
     ORDERING THE CONSTRUCTION OF SAID BUILDINGS: PROVID-
     ING FOR THE CHARGING OF RENTS AND FEES FOR SERVICES
     RENDERED BY THE BUILDINGS AND PROVIDING FOR THE IS-
     SUANCE AND SALE OF REVENUE BONDS IN ACCORDANCE WITH
     CHAPTER 72 OF THE 1934 ACTS OF THE GENERAL ASSEMBLY
     OF KENTUCKY TO FINANCE SAID CONSTRUCTION.

     WHEREAS, the University of Kentucky and its students are not
now being provided with adequate buildings for educational pur-
poses and in order to provide said University and its students
with more adequate facilities for educational purposes, it is
necessary that there be constructed buildings for the College of
Engineering of the University; a Heating Plant for the University;
a Student Union Building and a building for the College of Law of
the University; and

     WHEREAS, the Engineering College of the University has here-
tofore submitted preliminary plans and specifications for such
construction; and

     WHEREAS, said plans and specifications have been heretofore
adopted and ordered completed and presented to the Executive Com-
mittee of the Board of Trustees of the University of Kentucky for
final approval, pursuant to said resolution authorizing the ap-
proval of the detailed plans and specifications of said construc-
tion; and




 




9.



      WHEFEAS, under the provisions of Chapter 72 of thre 1934
Acts of the General Assembly of Kentucky the Board of Trustees
of the University of Kentucky is authorized to issue bonds as
therein provided for the purpose of constructing said improve-
ments;

     NOW, THEREFORE, THE BOARD OF TRUSTEES OF THE UNIVERSITY OF
KENTUCKY RESOLVE AS FOLLOWS:

     Section 1. That there shall be constructed buildings for
the College of Engineering of the University, a Heating Plant for
the University, a Student Union Building and a building for the
College of Law of the University (hereinafter designated the
"Project") substantially in accordance with the plans and speci-
fications heretofore presented to, and approved by this Board of
Trustees.

     Section 2. In order to provide for the payment of the cost,
in excess of the grant made to the Board of Trustees of the Uni-
versity of Kentucky by the United States Government (hereinafter
designated the "IGovernment") of constructing the Project for said
University, as designated in Section 1 hereof, there shall be
issued by the Board of Trustees of the University of Kentucky in
its corporate capacity and by and through its corporate name
"University of Kentucky", $600,000 of University of Kentucky
Building Revenue Bonds of 1935, dated as of December 1, 1935, of
the denomination of $1,000 each, to be numbered from 1 to 600
inclusive, bearing interest at the rate of four per centum (4%)
per annum, payable on June 1, 1936, and semi-annually thereafter
on the first days of December and June in each year, which said
bonds shall mature serially on December 1 of each year as fol-
lows, to-wit:

                   BOND
   YEAR        RETIREMENT            INTEREST         TOTAL

   1936           ____               $24,000         $24,000
   1937                               24,000          24,000
   1938         $10,000               24,000          34,000
   1939          10,000               23,600          33,600
   1940          10,000               23,200          33,200
   1941          10,000               22,800          32,800
   1942          10,000               22,400          32,400
   1943          15,000               22,000          37,000
   1944          15,000               21,400          36,400
   1945          15,000               20,800          35,800
   1946          15,000               20,200          35,200
   1947          25,000               19,600          44,600
   1948          25,000               18,600          43,600
   1949          25,000               17,600          42,600
   1950          25,000               16,600           41,600
   1951          25,000               15,600          40,600
   1952          25,000               14,600           39,600
   1953          25,000               13,600           38,600
   1954          25,000               12,600           37,600
   1955          25,000               11,600           36,600




 





10.



   (Table Continued)
                     BOND
  YEAR          RETIREDENT            INTEREST        TOTAL

  1956            025,000            $10,600         $35,600
  1957            25,000               9,600          34,600
  1958             25,000              8,600          332600
  1959            25,000               7,600          32,600
  1960            25,000               6,600          31,600
  1961             25,000              5,600          30,600
  1962             25,000              4,600          29,600
  1963             30,000              3,600          33,600
  1964            30,000               2,400          32,400
  1965             30,000              1,200          31,200



     Said bonds shall be signed for and on behalf of t'e Universi-
ty of Kentucky by its Chairman and sealed with the corporate seal
of the University of Kentucky and attested by its Secretary; and
the interest coupons attached to said bonds shall be executed with
the facsimile signatures of the said Chairman and Secretary, and
said bonds, together with the interest thereon, shall be payable
only out of the "University of Kentucky Building Revenue Bond
and Interest Redemption Fund" hereinafter created and shall be a
valid claim of the holders thereof only against said fund, and
the gross income and revenues of the Project pledged to such fund.

