Cabrini University) Series of 2017

NEW ISSUE – BOOK ENTRY ONLY RATING: Standard & Poor’s: “BBB+” (Stable) See: “RATING” herein In the opinion of Bond Counsel, under existing law and assuming continuing compliance by the Authority and the University with the requirements of the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations thereunder that relate to the Bonds, the interest on the Bonds is excluded from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; however, interest on the Bonds held by a corporation (as defined for federal income tax purposes) may be indirectly subject to federal alternative minimum tax because of its inclusion in the adjusted current earnings of a corporate holder. Bond Counsel is also of the opinion that, under existing law, interest on the Bonds is exempt from Pennsylvania personal income tax and from Pennsylvania corporate net income tax, and the Bonds are exempt from personal property taxes in Pennsylvania. See “TAX MATTERS” herein.

$49,265,000 Delaware County Authority (Commonwealth of Pennsylvania) Revenue Bonds (Cabrini University) Series of 2017

Dated: Date of Delivery Due: July 1, as shown on inside cover

The Delaware County Authority (the “Authority”) will issue $49,265,000 aggregate principal amount of its Revenue Bonds (Cabrini University) Series of 2017 (the “Bonds”) in denominations of $5,000 or any whole multiple thereof. The Bonds will be registered in the name of Cede & Co. as the registered owner and nominee for The Depository Trust Company (“DTC”), New York, New York.

The principal and redemption price on the Bonds will be payable to the registered owner at the designated corporate trust agency office of The Bank of New York Mellon Trust Company, N.A., Philadelphia, Pennsylvania, as trustee (the “Trustee”) for the Bonds pursuant to a Trust Indenture between the Authority and the Trustee under which the Bonds are issued and secured. The Bonds will bear interest at the rates shown on the inside cover hereof. Interest on the Bonds will be payable semiannually on January 1 and July 1, commencing January 1, 2018, in each case by the Trustee to the registered owners by check, or by wire transfer at the request of holders of at least $500,000 aggregate principal amount of such Bonds.

The Bonds are payable solely from, and are secured by an assignment and a pledge of, payments and other revenues to be received by the Authority under a Loan Agreement between the Authority and Cabrini University (the “University”), and from Bond proceeds and other moneys pledged to or held by the Trustee under the Trust Indenture.

The proceeds of the Bonds will be applied to pay the costs of a project for the benefit of the University as described herein. See “PROJECT” herein.

The Bonds are subject to redemption prior to maturity as described herein.

There are risks associated with an investment in the Bonds. Certain of these risks are outlined under “BONDHOLDERS’ RISKS” herein.

The Bonds are limited obligations of the Authority and are payable solely from payments required to be made by the University under the Loan Agreement and other sources described herein. Neither the credit nor the taxing power of Delaware County, the Commonwealth of Pennsylvania or any political subdivision thereof is pledged for the payment of the principal or redemption price of or interest on the Bonds, nor shall the Bonds be or be deemed a general obligation of the Authority or an obligation of Delaware County, the Commonwealth of Pennsylvania or any political subdivision thereof. The Authority has no taxing power.

This cover page contains certain information for quick reference only. It is not a summary of the issue. Investors must read the entire Official Statement to obtain information essential to making an informed investment decision.

The Bonds are offered when, as and if issued by the Authority, subject to prior sale, withdrawal or modification of the offer without any notice, and to the approving opinion of Reed Smith LLP, Philadelphia, Pennsylvania, Bond Counsel. Certain legal matters will be passed upon by McNichol, Bryne & Matlawski, P.C., Media, Pennsylvania, as counsel to the Authority; by Saul Ewing LLP, Philadelphia, Pennsylvania, as counsel to the University; and by Fox Rothschild LLP, Philadelphia, Pennsylvania, as counsel to the Underwriters. It is expected that Bonds in definitive form will be delivered to DTC in New York, New York, on or about June 20, 2017.

RBC CAPITAL MARKETS WELLS FARGO SECURITIES

Dated: May 31, 2017

$49,265,000 Delaware County Authority (Commonwealth of Pennsylvania) Revenue Bonds (Cabrini University) Series of 2017

MATURITY SCHEDULE

$14,525,000 Serial Bonds

Due July 1 Principal Interest Rate Price Yield CUSIP* Amount 2019 $520,000 4.000% 104.305 1.830% 245913LX4 2020 880,000 5.000% 108.870 1.970% 245913LY2 2021 920,000 5.000% 111.028 2.130% 245913LZ9 2022 970,000 5.000% 112.705 2.310% 245913MA3 2023 1,020,000 5.000% 113.973 2.490% 245913MB1 2024 1,070,000 5.000% 114.844 2.670% 245913MC9 2025 1,125,000 5.000% 115.179 2.870% 245913MD7 2026 1,180,000 5.000% 114.949 3.090% 245913ME5 2027 1,235,000 5.000% 115.153 3.220% 245913MF2 2028 1,300,000 5.000% 114.048* 3.340% 245913MG0 2029 1,365,000 5.000% 113.137* 3.440% 245913MH8 2030 1,435,000 5.000% 112.415* 3.520% 245913MJ4 2031 1,505,000 5.000% 111.787* 3.590% 245913MK1

$10,480,000 4.000% Term Bond maturing July 1, 2037, Priced at 98.625 to Yield 4.101%, CUSIP† 245913MM7

$10,660,000 5.000% Term Bond maturing July 1, 2042, Priced at 108.452* to Yield 3.970%, CUSIP† 245913MN5

$13,600,000 5.000% Term Bond maturing July 1, 2047, Priced at 108.022* to Yield 4.020%, CUSIP† 245913MP0

*Priced to first optional redemption date on July 1, 2027. † The CUSIP (Committee on Uniform Securities Identification Procedures) numbers shown above have been assigned by an organization not affiliated with the Authority, the University, the Underwriters or the Trustee, and such parties are not responsible for the selection or use of the CUSIP numbers. The CUSIP numbers are included solely for the convenience of holders and no representation is made as to the correctness of the CUSIP numbers printed above. CUSIP numbers assigned to the Bonds may be changed during the term of the Bonds based on a number of factors including but not limited to the refunding or defeasance of such issues or the use of secondary market financial products. None of the Authority, the University, the Underwriters or the Trustee has agreed to, nor is there any duty or obligation to, update this Official Statement to reflect any change or correction in the CUSIP numbers printed above. i

IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS THAT STABILIZE OR MAINTAIN THE MARKET PRICE OF THE BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME WITHOUT PRIOR NOTICE. ______

No dealer, broker, salesperson or other person has been authorized by the Authority, the University or the Underwriters to give any information or to make any representations with respect to the Bonds other than those in this Official Statement, and if given or made, such other information or representations must not be relied upon as having been authorized by any of the foregoing. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy, and there shall not be a sale of the Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale.

The information set forth herein has been obtained from the Authority, the University, The Depository Trust Company and other sources that are believed to be reliable, but is not guaranteed as to accuracy or completeness by, and is not to be construed as a representation by the Authority (except for the information under the caption “THE AUTHORITY” and information pertaining to the Authority under the caption “LITIGATION”) or the Underwriters or, as to information from other sources, by the Authority or the University. The information and expressions of opinion herein are subject to change without notice, and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the matters described herein since the date hereof.

The Underwriters have has reviewed the information in this official statement pursuant to their responsibilities to investors under the federal securities laws, but the Underwriters do not guarantee the accuracy or completeness of such information.

______

THE BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 NOR HAS THE INDENTURE BEEN QUALIFIED UNDER THE TRUST INDENTURE ACT OF 1939, AS AMENDED, IN RELIANCE UPON EXEMPTIONS CONTAINED IN SUCH ACTS. THE REGISTRATION OR QUALIFICATION OF THE BONDS IN ACCORDANCE WITH APPLICABLE PROVISIONS OF THE SECURITIES LAWS OF THE STATES IN WHICH THE BONDS HAVE BEEN REGISTERED OR QUALIFIED AND THE EXEMPTION FROM REGISTRATION OR QUALIFICATION IN THE OTHER STATES CANNOT BE REGARDED AS A RECOMMENDATION THEREOF. NEITHER THESE STATES NOR ANY OF THEIR AGENCIES HAVE PASSED UPON THE MERITS OF THE BONDS OR THE ACCURACY OR COMPLETENESS OF THIS OFFICIAL STATEMENT.

CAUTION REGARDING FORWARD-LOOKING STATEMENTS IN THIS OFFICIAL STATEMENT

Certain statements included in this Official Statement and Appendix A attached hereto constitute “forward- looking statements.” Such statements generally are identifiable by the terminology used, such as “plan,” “expect,” “estimate,” “budget,” “forecast,” “assumes” or other similar words or expressions. The achievement of certain results or other expectations contained in such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements described to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The University does not plan to issue any updates or revisions to those forward-looking statements if or when its expectations of the events, conditions or circumstances on which such statements are based change.

THE ORDER AND PLACEMENT OF MATERIALS IN THIS OFFICIAL STATEMENT, INCLUDING THE APPENDICES, ARE NOT TO BE DEEMED TO BE A DETERMINATION OF RELEVANCE, MATERIALITY OR IMPORTANCE, AND THIS OFFICIAL STATEMENT, INCLUDING THE APPENDICES, MUST BE CONSIDERED IN ITS ENTIRETY. THE OFFERING OF THE BONDS IS MADE ONLY BY MEANS OF THIS ENTIRE OFFICIAL STATEMENT.

TABLE OF CONTENTS

Page

OFFICIAL STATEMENT...... 1 INTRODUCTORY STATEMENT ...... 1 THE AUTHORITY ...... 3 THE BONDS ...... 4 THE PROJECT ...... 9 SECURITY AND SOURCES OF PAYMENT FOR THE BONDS ...... 10 BONDHOLDERS’ RISKS ...... 12 LIMITED OBLIGATIONS ...... 16 NO PERSONAL RECOURSE ...... 17 LITIGATION ...... 17 CONTINUING DISCLOSURE ...... 17 TAX MATTERS ...... 18 LEGAL MATTERS ...... 20 RATING ...... 20 UNDERWRITING ...... 20 FINANCIAL ADVISOR ...... 21 INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS ...... 21 OTHER MATTERS ...... 21 APPENDIX A – Information Concerning Cabrini University APPENDIX B – Audited Financial Statements of Cabrini University for the Fiscal Years Ended June 30, 2016 and 2015 APPENDIX C – Definitions of Certain Terms and Summaries of Indenture, Loan Agreement, Security Agreement and Collateral Agency Agreement APPENDIX D – Form of Continuing Disclosure Agreement APPENDIX E – Proposed Form of Opinion of Bond Counsel

iii

OFFICIAL STATEMENT

Relating to

$49,265,000 Delaware County Authority (Commonwealth of Pennsylvania) Revenue Bonds (Cabrini University) Series of 2017

INTRODUCTORY STATEMENT

This Introductory Statement is provided to furnish information with respect to the $49,265,000 aggregate principal amount of Revenue Bonds (Cabrini University) Series of 2017 (the “Bonds”) being issued by the Delaware County Authority (the “Authority”) under a Trust Indenture, dated as of June 1, 2017 (the “Indenture”), between the Authority and The Bank of New York Mellon Trust Company, N.A., a national banking association, Philadelphia, Pennsylvania, as trustee (the “Trustee”). The Bonds will be dated the date of their initial delivery, will mature on the date or dates set forth on the inside cover hereof, and will be subject to redemption prior to maturity as described herein under “THE BONDS – Redemption Prior to Maturity.”

The Authority will loan the proceeds of the Bonds to Cabrini University, a Pennsylvania nonprofit corporation (the “University”), pursuant to a Loan Agreement dated as of June 1, 2017, between the Authority and the University (the “Loan Agreement”).

Definitions of certain terms used herein and summaries of certain provisions of the Indenture, the Loan Agreement, the Security Agreement (defined herein) and the Collateral Agency Agreement (defined herein) are included in Appendix C hereto, the form of the Continuing Disclosure Agreement is set forth in Appendix D hereto and the form of opinion of Bond Counsel is set forth in Appendix E hereto. The description and summaries of the Loan Agreement, the Indenture and other documents contained herein do not purport to be comprehensive and are qualified in their entirety by reference to such documents, and all references to the Bonds are qualified in their entirety by the definitive form thereof included in the Indenture. Words and terms defined in such documents and not defined herein shall have the meanings set forth in such documents. Copies of such documents will be available for inspection during the initial offering period at the offices of RBC Capital Markets, LLC, Philadelphia, Pennsylvania, and thereafter, at the corporate trust office of the Trustee in Philadelphia, Pennsylvania or at the designated corporate trust office of any successor Trustee.

The Authority

Delaware County Authority (the “Authority”) is a body corporate and politic created by the Board of County Commissioners of Delaware County, Pennsylvania, pursuant to the provisions of the Pennsylvania Municipality Authorities Act, 53 Pa. Cons. Stat. §§5601-5622, as amended and supplemented (the “Act”). The Authority is authorized under the Act, among other things, to issue bonds or other obligations to finance projects for “eligible educational institutions” (as defined in the Act). The Bonds are being issued pursuant to the Act and a resolution adopted by the Authority. See “THE AUTHORITY” herein.

The University

The University is a private co-educational, Catholic institution located in Radnor, Delaware, County, Pennsylvania. For more information regarding the University, see Appendices A and B hereto.

The Trustee

The Bank of New York Mellon Trust Company, N.A., Philadelphia, Pennsylvania has been appointed to serve as the trustee under the Indenture.

The Project

The proceeds of the sale of the Bonds will be used, together with other available funds, to finance a project for the benefit of the University as described herein. See “THE PROJECT” herein.

Authorized Denominations; Book-Entry Only

The Depository Trust Company (“DTC”), New York, New York, will act as securities depository for the Bonds, and the Bonds will be registered in the name of Cede & Co., as registered owner and nominee for DTC. Individual purchases of Bonds will be made in book-entry form, in the authorized denomination of $5,000 and any whole multiple thereof. So long as Cede & Co. or any successor nominee of DTC is the registered owner of the Bonds, references herein to the Bondholders, Holders, holders, owners or registered owners shall mean Cede & Co., or such successor nominee, and shall not mean the Beneficial Owners (hereinafter defined) of the Bonds. Principal and interest on the Bonds are payable by the Trustee to Cede & Co., as nominee for DTC, which will, in turn, remit such principal and interest to the DTC Participants for subsequent disbursement to the Beneficial Owners. (See “THE BONDS -- Book Entry Only System” herein).

Security for Bonds

The proceeds of the Bonds will be loaned to the University under the Loan Agreement and secured, except as otherwise described herein, by an assignment to the Trustee of the Loan Agreement and the loan payments due thereunder.

The Bonds are limited obligations of the Authority payable solely from pledged revenues and other moneys assigned and pledged under the Indenture to secure such payment, including (i) the loan payments required to be made by the University under the Loan Agreement, and (ii) moneys and obligations held by the Trustee in certain funds established under the Indenture. See “SECURITY AND SOURCES OF PAYMENT FOR BONDS” herein.

The Loan Agreement is a general obligation of the University and the full faith and credit of the University is pledged to secure the payments required thereunder. The University’s obligations under the Loan Agreement are secured by a pledge of the Collateral (as further described under “SECURITY AND SOURCES OF PAYMENT FOR BONDS – Security Agreement” below) pursuant to a Security Agreement dated as of June 1, 2017 between the University and the Bank of New York Mellon Trust Company, N.A., as collateral agent (the “Collateral Agent”). The security interest in the Collateral granted under the Security Agreement will be on an equal and ratable basis with any security interest granted on such Collateral by the University to secure permitted obligations in the future (“Parity Obligations”) pursuant to a Collateral Agency Agreement dated as of June 1, 2017 among the University, the Authority, the Trustee and The Bank of New York Mellon Trust Company, N.A. as collateral agent (the “Collateral Agency Agreement”). For a summary of certain provisions of the Loan Agreement, the

Security Agreement and the Collateral Agency Agreement, see “SUMMARY OF CERTAIN PROVISIONS OF THE LOAN AGREEMENT”, “SUMMARY OF CERTAIN PROVISIONS OF THE SECURITY AGREEMENT” and “SUMMARY OF CERTAIN PROVISIONS OF THE COLLATERAL AGENCY AGREEMENT” in Appendix C hereto.

Except as described above, the University has not given or granted a mortgage lien or other security interest or encumbrance upon any property of the University to secure its payment obligations under the Loan Agreement or the Security Agreement. The Bonds will not be secured by a debt service reserve fund. See “SECURITY AND SOURCES OF PAYMENT FOR BONDS - No Debt Service Reserve Fund or Liens on Any Other Properties” herein.

Additional Indebtedness

Upon compliance with the terms and conditions of the Loan Agreement, the University may incur additional debt, including Additional Bonds, on a parity with the Bonds with respect to the lien on the Collateral. See “SOURCES OF AND SECURITY FOR PAYMENT OF THE BONDS – Additional Indebtedness”.

Bondholders’ Risks

Certain risks associated with the purchase of the Bonds are set forth in the section entitled “BONDHOLDERS’ RISKS” herein. Careful evaluation should be made of the risks set forth in such section and elsewhere in the Official Statement concerning the factors which may affect the payment of principal and interest on the Bonds when due.

THE AUTHORITY

The Authority is a public body corporate and politic created by an ordinance of the Board of County Commissioners (now the County Council) of the County of Delaware, Pennsylvania pursuant to the Act. The Authority was incorporated under its original name, Delaware County Hospital Authority, on August 15, 1974. By amendment of its Articles of Incorporation, the Authority’s name was changed to its present name, effective August 17, 1976. The Authority’s address is Delaware County Authority, 1671 North Providence Road, Media, Pennsylvania 19063.

The Authority is authorized by the Act and its Articles of Incorporation to, among other things, finance buildings and facilities for hospitals, health centers (including but not limited to, lifecare, nursing care and other health care buildings and facilities), buildings and facilities for colleges and universities authorized by the Act and buildings and facilities for secondary schools authorized by the Act. The Act grants to the Authority the power to issue bonds and other evidences of indebtedness or obligations.

The governing body of the Authority is a Board (the “Board”) consisting of five members appointed by the County Council. Members of the Authority’s Board are appointed for staggered five- year terms. A member of the Board may be reappointed at the expiration of his or her term. Board members serve until replaced. The present members of the Authority’s Board are:

Member Office Occupation Term Expires

Francis J. Catania, Esq. Chairman Attorney January 1, 2019

Thomas P. Wagner, Vice-Chairman Attorney January 1, 2018 Esq.

Paul J. Wechsler, III Secretary Businessperson January 1, 2021

Patrick V. Larkin, Jr. Treasurer Businessperson January 1, 2020

Thomas A. Donahue Assistant Businessperson January 1, 2022 Secretary/Treasurer

The Bonds are limited obligations of the Authority payable solely from amounts paid by the University under the Loan Agreement. See “LIMITED OBLIGATIONS” herein. The Authority has issued other series of bonds and notes. Each series of bonds or notes issued by the Authority is payable only from revenues provided by the institution for which such series was issued, and the general funds of the Authority are not pledged to the payment or security of any such securities. Accordingly, moneys available for the payment of such other issues will not be available for the payment of the Bonds nor will the moneys available for the payment of the Bonds be available for the payment of such other issues or any future bond or note issues, except for the pledge of Collateral which secures all Parity Obligations issued on behalf of the University.

The Authority has not prepared or assisted in the preparation of this Official Statement, except the statements with respect to the Authority contained under the captions “INTRODUCTORY STATEMENT – The Authority” and “LITIGATION” and under this caption and, except as aforesaid, the Authority is not responsible for any statements made in this Official Statement. Except for the execution and delivery of documents required to effect the issuance of the Bonds, the Authority has not otherwise assisted in the public offer, sale or distribution of the Bonds. Accordingly, except as aforesaid, the Authority disclaims responsibility for the disclosures set forth in this Official Statement or otherwise made in connection with the offer, sale and distribution of the Bonds.

