DOCKET

OCTOBER 6, 2000

I. CONSENT ITEMS

1. APPROVAL OF REVISIONS TO THE PERMANENT

UNIVERSITY IMPLEMENTING PROCEDURES FOR

MEDICAL CENTER PROCUREMENTS

The President will propose the adoption of the

following resolution:

RESOLVED that the Permanent University Implementing Procedures for Medical Center Procurements are revised (see Attachment) to correct outdated titles and terminology, increase the threshold for small procurements and sole-source justifications from $30,000 to $50,000, and provide for emergency procurement authority.

2. CONFLICT OF INTEREST EXEMPTION: GENEURON

THERAPEUTICS, INC.

The President will propose the adoption of the following resolution:

WHEREAS, the School of Medicine wishes to enter into sponsored research contracts with GeNeuron, Inc., for developing biologically enhanced devices for treatment of neurovascular disease; and

WHEREAS, Gerald R. Hankins, Ph.D., Gregory A. Helm, M.D., David F. Kallmes, M.D., have disclosed in advance their equity interests of 23.3, 24.2, 23.8, percent, respectively, in GeNeuron Therapeutics, Inc., and

WHEREAS, the University’s entry into research agreements with GeNeuron Therapeutics, Inc., would thereby expose Mr. Hankins, Dr. Helm and Dr. Kallmes to violation of the Virginia Conflicts of Interest Act unless approved by the Board as permitted by §2.1-639.6(c) (7) of the Code of Virginia;

Item 1.b. continued, Item 1.c. 2.

RESOLVED that the conflict of interest of Gerald R. Hankins, Ph.D., Gregory A. Helm, M.D., and David F. Kallmes, M.D., is approved by the Board of Visitors in order to permit the University to enter into agreements with GeNeuron, Inc., for research funding for the development of biologically enhanced devices for treatment of neurovascular disease; provided, as required by the law, Mr. Hankins, Dr. Helm, and Dr. Kallmes file the required annual disclosure statement of personal interests in GeNeuron Therapeutics, Inc., the University files the required annual report concerning the contracts with the Secretary of the Commonwealth, and the Associate Dean for Research vigilantly oversees application of University resources in the best interests of the University and in accordance with policy.

3. CONFLICT OF INTEREST EXEMPTION:

following resolution:

WHEREAS, the School of Medicine wishes to enter into a contract with Respiratory Research, Inc. to purchase a device to assist researchers in the development of technology and medications for the treatment of asthma and tuberculosis; and

WHEREAS, Benjamin Gaston, M.D. and John Hunt, M.D., have disclosed in advance their equity interests of 9.4 and 43.4 percent, respectively, in Respiratory Research, Inc.; and

with Respiratory Research, Inc. would thereby expose Drs. Gaston and Hunt to violation of the Virginia Conflicts of Interest Act unless approved by the Board as permitted by §2.1-639.6(c) (7) of the Code of Virginia;

RESOLVED that the conflict of interest of Benjamin Gaston, M.D., and John Hunt, M.D., is approved by the Board of Visitors in order to permit the University to enter an agreement with Respiratory Research, Inc. to purchase a device to be used for the development of technology for the treatment of asthma; provided, as required by the Virginia Conflict of

Item 1.c. continued, Item 1.d. 3.

Interests Act, the faculty file the required annual disclosure statement of personal interests in Respiratory Research, Inc., the University files the required annual report concerning the contact with the Secretary of the Commonwealth, and the relevant department chair vigilantly oversees application of University resources in the best interests of the University and in accordance with policy.

1. CONFLICT OF INTEREST EXEMPTION: APACHE

MEDICAL SYSTEMS

The President will propose the adoption of the

following resolution:

WHEREAS, the School of Medicine wishes to enter into a sponsored research contract with Apache Medical Systems, Inc. for activities that would assist in the development and validation of statistical and mathematical decision support models for cardiovascular diseases, HIV, cancer and women’s health issues; and

WHEREAS, William A. Knaus, M.D. has disclosed in advance his equity interests of 5.8 percent, in Apache Medical Systems Inc.; and