     Section 3. The aforesaid bonds and coupons shall be in sub-
stantially the following form, to-wit:


                  UNITED STATES OF AIERICA
                  COMMONWEALTH OF KENTUCKY
                  UNIVERSITY OF KENTUCKY
              UNIVERSITY BUILDING REVENUE BOND
                           OF 1935

No.                                                    $1,000


     The University of Kentucky for value received hereby promis-
es to pay to the bearer, or, if this bond be registered as here-
inafter provided, to the registered holder hereof, the sum of

               ONE THOUSAND DOLLARS ($1,000)

on the first day of December, 19    and to pay interest thereon
at the rate of four per centum (4X5 per annum on June 1, 1936,
and semiannually thereafter on December 1 and June 1 of each year
upon presentation and surrender of the annexed interest coupons
as they severally mature, both principal and interest being pay-
able in any coin or currency which, on the respective dates of
payment of the principal of and interest on this bond, is legal
tender for payment of public and private debts, at the office of




 






11.



she Treasurer of the University of Kentucky, in Lexington, Ken-
tucky, or, at the option of the holder, at the principal office
of the Chemical Bank and Trust Company in the Borough of Manhat-
tan, City, County and State of New York.

     This bond is issued for the purpose of constructing Univer-
sity buildings for the University of Kentucky under and in full
compliance with the Constitution and Statutes of Kentucky, includ-
ing, among others, Chapter 72 of the 1934 Acts of the General As-
sembly of Kentucky.

     This bond is payable only from a fixed amount of the gross
income and revenues to be derived from the operation of said
buildings which has been set aside as a special fund and pledged
for that purpose and identified as the "University of Kentumky
Building Revenue Bond and Interest Redemption Fund", and this
bond does not constitute an indebtedness of the University of
Kentucky or the Commonwealth of Kentucky within the mconing of
any constitutional provisions or limitations.

     The mortgage lien which is hereby recognized as valid and
binding on said buildings, is created and granted to and in favor
of the holder, or holders of this bond and the issue of which it
forms a part, and in favor of the holder or holders of the cou-
pons attached to said bond, and said buildings shall remain sub-
ject to such statutory mortgage lien until the payment in full
of the principal of and interest on this bond and the issue of
which it forms a part.

     This bond may be registered as to principal only or as to
both principal and Interest, at the option of the holder on the
books of the Secretary of the University of Kentucky, and said
registration shall be noted on the reverse hereof by said Secre-
tary; after which, no transfer of this bond shall be valid unless
made on said books by the registered owner in person or by at-
torney anf shirmla'ly notAd on the reverse hereof.  But this bond
may be discharged from registry by registered transfer to the
bearer and thereafter transferability by delivery shall be re-
stored.  Upon registration of this bond as to both principal
and interest, all unmatured appurtenant coupons shall be detached
by the Secretary and upon subsequent re-registration hereof as
to principal or to bearer, such of said coupons as shall not then
have matured, shall be again attached thereto.   This bond, If
registered as to principal, may be reregistered as to both prin-
cipal and interest and vice versa and if discharged from regis-
tration, it may again be registered as herein provided.   Regis-
tration of this bond as to principal only, however, shall not af-
fect the negotiability of the coupons appurtenant hereto, whici
shall continue to be transferable by delivery merely and shall49n
payable to bearer.




 







12.



     This bond is exempted from taxation in Kentucky.

     IT IS HEREBY CERTIFIED, RECITED, AND DECLARED that all acts,
conditions and things required to exist, happen and be performed
precedent to and in the issuance of this bond, do exist, have
happened and have been performed in due time, form and manner
as required by law and the amount of this bond, together with all
other obligations of said University of Kentucky does not exceed
any limit prescribed by the Constitution or Statutes of Kentucky,
and said buildings will be continuously operated by said Univer-
sity of Kentucky and that a sufficient portion of the income
and revenues of said building has been pledged to and will be
set aside into a special account in the treasury of said Univer-
sity of Kentucky for the payment of the principal of and inter-
est on this bond, and the issue of which it is one.

     IN WITNESS WHEREOF, the University of Kentucky has caused
this bond to be signed by its Chairman and its corporate seal to
be hereunto affixed, attested by the Secretary and the coupons
hereto attached to be executed with the facsimile signatures of
the said Chairman and said Secretary, all as of the first day of
December, 1935.

                                UNIVERSITY OF KENTUCKY

                                By Ruby Laffoon
                                   Chairman

(SEAL)

Attest:


D. H. Peak
Secretary




 





13.