THE BONDS

General

The Bonds will be dated, and will bear interest from, the date of their initial delivery. The Bonds will mature, unless previously called for redemption, on the dates and in the amounts set forth on the inside front cover hereof, and will bear interest at the rates set forth on the inside front cover hereof. Interest will be payable on January 1 and July 1 of each year (each, an “Interest Payment Date”), commencing January 1, 2018. The Bonds will be issued as fully registered Bonds without coupons and will be in the denomination of $5,000 or any whole multiple thereof.

The principal or redemption price of the Bonds will be payable upon presentation and surrender of the Bonds at the designated corporate trust agency office of the initial Trustee or any successor Trustee and interest on the Bonds will be paid on the applicable Interest Payment Date by check mailed to the owners of Bonds shown as the registered owners on the registration books maintained by the Trustee as registrar at the close of business on the fifteenth (15th) day of the calendar month (whether or not a Business Day) next preceding such Interest Payment Date. The interest and the principal or redemption

price becoming due on the Bonds shall, at the written request of the registered owner of at least $500,000 aggregate principal amount of the Bonds received by the Trustee at least five days before the corresponding Record Date or redemption date, be paid by wire transfer within the continental United States in immediately available funds to the bank account number of the registered owner specified in such request and entered by the Trustee on the register, but, in the case of principal or redemption price, only upon presentation and surrender of the Bonds at a designated corporate trust office of the Trustee. See “THE BONDS -- Book Entry Only System” below.

The Bank of New York Mellon Trust Company, N.A. has been appointed as Trustee under the Indenture and has a corporate trust office in Philadelphia, Pennsylvania. The Trustee shall act as registrar, paying agent and transfer agent for the Bonds.

As used herein, “Business Day” means any day on which banks located in the city in which the principal office of the Trustee is located are not required or authorized to remain closed and on which the New York Stock Exchange is not closed.

Book Entry Only System

The Bonds will be available initially only in book-entry form. Purchasers of the Bonds will not receive certificates representing their interest in the Bonds.

The following information concerning DTC and DTC’s book-entry only system has been obtained from DTC. The University, the Authority and the Underwriters take no responsibility for the accuracy of the information set forth in this section, and neither the Participants (as defined below) nor the Beneficial Owners (as defined below) should rely on the foregoing information with respect to such matters but should instead confirm the same with DTC or the Participants, as the case may be.

DTC, the world’s largest depository, is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934, as amended. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities through electronic computerized book-entry transfers and pledges between Direct Participants’ accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”). DTC has a Standard & Poor’s rating of AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com.

Purchases of Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for such Bonds on DTC’s records. The ownership interest of each actual

purchaser of each Bond (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their purchases. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participants through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Bonds, except in the event that use of the book-entry system for the Bonds is discontinued.

To facilitate subsequent transfers, all Bonds deposited by Participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Bonds with DTC and their registration in the name of Cede & Co. or such other nominee do not affect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Bonds; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Bonds may wish to take certain steps to augment transmission to them of notices of significant events with respect to the Bonds, such as redemptions, tenders, defaults, and proposed amendments to the bond documents. For example, Beneficial Owners of Bonds may wish to ascertain that the nominee holding the Bonds for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the Trustee and request that copies of the notices be provided directly to them.

Redemption notices shall be sent by the Trustee to DTC. If less than all of the Bonds are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in the Bonds to be redeemed.

Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Bonds unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the Authority or the Trustee as soon as possible after the record date with respect to any request for consent or vote. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose account the respective Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).

Payments of principal, redemption price and interest on the Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the Authority or Trustee, on each payable date in accordance with their respective holdings shown on DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of such Participants and not of DTC, the Trustee, the Authority or the University, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal, redemption price and interest to Cede & Co. (or to such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the Authority or the Trustee, disbursement of such payments to Direct Participants will be the

responsibility of DTC, and disbursement of such payments to the Beneficial Owners is the responsibility of Direct and Indirect Participants.

DTC may discontinue providing its services as securities depository with respect to the Bonds at any time by giving reasonable notice to the Authority or the Trustee. Under such circumstances, in the event that a successor securities depository is not obtained, Bond certificates are required to be printed and delivered. The Authority may determine to discontinue use of the system of book-entry transfers through DTC (or a successor securities depository). In that event, Bond certificates will be printed and delivered as described in the Indenture.

For every transfer and exchange of ownership interests in Bonds, the Beneficial Owners may be charged a sum sufficient to cover any tax, fee or other governmental charge that may be imposed in relation thereto.

IT IS THE DUTY OF EACH BENEFICIAL OWNER TO MAKE ARRANGEMENTS WITH THE APPLICABLE DIRECT PARTICIPANT OR INDIRECT PARTICIPANT TO RECEIVE FROM SUCH PARTICIPANT NOTICES OF PAYMENTS OF PRINCIPAL, PREMIUM (IF ANY) AND INTEREST, AND ALL OTHER PAYMENTS AND COMMUNICATIONS WHICH THE DIRECT PARTICIPANT RECEIVES FROM DTC. NEITHER THE AUTHORITY NOR THE TRUSTEE HAS ANY DIRECT OBLIGATION OR RESPONSIBILITY TO DIRECT PARTICIPANTS, INDIRECT PARTICIPANTS OR BENEFICIAL OWNERS.

THE AUTHORITY, THE TRUSTEE AND THE UNIVERSITY CANNOT AND DO NOT GIVE ANY ASSURANCES THAT DTC, THE DIRECT PARTICIPANTS OR THE INDIRECT PARTICIPANTS WILL DISTRIBUTE TO THE BENEFICIAL OWNERS OF THE BONDS (1) PAYMENTS OF PRINCIPAL OF, REDEMPTION PREMIUM, IF ANY, OR INTEREST ON THE BONDS, (2) CONFIRMATION OF BENEFICIAL OWNERSHIP INTEREST IN THE BONDS, OR (3) REDEMPTION OR OTHER NOTICES SENT TO DTC OR CEDE & CO., ITS NOMINEE, AS THE REGISTERED OWNER OF THE BONDS, OR THAT THEY WILL DO SO ON A TIMELY BASIS, OR THAT DTC, DIRECT PARTICIPANTS OR INDIRECT PARTICIPANTS WILL SERVE AND ACT IN THE MANNER DESCRIBED IN THIS OFFICIAL STATEMENT. THE CURRENT “RULES” APPLICABLE TO DTC ARE ON FILE WITH THE SECURITIES AND EXCHANGE COMMISSION, AND THE CURRENT “PROCEDURES” OF DTC TO BE FOLLOWED IN DEALING WITH DIRECT PARTICIPANTS ARE ON FILE WITH DTC.

NONE OF THE AUTHORITY, THE TRUSTEE, OR THE UNIVERSITY SHALL HAVE ANY RESPONSIBILITY OR OBLIGATION TO ANY DIRECT PARTICIPANT, INDIRECT PARTICIPANT OR ANY BENEFICIAL OWNER OR ANY OTHER PERSON NOT SHOWN ON THE REGISTRATION BOOKS OF THE TRUSTEE AS BEING A BONDHOLDER WITH RESPECT TO (1) THE BONDS; (2) THE ACCURACY OF ANY RECORDS MAINTAINED BY DTC OR ANY DIRECT PARTICIPANT OR INDIRECT PARTICIPANT; (3) THE PAYMENT BY DTC OR ANY DIRECT PARTICIPANT OR INDIRECT PARTICIPANT OF ANY AMOUNT DUE TO ANY BENEFICIAL OWNER IN RESPECT OF THE PRINCIPAL OR REDEMPTION PRICE OF OR INTEREST ON THE BONDS; (4) THE DELIVERY BY DTC OR ANY DIRECT PARTICIPANT OR INDIRECT PARTICIPANT OF ANY NOTICE TO ANY BENEFICIAL OWNER WHICH IS REQUIRED OR PERMITTED UNDER THE TERMS OF THE INDENTURE TO BE GIVEN TO BONDHOLDERS; (5) THE SELECTION OF THE BENEFICIAL OWNERS TO RECEIVE PAYMENT IN THE EVENT OF ANY PARTIAL REDEMPTION OF THE BONDS; OR (6) ANY CONSENT GIVEN OR OTHER ACTION TAKEN BY DTC AS REGISTERED OWNER OF THE BONDS.

So long as Cede & Co. is the registered owner of the Bonds as nominee of DTC, references herein to the Holders, holders, owners or registered owners of such Bonds shall mean Cede & Co. and shall not mean the Beneficial Owners of the Bonds.

Redemption Prior to Maturity

The Bonds will be subject to redemption prior to maturity as follows:

Optional Redemption. The Bonds maturing on and after July 1, 2028 shall be subject to redemption prior to maturity at the option of the Authority, upon the written direction of the University, in whole or in part on any date occurring on or after July 1, 2027 (and if in part, in any order of maturity or from among such specific maturities as may be designated in writing by the University, but within a particular maturity as selected by the Trustee at random or in such other manner as the Trustee in its discretion deems fair and appropriate) at a redemption price equal to 100% of the principal amount of the Bonds to be redeemed plus interest accrued to the date fixed for redemption.

Mandatory Sinking Fund Redemption. The Bonds maturing on July 1 of the years 2037, 2042 and 2047 are subject to mandatory redemption prior to maturity by the Authority in part at random in the principal amounts and on July 1 of the years set forth below, through the operation of the 2017 Bonds Sinking Fund Account established under the Indenture, at a redemption price equal to the principal amount of the Bonds to be so redeemed, plus accrued interest to the redemption date:

Term Bond due July 1, 2037 Term Bond due July 1, 2042__

Year Principal Year Principal (July 1) Amount (July 1) Amount 2032 $1,580,000 2038 $1,930,000 2033 1,640,000 2039 2,025,000 2034 1,710,000 2040 2,125,000 2035 1,780,000 2041 2,235,000 2036 1,850,000 2042* 2,345,000 2037* 1,920,000

Term Bond due July 1, 2047

Year Principal (July 1) Amount 2043 $2,460,000 2044 2,585,000 2045 2,715,000 2046 2,850,000 2047* 2,990,000 ______*Maturity

Extraordinary Option Redemption. In the manner and upon the terms and conditions provided in the Indenture and the Loan Agreement, the Bonds shall be subject to redemption prior to maturity at the option of the Authority, upon the written direction of the University, in the event of damage to or destruction or condemnation of all or any part of the University’s facilities, in whole on

any date or in part from time to time on any date (and if in part, in any order of maturity or from among such specific maturities as may be designated in writing by the University, but within a particular maturity as selected by the Trustee at random or in such other manner as the Trustee in its discretion deems fair and appropriate), in each case at the redemption price equal to 100% of the principal amount thereof to be redeemed plus interest accrued to the date fixed for redemption.

Notice of Redemption

When required to redeem Bonds, the Trustee shall cause notice of the redemption to be mailed by first-class mail not more than 60 nor less than 20 days prior to the redemption date to the registered owners of the Bonds to be redeemed at their registered addresses. Any such notice shall be given in the name of the Authority; shall identify the Bonds (or portions thereof) to be redeemed by reference to the series, the maturity and the identification numbers therefor established pursuant to this Indenture and any other descriptive information needed to identify accurately the Bonds to be redeemed; shall specify the redemption date and the redemption price; and shall state that on the redemption date the Bonds called for redemption will be payable at the office of the Trustee or other paying agent designated therein and that from that date interest will cease to accrue on the Bonds or portions thereof to be redeemed.

If at the time of mailing of notice of any optional redemption there shall not have been deposited with the Trustee moneys sufficient to redeem all or any of the Bonds called for redemption, such notice shall state that it is conditional in that it is subject to the deposit of the redemption moneys (or that it is subject to the deposit of the redemption moneys from a specified source or sources) with the Trustee not later than 12:00 Noon, prevailing Eastern time, on the redemption date, and that such notice shall be of no effect unless such moneys (or such moneys from such specified source or sources) are so deposited.

THE PROJECT

The proceeds from the sale of the Bonds, together with other available funds, will be used to finance a project (the “Project”) for the benefit of the University consisting of (i) refunding the entire outstanding aggregate principal amount of the Delaware County Authority College Revenue Bonds (Cabrini College), Series of 1999 (the “Series of 1999 Bonds”), (ii) refunding the entire outstanding aggregate principal amount of the Delaware County Authority College Revenue Bonds (Cabrini College), Series of 2003 (the “Series of 2003 Bonds”), (iii) refunding the entire outstanding aggregate principal amount of the Delaware County Authority College Revenue Bonds (Cabrini College), Series of 2007 (the “Series of 2007 Bonds” and together with the Series of 1999 Bonds and the Series of 2003 Bonds, the “Refunded Bonds”), and (iv) funding all or a portion of the costs of certain new capital projects of the University at its main campus, such new projects consisting generally of the construction, equipping and furnishing of an approximately 150-bed residential hall, one or more structured or surface parking facilities and other capital projects at the University’s main campus; (the refundings described in clauses (i), (ii) and (iii) above are referred to as the “2017 Refunding Project” and the capital projects described in clause (iv) above are referred to as the “2017 Capital Projects”); (v) finance capitalized interest on the portion of the Bonds allocated to the 2017 Capital Project during the construction period of the 2017 Capital Projects; and (vi) finance certain costs of issuing the Bonds. The Series of 1999 Bonds and the Series of 2003 Bonds are scheduled to be redeemed on June 20, 2017. The Series of 2007 Bonds are scheduled to be redeemed on July 1, 2017.

ESTIMATED SOURCES AND USES OF FUNDS

The following table sets forth the estimated sources and uses of funds in connection with the Bonds:

Sources of Funds

Par Amount of Bonds $49,265,000.00 Refunded Bonds Debt Service Reserve Funds $2,842,539.65 Refunded Bonds Debt Service Funds $1,403,944.88 Net Original Issue Premium $3,726,163.85 TOTAL SOURCES OF FUNDS $57,237,648.38

Uses of Funds

2017 Capital Projects $24,700,000.00 2017 Refunding Project $30,665,544.94 Capitalized Interest $1,250,063.89 Costs of Issuance (1) $622,039.55 TOTAL USES OF FUNDS $57,237,648.38

(1) Includes amounts to be paid for Authority related fees, Trustee fees, rating agency fees, financial advisory fees, legal counsel fees, printing costs and other fees and expenses, including the Underwriters’ discount.

SECURITY AND SOURCES OF PAYMENT FOR THE BONDS

General

The Bonds are limited obligations of the Authority and are payable solely from the sources referred to herein. Neither the credit nor the taxing power of Delaware County, the Commonwealth of Pennsylvania or any political subdivision thereof is pledged for the payment of the principal or redemption price of or interest on the Bonds, nor shall the Bonds be or be deemed a general obligation of the Authority or an obligation of Delaware County, the Commonwealth of Pennsylvania or any political subdivision thereof. The Authority has no taxing power.

Set forth below is a brief discussion of certain provisions of the Loan Agreement, the Indenture, the Security Agreement and the Collateral Agency Agreement which relate to the security for the Bonds. Reference should be made to Appendix C hereto for a further description of the provisions of such documents.

The Indenture

The Bonds will be issued under and secured by the Indenture. The Indenture provides that all Bonds issued thereunder will be limited obligations of the Authority, payable solely from the sources identified therein, which include: (i) payments required to be made by the University under the Loan Agreement (other than certain fees and indemnification payments required to be paid to the Authority or to the Trustee), and (ii) certain moneys and securities held by the Trustee under the Indenture and investment earnings thereon (but excluding the Rebate Fund). See “SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE” in Appendix C hereto for a summary of certain provisions of the Indenture.

The Loan Agreement

Under the Loan Agreement, the University will be obligated to make loan payments in amounts necessary to provide for the payment as and when due of the principal or redemption price of, and interest on, the Bonds, any amounts that may be required to make up any deficiency that may occur in any funds and accounts established under the Indenture, and to provide for certain other payments required by the Indenture. The Authority will assign the Loan Agreement, including its right to receive loan payments thereunder (other than certain fees, expenses and indemnification payments required to be paid to the Authority or to the Trustee) to the Trustee as security for the Bonds.

Security Agreement

To secure its obligations under the Loan Agreement, the University will enter into the Security Agreement and grant to the Collateral Agent a lien on and security interest in Collateral, on a parity with any lien on and security interest in the Collateral hereafter granted by the University to secure Parity Obligations. The existence of such lien and security interest in the Collateral will not prevent the University from expending, depositing or commingling such funds so long as the University is not in default under the Loan Agreement.

Collateral means:

(a) All receipts, revenues, rentals, income and other moneys held, received or receivable by or on behalf of the University from any source, including, without limitation, all operating and nonoperating revenues, and all rights to receive the same whether in the form of accounts, contract rights, chattel paper, instruments or general intangibles, and the proceeds thereof (whether cash or non-cash), in each case whether now owned or held or hereafter acquired by the University, but excluding, however, any gifts, grants, bequests, donations and contributions, and the income and gains derived therefrom, that are designated at the time of making by the donor as being for specific purposes inconsistent with the payment of debt service on Parity Obligations of the University;

(b) All books and records relating to the foregoing Collateral, including, without limitation, all correspondence, memoranda, computer programs, tapes, discs, ledger sheets, papers, books and other documents or transcribed information of any type and whether expressed in ordinary or machine readable language; and

To the extent that a security interest can be perfected in the Collateral by filing of financing statements, such action will be taken. The security interest in the Collateral may not be enforceable against third parties unless such Collateral is actually transferred to the Collateral Agent or is subject to exceptions under the Uniform Commercial Code (the “UCC”) as enacted in the Commonwealth. See “BONDHOLDERS’ RISKS – Security Interest in the Collateral” herein.

Collateral Agency Agreement

The security interest in the Collateral granted pursuant to the Security Agreement will be on equal and ratable basis with any security interest in the Collateral hereafter granted to secure any Parity Obligations pursuant to the terms of the Collateral Agency Agreement.

Additional Indebtedness

The University may incur, guaranty or assume additional indebtedness upon compliance with specified requirements and limitations contained in the Loan Agreement. To the extent permitted under the Loan Agreement, such additional indebtedness may be secured by liens on and security interests in property of the University, including a lien on and security interest in the Collateral on a parity with the lien on and security interest in the Collateral granted to secure the Bonds and any other Parity Obligations of the University. See “SUMMARY OF CERTAIN PROVISIONS OF THE LOAN AGREEMENT – Permitted Indebtedness of the University” in Appendix C hereto for a description of the requirements and limitations relating to the incurrence of and security for additional indebtedness which may be incurred by the University.

Financial Covenant

The University covenants that, as of the last day of each Fiscal Year, either (a) Coverage Ratio A shall be at least 110%, or (b) Coverage Ratio B shall be at least 150%, or (c) the Expendable Funds Ratio shall be at least 50%. The failure of the University to meet one of the such financial covenants for any one Fiscal Year shall not be an Event of Default, but the failure to meet one of the tests for two consecutive Fiscal Years shall be an Event of Default unless the University engages a consultant to make a report to the University Board containing recommendations as to how the University may achieve such compliance. The failure of the University to meet one of such covenants for three consecutive Fiscal Years shall be an Event of Default. See “SUMMARY OF CERTAIN PROVISIONS OF LOAN AGREEMENT – Financial Covenant” in Appendix C for a description of the covenants referenced above.

No Debt Service Reserve Fund or Liens on Any Other Properties

Except as described above under “Security Agreement”, the University has not given or granted a mortgage lien or other security interest or encumbrance upon any property of the University to secure its payment obligations under the Loan Agreement or the Security Agreement. The Bonds will not be secured by a debt service reserve fund.

BONDHOLDERS’ RISKS

Purchase of the Bonds involves a degree of risk. In order to identify risk factors and make an informed investment decision, potential investors should be thoroughly familiar with this entire Official Statement, including the Appendices hereto, in order to make a judgment as to whether the Bonds are an appropriate investment. Certain risks associated with the purchase of the Bonds are described below and in Appendix A. Such lists of possible factors, while not setting forth all the factors that must be considered, contain some of the factors that should be considered prior to purchasing the Bonds. The discussion of risk factors is not, and is not intended to be, comprehensive or exhaustive. Prospective purchasers of the Bonds should give careful consideration to the matters referred to in the following summary.

Limited Obligations

The Bonds are limited obligations of the Authority and are payable solely from payments made pursuant to the Loan Agreement. No representation or assurance can be given to the effect that the University will generate sufficient revenues to meet the University’s payment obligations under the Loan Agreement.