WHEREAS, the University’s entry into a research agreement with Apache Medical Systems, Inc. would thereby expose Dr. Knaus to violation of the Conflicts of Interest Act unless approved by the Board as permitted by §2.1-639.6(c) (7) of the Code of Virginia;

RESOLVED that the conflict of interest of William A. Knaus, M.D., is approved by the Board of Visitors in order to permit the University to enter into an agreement with Apache Medical Systems, Inc. for activities that would assist in the development and validation of statistical and mathematical decision support models for cardiovascular diseases, HIV, cancer and women’s health issues; provided, as required by the Virginia Conflict of Interests Act, Dr.Knaus, files the required annual disclosure statement of personal interests in Apache Medical Systems, Inc., the University files the required annual report concerning the contract with the Secretary of the Commonwealth, and the Associate Dean for Research vigilantly oversees the application of University

Item 1.d. continued, Item 1.e. 4.

resources in the best interests of the University and in accordance with policy.

OF UNIVERSITY-RELATED FOUNDATIONS

The President will propose the adoption of the following resolution:

RESOLVED that the following persons be approved as representatives of the Board of Visitors to the governing boards of the following University-Related Foundations:

University of Virginia College

Foundation Timothy B. Robertson

Healthcare Partners, Inc. Charles M. Caravati, Jr.

Historic Renovation Corporation David W. Carr

University of Virginia Patent

Foundation Timothy B. Robertson

Virginia Ambulatory Surgery, Inc. R. Scott Jones

Virginia Student Aid Foundation M. Terry Holland

Virginia Urologic Foundation William D. Steers

Items 1.f., 1.g., 1.h. 6.

following resolution:

RESOLVED that Ayers/Saint/Gross, Inc., of Baltimore, Maryland is approved for the performance of architectural and engineering services for the Emmet Street Pedestrian Bridge project.

1. APPROVAL OF ENGINEER SELECTION FOR THE

DAVIS ELECTRICAL VAULT PROJECT

The President will propose the adoption of the

following resolution:

RESOLVED that RMF Engineering, Inc., of

Baltimore, Maryland is approved for the performance of architectural and engineering services for the Davis Electrical Vault project.

2. APPROVAL OF ARCHITECTURAL DESIGN GUIDELINES

FOR STUDIO ART BUILDING PROJECT

The President will propose the adoption of the following resolution:

RESOLVED that the architectural design

guidelines, dated September 20, 2000, prepared by the Architect for the University, for the Studio Art Building project are approved; and

RESOLVED FURTHER that the project will be presented for further review at the schematic design level of development.

Items 1.i., 1.j. 7.

3. APPROVAL OF PERMANENT EASEMENT FOR VIRGINIA

ELECTRIC AND POWER COMPANY ACROSS UNIVERSITY OF VIRGINIA PROPERTY LOCATED AT THE LAMBETH FIELD RESIDENCE AREA

The President will propose the adoption of the following resolution:

RESOLVED that the granting of a permanent

easement, dated September 20, 2000, to Virginia Electric and Power Company for an underground electric line serving 35 University Circle, across property owned by The Rector and Visitors of the University of Virginia, is approved; and

RESOLVED FURTHER that appropriate officers of

the University are authorized to execute said dedication and easement.

4. APPROVAL OF PERMANENT EASEMENT FOR VIRGINIA

following resolution:

RESOLVED that the granting of a permanent easement, dated September 20, 2000, to Virginia Electric and Power Company for an electric line located on the west side of Monroe Lane, across property owned by The Rector and Visitors of the University of Virginia, is approved; and

RESOLVED FURTHER that appropriate officers of the University are authorized to execute said dedication and easement.

Item 2.a. 8.

2. ACTION ITEMS
1. APPROVAL OF BOND ISSUANCE FOR MONROE LANE

following resolution:

WHEREAS, the General Assembly of Virginia passed an act entitled "Commonwealth of Virginia Higher Educational Institutions Bond Act of 2000" (the "2000 Act") which has been or is expected to be signed by the Governor; and

WHEREAS, the 2000 Act may be repealed but the Project, as defined below, continues as an authorized project for bond financing through subsequent legislation (the 2000 Act and any such subsequent legislation, the "Act"); and