                       'FORMD OF COUPON


No.                                                   $20.00


    On the first day of              , 19  , the University of
Kentucky will pay to bearer, Twenty Dollars (20.00) in any coin
or currency which, on the date of payment of this coupon is le-
gal tender for the payment of public and private debts, out of
its "University of Kentucky Building Revenue Bond and Interest
Redemption Fund", at the office of the Treasurer of the Univer-
sity of Kentucky in Lexington, Kentucky, or, at the option of
the holder, at the principal office of the Chemical Bank and
Trust Company of New York in the Borough of Manhattan, City,
County and State of New York, as provided in and for interest
then due on its University of Kentucky Building Revenue Bond of
1935, dated December 1, 1935, No.



                                Chairman, Board of Trustees


                                       Secretary


          (To be printed on the back of each bond)


DATE OF REGISTRATION NAME OF REGISTERED   MANNER OF     SIGNATURE
                     HOLDER               REGISTRATION  OF SECRE-
                                                         TARY



.




 





14.



     Section 4.   From and after the delivery of any bond issued
un~ghe provisions of this resolution, the Project of said Uni-
/A 6  2ucky shall be operated on a fiscal year basis, commencing
on December 1 of each year and ending on November 30 of the fol-
lowing year, and on that basis the gross income and revenues of
said Project shall be set aside into a separate and special fund
designated the "University of Kentucky Building Revenue Fund"
(hereinafter designated the "Building Revenue Fund").

      There shall be and there is hereby created a fund to be known
 as "University of Kentucky Building Revenue Bond and Interest Re-
 demption Fund", (hereinafter called the "Bond Fund") into which
 there shall be set aside from the monies held in the Building
 Revenue Fund such amounts as will be sufficient to pay the inter-
 est on and principal of the bonds hereby authorized and it is
 hereby determined that the amounts necessary and to be set aside
 into said fund shall be usfollows:

      During the first ten years after the date when the Project
 is first put into operation, the amounts so payable into the Bond
 Fund in each month shall equal 1/5 of the next maturing install-
 ment of interest and 1/10 of the next maturing installment of
 principal. During each of the following years (after the first
 ten) the amount so payable in each month to the Bond Fund shall
 equal 1/6 of the next maturing installment of interest and 1/12
 of the next maturing installment of principal on the bonds. In
 the event that the monies held in the Building Revenue Fund in
 any month shall be insufficient to make the aforesaid payments
 in full, any such deficiency shall be added to the amounts re-
 quired to be paid into such Bond Fund in the following month.

      The amount by which any such payment in the fiscal year ex-
 ceeds the aggregate amount of interest on and principal of said
 bonds becoming due in such year shall be held in said Bond Fund
 as a reserve for contingencies and used solely as herein provid-
 ed. Provided, however, that no further payments need be made
 into said Bond Fund after such amount of the bonds shall have
 been retired so that the amount then held in the bond fund, in-
 cluding the reserve for contingencies, is equal to the entire
 amount of the principal and interest that will be payable at the
 time of their maturity on all of the bonds then remaining out-
 standing.

      If, for any reason, the University of Kentucky shall fail to
 make any such payments into such Bond Fund as aforesaid, during
 any fiscal year, any sums then held as a reserve for contingen-
 cies shall be used fQr thle payment of any portion of the inter-
 est on or principal of said bonds becoming due in such fiscal
 year, on which bonds there would otherwise be default, but such
 reserve shall be reimbursed therefor from the first available pay-
 ments made into the Bond Fund in the following year or years in
 excess of the required payment for the then current fiscal year.




 





15.



     All monies held in the Bond Fund or as a reserve for con-
tingencies shall be deposited in a bank which is a member of the
Federal Reserve System and of the Federal Deposit Insurance Cor-
poration; the monies held as reserve for contingencies may be
invested in direct obligations of the United States of America,
provided, however, that the University shall make a sale of a
sufficient amount of such obligations in the event that it shall
prove necessary to draw upon said reserve.

     The payments hereinabove provided into said Bond Fund shall
be made in equal monthly installments on the first day of each
month, except when the first day of any months shall be on a Sun-
day or a legal holiday, in which event such payments shall be
made on the next succeeding secular day and the balance then re-
maining shall be set aside for the operation and maintenance, as
hereinafter fully provided.

     The Bond Fund, hereinabove created and described, shall be
used solely and only for the purpose of paying principal of and
interest on the bonds herein authorized to be issued, and is
hereby irrevocably pledged for that purpose and shall be used for
no other purpose whatsoever.

     The balance of the monies remaining in the Building Revenue
Fund after the aforesaid payments into the Bond Fund in each
month shall be set aside as follows:

     There shall be created an "Operation and Maintenance account"
to be used for the proper operation and maintenance of said
Project, into which there shall be set aside from the monies
hereinafter referred to, an amount sufficient to provide for the
payment of reasonable and necessary expenses of operating and
maintaining the Project.

     Section 5. All monies received from any bonds issued pur-
suant hereto, exclusive of accrued interest, shall be applied
solely for the construction of said Project, as herein authorized,
provided that such proceeds, together with all sums received as