Reliance on Student Tuition, Fees and Other Charges

The adequacy of the University's revenues will largely depend on the amount of future tuition and other student derived revenue the University receives. Such revenue in turn will depend primarily on the University's ability to charge sufficient rates for tuition, student fees and student charges and to maintain enrollment levels. Future enrollment levels will depend on the number of students applying to the University and accepting offers of admission. A number of factors, including, without limitation, levels of tuition rates and other fees, competition from other colleges and universities, a change in the number of University age students and changing general economic conditions will influence the number of applicants to the University. Certain of these factors are outside of the University’s control.

Competition

Competition among institutions of higher education is intense nationally and within the region from which the University draws the majority of its students. Universities and colleges compete principally based on location, tuition rates, degree offerings, and academic reputation. To the extent that competitors have or achieve an advantage with respect to any of these factors, the University could be adversely affected. In addition, competitive pressures could result in tuition reductions or the inability to raise tuition, which could adversely affect the change in the University's unrestricted net assets.

Fluctuations in Market Value of Investments

Earnings on investments have historically provided the University an important source of cash flow and capital appreciation to support its programs and services, to finance capital expenditure investments and to build cash reserves. Historically the value of both debt and equity securities has fluctuated and, in some instances, the fluctuations have been quite significant. Diversification of securities holdings may diminish the impact of these fluctuations. However, no assurances can be given that the market value of the investments of the University will grow, or even remain at current levels and there is no assurance that such market value will not decline.

Potential Effects of Bankruptcy

If the University were to file a petition for relief under Title 11 of the United States Code, as amended (the “Bankruptcy Code”), the filing would operate as an automatic stay of the commencement or continuation of any judicial or other proceeding against the University and its property. If the bankruptcy court so ordered, the University’s property, including its revenues, could be used for the benefit of the University despite the claims of its creditors (including the Trustee).

In a bankruptcy proceeding, the University could file a plan for the adjustment of its debts which modifies the rights of creditors generally or the rights of any class of creditors, secured or unsecured. The plan, when confirmed by the court, would bind all creditors who had notice or knowledge of the plan and discharge all claims against the debtor provided for in the plan. No plan may be confirmed unless, among other conditions, the plan is in the best interest of creditors, is feasible and has been accepted by each class of claims impaired thereunder.

Each class of claims has accepted the plan if at least two-thirds in dollar amount and more than one-half in number of the allowed claims of the class that are voted with respect to the plan are cast in its favor. Even if the plan is not so accepted, it may be confirmed if the court finds that the plan is fair and does not discriminate unfairly.

Covenant to Maintain Tax-Exempt Status of the Bonds

The tax-exempt status of the Bonds, as described under “TAX MATTERS” herein, is based on the continued compliance by the Authority and the University with certain covenants contained in the Indenture, the Loan Agreement and certain other documents entered into by the Authority and the University. These covenants relate generally to restrictions of the use of facilities financed with proceeds of the Bonds, arbitrage limitations, rebate of certain excess investment earnings to the federal government and restrictions on the amount of issuance costs which can be financed with proceeds of the Bonds. Failure by the Authority or the University to comply with such covenants could cause interest on the Bonds to become subject to federal income taxation retroactive to the date of issuance of the Bonds.

Local Tax Assessment

In recent years, a number of local taxing authorities in the Commonwealth have sought to subject the facilities of non-profit and other traditionally exempt organizations to local real estate and business privilege taxes, primarily by challenging their status as “institutions of purely public charity” as described in the Pennsylvania Constitution, notwithstanding the fact that Pennsylvania nonprofit facilities historically have been viewed as exempt from such taxes. The Pennsylvania constitutional test is very subjective and frequently difficult to satisfy. Pennsylvania court decisions have been highly fact-specific and do not provide clear overall guidance on the question. In addition, the Pennsylvania law sets forth additional standards that must be satisfied for tax exemption. Therefore, there is no assurance that under current Pennsylvania law that the University will remain exempt from real estate and other local taxes.

Maintenance of the University’s 501(c)(3) Status

The tax-exempt status of the Bonds presently depends upon the University’s maintenance of its status as an organization described in Section 501(c)(3) of the Code.

The University has been determined by the Internal Revenue Service (the “IRS”) to be a tax- exempt organization described in Section 501(c)(3) of the Code, pursuant to a group determination letter issued to the United States Conference of Catholic Bishops. To maintain such status, the University must conduct its operations in a manner consistent with representations previously made to the IRS and with current and future IRS regulations and rulings.

Failure to comply with current and future regulations and rulings of the IRS could adversely affect the ability of the University to finance or refinance indebtedness on a tax-exempt basis or otherwise generate revenues necessary to provide for payment of the Bonds. Although the University has covenanted to maintain its status as a tax-exempt organization, loss of tax-exempt status would likely have a significant adverse effect on the University and its operations and could result in the includability of interest on the Bonds in gross income for federal income tax purposes retroactive to their date of issue.

Potential Changes in Federal and State Tax Law

Future laws, clarifications of the Code or state or local tax law or court decisions may cause interest on the Bonds to be subject, directly or indirectly, in whole or in part, to federal income taxation or to be subject to state income taxation, or otherwise prevent Owners from realizing the full current benefit

of the tax status of such interest. Legislative proposals have been periodically released in prior years that would limit the extent of the exclusion from gross income of interest on obligations of states and political subdivisions under Section 103 of the Code (including the Bonds) for taxpayers whose income exceeds certain thresholds. The introduction or enactment of any such legislative proposals or clarification of the Code or court decisions may also affect, perhaps significantly, the market prices for, or marketability of, the Bonds. Prospective purchasers of the Bonds should consult their own tax advisors regarding the potential impact of any pending or proposed federal or state tax legislation or regulations.

Security Interest in the Collateral

The University’s obligations under the Loan Agreement will be secured by a lien on and security interest in the Collateral on an equal and ratable basis with any future Parity Obligations. The effectiveness of the pledge of Collateral is limited since a security interest in money generally cannot be perfected by the filing of financing statements under the UCC. Rather, such a security interest is perfected by taking possession of the subject funds. The monies constituting the Collateral received by the University from time to time are not required to be transferred to or held by the Collateral Agent, and may be spent by the University or commingled with its other funds. Under these circumstances, the pledge of the Collateral might not be perfected under the UCC.

To the extent a security interest can be perfected in the Collateral by the filing of financing statements, such action will be taken. The security interest in the Collateral may be unenforceable against third parties unless such Collateral is actually transferred to or for the benefit of the Collateral Agent and may be subject to other exceptions under the UCC. Such security interest may be further limited by the following: (1) statutory liens; (2) rights arising in favor of the United States of America or any agency thereof; (3) present or future prohibitions against assignment contained in any Pennsylvania statutes or regulations; (4) constructive trusts, equitable liens or other rights impressed or conferred by any Pennsylvania or federal court in the exercise of its equitable jurisdiction; (5) federal bankruptcy laws or state laws dealing with fraudulent conveyances affecting assignments of revenues and assets; and (6) any defect in the filing of, or any failure to file, appropriate continuation statements to the UCC.

Enforceability of Remedies

The remedies available to Bondholders upon an Event of Default under the Indenture or the Loan Agreement are in many respects dependent upon judicial action which is subject to discretion or delay. Under existing law and judicial decisions, including specifically the Bankruptcy Code, the remedies specified in the Indenture and the Loan Agreement may not be readily available or may be limited. A court may decide not to order specific performance. The various legal opinions to be delivered concurrently with the original delivery of the Bonds will be qualified as to enforceability of the various legal instruments by limitations imposed by bankruptcy, reorganization, insolvency or other similar laws or legal or equitable principles affecting creditors’ rights.

Other Risk Factors

In the future, the following factors, among others, may adversely affect the revenues or operations of the University to an extent that cannot be determined at this time.

(i) Changes in the demand for higher education in general or for programs offered by the University in particular.

(ii) Competition from other educational institutions both regionally and nationally.

(iii) Higher interest rates, which could prevent borrowing for needed capital expenditures.

(iv) Lack of demand for on-campus housing and meal service at the University.

(v) Increasing costs of compliance with governmental regulations, including accommodations for handicapped or special needs students, and costs of compliance with the changes in such regulations.

(vi) Increased costs and decreased availability of public liability insurance.

(vii) Increased costs and/or decreased availability of student loan funding.

(viii) Employee strikes and other adverse labor actions that could result in a substantial reduction in revenues without corresponding decreases in costs.

(ix) Cost and availability of energy.

(x) An increase in the costs of health care benefits, retirement plans, or other benefit packages offered by the University to its employees.

(xi) Higher interest rates, which could strain cash flow or prevent borrowing for needed capital expenditures.

(xii) The occurrence of natural disasters, including floods and hurricanes and pandemics and similar events, which might damage the facilities of the University, interrupt service to such facilities or otherwise impair the operation and ability of such facilities to produce revenue.

(xiii) Reduced future University net revenues as a result of a need to increase tuition discounting to attract students.

(xiv) Reduced ability to attract future annual operating contributions or capital campaign contributions, that may limit future projects or the ability to address deferred maintenance and/or the support of expenses related to faculty salaries, tuition discounting or additional programs.

(xv) An inability to retain students, resulting in enrollment losses and reduced revenues.

(xvi) A downgrade in the University’s bond rating or rating outlook to a level which prevents the University from being able to borrow at affordable rates in the future.

LIMITED OBLIGATIONS

The Bonds are limited obligations of the Authority and are payable solely from sources referred to herein. Neither the credit nor the taxing power of Delaware County, the Commonwealth of Pennsylvania or any political subdivision thereof is pledged for the payment of the principal or redemption price of or interest on the Bonds, nor shall the Bonds be or be deemed a general obligation of the Authority or an obligation of Delaware County, the Commonwealth of Pennsylvania or any political subdivision thereof. The Authority has no taxing power.

NO PERSONAL RECOURSE

No covenant or agreement contained in the Indenture, the Bonds, the Loan Agreement or any other document entered into in connection with the Bonds shall be deemed to be the covenant or agreement of any member, director, officer, attorney, agent or employee of the Authority or the University in an individual capacity. No recourse shall be had for the payment of any claim based thereon against any member, director, officer, agent, attorney or employee of the Authority or the University, past, present or future, or their successors or assigns, as such, either directly or through the Authority or the University or any successor corporations, whether by virtue of any constitutional provision, statute or rule of law, or by the enforcement of any assessment or penalty, or otherwise.

LITIGATION

There is no controversy or litigation of any nature now pending or, to the knowledge of the University or the Authority, threatened that seeks to restrain or enjoin the issuance, sale, execution or delivery of the Bonds, or in any way contests or affects the validity of the Bonds, any proceedings of the Authority taken with respect to the issuance or sale thereof, any security or the pledge or application of any moneys provided for the payment of the Bonds, the existence or powers of the Authority or the accomplishment of the purposes for which the Bonds are being issued.

Other than as set forth in Appendix A, there is no controversy or litigation of any nature now pending against the University or, to the knowledge of any of its respective officers, threatened which in the judgment of the University would materially adversely affect the operations or financial condition of the University or the ability of the University to perform its obligations under the Loan Agreement.

CONTINUING DISCLOSURE

The Authority has determined that no financial or operating data concerning the Authority is material to any decision to purchase, hold or sell the Bonds and the Authority will not provide any such information. The University has undertaken all responsibilities for any continuing disclosure to holders of the Bonds as described below, and the Authority shall have no responsibility or liability to the holders of the Bonds or any other person with respect to such disclosures.

In order to assist the Underwriters in complying with the requirements of Rule 15c2-12 (the “Rule”), the University will enter into the Continuing Disclosure Agreement. See Appendix D for the proposed form of Continuing Disclosure Agreement.

In connection with the issuance of the Refunded Bonds, the University executed continuing disclosure agreements similar to the Continuing Disclosure Agreement that required the University to file an update of certain financial and operating data (the “Annual Information”) and its audited financial statements within 150 days of the University’s fiscal year end. For the fiscal years 2012, 2013, 2014 and 2015, the University was late in filing its audited financial statements and its Annual Information. Additionally, for the periods referenced above, the University failed to provide notice of its failure to file Annual Information and audited financial statements in a timely manner.

While the rating agencies make their rating actions widely available and it is the University’s practice to make rating actions available on its website, the continuing disclose agreements entered into with respect to each series of bonds issued on behalf of the University also require that the University file notice on EMMA of any change in the ratings of such bonds. During the applicable 5-year period prior to the date of this Official Statement, the University failed to file notice on EMMA of an upgrade on the enhanced S&P rating on the Refunded Bonds on April 2, 2015. The University filed notice of all such

failures to file and has since filed all of the required information on EMMA. The University intends to fully comply with all current and future continuing disclosure undertakings, compliance of which will be overseen by the Office of the Treasurer of the University.

TAX MATTERS

In the opinion of Bond Counsel, under existing law and assuming continuing compliance by the Authority and the University with the requirements of the Internal Revenue Code of 1986, as amended (the “Code”) and the regulations thereunder that relate to the Bonds, interest on the Bonds is excluded from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; however, interest on the Bonds held by a corporation (as defined for federal income tax purposes) may be indirectly subject to federal alternative minimum tax because of its inclusion in the adjusted current earnings of a corporate holder.

Such opinion of Bond Counsel is given subject to the condition that the Authority and the University shall comply with all requirements of the Code that must be satisfied subsequent to the issuance of the Bonds in order that interest on the Bonds be (or continue to be) excluded from gross income for federal income tax purposes.

Bond Counsel is also of the opinion that, under existing law, interest on the Bonds is exempt from Pennsylvania personal income tax and from Pennsylvania corporate net income tax, and the Bonds are exempt from personal property taxes in Pennsylvania.

Except as expressly stated above, Bond Counsel will not express any opinion as to any other federal or state tax consequences of acquiring, carrying, owning or disposing of the Bonds, and prospective purchasers of the Bonds should consult with their own tax advisors as to the applicability of these and any other collateral tax consequences of ownership of the Bonds.

Certain of the Bonds have been sold with original issue discount (the “OID Bonds”). For each maturity of the OID Bonds, original issue discount is the excess of the stated redemption price at maturity of such OID Bonds over the initial offering price to the public, excluding underwriters and other intermediaries, at which price a substantial amount of such OID Bonds were sold. The appropriate portion of such original issue discount allocable to the original and each subsequent holder will be treated as interest and excluded from gross income for federal income tax purposes and will increase a holder’s tax basis in such OID Bonds for purposes of determining gain or loss upon sale, exchange, redemption, or payment at maturity. Owners of such OID Bonds should consult their own tax advisors with respect to the computation and determination of the portion of original issue discount which will be treated as interest and added to a holder’s tax basis during the period such OID Bonds are held.

Any Bonds purchased, whether at original issuance or otherwise, for an amount greater than their principal amount payable at maturity (or, in some cases, at their earlier call date) (the “Premium Bonds”), will be treated as having amortizable bond premium. No deduction is allowable for the amortizable bond premium on the Premium Bonds. However, a purchaser’s basis in a Premium Bond, and under the Treasury Regulations the amount of tax-exempt interest received, will be reduced by the amount of amortizable bond premium properly allocable to such purchaser. Owners of Premium Bonds should consult their own tax advisors with respect to the proper treatment of amortizable bond premium in their particular circumstances.

Ownership of the Bonds may result in collateral federal income tax consequences to certain taxpayers, including, without limitation, financial institutions, property and casualty insurance companies,

individual recipients of Social Security or Railroad Retirement benefits, S corporations with “excess net passive income” and taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry the Bonds. Bond Counsel expresses no opinion as to such collateral federal income tax consequences.

The opinion of Bond Counsel on federal tax matters will be based upon and will assume the accuracy of certain representations and certifications, and compliance with certain covenants, of the University and the Authority to be contained in the transcript of proceedings for the issuance of the Bonds and that are intended to evidence and assure that the Bonds are and will remain obligations the interest on which is excluded from gross income for federal income tax purposes. Bond Counsel will also rely on the opinion of Saul Ewing LLP as to all matters concerning the status of the University as an organization described in Section 501(c)(3) of the Code and exempt from federal income tax under Section 501(a) of the Code. Bond Counsel will not independently verify the accuracy of those certifications and representations or that opinion.

The Code prescribes a number of qualifications and conditions for the interest on state and local obligations to be and to remain excluded from gross income for federal income tax purposes, some of which require future or continued compliance after issuance of the obligations in order for the interest to be and to continue to be so excluded from the date of issuance. Noncompliance with these requirements by the University or the Authority may cause the interest on the Bonds to be included in gross income for federal income tax purposes and thus to be subject to federal income tax retroactively to their date of issuance. The University and, subject to certain limitations, the Authority have each covenanted to take the actions required of it for the interest on the Bonds to be and to remain excluded from gross income for federal income tax purposes, and not to take any actions that would adversely affect that exclusion.

Current and future legislative proposals, if enacted into law, clarification of the Code or court decisions may cause interest on the Bonds to be subject, directly or indirectly, in whole or in part, to federal income taxation, or otherwise prevent the owners of the Bonds from realizing the full current benefit of the tax status of such interest. The introduction or enactment of any such legislative proposals, or any such clarification of the Code or any such court decisions, may also affect the market price for or marketability of the Bonds. Prospective purchasers of the Bonds should consult their own tax advisers regarding any pending or proposed federal tax legislation, as to which Bond Counsel expresses no opinion.

The opinion of Bond Counsel is based on current legal authority, covers certain matters not directly addressed by such authorities, and represents Bond Counsel’s judgment as to the proper treatment of the Bonds for federal income tax purposes. It is not binding on the IRS or the courts. Furthermore, Bond Counsel cannot give and has not given any opinion or assurance about the future activities of the Authority or the University, or about the effect of future changes in the Code, the applicable regulations, the interpretation thereof or the enforcement thereof by the IRS.

THE FOREGOING IS NOT INTENDED AS AN EXHAUSTIVE DESCRIPTION OF THE PROVISIONS OF FEDERAL OR STATE TAX LAW OR OTHER FACTORS WHICH MAY HAVE AN EFFECT ON INDIVIDUALS AND CORPORATIONS HOLDING THE BONDS OR RECEIVING INTEREST THEREON. PROSPECTIVE PURCHASERS OF THE BONDS SHOULD CONSULT WITH THEIR TAX ADVISORS REGARDING THE EFFECT ON THEIR AFFAIRS OF HOLDING THE BONDS OR RECEIVING INTEREST THEREON, INCLUDING, BUT NOT LIMITED TO, THE EFFECT OF STATE AND LOCAL TAX LAWS.

LEGAL MATTERS

Legal matters incident to the authorization, issuance and sale of the Bonds are subject to the approval of Reed Smith LLP, Philadelphia, Pennsylvania, Bond Counsel. Reed Smith LLP has provided legal services to the University and the Underwriters on unrelated matters from time to time. Certain legal matters will be passed upon by McNichol, Byrne & Matlawski, P.C., Media, Pennsylvania, as counsel to the Authority; by Saul Ewing LLP, Philadelphia, Pennsylvania, as counsel to the University; and by Fox Rothschild, LLP, Philadelphia, Pennsylvania, as counsel to the Underwriters. The various legal opinions to be delivered express the professional judgment of the attorney rendering the opinion as to the legal issues explicitly addressed therein. Such opinions will be subject to certain assumptions and conditions and the rendering of any such opinion does not constitute a guaranty of any particular matter subject to any such opinion.

RATING

S&P Global Ratings, a Standard & Poor's Financial Services LLC business (“S&P”), has assigned its municipal bond rating of “BBB+” to the Bonds, accompanied by a Stable Outlook, based on the creditworthiness of the University.

Certain information and materials not included in this Official Statement were furnished to S&P. Generally, rating services base their ratings on information and materials so furnished and on investigations, studies and assumptions by such rating service. The rating and outlook assigned to the Bonds reflects only the views of S&P at the time such rating was issued, and an explanation of the significance of such rating and outlook may be obtained only from S&P. Such rating and outlook are not a recommendation to buy, sell or hold the Bonds. There is no assurance that any such rating or outlook will continue for any given period of time or that they will not be lowered or withdrawn entirely by S&P if, in its judgment, circumstances so warrant. Any such downward revision of such rating or outlook or withdrawal of such rating may have an adverse effect on the market price of the Bonds.