WHEREAS, pursuant to the Act, the Treasury Board of the Commonwealth of Virginia (the "Treasury Board") is authorized, by and with the consent of the Governor, to sell and issue bonds or bond anticipation notes of the Commonwealth of Virginia for the purpose of providing funds, with other available funds, for paying the cost of acquiring, constructing, renovating, enlarging, improving and equipping certain revenue-producing capital projects at certain institutions of higher learning of the Commonwealth and for paying issuance costs, reserve funds and other financing expenses (the "Financing Expenses"), all in accordance with the provisions of Section 9(c) of Article X of the Constitution of Virginia; and

WHEREAS, such revenue-producing capital projects include the Monroe Lane Student Residence Hall, Capital Outlay Project Number 16385 (the "Project") for the University of Virginia (the "Institution"); and

WHEREAS, the Treasury Board is proposing to sell and issue bonds or bond anticipation notes pursuant to the Act for such revenue-producing capital projects, in one or more series;

Item 2.a. continued 9.

RESOLVED that:

Section 1. The Board of Visitors of the Institution (the "Board") requests the Treasury Board to sell and issue bonds or bond anticipation notes ("BAN's") in an aggregate principal amount not to exceed $4,800,000 to finance all or a portion of the costs of the Project plus Financing Expenses (individually, the "Project Bonds" or "Project Notes," collectively, the "Project Borrowing"). The Project Borrowing will be identified by amount by the State Treasurer upon issuance of any bonds or BAN's.

Section 2. The Board (a) covenants to fix, revise, charge and collect a housing fee and other rates, fees and charges, for or in connection with the use, occupation and services of the Project and (b) pledges such rates, fees and charges remaining after payment of (i) the expenses of operating the Project and (ii) the expenses related to all other activities funded by the housing fee ("Net Revenues") to the payment of the principal of, premium, if any, and interest on the Project Borrowing. The Board further covenants that it will fix, revise, charge and collect such rates, fees and charges in such amounts so that Net Revenues will at all times be sufficient to pay, when due, the principal of, premium, if any, and interest on the Project Borrowing and on any other obligations secured by Net Revenues (such payments collectively the "Required Payments"). The Project Borrowing shall be secured on a parity with such other obligations so secured by Net Revenues (other than any obligations secured by a prior right in Net Revenues). Any Net Revenues pledged herein in excess of the Required Payments may be used by the Institution for any other lawful purpose.

Section 3. It is hereby found, determined and declared that, based upon responsible engineering and economic estimates and advice of appropriate officials of the Institution, as shown on the Financial Feasibility Study, the anticipated Net Revenues pledged herein will be sufficient to pay the Required Payments so long as the aggregate amount of net debt service on the Project Borrowing actually payable in any bond year does not exceed the amounts assumed in the Financial Feasibility Study.

Item 2.a. continued 10.

Section 4. The Board covenants that the Institution will furnish the Treasury Board its general purpose financial statements, within 30 days of their issuance and receipt, audited by a firm of certified public accountants or the Auditor of Public Accounts which shall include a schedule of revenues and expenditures for auxiliary enterprise systems. If Net Revenues are insufficient to pay Required Payments during such period, the Institution shall provide evidence of a plan to generate Net Revenues sufficient to make Required Payments in the future.

Section 5. The Board covenants that so long as any of the Project Notes are outstanding, the Institution will pay to the State Treasurer, not less than 30 days before each interest payment date, an amount estimated by the State Treasurer to be due and payable on such date as interest on the Project Notes. The Board covenants that so long as any of the Project Bonds are outstanding, the Institution will pay to the State Treasurer, not less than 30 days before each interest or principal payment date, the amount certified by the State Treasurer to be due and payable on such date as principal of, premium, if any, and interest on the Project Bonds.

Section 6. The Board hereby approves and authorizes its Executive Vice President and Chief Operating Officer (officer) to execute and deliver on behalf of the Institution the Payment Agreement, to be completed with such changes as the officer of the Institution executing such Payment Agreement determines to be appropriate and in the best interest of the Institution.

Section 7. The Board covenants that the Institution will pay from time to time its proportionate share of all expenses incurred in connection with the sale and issuance of any series of bonds that includes Project Bonds or Project Notes and all expenses thereafter incurred in connection with the Bonds, including without limitation the expense of calculating any rebate to the United States of the earnings derived from the investment of gross proceeds of the Bonds, all as certified by the State Treasurer to the Institution.

Item 2.a. continued 11.

Section 8. The Board covenants that the Institution will not take or omit to take any action the taking or omission of which will cause the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended, including regulations issued pursuant thereto (the "Code"), or otherwise cause interest on the Bonds to be includable in the gross income of the owners thereof for federal income tax purposes under existing laws. Without limiting the generality of the foregoing, the Institution will pay from time to time its proportional share of any rebate to the United States of the earnings derived from the investment of the gross proceeds of the Bonds.

Section 9. The Board covenants that the Institution will proceed with due diligence to undertake and complete the Project and that the Institution will spend all of the available proceeds derived from the sale of the Project Borrowing for costs associated with the Project and appropriated for the Project by the General Assembly.

Section 10. The Board covenants that the Institution will not permit the proceeds of the Project Borrowing to be used in any manner that would result in (a) 5 percent or more of such proceeds being used in a trade or business carried on by any person other than a governmental unit, as provided in Section 141(b) of the Code, (b) 5 percent or more of such proceeds being used with respect to any output facility within the meaning of Section 141(b)(4) of the Code, or (c) 5 percent or more of such proceeds being used directly or indirectly to make or finance loans to any persons other than a governmental unit, as provided in Section 141(c) of the Code. The Institution need not comply with such covenants if the Institution obtains the written approval of the State Treasurer and an opinion of nationally recognized bond counsel acceptable to the Treasury Board that such covenants need not be complied with to prevent the interest on the Bonds from being includable in the gross income of the owners thereof for federal income tax purposes.

Section 11. The Board covenants that for so long as any of the Bonds are outstanding the Institution will not enter into any operating lease, management contract or similar agreement with any person or entity, other than a state or local governmental unit, for all or any portion of the Project without first obtaining the written approval of the State

Item 2.a. continued 12.

Treasurer and an opinion of nationally recognized bond counsel acceptable to the Treasury Board that entering into such agreement will not cause the interest on the Bonds to be included in the gross income of the owners thereof for federal income tax purposes.

Section 12. The Board covenants that for so long as any of the Bonds are outstanding, the Institution will not sell or dispose of any or any part of the Project without first obtaining the written approval of the State Treasurer and an opinion of nationally recognized bond counsel acceptable to the Treasury Board that such sale or disposition will not cause interest on the Bonds to be included in the gross income of the owners thereof for federal income tax purposes.

Section 13. The officers of the Institution are authorized and directed to execute and deliver all certificates and instruments and to take all such further action as may be considered necessary or desirable in connection with the sale and issuance of the Bonds.

Section 14. The Board acknowledges that the Treasury Board will rely on the representations and covenants set forth herein in issuing the Bonds, that such covenants are critical to the security for the Bonds and the exclusion of the interest on the Bonds from the gross income of the owners thereof for federal income tax purposes, that the Board will not repeal, revoke, rescind or amend any of such covenants without first obtaining the written approval of the Treasury Board, and that such covenants will be binding upon the Board so long as any of the Bonds are outstanding.

Section 15. This resolution shall take effect immediately.

Item 2.b. 13.

The President will propose the adoption of the following resolution:

WHEREAS, item 131 of the 2000 Appropriation Act requires the Secretary of Education to recommend to the Chairmen of the Senate Finance Committee and House Appropriations Committee those institutions that are ready to proceed with an institutional performance agreement (IPA) by December 1, 2000; and

WHEREAS, in order to facilitate his recommendation on July 27, 2000, the Secretary of Education asked the University to develop an IPA; and

WHEREAS, the University has developed an IPA according to the guidance provided by the Secretary of Education;

RESOLVED that the IPA is approved subject to further modifications during the negotiation process with the Secretary of Education;

RESOLVED FURTHER that the President and the Executive Vice President and Chief Operating Officer are hereby authorized to amend the IPA during the negotiation process in consultation with the members of the Board of Visitors who also were members of the Governor’s Blue Ribbon Commission on Higher Education.