UNDERWRITING

The Bonds are being purchased by RBC Capital Markets, LLC and Wells Fargo Securities (the “Underwriters”) pursuant to a Bond Purchase Agreement among the Underwriters, the Authority and the University. The Underwriters have agreed to purchase the Bonds at an aggregate purchase price of $52,683,257.60 (representing the par amount of the Bonds of $49,265,000.00, less an Underwriters’ discount of $307,906.25 and plus a net original issue premium of $3,726,163.85). The Bond Purchase Agreement provides, among other things, that they will purchase all the Bonds, if any are purchased. The obligation of the Underwriters to pay for the Bonds is subject to certain terms and conditions set forth in the Bond Purchase Agreement, including delivery of specified opinions of counsel and of a certificate of the University that there has been no material adverse change in its condition (financial or otherwise) from that set forth in this Official Statement. The Bond Purchase Agreement also provides that the University will indemnify the Underwriters and the Authority against losses, claims and liabilities arising out of any materially incorrect statement or information contained in or material information omitted from this Official Statement pertaining to the University. The initial public offering prices set forth on the inside front cover page of this Official Statement may be changed by the Underwriters from time to time without any requirement of prior notice. The Underwriters reserve the right to sell Bonds to certain dealers and others at prices lower than those offered to the public.

The Underwriters and their respective affiliates are full-service financial institutions engaged in various activities that may include securities trading, commercial and investment banking, municipal advisory, brokerage, and asset management. In the ordinary course of business, the Underwriters and

their respective affiliates may actively trade debt and, if applicable, equity securities (or related derivative securities) and provide financial instruments (which may include bank loans, credit support or interest rate swaps). The Underwriters and their respective affiliates may engage in transactions for their own accounts involving the securities and instruments made the subject of this securities offering or other offering of the Authority. The Underwriters and their respective affiliates may also communicate independent investment recommendations, market color or trading ideas and publish independent research views in respect of this securities offering or other offerings of the Authority.

Wells Fargo Securities is the trade name for certain securities-related capital markets and investment banking services of Wells Fargo & Company and its subsidiaries, including Wells Fargo Bank, National Association, which conducts its municipal securities sales, trading and underwriting operations through the Wells Fargo Bank, NA Municipal Products Group, a separately identifiable department of Wells Fargo Bank, National Association, registered with the Securities and Exchange Commission as a municipal securities dealer pursuant to Section 15B(a) of the Securities Exchange Act of 1934.

Wells Fargo Bank, National Association, acting through its Municipal Products Group ("WFBNA"), one of the underwriters of the Bonds, has entered into an agreement (the "WFA Distribution Agreement") with its affiliate, Wells Fargo Clearing Services, LLC (which uses the trade name “Wells Fargo Advisors”) ("WFA"), for the distribution of certain municipal securities offerings, including the Bonds. Pursuant to the WFA Distribution Agreement, WFBNA will share a portion of its underwriting or remarketing agent compensation, as applicable, with respect to the Bonds with WFA. WFBNA has also entered into an agreement (the “WFSLLC Distribution Agreement”) with its affiliate Wells Fargo Securities, LLC (“WFSLLC”), for the distribution of municipal securities offerings, including the Bonds. Pursuant to the WFSLLC Distribution Agreement, WFBNA pays a portion of WFSLLC’s expenses based on its municipal securities transactions. WFBNA, WFSLLC, and WFA are each wholly-owned subsidiaries of Wells Fargo & Company.

FINANCIAL ADVISOR

Fairmount Capital Advisors, Inc., Philadelphia, Pennsylvania, (“Fairmount”) has served as financial advisor to the University with respect to the sale of the 2017 Bonds. Fairmount is not obligated to undertake, and has not undertaken, either to make an independent verification of or to assume responsibility for, the accuracy, completeness or fairness of the information contained in this Official Statement. Fairmount has assisted in matters relating to the planning, structuring and issuance of the 2017 Bonds, and has provided other financial advice. Fairmount is a financial advisory and consulting organization and is not engaged in the underwriting, marketing or trading of municipal securities or other negotiable instruments. Fairmount has not been engaged by the Authority.

INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

The financial statements of the University as of and for the fiscal years ended June 30, 2016 and June 30, 2015 are included in Appendix B hereto and have been audited by CliftonLarsonAllen LLP, as stated in their report appearing therein.

OTHER MATTERS

The order and placement of materials in this Official Statement, including the Appendices, are not to be deemed a determination of relevance, materiality or importance, and this Official Statement, including the Appendices, must be considered in its entirety. The offering of the Bonds is made only by

means of this entire Official Statement. The Appendices are integral parts of this Official Statement and should be read in their entirety together with the other sections of this Official Statement.

The references to and summaries or descriptions of provisions of the Bonds, the Indenture, the Loan Agreement, the Security Agreement and the Collateral Agency Agreement contained herein and in the Appendices hereto, and all references to other materials not stated to be quoted in full, are only brief outlines of some of the provisions thereof and do not purport to summarize or describe all of the provisions thereof. Copies of such documents may be obtained from the Underwriters or the Trustee as set forth herein under “INTRODUCTORY STATEMENT.”

The information set forth in this Official Statement, and in the Appendices hereto, should not be construed as representing all of the conditions affecting the Authority, the University or the Bonds.

Statements made in this Official Statement involving matters of opinion, whether or not expressly so stated, are intended merely as such and not as representations of facts. All projections, estimates and other statements in this Official Statement involving matters of opinion, whether or not expressly so stated, are intended as such and not as representations of fact.

The distribution of this Official Statement has been duly authorized by the Authority and the University. The Authority has not assisted in the preparation of this Official Statement, except for the statements pertaining to the Authority under the captions “THE AUTHORITY” and “LITIGATION” herein and, except as aforesaid, the Authority is not responsible for any statements made in this Official Statement. Except for the execution and delivery of documents required to effect the issuance of the Bonds, the Authority has not otherwise assisted in the public offer, sale or distribution of the Bonds. Accordingly, except as aforesaid, the Authority assumes no responsibility for the disclosures set forth in this Official Statement.

DELAWARE COUNTY AUTHORITY

By: /s/ Francis J. Catania, Esq. Authorized Officer

CABRINI UNIVERSITY

By: /s/ Eric J. Olson Authorized Officer

APPENDIX A

INFORMATION CONCERNING CABRINI UNIVERSITY

[ THIS PAGE INTENTIONALLY LEFT BLANK ] CABRINI UNIVERSITY

Introduction and History of the University

Cabrini University (the “University” or “Cabrini”) is a private, co-educational, Catholic institution located in Radnor Township, Delaware County, Pennsylvania, near the City of Philadelphia. The University offers both undergraduate and graduate instruction with accredited programs of study in four schools: School of Education; School of Business, Arts, and Media; School of Humanities and Social Sciences; and School of Natural Sciences and Allied Health. The University offers 35 bachelor degrees, 10 affiliated pre-professional programs, five master’s degrees, and two doctoral degrees. While approximately 65% of full-time undergraduate students resided on campus in 2016, the University also has a strong commitment to commuter, graduate, and adult students. The serene campus covers 112 acres and includes 29 facilities. Of a total enrollment of nearly 2,450 students for the 2016-2017 academic year, 1,384 are full-time undergraduates, 266 are part-time undergraduates and non-traditional students, and 786 are graduate students. Seventy percent of all undergraduate students are from Pennsylvania, 28% are from other Mid-Atlantic States, and 2% are from outside the region or are international students.

The University was founded in 1957 by the Missionary Sisters of the Sacred Heart of Jesus (the “MSSH”) who have been represented on the University’s Board of Trustees since its inception. The name of the University commemorates the nineteenth-century founder of the MSSH, Saint Frances Xavier Cabrini, who was the first American citizen Roman Catholic saint and known by Catholics as the patron saint of immigrants. Rooted in the heritage of Saint Frances Xavier Cabrini, the University is a vital part of the international education ministry of the MSSH and is the only university amongst its other world-wide institutions. The MSSH is organized as a 501(c)(3) non-for-profit corporation under the laws of the State of Illinois. The campus is leased to the University by the MSSH, pursuant to a lease with a term that currently expires in 2059. For more information on the lease, see “Campus Lease” herein.

Major awards and recognitions of the University include:  Best Value Top College in 2017 per the Educate to Career (ETC) College Rankings Index  Named a national “College of Distinction” in 2017 (http://collegesofdistinction.com/)  2016 College of the Year by the National Hispanic Institute (NHI) for being one of NHI’s strongest partners and for recognizing the important impact of NHI’s mission  Listing in the President’s Higher Education Community Service Honor Roll in 2016 by the U.S. Department of Education  Designation as a Military Friendly School by Victory Media in 2016

Governance of the University

Members of the Corporation The University is incorporated under the laws of the Commonwealth of Pennsylvania as a nonprofit corporation. It is also an institution founded by the MSSH and pursuant to Catholic canon law. The MSSH is a world-wide religious order of Catholic nuns that is divided into regional provinces under the direction of a provincial leader. Cabrini is part of the MSSH’s Stella Maris province that includes all of the United States of America and Australia. This province’s leader and her fellow provincial members who hold the title “councilor” are Members of Cabrini

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University (the “Members”). The issuance of the 2017 Bonds has been approved by the Members.

The present Members of the University are as follows:

Sister Eileen Currie Provincial Councilor, MSSH Sister Diane Olmstead Provincial Councilor, MSSH Sister Pietrina Raccuglia Provincial, MSSH

Board of Trustees Cabrini has a two-tiered director structure comprised of Members and a Board of Trustees (the “Board”). Subject to powers reserved by the Members, the University is directed by a Board consisting of no less than 15 and no more than 35 Trustees. Member powers include final approval of the following matters voted on by the Board: any change in philosophy or purpose of the University; any change to the University articles of incorporation or bylaws; any property transaction that requires approval per Catholic canon law; any merger, consolidation, or plan of dissolution; and approval of the University President and election or reelection of a Trustee. The Provincial Member and the President of the University are ex-officio Trustees with voting rights. In general, the Trustees serve for staggered three-year terms and are eligible for re-election to a maximum of three full consecutive terms. Trustees who have served for nine consecutive years (exclusive of any partial terms) are eligible to serve again after a one-year hiatus. The Chairperson of the Board can serve up to twelve years of service, but no more than six continuous years. In addition, there is a class of Trustee Emeriti who may attend meetings by invitation and are entitled to speak at such meetings, but they are not entitled to motion or vote at any meeting of the Board.

The Board meets a minimum of three times per year. The Executive Committee of the Board of Trustees can act on behalf of the Board with regard to specific matters. The Board has the following additional committees: Audit, Risk, Legal, and Compliance; Constituent Relations; Fiscal Integrity; Educational Quality; and Trusteeship.

The present members of the University’s Board of Trustees, as well as each member’s principal business or professional affiliation are as follows:

Ms. Anne Marie Borneman Educational Consultant

Ms. Mary Kathryn Burke President/CEO, White Horse Village

Ms. Nancy Costello Communications Director, MSSH Mission Office

Mr. William DeSante Senior Manager, ICE Data Services

Ms. Shirley Dixon Retired Faculty Member, Cabrini University

Mr. Frank Emmerich, Jr. Attorney, Conrad O’Brien PC

Mr. Francis Fox President, Archbishop John Carroll High School

Mr. Hernán Guaracao CEO, AL DÍA News Media, Inc.

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Mr. Robert Jara Retired President, First CornerStone Bank

Ms. Jacqueline Kirby Vice President, Jazz Pharmaceuticals

Ms. Amy Lambert Senior VP, Children’s Hospital of Philadelphia

Ms. Carole Pantalone Real Estate Broker, Hoffman Agency, Inc.

Sister Pietrina Raccuglia Provincial, Voting Ex-Officio

Mr. David Regn CEO, Stream Companies

Ms. Claire Roth Director, Insurcard

Mr. John Schanz Executive, Atairos

Ms. Mary Beth Senkewicz Attorney, D.C. Health Benefit Exchange Authority

Mr. William Stemper President of Business Services, Comcast

Ms. Myrna Soto Senior Vice President, Comcast

Dr. Donald Taylor President, Voting Ex-Officio

Mr. Patrick Ward Pennsylvania Market President, WSFS Bank

Mr. Joel Zazyczny Executive, Gelest, Inc.

Emeritus trustees of the University are:

Mr. Robert L. D’Anjolell, Sr. Ms. Edith J. Dixon Ms. Margaret Hamilton Duprey Mr. James M. Maguire Ms. Barbara Rawls Mr. Andrew Trolio

Corporate Officers of the University are:

Mr. John Schanz Chair of the Board Mr. Frank Emmerich Vice Chair of the Board Ms. Claire Roth Secretary Dr. Donald Taylor President Mr. Eric J. Olson Treasurer

Certain members of the Board may also provide other services to the University or may serve on the boards of, in other capacities with, or may have ownership interest in other organizations with which the University transacts business, subject to compliance with the University’s conflict of interest policies.

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Principal Administrative Officers of the University

Donald B. Taylor, PhD, President. Dr. Taylor was appointed eighth President of Cabrini University in 2014. In 2016, he transitioned Cabrini from a college to a university. His mission- driven, entrepreneurial vision was incorporated into the strategic plan titled Cabrini 2020 Roadmap: Vision, Impact, Growth. The goal of this 2020 Roadmap is to strengthen the Catholic liberal arts education experience for the University’s diverse population of undergraduate and graduate students, some of whom are often the first in their family to attend college.

To create educational pathways for students to attend Cabrini, Dr. Taylor has established almost two dozen partnerships with K-12 schools, institutions of higher education, and educational non- profits across the region, the nation, and the world. He expanded undergraduate and graduate degree programs at the University and introduced Cabrini’s first two doctoral programs, in Educational Leadership (EdD) and Organizational Development (PhD/DBA). He has also expanded undergraduate research and introduced second-year Living and Learning Communities. Dr. Taylor also created four distinct schools in the University each headed by a Dean: School of Education; School of Business, Arts, and Media; School of Humanities and Social Sciences; and School of Natural Sciences and Allied Health.

Dr. Taylor has focused strategic initiatives to make Cabrini University a Hispanic Serving Institution, including partnering with organizations like the National Hispanic Institute and Esperanza, and by creating partnerships with schools in South America. This coincides with his effort to internationalize the Cabrini campus by introducing the University into the global educational marketplace in the Americas, Europe, and Asia.

Prior to Cabrini, Dr. Taylor spent a 22-year career at Benedictine University in Lisle, Illinois, where he served as provost and chief academic officer from 2008 to 2014. He was integral in the evolution of Benedictine University from a small, residential liberal arts college of 1,000 students to a comprehensive doctoral institution of more than 10,000 students with branch campuses in Springfield, Ill. and Mesa, Ariz. He also helped plan and implement Benedictine’s Global University, developing partnerships with prestigious universities in China and Vietnam.

Prior to his appointment as provost, Dr. Taylor served as the initial Dean of the University of Sciences, Chair of the Department of Biological Sciences, and Program Director for the Biochemistry and Molecular Biology Program. He joined the faculty at Benedictine in 1992.

Dr. Taylor earned a BS in education and a PhD in cell and molecular biology from the University of Memphis.

Eric J. Olson, Vice President for Finance and Treasurer. Mr. Olson was appointed to this position in 2013, having previously been employed at Drexel University for more than 14 years, where he held the positions of Interim Senior Vice President for Finance, Treasurer, and CFO; Vice President for Finance and Associate Treasurer; and Associate Comptroller. At Cabrini, Mr. Olson is instrumental in the implementation of the Roadmap to Growth due to his expert management of financial resources and investments, strategic planning, and forecasting. Mr. Olson started his long association with higher education as a Certified Public Accountant (CPA) at Coopers and Lybrand (now PriceWaterhouseCoopers) where he rose to the rank of General Practice Audit Manager. His clients included the University of Pennsylvania, The Philadelphia College of Pharmacy & Science (now the University of the Sciences), The American College, and The Medical College of Pennsylvania (now part of the Drexel University College of Medicine).

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Mr. Olson received his BS degree from the Smeal College of Business of Penn State University. He serves the larger higher education community as a member of the National Association of College and University Business Officers (NACUBO), the Eastern Association of College and University Business Officers (EACUBO), the Association of Independent College and Universities in Pennsylvania (AICUP), and as an active participant in the Southeastern Pennsylvania Consortium for Higher Education (SEPCHE). Mr. Olson fosters ties with the greater Philadelphia community as a volunteer for the Boy Scouts of America.

Jeff Gingerich, PhD, Vice President for Academic Affairs and Provost. Dr. Gingerich was appointed Provost and Vice-President of Academic Affairs in 2015 after having served in that position on an interim basis since 2014. Dr. Gingerich co-chaired the University 2015 Self-Study for Middle States Commission on Higher Education Accreditation and the 2016-2020 Roadmap to Growth Strategic Plan Committee. Dr. Gingerich is a member of the President’s Cabinet and the institutional representative to the Board of Trustee’s Educational Quality Committee. Dr. Gingerich oversees the programming and budgets of all academic programs and support services, including the Library, Institutional Research, Assessment and Accreditation, Instructional Design, the Nerney Leadership Institute, and Wolfington Center for social justice.

Prior to joining Cabrini, Dr. Gingerich was Associate Professor of Sociology at Bluffton University in Ohio. He received his Masters and PhD degrees in Sociology at the University of Pennsylvania. Much of his life’s work prior to entering higher education was shaped by six years as a voluntary service worker in New Orleans, Louisiana, where he coordinated conflict resolution services at the Twomey Center for Peace through Justice at Loyola University.

Celia Cameron, Vice President of Marketing and Communications. Ms. Cameron was appointed Vice President of Marketing and Communications for Cabrini University in 2015. Ms. Cameron leads national and international marketing and branding campaigns to increase both undergraduate and graduate admissions pursuant to the Roadmap to Growth strategic plan. Prior to Cabrini, Ms. Cameron spent a decade in branding and enrollment marketing and event and advancement communications at Lehigh University, The Wharton School, Fordham University, and Columbia University Medical Center. Before making the switch to higher education, Ms. Cameron worked in marketing for insurance and financial institutions.

Ms. Cameron holds a BS in Communications from Cornell University and a MA in Global Marketing, Communications, and Advertising from Emerson College. She is currently pursuing her PhD in Organizational Development from Cabrini University.

Stephen M. Highsmith, Vice President of Institutional Advancement. Mr. Highsmith was appointed Vice President of Institutional Advancement in January 2016. Mr. Highsmith is a graduate of Cabrini University with a BA in English and Communications, and he later served as a Cabrini Trustee for nine years. Mr. Highsmith returns to Cabrini after a long, successful career in broadcast journalism as Director of Community Relations and Local Programming at PHL17- TV, morning News Anchor and News Director of WCAU Radio (CBS), News Anchor of the NJN Nightly News, and Chief Political Correspondent and Anchor for “Inquirer New Tonight” on WPHL-TV. Mr. Highsmith served as NBC10 political correspondent and host of NBC10@Issue from 2005 to 2013.

Mr. Highsmith serves as the Treasurer of the Mummers Museum Board of Directors. He is also a member of the Board of Directors of CADEkids. He is a former member of the Boards of the Boys and Girls Clubs of Philadelphia, United Cerebral Palsy of Philadelphia, and the Greater Philadelphia Cultural Alliance, and the Board of Governors of the Mid-Atlantic Chapter of the A-5

National Academy of Television Arts and Sciences. Mr. Highsmith has been honored by the National Association of Television Arts and Sciences, the Associated Press, the Radio and Television News Directors Association, and the Pennsylvania Association of Broadcasters. In 2011, Mr. Highsmith was inducted into the Broadcast Pioneers Hall of Fame, and he is also an inductee of the Philadelphia Mummers String Band Association Hall of Fame.

Christine Lysionek, PhD, Vice President for Student Life. Dr. Lysionek was appointed as the Vice President for Student Life in 2003. She provides leadership and direction for several areas of the University including Athletics & Recreation, the Center for Student Engagement & Leadership, Dean of Students, Residence Life, Health Services, Counseling and Psychological Services, Dining Services, Public Safety, Campus Ministry, and Student Diversity Initiatives.

Prior to Cabrini, Dr. Lysionek held various positions over the span of 22 years at Villanova University, specifically Assistant Dean of Students (1981-1990), the Managing Director of the University Sesquicentennial anniversary celebration (1991-1993), and Director for Residence Life (1993-2003). Prior to her time at Villanova, she served as the Assistant Director for Student Life at LaSalle University in Philadelphia, PA.

Dr. Lysionek holds a BS in Psychology and a MS in Counseling from the State University of New York, College at Brockport. In 1993, she earned a PhD in Higher Education Administration from the University of Pennsylvania. She completed the Institute for Educational Management program at Harvard University in 2007 and the Institute for Administrators in Catholic Higher Education at Boston College in 2011. She is an active member of the National Association of Student Personnel Administrators and the American College Personnel Association.

Robert W. Reese, Vice President for Enrollment Management. Mr. Reese was appointed to this position in 2013, having previously been the Associate Vice President for Enrollment Services at Holy Family University in Philadelphia from 2009 to 2012. Prior to that, Mr. Reese was the Director of University Admissions at Marywood University in Scranton, Pennsylvania from 2000 to 2007. A leader in enrollment trends and strategies, Mr. Reese was an education enrollment consultant from 2005 to 2013. His clients included Cabrini University, Johnson College in Scranton, and Baptist Bible College of Clarks Summit, Pennsylvania. Mr. Reese is a retired veteran who last served as an armor battalion operations officer for the Pennsylvania Army National Guard. He retired with the rank of Major in 2004.

Mr. Reese received his BFA in Advertising Graphics and Photography from Marywood College in 1989 and his MBA in Management from Marywood University in 2007.

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Accreditation

The University is accredited by the Middle States Commission on Higher Education (“MSCHE”). In 2015, Cabrini received a positive 10-year peer review assessment that reaffirmed its accreditation standing. A Periodic Peer Review Report will be due to MSCHE on June 1, 2020 with the next Self Evaluation Study to be conducted by MSCHE in 2023 or 2024. Cabrini is approved by the Pennsylvania Department of Education to offer teacher education program and certification. The Social Work program is accredited by the Council on Social Work Education.

Academic Profile

Cabrini’s academic program offerings and student body have grown over the past 60 years. Currently, the University has over 35 undergraduate majors, five graduate programs and two doctoral programs. As of July 1, 2016, Cabrini received approval from the Commonwealth of Pennsylvania to become a university, which marked the official implementation of its new four school structure:

The School of Business, Arts and Media (BAM) includes the departments of Business, Leadership & Organizational Development, Graphic Design & Fine Arts, and Communication. Students are offered many major and minor options as professional preparation for a variety of careers. All of the departments require internships for their majors (and some minors) to provide real world experience for the students. BAM offers bachelor’s degrees, a degree completion program for working adults, a Master in Accounting, a Master of Science in Leadership, and a PhD/DBA in Organizational Development.

The School of Education includes the departments of Teacher Education, Educational Specialists, and Educational Policy & Leadership. Students complete field experiences, internships, or student‐teaching for certification beginning in their sophomore year. All of the departments offer the Master of Education program and additional add‐on certifications completed at the post‐baccalaureate level. Teacher certifications, endorsements, and certificates can be earned individually or within a master’s degree. For those students interested in earning a specialized master’s degree without certification, the School offers a Master of Education in Teaching and Learning and a Master of Education in Curriculum, Instruction, and Assessment. In addition, the School offers a Doctorate (EdD) in Educational Leadership with three areas of concentration: PK-12 Educational Leadership, Curriculum & Instruction, and Leadership in Higher Education.

The School of Humanities and Social Sciences (HSS) includes the foundational academic departments that are the core of a liberal arts education: English, History & Political Science, Philosophy & Liberal Studies, Psychology, Religious Studies, Romance Languages & Literatures, Social Work, Sociology, and Criminology. Students in this school choose from a wide array of majors at the undergraduate level. HSS also offers the Master of Arts in Religious & Pastoral Studies Program, and a five-year dual-degree program in which students can earn a Bachelor of Arts in Criminology and a Master of Arts in Criminology and Criminal Justice. In addition, the dean and faculty of HSS have a leadership role in reviewing, assessing, and revising central aspects of the core curriculum for all undergraduate students of Cabrini University.

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The School of Natural Sciences and Allied Health (NSAH) includes Exercise Science & Health Promotion, Information Science & Technology, Mathematics, and Science. Students of NSAH prepare for professional careers or graduate school in the areas of biology, chemistry, exercise science and health promotion, mathematics, and technology. NSAH also helps students advance their careers through entry into Cabrini’s 4+1 Master of Science in Biological Sciences degree or through one of our many affiliations with regional professional schools that facilitates a student’s entry into dentistry, pharmacy, physical therapy, physician assistant studies, and podiatry programs.

Each of the four schools is led by a dean who reports directly to the Provost and Vice President of Academic Affairs. In addition to the schools, the Academic Affairs division includes the Center for Student Success that provides disability resources, career development, academic advising, tutoring, and retention services; the Wolfington Center for social justice and community-based learning in the spirit of St. Frances Xavier Cabrini; the Holy Spirit Library; and the offices of the registrar, academic technology services, and academic partnerships. Academic programming is further enhanced by the Honors Program, the Nerney Leadership Institute, The Children’s School, a theater, a student newspaper and television studio, a Federal Communications Commission (FCC) radio station (WYBF-89.1 FM), science laboratories, and graphic design and fine arts studios.

Cabrini offers the following Bachelor degree programs:

Bachelor of Arts Degree Programs: Bachelor of Science Degree Programs:  American Studies  Accounting  Black Studies  Biology/pre-medicine  Communication  Business Management  Criminology  Chemistry  Digital Communication and Social Media  Exercise Science and Health Promotion  English  Finance  Gender and Body Studies  Human Resources Management  Graphic Design  Information Sciences and Technology  History  International Business  Individualized Major  Marketing  Italian  Mathematic  Leadership Studies  Liberal Studies Bachelor of Science in Education Degrees:  Philosophy  Education Studies  Political Science  Middle-level Education (grades 4-8)  Psychology  Pre-K-4 Education  Religious Studies  Pre-K-4 Special Education  Sociology  Spanish Bachelor of Social Work Degree  Writing

Cabrini offers seven graduate degrees—five master’s level and two doctoral. Cabrini’s longest standing graduate degree is the Master of Education (MEd) with or without state teacher certification. The MEd degree can also provide specialization in curriculum, instruction, and

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assessment (CIA) or principal development. Cabrini offers a Master of Science in Leadership, which is designed as an MBA alternative intended to develop leadership potential and expertise across all industries. Newer graduate programs include a Master of Accounting, Master of Science in Biological Science, and Master of Arts in Religious and Pastoral Studies.

In 2016, Cabrini launched its first part-time doctoral programs with full cohorts. An executive- format PhD/DBA in Organizational Development holds monthly on-campus classes that are supplemented by online work. The part-time Doctorate (EdD) in Educational Leadership is designed for teachers, principals, and higher education professionals who are working full time and want to advance their careers.

A minimum of 123 credit hours, with a cumulative grade-point average of 2.0, is required for a bachelor’s degree. Forty-five of these credit hours must be completed at Cabrini with the last 30 credits of the degree program completed at Cabrini. Total credit hours are distributed among the liberal education curriculum, the major, and electives. Graduate credit hours and minimum grade- point average requirements range by program. Graduate students may be enrolled part time (less than nine credits a semester) or full time (nine credits or more per semester).

University Facilities

The University occupies a 112-acre wooded, suburban campus in Radnor Township, Delaware County, Pennsylvania. The University also has several additional instructional sites (where course requirements are fulfilled primarily for School of Education students) in the greater Philadelphia area.

The University currently has 29 physical facilities. Among the principal facilities are: a newly renovated and expanded 86,000-square-foot athletic and recreation complex with designated classroom and meeting space; a 64,000-square-foot state-of-the-art science and technology building with modern laboratories and classrooms; a 47,000-square-foot building with classrooms, studios, and a dining hall; a campus center building with a 215 seat auditorium, bookstore, and cafe; a chapel; a library; four traditional residence halls; an apartment-style residence hall; seven residential houses used by students; a private residential house for the President; and a turn of the century mansion (on the National Register of Historic Places effective 2009) and renovated stable, both used for administration and faculty offices.

The University completely renovated the largest of the seven student residential houses, Dixon House, in 2016 and one of its oldest traditional residence halls, Woodcrest Hall, in 2017. Other improvements include the renovation of a conference room within the original stable building (Grace Hall) into a modern, technology-equipped 30-seat conference room to accommodate online courses and distance learning. The University also entered into a long-term license agreement to renovate and use the baseball field and locker room of a neighboring “feeder” school, Archbishop John Carroll High School, which enabled Cabrini to add a men’s baseball team to its NCAA Division III athletic program beginning in fall 2016.

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Student Housing and New Facility Project

The University has 12 on-campus housing options for its undergraduate students with a total of 908 beds. While Cabrini does not have an on-campus living requirement for freshman, the majority of undergraduate students opt to live in the residence halls. Cabrini has traditional, suite-style, and apartment-style residence halls as well as seven houses. Of the total 908 beds offered, the University is currently over 100% occupancy for the 2016-2017 academic year. The fall 2016 residential population was 912, causing Cabrini to convert lounge space into rooms to accommodate students desiring to live on campus. The University believes this trend will continue and necessitates the construction of new on-campus housing.

As part of the University’s 2020 Roadmap to Growth strategic plan, the University’s enrollment growth strategy includes investments in new dormitory facilities. A portion of the proceeds of the 2017 Bonds will be used to construct a new 150-bed residence hall and a separate parking structure to accommodate the continued growth in enrollment. The University has also been awarded a grant from the Commonwealth of Pennsylvania Redevelopment Assistance Capital Program in the amount of $1,000,000 to help fund a parking structure to complement the new residence hall. The receipt of the grant is subject to compliance with all of the terms and conditions of the grant program.

Campus Lease

The 112-acre campus is leased to the University by MSSH (in such capacity, the “Lessor”). Pursuant to its current terms, the lease (the “Lease”) continues for a term ending in 2059. The rent paid by the University is a nominal, annual amount. The Lease permits the Lessor to increase the rent to an amount equal to the then fair market rental value in the event that the Lessor ceases its sponsorship or the University were to lose its status as a “Church College” (as defined in the Lease). The annual rental under this provision may not exceed $250,000 so long as any long-term University debt obtained through a public authority is outstanding. If the $250,000 rental is imposed, it is subject to annual adjustment thereafter pursuant to a formula in the Lease, subject to a 5% cap on each adjustment. In the event the Lessor ceases to sponsor the University but the Lessor does not elect to increase the rental to the $250,000 amount, the Lessor may terminate the Lease, provided that the Lessor may not exercise this termination right so long as any loan from the Delaware County Authority or the Pennsylvania Higher Educational Facilities Authority or any loan to the University which is secured in whole or in part by the Lease and reflected on the financial statements of the University, remains unpaid. If, during the Lease term, the Lessor receives an offer for the purchase of all or any portion of the leased premises, the University has the right (“Right of First Refusal”) to purchase such premises for the same price and on the same terms as stated in such offer. If the University does not exercise its Right of First Refusal, the Lessor may convey such premises to the offeror free and clear of the Right of First Refusal. Similarly, if during the Lease term, the Lessor determines to sell all or any portion of the leased premises, the University has the right (“Right of First Offer”) to purchase such premises at a purchase price established pursuant to the Lease. If the University does not exercise its Right of First Offer, the Lessor may sell the leased premises to a third party free and clear of the Right of First Offer. The Lessor may terminate the Lease if an “Event of Default” (as defined therein) shall have occurred. Events of Default include, but are not limited to, a default by the University in the performance of its rental and other obligations under the Lease, or the bankruptcy, insolvency or dissolution of the University; or if the lender of any funds evidencing construction or permanent financing for improvements to the leased premises claims a default that is not cured by the University or the Lessor.

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Enrollment

The following table sets forth applications, acceptances, enrollments, and mean SAT scores of freshmen, for the past five academic years:

2012-2013 2013-2014 2014-2015 2015-2016 2016-2017 Freshmen Applications 2,608 2,127 2,257 2,544 3,187 Transfer Applications 313 273 242 274 272 Graduate Applications 500 397 363 387 280 Total Applications 3,421 2,797 2,862 3,205 3,739

Freshmen Acceptances 1,895 1,580 1,699 1,843 2,264 Transfer Acceptances 140 152 140 142 143 Graduate Acceptances 380 286 246 260 218 Total Acceptances 2,415 2,018 2,085 2,245 2,625

Total Acceptance Rate 71% 72% 73% 70% 70% Freshman Acceptance Rate 73% 74% 75% 72% 71% Freshman to Sophomore 74% 71% 77% 76% 70% Retention Rate

Freshmen Matriculants 395 316 400 399 481 Transfer Matriculants 64 64 56 63 56 Graduate Matriculants 337 247 236 213 156 Enrollment 796 627 692 675 693

Freshman Matriculation Rate 21% 20% 24% 22% 21% Total Matriculation Rate 33% 31% 33% 30% 26% Cabrini Mean SAT 916 895 892 884 889 (Verbal & Math) PA Mean SAT 992 998 1001 1003 1006 (Verbal & Math) National Mean SAT 1010 1010 1010 1006 1002 (Verbal & Math)

Source: Cabrini University Fall 2016 Fact Book.

As of May 1, 2017, a total of 3,353 freshmen applications have been received and 2,469 students have been accepted. Freshman applications and acceptances as of May 1, 2016 were 3,054 and 2,183, respectively and freshman applications and acceptances as of May 1, 2015 were 2,422 and 1,790, respectively. Deposits received through May 1, 2017 totaled 456, as compared to 444 and 317 for the same time in 2016 and 2015.

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The following table shows fall semester enrollment for the past five academic years.

2012-2013 2013-2014 2014-2015 2015-2016 2016-2017 Undergraduate Full Time 1,298 1,228 1,283 1,310 1,384 Undergraduate Part Time 115 99 86 92 117 Graduate Full Time 143 75 111 74 73 Graduate Part Time 1,253 1,111 797 851 786 Total Headcount 2,809 2,513 2,277 2,327 2,360 Undergraduate FTE 1,343 1,267 1,319 1,346 1,430 Graduate FTE 622 471 373 371 345 Total FTE 1,965 1,738 1,692 1,717 1,775

Source: Cabrini University Fall 2016 Fact Book.

The five-year average degree completion rate for full-time Cabrini University students is 52.3% which compares favorably to the Private Masters-Traditional Selectivity degree completion rate of 49.9%.

Efforts by the University’s admission department to target high-performing inquiry sources resulted in an increase in the inquiry to application conversion rate. The result is a higher application count from a stronger inquiry pool. As of March 1, 2017, the conversion rate of inquiries into applications for the fall 2017 entering class was 21%. Conversion rates for entering classes as of March 1, 2016 and 2015 were 19% and 14%, respectively. This has contributed to three consecutive years of significantly increased Undergraduate enrollment.

The decline in graduate enrollment is directly attributable to the matching state-wide decline in enrollment in Education programs. Cabrini enjoyed significant enrollment in graduate education programming for a decade; and Education programming comprised the majority of graduate enrollment at Cabrini. In response, Cabrini has increased enrollment in the MSL and MACC graduate programs in the last year and is exploring the addition of new graduate offerings and online graduate programming.

Student Geographic Distribution

The following table details the geographical distribution of the University’s incoming full-time students for the past five academic years.

Fall 2012 Fall 2013 Fall 2014 Fall 2015 Fall 2016 Pennsylvania 61.5% 67.4% 66.5% 66.2% 69.9% New Jersey 23.3% 21.2% 21.3% 24.1% 20.4% Delaware 2.3% 2.5% 2.5% 3.8% 2.5% New York 5.3% 3.5% 3.5% 3.3% 1.7% Maryland 4.8% 3.8% 2.8% 1.3% 2.5% Other U.S. 2.5% 1.6% 3.1% 1.3% 2.0% International 0.3% 0.0% 0.3% 0.0% 1.0%

Source: Cabrini University Fall 2016 Fact Book.

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Student Tuition/Fees and Comparative Information from Competing Institutions

The following table shows tuition and fees for the past five academic years:

2012-2013 2013-2014 2014-2015 2015-2016 2016-2017 Tuition: Full Time $ 28,090 $ 28,090 $ 28,932 $ 28,932 $ 30,588 Part Time* $ 495 $ 495 $ 515 $ 525 $ 540 Graduate* $ 595 $ 595 $ 615 $ 625 $ 640 Room & Board $ 11,859 $ 11,859 $ 12,026 $ 12,026 $ 12,226

*Per Credit Hour Source: Cabrini University officials.

Tuition and fees comparisons are listed below for the 2016-2017 academic year for institutions believed by the University to be peers and competitors. These colleges and universities were selected based upon acceptance criteria, location and/or availability of majors, as well as empirical data regarding cross applications by entering Cabrini University first year students.

Institution: Tuition & Fees Drexel University $ 51,030 Villanova University $ 49,280 Saint Joseph’s University $ 43,020 Widener University $ 42,870 Albright College $ 41,544 La Salle University $ 41,100 Arcadia University $ 40,920 Philadelphia University $ 37,800 Gwynedd-Mercy University $ 32,480 Cabrini University $ 30,588 Neumann University $ 28,580

Source: Institution officials.

Student Financial Aid

Students at the University may be awarded financial aid based on merit, need, or a combination of both. Funds for student financial aid come from governmental programs, foundations, individuals, and the University itself. Aid is awarded in two forms: grants and scholarships that need not be repaid, and self-help aid that usually consists of student loans and campus employment. Most University financial aid packages consist of both types of aid.

Institutionally funded awards are the single largest source of financial aid to the University’s students. Institutionally funded awards go only to full-time students and are the planned result of extending more financial aid offers to academically talented students on the basis of merit. In the fall of 2016, 98% of full-time undergraduate students received institutional financial aid.

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Loan programs supported by the federal government are also a significant source of student financial aid funds. Under current federal guidelines for the Direct Loan program all U.S. citizens or eligible non-citizens may borrow up to $31,000 in pursuit of an undergraduate degree. These loans may be subsidized or unsubsidized depending on the financial need of the student. Additionally, parents of undergraduate students may borrow up to the full cost of education (less any financial aid) under the Parent Loan for Undergraduate Students (PLUS) program.

The University’s Financial Aid Office works closely with students and their families during all phases of the financial aid process. Through one-on-one financial counseling, the University’s goal is to eliminate confusion, to simplify paperwork, and to provide quick, accurate answers that enable families to assess their individual financial situations with confidence.

The following table shows sources of Financial Aid for the past five academic years:

2011-2012 2012-2013 2013-2014 2014-2015 2015-2016 Federal Grants $1,724,147 $2,063,457 $2,135,834 $2,310,715 $2,661,767 Federal Work Study $272,192 $296,862 $388,797 $329,435 $257,938 PHEAA State Grants $1,229,568 $1,344,568 $1,334,265 $1,483,158 $1,800,587 Direct Loans - Subsidized $9,471,902 $3,760,351 $3,449,964 $3,584,491 $3,668,973 Direct Loans - Unsub $9,464,805 $9,660,841 $8,330,265 $8,179,315 $7,701,403 PLUS Loans $4,129,301 $3,180,073 $3,125,443 $3,747,293 $3,835,537 Perkins Loans $108,350 $77,000 $120,550 $211,881 $162,347 Institutional Aid $18,571,869 $17,656,580 $17,256,779 $18,725,258 $19,058,132 Total Financial Aid Sources $44,972,134 $38,039,732 $36,141,897 $38,571,545 $39,146,684

Source: Cabrini University officials.

Faculty and Employees

For the 2016-17 academic year, the University employed 83 full-time faculty, approximately 86% of whom hold terminal degrees and 46% of whom are tenured. A part-time faculty of 229 members augments Cabrini’s full-time faculty. The ratio of full-time equivalent students to full- time equivalent faculty is 16:1. The average class size for undergraduate courses is 15 students and the average class size for graduate courses is 9 students.