Item 2.c. 14.

c. REPORT ON ACTIONS OF THE EXECUTIVE COMMITTEE

The Rector will report on the following actions taken by the Executive Committee on July 14, 2000, and September 7, 2000:

1. APPROVAL OF ARCHITECT SELECTION FOR THE

STUDIO ART BUILDING

(Adopted July 14, 2000)

RESOLVED that Machado & Silvetti Associates, Inc. of Boston, Massachusetts, is approved for the performance of architectural and engineering services for the Studio Art Building.

(Adopted July 14, 2000)

WHEREAS, the Executive Committee of the Board of Visitors has reviewed proposed legislative actions related to interest earnings on Medical Center operating cash balances and increased autonomy for Medical Center employee compensation and benefits, and procurement functions in the Medical Center; and

WHEREAS, the Executive Committee concludes that the proposed changes are prudent and in the best interest of the University;

RESOLVED that the Executive Vice President and Chief Operating Officer is authorized to seek legislation accomplishing the above-described purposes.

CENTER GENERAL ENDOWMENT

(Adopted July 14, 2000)

RESOLVED by the Executive Committee of the Board of Visitors that the disinvestment of the Miller Center General Endowment, a quasi-endowment, be approved and that the proceeds be applied to the Miller Center Addition and Renovation project.

Item 2.c. continued 15.

WHEREAS, the School of Medicine wishes to enter into a sponsored research contract with EluSys Therapeutics, Inc., for developing technology for the treatment of chronic Hepatitis C; and

WHEREAS, Ronald P. Taylor, Ph.D. has disclosed in advance his equity interests of 3.3 percent in EluSys Therapeutics, Inc.; and

WHEREAS, the University’s entry into a research agreement with EluSys Therapeutics, Inc., would thereby expose Mr. Taylor to violation of the Virginia Conflicts of Interests Act unless approved by the Board as permitted by §2.1-639.6(c) (7) of the Code of Virginia;

RESOLVED that the conflict of interest of Ronald P. Taylor, Ph.D., is approved by the Board of Visitors in order to permit the University to enter into an agreement with EluSys Therapeutics, Inc., for research funding for the development of technology for the treatment of Hepatitis C; provided, as required by the Virginia Conflict of Interests Act, Mr. Taylor files the required annual disclosure statement of personal interests in EluSys Therapeutics Inc., the University files the required annual report concerning the contract with the Secretary of the Commonwealth, and the relevant department chair vigilantly oversees application of University resources in the best interests of the University and in accordance with policy.

2000-2001 ENDOWMENT INCOME DISTRIBUTION

(Adopted September 7, 2000)

RESOLVED that the Executive Vice President and

Chief Operating Officer is authorized to increase the Fiscal Year 2000-2001 income distribution of Class A shares from $89.39 to $90.56 per share and Class B shares from $122.76 to $125.89 per share.

Item 2.c. continued, Items 2.d. and 2.e. 16.

RESOLVED by the Executive Committee of the Board of Visitors approves the renewal of the lease on the Lower Apartment in Pavilion VIII, held by Ms. Sarah Farrell, Assistant Professor of Nursing, for a term of two years; the lease shall expire on July 31, 2002.

The President will propose the adoption of the following resolution:

WHEREAS, the Board of Visitors approved a project for the renovation of the Observatory Hill Dining Hall, and

WHEREAS, the bids let for the project have come in considerably over budget, and

WHEREAS, a new dining hall with more space and better siting can be built for slightly more than the cost of renovating the building;

RESOLVED that the Board of Visitors approves the demolition of the Observatory Hill Dining Hall and the Tree House, which will be replaced by a new facility.

e. APPROVAL OF THE PLACEMENT OF A

FOUNTAIN AT THE UNIVERSITY OF VIRGINIA’S

COLLEGE AT WISE

The President will propose the adoption of the following resolution:

WHEREAS, Dumlupinar University in Kutahya, Turkey has given The University of Virginia’s College at Wise a fountain kiosk in commemoration of the ties between the two institutions, and

Item 2.e. continued 17.

WHEREAS, the College and its Board propose that

the fountain be erected on the plaza in front of Zehmer Hall;

RESOLVED that the Board of Visitors approves the proposal to erect the fountain from Dumlupinar University on the plaza in front of Zehmer Hall at The University of Virginia’s College at Wise.

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