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For the 2016-17 academic year, the University had a total of 189 full-time and 19 part-time employees. The University also utilized approximately 170 work-study students and 201 non- work-study student employees. The following is a breakdown of Cabrini employees by position:

Faculty (full-time) 83 Faculty (part-time) 229 Executive & Administrative Staff (full-time) 50 Other Professional Staff (full-time) 99 Other Professional Staff (part-time) 5 Technical Staff (full-time) 4 Clerical and Support Staff (full-time) 23 Clerical and Support Staff (part-time) 14 Skilled Craft (full-time) 6 Service and Maintenance (full-time) 7 Student employees (part-time) 201

Employee Relations

None of the University’s employees are currently unionized and the University considers its relations with employees to be good.

University Finances

The summary of Unrestricted Operating and Non-operating Activities for the past five years has been derived from the University’s audited financial statements. The summary information set forth below should be read in conjunction with the University’s audited financial statements and the notes thereto. The financial statements for the University for the years ended June 30, 2015 and 2016 appear as Appendix B to this Official Statement.

Fiscal Year Ended 2012 2013 2014 2015 2016 Operating revenues: Student Tuition and fees, net 39,507,827 31,118,806 27,903,935 27,267,438 27,372,957 Auxiliary enterprises, net 9,575,960 10,016,302 9,681,594 10,748,632 10,750,896 Government grants 191,373 218,416 202,275 249,409 295,064 Private gifts and grants 2,154,891 2,796,468 2,289,369 2,259,158 3,349,870 Investment income 647,121 715,162 699,150 601,160 316,588 Endowment income 122,304 1,054,859 1,153,258 1,270,220 1,339,881 Other revenue 375,358 396,534 410,443 321,931 308,772 Net assets released from restrictions 802,918 2,865,765 780,775 1,404,620 1,312,105 Total operating revenues 53,377,752 49,182,312 43,120,799 44,122,568 45,046,133

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Operating expenses: Instruction 16,302,355 15,766,739 15,620,799 16,713,721 18,618,626 Academic support 4,233,010 4,697,283 4,464,118 4,761,606 5,290,445 Student services 13,003,706 12,449,071 11,832,544 12,805,092 11,923,289 Institutional support 9,583,293 8,883,386 8,337,823 8,588,451 8,818,788 Scholarships 348,133 394,478 494,037 507,535 Auxiliary enterprises 8,875,775 8,785,041 8,680,240 9,156,145 9,965,468 Total operating expense 51,998,139 50,929,653 49,330,002 52,519,052 55,124,151 Change in net assets from operating activities 1,379,613 (1,747,341) (6,209,203) (8,396,484) (10,078,018) Non-operating : Change in market value of invests 57,217 1,928,196 3,732,586 (280,019) (150,825) Recovery of funds with deficiencies 2 393 (270) 105 104 Other Changes in net assets (75,749) 189,013 (1,381,228) - 9,147 Net assets released from restrictions - - 17,023 12,726 - Change in net assets from nonoperating activities (18,530) 2,117,602 2,368,111 (267,188) (141,574) Change in net assets 1,361,083 370,261 (3,841,092) (8,663,672) (10,219,592) Net assets, beginning of year 93,601,067 94,962,150 95,332,411 91,491,319 82,827,647 Net assets, end of year 94,962,150 95,332,411 91,491,319 82,827,647 72,608,055

Fiscal Year 2016 and 2015 unrestricted operating results include $2.5 million and $1.0 million, respectively, of Board-approved designated expenditures to support the aforementioned Roadmap 2020 strategic plan from cash reserves. More information is provided in the Management Discussion.

Endowment Funds

The market value of the University’s endowment and similar funds portfolios for the dates noted is shown below.

6/30/13 6/30/14 6/30/15 6/30/16 12/31/16* Donor Restricted $ 7,781,178 $ 8,188,777 $ 8,545,429 $ 8,859,118 $ 9,134,742 Temporarily Restricted $ 6,888,611 $ 8,907,534 $ 8,328,634 $ 8,371,723 $ 7,008,717 Unrestricted $ 24,530,336 $ 27,868,988 $ 26,870,281 $ 26,686,823 $ 27,135,290 Total Endowment $ 39,200,125 $ 44,965,299 $ 43,744,344 $ 43,917,664 $ 43,278,749

* Unaudited

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Investment Policy

The University’s portfolio is invested to maintain preservation of principal while seeking to maximize returns within acceptable levels of risk consistent with its short-term and long-term financial goals. The University exercises corporate responsibility of its investments; accordingly, investment managers are directed by the University’s Fiscal Integrity Committee of the Board of Trustees to operate within certain parameters. The chairperson and the members of the Fiscal Integrity Committee are appointed by the chairperson of the Board of Trustees and report to the Board of Trustees. The University’s investment portfolio is externally managed through an investment advisor, The Haverford Trust Company.

The short- and long-term investment accounts are managed on a total return basis using the fiscal year of the University as a time line for performance. Risk on the equity portfolio should be moderate and controlled through asset allocation and the use of quality investments. The investment policy contains the following asset allocation guidelines:

ASSET RANGE ACTUAL AS OF 12/31/16 Cash 0-10% 6%

Total Equity 55-70% 61% U.S. Large Cap 35-50% 44% U.S. Small / Mid Cap 0-10% 4% Int’l Developed 0-10% 6% Int’l Emerging 0-10% 7%

Total Fixed Income 25-35% 27% U.S. Investment Grade 20-35% 27% Int’l Investment Grade 0-10% 0% High Yield 0-5% 0%

Liquid Alternatives 0-10% 6% REITs 0-5% 0% Other 0-10% 6%

The cost of investments sold is determined by the specific identification method. Changes in market value of investments are recognized as increases or decreases in unrestricted net assets unless their use is temporarily or permanently restricted by explicit donor stipulations or by law. Income from pooled investments is allocated to the separate accounts on a percentage basis. The University’s spending rule for endowment funds is at least 2% and no more than 7% of a rolling average of prior years’ market values, pursuant to Pennsylvania – Act 141- 15pa. C.S.A. code 5568. The annual spend rate is voted upon annually by the Board of Trustees and was 4% for Fiscal Years 2015, 2016, and 2017.

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Long-Term Indebtedness

The University’s long-term debt as of June 30, 2016 was as follows:

Balance Delaware County Authority Revenue Bonds, Series 1999 $ 2,190,000 Delaware County Authority Revenue Bonds, Series 2003 $ 18,770,000 Delaware County Authority Revenue Bonds, Series 2007 $ 10,315,000 Total Long-Term Indebtedness $ 31,275,000

A portion of the proceeds from the Series of 2017 bonds will be used to currently refund all of the University’s outstanding debt as referenced above.

Debt Service 2017 Bonds

Bond Year Ended Total Debt July 1 Principal Interest Service 2018 $2,425,155 $2,425,155 2019 $520,000 2,353,250 2,873,250 2020 880,000 2,332,450 3,212,450 2021 920,000 2,288,450 3,208,450 2022 970,000 2,242,450 3,212,450 2023 1,020,000 2,193,950 3,213,950 2024 1,070,000 2,142,950 3,212,950 2025 1,125,000 2,089,450 3,214,450 2026 1,180,000 2,033,200 3,213,200 2027 1,235,000 1,974,200 3,209,200 2028 1,300,000 1,912,450 3,212,450 2029 1,365,000 1,847,450 3,212,450 2030 1,435,000 1,779,200 3,214,200 2031 1,505,000 1,707,450 3,212,450 2032 1,580,000 1,632,200 3,212,200 2033 1,640,000 1,569,000 3,209,000 2034 1,710,000 1,503,400 3,213,400 2035 1,780,000 1,435,000 3,215,000 2036 1,850,000 1,363,800 3,213,800 2037 1,920,000 1,289,800 3,209,800 2038 1,930,000 1,213,000 3,143,000 2039 2,025,000 1,116,500 3,141,500 2040 2,125,000 1,015,250 3,140,250 2041 2,235,000 909,000 3,144,000 2042 2,345,000 797,250 3,142,250 A-18

2043 2,460,000 680,000 3,140,000 2044 2,585,000 557,000 3,142,000 2045 2,715,000 427,750 3,142,750 2046 2,850,000 292,000 3,142,000 2047 2,990,000 149,500 3,139,500

TOTAL $49,265,000 $45,272,505 $94,537,505

Gifts, Contributions, and Grants

Total gifts, grants, and bequests to the University per constituency for the previous five years ending June 30 are as follows:

FISCAL YEAR ENDED 2012 2013 2014 2015 2016 Alumni $353,313 $593,576 $527,947 $526,090 $556,672 Parents 82,802 101,768 585,223 64,392 93,042 Friends* 205,399 287,417 234,731 223,741 384,789 Corporations 266,242 707,289 286,117 466,708 269,715 Foundations 146,751 807,197 539,956 458,454 258,946 Government 346,300 790,372 266,684 319,389 382,348 Total Gifts, Grants, Bequests $1,400,806 $3,287,619 $2,440,659 $2,058,774 $1,945,512

*Friends include Faculty and Staff

Pension Program

The University has a defined contribution pension plan covering certain faculty, staff and administrative personnel. Benefits are provided through direct payments to the Teachers’ Insurance and Annuity Association and the College Retirement Equity Fund. The University’s policy with respect to its contribution is to provide 5% of eligible employees’ salaries. Employees who elect to contribute 1%, 2%, 3%, or 4% of their base salary will receive an additional employer contribution of the same percentage. For the years ended June 30, 2016 and 2015, pension expense was $1,413,769 and $1,276,571, respectively.

A-19 Development and Fundraising

The development staff consists of eight professionals and three support staff, all of whom work closely with the President in his development efforts. Activities vary and include highly targeted fundraising from individuals, foundations, and corporations as well as wide-coverage annual fund campaigns.

Over the past five fiscal years, total annual fundraising has averaged over $2.2 million per year. Additionally, management expects to reach its $3.3 million annual fundraising goal for the 2017 Fiscal Year. Alumni participation in Fiscal Year 2016 was 8.8%, the highest in five years.

Comprehensive Campaign

The University is currently in the planning stage of a comprehensive fundraising campaign, with gifts designated for capital projects; scholarships; support of its new academic centers, including the new Center on Immigration and Center on Childhood Trauma and Domestic Violence; and increased unrestricted support of the annual fund.

The University has issued a request for proposals for a feasibility study regarding capacity, readiness, and the conducting of a comprehensive campaign, with the quiet phase starting as early as Fiscal Year 2018.

Litigation

The University, like similar institutions, is subject to a variety of suits and proceedings arising in the ordinary course of business. In the opinion of University management, there is no litigation, individually or in the aggregate, currently pending, or to the knowledge of the University threatened against it, which, adversely determined, would, in the judgment of management of the University, result in a material adverse effect on the University’s financial condition or results of operations.

Management’s Discussion

The Board of Trustees realized the unique opportunity to grow the institution in the appointment of its first male, non-Catholic President, Dr. Donald Taylor in 2014. Two years later, under Dr. Taylor’s leadership, Cabrini became a university on July 1, 2016. Dr. Taylor’s strategic plan, Cabrini 2020 Roadmap: Vision, Impact, Growth seeks to increase Hispanic and international student recruitment and expand Cabrini’s academic programming and high-impact learning experiences.

2016 also saw the launch of Cabrini’s first doctoral programs with full cohorts. The University experienced its third consecutive year of increased undergraduate enrollment in 2016 and started Fiscal Year 2017 with its largest freshman class in 9 years (481 incoming freshmen).

Though Fiscal Years 2016 and 2015 had negative operating results of $10.0 Million and $8.4 million, respectively, these included one-time expenditures of $2.5 Million in 2016 and $1.0 Million in 2015 of Board-approved investment to support the strategic plan. Based on the increasing growth in undergraduate enrollment and strong fiscal control of expenditures, management expects Fiscal Year 2017 to have an operating loss of approximately $7 Million which represents a notable improvement from the previous two fiscal years; a positive

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improvement trend which management expects will continue. The University also expects another incoming freshmen class of 480 or more for Fiscal Year 2018.

Cash surpluses from the early 2000’s were invested and set aside in both short-term investments and the Endowment. This operating cash reserve helped Cabrini not only self-fund two major construction projects in 2016, but also invest in operations so the 2020 Roadmap growth strategy could turn around enrollment to the level currently achieved. This accounts for the decrease in short-term investments of $17.5 million from Fiscal Year 2015 to 2016 and a related increase in land, building, and equipment of $8.7 million from Fiscal Year 2015 to 2016.

Major capital improvements accomplished in Fiscal Year 2016 include the renovation of a residence hall for $1.6 million and the completion of a 27,000-square-foot addition to the athletic and recreation complex building for $13.0 million. Cabrini also engaged in a long-term license agreement with neighboring Archbishop John Carroll High School to use its baseball field and locker rooms. In exchange for facility use, Cabrini agreed to invest $1.5 million towards NCAA baseball field improvements. The residence hall renovations, athletic complex expansion and baseball field improvements were all funded with internal University resources.

As a result of the above noted baseball field improvements project, the University was able to add an NCAA men’s varsity baseball team to its athletic program in the fall 2016. Also in 2016, the University added an NCAA women’s crew team.

Support from granting agencies also increased in Fiscal Year 2016 and into 2017. Recent grant awards include $1,000,000 from the Pennsylvania Redevelopment Assistance Capital Program (RACP) and $675,000 from the Pennsylvania Multimodal Transportation Fund towards improved campus roads and pedestrian walk ways projects; a sub-award of $478,000 from the Pennsylvania Department of Education Early Learning Principal Instructional Coaching Program to improve K- 12 teaching; $300,000 from the Department of Justice and $27,200 from the Pennsylvania Department of Education “It’s on Us” grants for prevention of violence against women programs; $650,000 from the National Science Foundation for the STEM Programs; $100,000 from the NCAA; and a sub-award of $14,625 from the Pennsylvania Department of Education for high school tutoring.

The foregoing discussion is based on University management’s internal review of audited operating results and financial position for Fiscal Year 2016 and preceding years. This information should be read in conjunction with the audited financial statements of the University and the related notes, which are included in Appendix B to this Official Statement.

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APPENDIX B

AUDITED FINANCIAL STATEMENTS OF CABRINI UNIVERSITY FOR THE FISCAL YEARS ENDED JUNE 30, 2016 AND 2015

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FINANCIAL STATEMENTS

YEARS ENDED JUNE 30, 2016 AND 2015

CABRINI COLLEGE TABLE OF CONTENTS YEARS ENDED JUNE 30, 2016 AND 2015

INDEPENDENT AUDITORS’ REPORT 1

FINANCIAL STATEMENTS

STATEMENTS OF FINANCIAL POSITION 3

STATEMENTS OF ACTIVITIES 4

STATEMENTS OF CASH FLOWS 6

NOTES TO FINANCIAL STATEMENTS 7

CliftonLarsonAllen LLP CLAconnect.com

INDEPENDENT AUDITORS’ REPORT

Board of Trustees Cabrini College Radnor, Pennsylvania

We have audited the accompanying financial statements of Cabrini College, which comprise the statements of financial position as of June 30, 2016 and 2015, and the related statements of activities and cash flows for the years then ended, and the related notes to the financial statements.

Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors’ judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

(1) Board of Trustees Cabrini College

Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Cabrini College as of June 30, 2016 and 2015, and the changes in its net assets and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

CliftonLarsonAllen LLP

Plymouth Meeting, Pennsylvania September 30, 2016

(2) CABRINI COLLEGE STATEMENTS OF FINANCIAL POSITION JUNE 30, 2016 AND 2015

2016 2015 ASSETS

Cash and Cash Equivalents$ 4,293,908 $ 5,828,097 Short‐Term Investments 12,105,754 29,649,714 Accounts and Interest Receivable, Net of Allowance for Doubtful Accounts of $363,991 and $533,314, Respectively 3,021,632 2,626,546 Prepaid Expenses and Other Assets 1,068,699 1,030,489 Contributions Receivable, Net 285,722 344,348 Deposits with Bond Trustee 4,930,065 4,587,018 Student Loans Receivable 1,009,810 995,042 Investments, at Market 43,895,124 43,689,528 Bond Issuance Costs, Net of Accumulated Amortization of $1,914,455 and $1,820,598, Respectively 810,163 904,020 Land, Buildings and Equipment, Net 61,974,514 53,295,477

Total Assets$ 133,395,391 $ 142,950,279

LIABILITIES AND NET ASSETS

LIABILITIES Current Portion of Long‐Term Debt$ 1,320,000 $ 960,000 Accounts Payable and Accrued Expenses 3,966,561 3,402,400 Accrued Salary and Benefits 2,413,277 1,948,934 Deferred Revenue and Deposits 2,233,080 2,046,875 Conditional Asset Retirement Obligation 515,487 484,251 Refundable Government Loan Funds 811,633 822,455 Long‐Term Debt Net of Current Portion 29,955,000 31,275,000 Total Liabilities 41,215,038 40,939,915

NET ASSETS Unrestricted 72,608,055 82,827,647 Temporarily Restricted 10,713,180 10,637,288 Permanently Restricted 8,859,118 8,545,429 Total Net Assets 92,180,353 102,010,364

Total Liabilities and Net Assets$ 133,395,391 $ 142,950,279

See accompanying Notes to Financial Statements. (3) CABRINI COLLEGE STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2016

Temporarily Permanently Unrestricted Restricted Restricted Total OPERATING REVENUE Student Related Revenue Tuition and Fees, Net of Financial Assistance Provided of $21,014,715$ 27,372,957 $ ‐ $ ‐ $ 27,372,957 Auxiliary Enterprises 10,750,896 ‐ ‐ 10,750,896 Total Student Related Revenue 38,123,853 ‐ ‐ 38,123,853

Government Grants 295,064 333,412 ‐ 628,476 Private Gifts and Grants 3,349,870 703,236 ‐ 4,053,106 Investment Income 316,588 ‐ 316,588 Endowment Income 1,339,881 282,982 ‐ 1,622,863 Other Revenue 308,772 34,528 ‐ 343,300 Net Assets Released from Restrictions 1,312,105 (1,312,105) ‐ ‐ Total Operating Revenue 45,046,133 42,053 ‐ 45,088,186

OPERATING EXPENSES Instruction 18,618,626 ‐ ‐ 18,618,626 Academic Support 5,290,445 ‐ ‐ 5,290,445 Student Services 11,923,289 ‐ ‐ 11,923,289 Institutional Support 8,818,788 ‐ ‐ 8,818,788 Scholarships 507,535 ‐ ‐ 507,535 Auxiliary Enterprises 9,965,468 ‐ ‐ 9,965,468 Total Operating Expense 55,124,151 ‐ ‐ 55,124,151

CHANGE IN NET ASSETS FROM OPERATING ACTIVITIES (10,078,018) 42,053 ‐ (10,035,965)

NON‐OPERATING Endowment and Other Gifts ‐ 82,800 313,689 396,489 Change in Market Value of Investments, Net of Endowment Income (150,825) (39,710) ‐ (190,535) Recovery of Funds with Deficiencies 104 (104) ‐ ‐ Other Changes in Net Assets 9,147 (9,147) ‐ ‐ Change in Net Assets from Non‐Operating Activities (141,574) 33,839 313,689 205,954

CHANGE IN NET ASSETS (10,219,592) 75,892 313,689 (9,830,011)

Net Assets ‐ Beginning of Year 82,827,647 10,637,288 8,545,429 102,010,364

NET ASSETS ‐ END OF YEAR $ 72,608,055 $ 10,713,180 $ 8,859,118 $ 92,180,353

See accompanying Notes to Financial Statements. (4) CABRINI COLLEGE STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2015

Temporarily Permanently Unrestricted Restricted Restricted Total OPERATING REVENUE Student Related Revenue Tuition and Fees, Net of Financial Assistance Provided of $19,809,739$ 27,267,438 $ ‐ $ ‐ $ 27,267,438 Auxiliary Enterprises 10,748,632 ‐ ‐ 10,748,632 Total Student Related Revenue 38,016,070 ‐ ‐ 38,016,070

Government Grants 249,409 338,141 ‐ 587,550 Private Gifts and Grants 2,259,158 747,766 ‐ 3,006,924 Investment Income 601,160 4 ‐ 601,164 Endowment Income 1,270,220 246,398 ‐ 1,516,618 Other Revenue 321,931 37,284 ‐ 359,215 Net Assets Released from Restrictions 1,404,620 (1,404,620) ‐ ‐ Total Operating Revenue 44,122,568 (35,027) ‐ 44,087,541

OPERATING EXPENSES Instruction 16,713,721 ‐ ‐ 16,713,721 Academic Support 4,761,606 ‐ ‐ 4,761,606 Student Services 12,805,092 ‐ ‐ 12,805,092 Institutional Support 8,588,451 ‐ ‐ 8,588,451 Scholarships 494,037 ‐ ‐ 494,037 Auxiliary Enterprises 9,156,145 ‐ ‐ 9,156,145 Total Operating Expense 52,519,052 ‐ ‐ 52,519,052

CHANGE IN NET ASSETS FROM OPERATING ACTIVITIES (8,396,484) (35,027) ‐ (8,431,511)

NON‐OPERATING Endowment and Other Gifts ‐ ‐ 332,461 332,461 Change in Market Value of Investments, Net of Endowment Income (280,019) 23,745 ‐ (256,274) Recovery of Funds with Deficiencies 105 (105) ‐ ‐ Other Changes in Net Assets ‐ (24,191) 24,191 ‐ Net Assets Released from Restrictions 12,726 (12,726) ‐ ‐ Change in Net Assets from Non‐Operating Activities (267,188) (13,277) 356,652 76,187

CHANGE IN NET ASSETS (8,663,672) (48,304) 356,652 (8,355,324)

Net Assets ‐ Beginning of Year 91,491,319 10,685,592 8,188,777 110,365,688

NET ASSETS ‐ END OF YEAR $ 82,827,647 $ 10,637,288 $ 8,545,429 $ 102,010,364

See accompanying Notes to Financial Statements. (5) CABRINI COLLEGE STATEMENTS OF CASH FLOWS YEARS ENDED JUNE 30, 2016 AND 2015

2016 2015 CASH FLOWS FROM OPERATING ACTIVITIES Change in Net Assets$ (9,830,011) $ (8,355,324) Adjustments to Reconcile Change in Net Assets to Net Cash Used by Operating Activities: Depreciation and Amortization 4,992,883 4,793,847 Provision for Doubtful Accounts and Loans (175,837) 19,459 Contributions Restricted for Long‐term Purposes (396,489) (332,461) Realized and Unrealized (Gains) Losses on Investments (621,643) 236,748 Accretion of Conditional Asset Retirement Obligation 31,236 29,434 Changes in Operating Assets and Liabilities: Accounts and Interest Receivable (225,763) 29,594 Prepaid Expenses and Other Assets (38,210) (42,941) Contributions Receivable 65,140 (39,438) Accounts Payable and Accrued Expenses 1,028,504 (151,097) Deferred Revenue and Deposits 186,205 61,891 Net Cash Used by Operating Activities (4,983,985) (3,750,288)

CASH FLOWS FROM INVESTING ACTIVITIES Purchase of Investments (70,354,399) (2,250,460) Proceeds from Sale of Investments 70,738,705 2,674,101 Purchases of Short‐term Investments (19,808,147) (593,879) Sales of Short‐term Investments 37,383,848 10,536,521 Proceeds from Student Loans Receivable 147,579 173,549 Payments for Student Loans (162,347) (211,881) Investments in Deposit Held by Trustee (343,047) (36,133) Purchase of Land, Buildings, and Equipment (13,578,063) (3,551,108) Net Cash Provided by Investing Activities 4,024,129 6,740,710

CASH FLOWS FROM FINANCING ACTIVITIES Contributions Restricted for Endowments 396,489 332,461 Payments on Long‐term Debt (960,000) (905,000) Change in Refundable Government Loan Fund (10,822) (5,626) Net Cash Used by Financing Activities (574,333) (578,165)

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (1,534,189) 2,412,257

Cash and Cash Equivalents ‐ Beginning of Year 5,828,097 3,415,840

CASH AND CASH EQUIVALENTS ‐ END OF YEAR $ 4,293,908 $ 5,828,097

SUPPLEMENTAL CASH FLOWS INFORMATION Cash Paid During the Year for Interest, Net of Capitalized Interest$ 1,541,330 $ 1,580,518

See accompanying Notes to Financial Statements. (6) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization Cabrini College (the College) is a Catholic institution of higher education dedicated to academic excellence, leadership development, and a commitment to social justice. The College welcomes learners of all faiths, cultures and backgrounds and prepares them to become engaged citizens of the world. Since its founding in 1957 by the Missionary Sisters of the Sacred Heart of Jesus (MSC), Cabrini College has been a national leader among higher education institutions in integrating work for social justice into a college education.

Cabrini offers more than 34 academic majors, pre‐professional programs, concentrations and minors to undergraduate students at the College’s serene 117‐acre campus in Radnor, Pennsylvania. The College also offers the Master of Education and teacher certification at 13 off‐site locations in Pennsylvania and an innovative Master of Science in Leadership degree. The campus sits on the grounds of the former Woodcrest Estate, which has as its centerpiece the Mansion, designed by renowned architect Horace Trumbauer and constructed between 1901 and 1903.

During the 2015‐2016 academic year, Cabrini enrolled 1402 undergraduate students and 851 graduate students. The student population hailed from 15 states and several different countries. The College maintains an undergraduate student‐to‐faculty ratio of 11 to 1; the average undergraduate class size is between 10 to 19 students. More than 580 students earned bachelors and master’s degrees in 2016. The College counts more than 14,000 alumni of record.

Cabrini offers more than 50 student clubs and organizations in academic fields, sports, the arts, international and multicultural activities, community service student government, publications and media, and other areas. Study away opportunities include short‐term and semester abroad programs in Italy, England, Australia, Ireland, and Guatemala.

An NCAA Division III institution, Cabrini sponsors 18 varsity athletic programs and is in the Colonial States Athletic Conference (CSAC). The Cavaliers have captured the CSAC President’s Cup, awarded to the program with the best overall performance of the year, in ten of the fifteen years the Cup has been awarded. In 2016, Cabrini won CSAC titles in women’s basketball, field hockey, men’s and women’s lacrosse, men’s and women’s soccer, and volleyball.

Cabrini students secure internship experiences locally and throughout the United States at many leading organizations, including Catholic Relief Services, Comcast, CBS3, FOX29, NBC10, ING Financial, Kramer Drive, SunGard, United States Liability Insurance, and with Philadelphia professional sports teams.

Basis of Accounting The College’s financial statements have been prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America.

(7) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Basis of Presentation Net assets and revenues, gains, expenses and losses are classified as unrestricted, temporarily restricted or permanently restricted based on the existence or absence of donor‐imposed restrictions as follows:

Unrestricted – Net assets that are not subject to donor‐imposed stipulations. Unrestricted net assets may be designated for specific purposes by action of the Board of Trustees or may otherwise be limited by contractual agreements with outside parties.

Temporarily Restricted – Net assets whose use by the College is subject to donor‐imposed stipulations that can be fulfilled by actions of the College pursuant to those stipulations or that expire by the passage of time.

Permanently Restricted – Net assets subject to donor‐imposed stipulations that they be maintained permanently by the College. Such assets primarily include the College’s permanent endowment funds.

Expirations of temporary restrictions recognized on net assets are reported as releases from temporarily restricted net assets to unrestricted net assets.

Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenue and expenses and the disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reported periods. The most significant management estimates and assumptions relate to the determination of allowances for doubtful accounts; valuation of investments without a readily determinable market value; useful lives of fixed assets; and the recording of conditional asset retirement obligations. Actual results could differ from these estimates.

Cash and Cash Equivalents The College considers all highly liquid investments with an original maturity date of 90 days or less to be cash equivalents. The balances are insured by the Federal Deposit Insurance Corporation up to certain limits. At times, the College’s cash may be in excess of federally insured limits.

Short‐Term Investments The College holds funds in certain short‐term investment accounts which are used primarily for operating activities at the College and are recorded at fair value. Short‐term investments carry certain risks including lack of regulatory oversight, interest rate and market risk. Changes in risk factors might affect the amounts reported on the statements of financial position.

(8) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Accounts Receivable Accounts receivable include student accounts receivable and other receivables. Student accounts receivable represent amounts due for tuition, fees, and room and board from currently enrolled and former students. The College extends unsecured credit to students and parents of dependent students in connection with their studies. Accounts receivable are stated at the amount management expects to collect from outstanding balances. Management provides for probable uncollectible amounts through a provision for bad debt expense and an adjustment to a valuation allowance based on its assessment of such factors as prior collection history and type of receivable. Balances that are still outstanding after reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable.

Investments Investments in publicly traded securities are stated at quoted market value. Other investments, for which no such quoted market values or valuations are readily available, are carried at fair value as estimated by management using values provided by external investment managers. Short term investments in money market funds and temporarily invested cash categorized within investments are valued at cost, which approximates fair value.

The net changes in fair value and the realized gains and losses on investments sold are reflected in the statements of activities as change in market value of investments.

Investment securities are exposed to various risks, such as interest rate, market and credit risk. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the value of investment securities could occur in the near‐term and such changes could materially affect the amounts reported in the statements of financial position.

Land, Buildings and Equipment Land, buildings and equipment are stated primarily at cost less accumulated depreciation. Expenditures for new construction, major renewals and replacements, and equipment costing over $5,000 are capitalized. The College records depreciation using the straight‐line method over the following estimated useful lives:

Land Improvements 10‐30 years Building 40 years Building Improvements 5‐40 years Campus Improvements 5‐15 years Automobiles and Trucks 6 years Technology Equipment 4‐10 years Furniture, Fixtures and Other Equipment 2‐10 years

(9) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Land, Buildings and Equipment (Continued) Notwithstanding the above estimates, land improvements, buildings and building improvements are not depreciated past any underlying lease terms. Contributions of long‐lived assets or contributions restricted for acquisition of long‐lived assets are reported as increases in temporarily restricted net assets; those restrictions expire when the long‐lived assets are placed in service by the College.

Endowment Funds The College’s permanently restricted net assets consist of numerous endowment funds established for the purposes discussed in Note 8. As required by generally accepted accounting principles, net assets associated with endowment funds, are classified and reported based on the existence or absence of donor‐imposed restrictions.

The College’s endowment consists of a portfolio of actively managed funds established to provide a predictable stream of funding to programs supported by its endowment and long‐term financial stability. The endowment consists of donor‐restricted endowment funds and a board designated endowment.

Interpretation of Relevant Law: The College operates in the Commonwealth of Pennsylvania and is not required to adopt the provisions related to Uniform Prudent Management of Institution Act of 2006 (UPMIFA), which provides guidance on the net asset classification of donor‐restricted endowment funds for a not‐for‐profit organization. However, the College is subject to enhanced disclosure requirements. The College has interpreted Commonwealth of Pennsylvania Act 141 as requiring the preservation of the fair value of the original gift as of the gift date of the donor‐ restricted endowment funds absent explicit donor stipulations to the contrary. As a result of this interpretation, the College classifies as permanently restricted net assets the original value of gifts donated to the permanent endowment and the original value of subsequent gifts to the permanent endowment. This is regarded as the “historic dollar value” of the endowed fund. The remaining portion of the donor‐restricted endowment fund that is not classified in permanently restricted net assets and is regarded as “net appreciation” is classified as temporarily restricted net assets until those amounts are appropriated for expenditure by the College in a manner consistent with the College’s spending policy.

Funds with Deficiencies: From time to time, the fair value of assets associated with individual donor restricted endowment funds may fall below the “historic dollar value.” Deficiencies of this nature are reported by a charge to unrestricted net assets and a corresponding increase to temporarily restricted net assets. The deficiencies recorded in unrestricted net assets were $1,615 and $1,719 for the years ended June 30, 2016 and 2015, respectively. These deficiencies resulted from unfavorable market fluctuations. Over time these may reverse due to appreciation of the underlying investments.

(10) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Endowment Funds (Continued) Investment Return Objectives, Risk Parameters and Strategies: The College has adopted an investment policy that is designed to stabilize annual spending levels and to preserve the value of the investment portfolio over time. Endowment assets include those assets of donor‐restricted funds that the College must hold in perpetuity. The College expects its endowment funds, over time, to provide an annual expected rate of return of inflation plus an additional 5.5% (i.e. Consumer Price Index (CPI) +5.5%). Investments are diversified to manage the risk of losses, unless under the circumstances it is clearly prudent not to do so. The investment horizon of the endowment is long term in nature. To satisfy its long‐term rate‐of‐return objectives, the College relies on a total return strategy in which investment returns are achieved through both capital appreciation (realized and unrealized) and current yield (interest and dividends).

Alternative Investments: Over the years the College has included a wide range of investments, including alternative strategies. The rationale for including alternative strategies for the College’s portfolio is to reduce overall volatility while providing equity like returns. Alternative asset classes have historically demonstrated lower volatility on a stand‐alone basis compared to traditional asset classes. Additionally they have had low correlations thus providing diversification benefits at the total fund level. Investments in such funds do carry certain risks including lack of regulatory oversight, interest rate and market risk. Due to the level of risk associated with these investments, it is at least reasonably possible that changes in risk factors in the near team might materially affect the amounts reported in the statements of financial position.

Spending Policy: For the years ended June 30, 2016 and 2015 the College has a spending policy approved by the Board of Trustees that limits spending of investment return to 4% of the average of the market value of investment assets for the previous twelve quarters.

(11) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Fair Value Measurements The College follows the authoritative definition of fair value which focuses on the price that would be received to sell the asset or paid to transfer the liability between market participants at the measurement date (an exit price). An exit price valuation will include margins for risk even if they are not observable. A fair value hierarchy is applied that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels (Level 1, 2 and 3). See Note 15 for additional information regarding fair value measurements.

Contributions Contributions, including unconditional promises to give, are recognized as revenue in the period received. Conditional promises to give are not recognized until they become unconditional; that is, when the conditions on which they depend are substantially met. Unconditional promises of gifts are included in the financial statements as contributions receivable and revenues of the appropriate net asset category. Contributions of assets other than cash are recorded at their estimated fair value. An allowance for uncollectible contributions receivables is provided based upon management’s judgment, including such factors as prior collection history, type of contribution, and nature of fund raising activity.

In addition contributions receivable scheduled to be collected beyond one year are discounted to their net present value at the time the revenue is recorded. The College applied a rate of 3.50% in determining the required discount.

Income Taxes The College has received a determination letter from the Internal Revenue Service indicating it is a tax exempt organization under Section 501(c)(3) of the Internal Revenue Code and is subject to federal and state income tax only on net unrelated business income. The College engages in activities that are considered unrelated to its exempt purpose. These activities are subject to federal and state income tax. However, such activities generated a loss in fiscal 2016 and 2015. Further, the College has a net operating loss carry forward of $1,719,479 available to offset any taxable income from these unrelated activities. Accordingly, no federal or state tax provision is required. The net operating losses begin to expire in 2024.

The College is required to determine whether a transaction or event must be reported in a tax return and to evaluate whether a tax position be recognized or derecognized based on a “more likely than not” threshold. This applies to positions taken or expected to be taken in a tax return. No adjustments to the financial statements were required as a result of this review.

Non‐Operating Activities The College considers endowment gifts, capital campaign gifts, net realized gains and losses on sale of investments and endowment income in excess or deficit of its spending policy to be non‐ operating activities.

(12) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Advertising Advertising costs are expensed when incurred. Advertising costs were $866,656 and $601,399 for the years ended June 30, 2016 and 2015, respectively.

Deposits with Bond Trustee Deposits with bond trustee consist of cash and cash equivalents held by a trustee in fulfillment of debt agreements. These funds are restricted to future debt service as defined by the debt agreement. These funds also include investments in government securities, the maturing principal of and interest on which were determined to be sufficient to pay the redemption price of the 1999 bonds (Note 7).

Student Loans Receivable Student loans receivable include funds advanced to students through the Perkins loan program.

Bond Issuance Costs Costs incurred in connection with obtaining long‐term debt have been capitalized and are being amortized using the effective interest method over the life of the long‐term debt.

Deferred Revenue and Deposits Revenues received prior to the end of the fiscal year which relate to the following fiscal year are recorded and reflected as deferred revenue.

Refundable Government Loan Funds Amounts received from governmental agencies that have been advanced to students in the form of loans are shown as refundable government loan funds on the statements of financial position. These funds are ultimately refundable to the United States government.

Early Adoption of Accounting Principles During the year ended June 30, 2016, the College early adopted a provision of Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) 2016‐01, Financial Instruments – Overall Recognition and Measurement of Financial Assets and Financial Liabilities. This provision eliminates the requirement for entities, other than public business entities, to disclose the fair values of financial instruments carried at amortized cost, as previously required by Accounting Standards Codification (ASC) 825‐10‐50. As such, the College has omitted this disclosure for the years ended June 30, 2016 and 2015. The early adoption of this provision did not have an impact on the College’s financial position or results of operations.

In May 2015 the FASB issued Accounting Standard Update No. 2015‐07, Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or its Equivalent), (“ASU 2015‐07”). ASU 2015‐07 removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical expedient. The College adopted ASU 2015‐07 for the June 30, 2016 reporting period. The adoption had no effect on the financial statements but removed the disclosures described above as of June 30, 2016 and 2015.

(13) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Subsequent Events In preparing these financial statements the College has evaluated events and transactions through September 30, 2016, the date the financial statements were issued. Except as disclosed in Note 16, the College is not aware of any events or transactions which would require recognition or disclosure in the financial statements.

NOTE 2 STUDENT LOANS

The College makes uncollateralized loans to students based on financial need under the Perkins Federal loan program (federal funding). Allowances for doubtful accounts are established based on prior collection experience and current economic factors which, in management’s judgment, could influence the ability of loan recipients to repay the amounts per the loan terms. At June 30, 2016 and 2015, student loans receivable were $1,009,810 and $995,042, respectively, which is about 0.8% and 0.7% of total assets. Of these amounts, as of June 30, 2016 and 2015, $529,297 and $566,538, respectively, were not in repayment status. The allowance for doubtful accounts was $0 at both June 30, 2016 and 2015.

At June 30, 2016 and 2015, the following amounts were past due under the student loan programs.

Past Due: 2016 2015 60‐90 Days$ 1,385 $ 1,655 91‐180 Days 3,155 5,854 181‐730 Days 67,688 47,457 731+ Days 213,368 212,102 $ 285,596 $ 267,068

Funds advanced by the Federal government of $811,633 and $822,455 at June 30, 2016 and 2015, respectively, are ultimately refundable to the government and are classified as liabilities in the statements of financial position.

NOTE 3 CONTRIBUTIONS RECEIVABLE

Contributions receivable at June 30 are due as follows:

2016 2015 In One Year or Less$ 162,833 $ 137,667 Between One Year and Five Years 172,250 277,583 Total 335,083 415,250 Less Discount to Present Value (17,614) (32,641) Less Allowance for Doubtful Pledges (31,747) (38,261) Total Contribution Receivable, Net$ 285,722 $ $ 344,348

(14) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 4 INVESTMENTS

Short‐term investments consist of the following at June 30:

2016 2015 Cash and Cash Equivalents$ 3,674,927 $ 155,009 Domestic Equity 495,992 ‐ Corporate Bonds 3,452,341 18,839,027 U.S. Government Agency Bonds 4,443,218 8,474,399 International Bonds 39,276 2,181,279 Total Short‐Term Investments$ 12,105,754 $ 29,649,714

Investments consist of the following at June 30:

2016 2015 Cash and Cash Equivalents$ 2,615,271 $ 44,996 Domestic Equity 21,595,673 21,710,861 International Equity 4,993,703 7,503,974 Corporate Bonds 9,408,776 6,244,656 U.S. Government Agency Bonds 2,645,445 5,826,256 Equity Mutual Funds 1,446,948 ‐ International Bonds 261,286 2,344,842 Alternative Investments 928,022 13,943 Total Investments$ 43,895,124 $ 43,689,528

The components of total investment income from cash and investments for 2016 and 2015 are reflected below:

2016 2015 Investment Income, Net of Investment Expenses$ 1,127,273 $ 2,098,256 Realized Gains, Net 9,467,339 797,386 Unrealized Losses, Net (8,845,696) (1,034,134) Total Investment Income $ 1,748,916 $ 1,861,508

(15) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 5 ENDOWMENTS

Endowment net asset activity for the year ended June 30, 2016 is as follows:

Temporarily Permanently Unrestricted Restricted Restricted Total Net Assets, July 1, 2015$ 26,870,281 $ 8,328,634 $ 8,545,429 $ 43,744,344 Investment Return 842,433 557,261 ‐ 1,399,694 Contributions ‐ 82,800 313,689 396,489 Appropriation of Endowment Assets for Operations (Draw) (1,025,995) (596,868) ‐ (1,622,863) Recovery of Deficiencies in Historical Values 104 (104) ‐ ‐

Net Assets, June 30, 2016$ 26,686,823 $ 8,371,723 $ 8,859,118 $ 43,917,664

The endowment net asset funds consisted of the following at June 30, 2016:

Temporarily Permanently Unrestricted Restricted Restricted Total Donor Restricted Endowment Funds$ (1,615) $ 8,371,723 $ 8,859,118 $ 17,229,226 Board‐Designated Funds 26,688,438 ‐ ‐ 26,688,438 Total$ 26,686,823 $ 8,371,723 $ 8,859,118 $ 43,917,664

Endowment net asset activity for the year ended June 30, 2015 is as follows:

Temporarily Permanently Unrestricted Restricted Restricted Total Net Assets, July 1, 2014$ 27,868,988 $ 8,907,534 $ 8,188,777 $ 44,965,299 Investment Return 910,123 558,781 ‐ 1,468,904 Contributions ‐ ‐ 356,652 356,652 Appropriation of Endowment Assets for Operations (Draw) (1,908,935) (1,137,576) ‐ (3,046,511) Recovery of Deficiencies in Historical Values 105 (105) ‐ ‐ Net Assets, June 30, 2015$ 26,870,281 $ 8,328,634 $ 8,545,429 $ 43,744,344

The endowment net asset funds consisted of the following at June 30, 2015:

Temporarily Permanently Unrestricted Restricted Restricted Total Donor Restricted Endowment Funds$ (1,719) $ 8,328,634 $ 8,545,429 $ 16,872,344 Board‐Designated Funds 26,872,000 ‐ ‐ 26,872,000 Total$ 26,870,281 $ 8,328,634 $ 8,545,429 $ 43,744,344

(16) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 6 LAND, BUILDINGS, AND EQUIPMENT

Land, buildings, and equipment consist of the following at June 30, 2016 and 2015:

2016 2015

Land and Improvements$ 4,228,853 $ 4,499,400 Buildings and Improvements 83,773,181 80,870,062 Campus Improvements 12,208,664 11,606,689 Autos and Trucks 259,434 302,586 Technology Equipment 2,000,954 2,107,514 Furniture, Fixtures and Other Equipment 1,505,241 1,455,431 Construction in Progress 12,079,914 2,579,126 Leased Equipment 188,059 32,160 Total 116,244,300 103,452,968 Accumulated Depreciation (54,269,786) (50,157,491)

Total Land, Buildings and Equipment$ 61,974,514 $ 53,295,477

Depreciation expense totaled $4,899,026 and $4,697,632 for the years ended June 30, 2016 and 2015, respectively.

In 2010, the College instituted a fixed assets disposal policy in which assets in the categories of autos and trucks; technology equipment; and furniture, fixtures and other equipment, are removed from fixed assets in the fiscal year after they are fully depreciated. All assets that are sold or disposed of are removed from fixed assets in the fiscal year in which the sale or disposal occurs. The amount of assets removed totaled $786,730 and $924,434 for the years ended June 30, 2016 and 2015, respectively.

NOTE 7 LONG‐TERM DEBT

Long‐term debt at June 30 consisted of the following:

2016 2015

Delaware County Authority College Revenue Bonds, Series 1999$ 2,190,000 $ 2,235,000 Delaware County Authority College Revenue Bonds, Series 2003 18,770,000 19,400,000 Delaware County Authority College Revenue Bonds, Series 2007 10,315,000 10,600,000 Total 31,275,000 32,235,000 Current Maturities (1,320,000) (960,000)

Total Bonds Payable, Net of Current Portion$ 29,955,000 $ 31,275,000

(17) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 7 LONG‐TERM DEBT (CONTINUED)

Delaware County Authority College Revenue Bonds, Series 1999 The College is obligated to the Delaware County Authority and to others under indentures relating to the College Revenue Bonds, Series 1999 (the 1999 bonds), issued for an original amount of $15,065,000. These bonds have interest rates ranging from 3.90% to 5.875% and mature in varying amounts through 2029.

Delaware County Authority College Revenue Bonds, Series 2003 During fiscal 2004, the College issued $25,000,000 in Delaware County Authority College Revenue Bonds, Series 2003 (the 2003 bonds). The proceeds from the 2003 bonds were used to refund the outstanding principal amount of the 1997 bonds and were used to finance, or reimburse the College for costs of capital improvements including partially funding the construction of a building for science, education, and technology, a new residence hall, and infrastructure improvements. These bonds have interest rates ranging from 2.125% to 5.50% and mature in varying amounts through 2033.

Delaware County Authority College Revenue Bonds, Series 2007 During fiscal 2007, the College issued $12,605,000 in Delaware County Authority College Revenue Bonds, Series 2007 (the 2007 bonds). The proceeds from the 2007 bonds were used to advance refund a portion of the outstanding principal amount of the 1999 bonds. These bonds have interest rates ranging from 4.0% to 4.5% and mature in varying amounts through 2029.

The bonds are collateralized by an interest in, and lien on, the College’s unrestricted revenues. In addition, the College is subject to certain restrictions related to additional indebtedness, and the maintenance of various financial ratios.

Interest expense on all long‐term debt totaled $1,541,330 and $1,580,518 for the years ended June 30, 2016 and 2015, respectively.

The maturity of long‐term debt as of June 30, 2016 over the next five years and thereafter is as follows:

Year Ending June 30, Amount 2017$ 1,320,000 2018 1,370,000 2019 1,435,000 2020 1,500,000 2021 1,585,000 Thereafter 24,065,000 Total$ 31,275,000

(18) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 8 NET ASSETS

Unrestricted net assets include amounts designated by the Board of Trustees for future capital expansion and other projects of $8,805,156 and $29,649,714 as of June 30, 2016 and 2015, respectively.

Net assets are temporarily restricted for the following purposes at June 30:

2016 2015 Accumulated Earnings and Other Endowment Related Amounts$ 8,877,117 $ 8,850,075 Purpose Restricted 1,836,063 1,787,213

Total$ 10,713,180 $ 10,637,288

Net assets are permanently restricted for the following purposes at June 30:

2016 2015

Scholarships$ 2,708,167 $ 2,597,453 General Operations 3,007,996 3,007,996 Academic Development 1,340,727 1,337,752 Student Development 1,802,228 1,602,228

Total$ 8,859,118 $ 8,545,429

NOTE 9 CAPITAL AND OPERATING LEASES

The College leases a mail postage machine and copiers under a capital lease and certain other equipment under long‐term operating leases. Rent expense was $3,338,617 and $2,030,178 for the years ended June 30, 2016 and 2015, respectively. This includes the rental of the real estate from the MSC comprising the College campus (see Note 14).

NOTE 10 PENSION PLAN

The College has a defined contribution pension plan covering full‐time faculty, staff and administrative personnel. Benefits are provided through direct payments to the Teachers’ Insurance and Annuity Association and the College Retirement Equity Fund (TIAA‐CREF). The College’s policy with respect to its contribution is to provide 5% of eligible employees’ salaries. Employees, who elect to contribute 1%, 2%, 3% or 4% of their base salary, will receive an additional employer contribution of the same percentage. For the years ended June 30, 2016 and 2015, pension expense was $1,413,769 and $1,276,571, respectively.

(19) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 11 CONDITIONAL ASSET RETIREMENT OBLIGATION

The College is required to recognize the cost associated with the eventual remediation and abatement of asbestos and other regulated substances located within the construction of the College’s buildings and equipment. The cost of the abatement was estimated utilizing an externally conducted survey for asbestos identification and contractor estimates for remediation integrated with management’s future remediation plans. During the years ended June 30, 2016 and 2015, the College accreted an additional $31,236 and $29,434, respectively, to the conditional asset retirement obligation.

NOTE 12 FUNCTIONAL EXPENSES

Operation and maintenance expenses and depreciation of plant assets and interest on long‐term debt are allocated to program and supporting activities based upon the primary use of the facilities.

Expenses reported in the financial statements are classified among program services and supporting activities for the years ended June 30, 2016 and 2015 as follows:

2016 2015

Program Services$ 37,057,250 $ 34,714,298 Supporting Activities: Management and General 16,458,978 16,111,756 Fundraising 1,607,923 1,692,998

Total$ 55,124,151 $ 52,519,052

(20) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 13 COMMITMENTS AND CONTINGENCIES

Credit Facilities The College has an unsecured line of credit which provides for borrowings up to $1,500,000 and bears interest at a floating interest rate equal to the prime rate, which was 3.50% and 3.25% on June 30, 2016 and 2015, respectively. The line of credit expires on December 31, 2016. The College did not have any outstanding borrowings against the line of credit as of June 30, 2016 or June 30, 2015.

Litigation Various lawsuits, claims and other contingent liabilities arise in the ordinary course of the College’s educational activities. While the ultimate disposition of such contingencies is not determinable at this time, management believes that any liability resulting from these contingencies will not materially affect the financial position of the College as of June 30, 2016.

Federally Funded Financial Aid Federally funded financial aid programs are subject to special audit. Such audits could result in claims against the resources of the College. No provision has been made for any liabilities that may arise from such audits since the amounts, if any, cannot be determined at this date.

Purchase Commitments The College has a commitment under contract for renovations to an athletic and recreation center. This unrecorded commitment was $1,708,357 at June 30, 2016.

NOTE 14 RELATED‐PARTY TRANSACTIONS

The College leases from the MSC the land comprising the College campus along with certain buildings for a term ending December 2059. Improvements to the campus buildings and land that are subject to this lease are not depreciated beyond the year 2059. The College is required to pay the MSC a nominal annual rent for the use of such real estate. The lease agreement contains several additional provisions, including limiting the amount of annual rent paid to the MSC in the event the MSC ceases sponsorship to $250,000, as long as any long term debt obtained through a public authority, whether or not secured, exists on the financial records of the College. The College has the right of first refusal and right of first offer in the event certain conditions are met.

In accordance with generally accepted accounting principles, $2,886,431 has been included in private gifts and grants and a corresponding charge for operating costs which have subsequently been allocated among the operating expenses in the 2016 and 2015 statements of activities for the difference between the fair market rental value and rent paid. Under the terms of the lease, the College is responsible for all utilities, taxes, insurance and maintenance costs related to the leased property.

(21) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 15 FAIR VALUE MEASUREMENTS

The College has categorized its financial instruments, based on the priority of the inputs to the valuation technique, into a three‐level fair value hierarchy. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

Level 1 Financial assets and liabilities whose values are based on unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level 2 Financial assets and liabilities whose values are based on one or more of the following: 1. Quoted prices for similar assets or liabilities in active markets; 2. Quoted prices for identical or similar assets or liabilities in non‐active markets; 3. Pricing models whose inputs are observable for substantially the full term of the asset or liability; or 4. Pricing models whose inputs are derived principally from or corroborated by observable market data through correlation or other means for substantially the full term of the asset or liability.

Level 3 Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable. These inputs reflect management’s own assumptions about the assumptions a market participant would use in pricing the asset or liability.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The College’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability.

(22) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 15 FAIR VALUE MEASUREMENTS (CONTINUED)

A review of the fair value hierarchy classifications is conducted on an annual basis. Changes in the type of inputs may result in a reclassification for certain financial assets or liabilities.

The following tables present information about the College’s assets and liabilities measured at fair value on a recurring basis as of June 30, 2016 and 2015 and indicates the fair value hierarchy of the valuation techniques utilized by the College to determine such fair value. 2016 Level 1 Level 2 Level 3Total Deposits with Bond Trustee$ 4,930,065 $ ‐ $ ‐ $ 4,930,065 Investments Domestic Equity 22,091,665 ‐ ‐ 22,091,665 International Equity 4,993,703 ‐ ‐ 4,993,703 Corporate Bonds 12,861,117 ‐ ‐ 12,861,117 U.S. Government Agency Bonds 7,088,663 ‐ ‐ 7,088,663 International Bonds 300,562 ‐ ‐ 300,562 Equity Mutual Fund 1,446,948 ‐ ‐ 1,446,948 Total Assets$ 53,712,723 $ ‐ $ ‐ $ 53,712,723

Investments measured at Fair Value using Net Asset Value per Share 928,022 Total Assets $ 54,640,745

2015 Level 1 Level 2 Level 3Total Deposits with Bond Trustee$ 4,587,018 $ ‐ $ ‐ $ 4,587,018 Investments Domestic Equity 21,710,861 ‐ ‐ 21,710,861 International Equity 7,503,974 ‐ ‐ 7,503,974 Corporate Bonds 25,083,683 ‐ ‐ 25,083,683 U.S. Government Agency Bonds 14,300,655 ‐ ‐ 14,300,655 International Bonds 4,526,121 ‐ ‐ 4,526,121 Total Assets$ 77,712,312 $ ‐ $ ‐ $ 77,712,312

Investments measured at Fair Value using Net Asset Value per Share 13,943 Total Assets $ 77,726,255

(23) CABRINI COLLEGE NOTES TO FINANCIAL STATEMENTS JUNE 30, 2016 AND 2015

NOTE 15 FAIR VALUE MEASUREMENTS (CONTINUED)

Fair values for investments are determined by reference to quoted market prices and other relevant information generated by market transactions. For alternative investments, fair value of each investment is determined based on a review of the audited financial statements of the underlying funds, and other information from independent third parties including information provided by the fund managers and research performed by the investment manager.

Fair value measurements of investments in certain entities that calculate net asset value per share (or its equivalent) as of June 30, 2016 are:

Net Asset Unfunded Redemption Redemption Value Commitments Frequency Notice Period Private Equity Funds$ 10,176 $ ‐ In liquidation N/A Private Equity Funds 917,846 ‐ Quarterly 65 days

The unobservable inputs used to determine the fair value of these investments have been estimated based on the net asset value per share as provided by the investment managers as the practical expedient estimate of fair value of the investment without further adjustment. While the College believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial statements could result in a different estimate of fair value at the reporting date.

NOTE 16 SUBSEQUENT EVENTS

As of July, 1, 2016 Cabrini College received approval from the Commonwealth of Pennsylvania to become a University. The changeover also marks the official implementation of a new academic structure, which includes four academic schools: the School of Education; the School of Business, Arts, and Media; the School of Humanities and Social Sciences; and the School of Natural Sciences and Allied Health.

Effective September 6, 2016, the College entered into a long term license agreement with the Archdiocese of Philadelphia to use the baseball field at Archbishop Carroll High School for the Cabrini baseball program for a minimum of 20 years. As part of the license agreement, Cabrini agreed to invest up to $1.5 million toward field improvements to ready the field for NCAA play.

(24)

APPENDIX C

DEFINITIONS OF CERTAIN TERMS AND SUMMARIES OF SUMMARY OF CERTAIN PROVISIONS OF INDENTURE, LOAN AGREEMENT, SECURITY AGREEMENT AND COLLATERAL AGENCY AGREEMENT

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APPENDIX C

DEFINITIONS OF CERTAIN TERMS AND SUMMARY OF CERTAIN PROVISIONS OF THE FINANCING DOCUMENTS

The following sets forth the definitions of certain terms used in or otherwise relevant to the Indenture, the Loan Agreement, the Security Agreement and the Collateral Agency Agreement and a summary of certain provisions of such documents. Certain other provisions of such documents relating to the Bonds are summarized in the Official Statement under the sections captioned “THE BONDS” and “SECURITY AND SOURCES OF PAYMENT FOR THE BONDS”. Reference should be made to the Indenture, the Loan Agreement, the Security Agreement and the Collateral Agency Agreement for a complete statement of all of these provisions and other provisions which are not summarized in this Official Statement. Copies of these documents may be obtained from the Trustee.

DEFINITIONS OF CERTAIN TERMS

The following are terms defined in (or otherwise relevant to) the Indenture, the Loan Agreement, the Security Agreement and the Collateral Agency Agreement:

“Act” means the Pennsylvania Municipality Authorities Act, being Chapter 56 of Title 53 of the Pennsylvania Consolidated Statutes, as heretofore amended and as hereafter amended or supplemented at the time in question.

“Additional Bonds” means the Bonds of the Authority which may be issued from time to time pursuant to the Indenture and which are in addition to the 2017 Bonds.

“Additional Parity Debt” shall mean all obligations of the University from time to time arising under or in connection with or related to or evidenced by or secured by any Additional Parity Debt Agreement, in each case whether such obligations are direct or indirect, otherwise secured or unsecured, joint or several, absolute or contingent, due or to become due, whether for payment or performance, now existing or hereafter arising (specifically including but not limited to obligations arising or accruing after the commencement of any bankruptcy, insolvency or similar proceedings with respect to the University, or which would have arisen or accrued but for the commencement of such proceeding, even if the claim for such obligation is not allowed in such proceeding under applicable law).

“Additional Parity Debt Agreement” shall mean each document, instrument or agreement which is designated an “Additional Parity Debt Agreement” in accordance with the Collateral Agency Agreement.

“Additional Parity Obligee” shall mean the holder of any particular Additional Parity Debt (or a trustee, agent or other representative for such holder).

“Authorized Issuer Representative” means the person at the time designated to act on behalf of the Authority by written certificate last furnished to the University and the Trustee containing the specimen signature of such person and duly signed on behalf of the Authority. Such certificate may designate an alternate or alternates.

“Authorized University Representative” means the person at the time designated to act on behalf of the University by written certificate last furnished to the Authority and the Trustee containing the specimen signature of such person and duly signed on behalf of the University. Such certificate may designate an alternate or alternates.

“Available Moneys” means any monies on deposit with the Trustee for the benefit of the holders of any Bonds which are (a) proceeds of such Bonds or refunding bond proceeds, (b) amounts that have been so held on deposit for a period of 124 consecutive days during which period and prior thereto no petition in bankruptcy under the United States Bankruptcy Code has been filed by or against the Authority or the University, and no similar proceedings by or against the Authority or the University have been instituted under state insolvency or other laws

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affecting creditors' rights generally, (c) proceeds of a drawing or claim made under any applicable Credit Facility securing such Bonds, or (d) monies with respect to which an unqualified opinion from nationally recognized Counsel experienced in bankruptcy matters has been received by the Trustee stating that payments of such monies to such Bondholders would not constitute voidable preferences under Section 547 of the United States Bankruptcy Code, or similar state or federal laws with voidable preference provisions, in the event of the filing of a petition for relief under the United States Bankruptcy Code, or similar state or federal laws with voidable preference provisions, by or against the Authority or the University.

“Adjusted Net Revenues Available for Debt Service” shall mean, for any period, the Net Revenues Available for Debt Service for such period, plus any unrestricted funds of the University that have not otherwise been taken into account in the calculation of Net Revenues Available for Debt Service for such period and that are available for the payment of debt service on Indebtedness of the University.

“Average Annual Debt Service Requirement” shall mean, as of any particular date of computation and as to any Bonds or other Indebtedness under consideration, an amount equal to (a) the aggregate Debt Service Requirement on such Bonds or Indebtedness for the period beginning with the Fiscal Year within which such computation shall be made and ending with the Fiscal Year in which the last stated maturity of the relevant Bonds or Indebtedness shall occur, divided by (b) the number of Fiscal Years contained in such period.

“Balloon Debt” shall mean any Long-Term Debt, 25% or more of the original principal amount of which comes or may come due in any one Fiscal Year by virtue of stated maturity, mandatory redemption or prepayment or optional or mandatory tender for purchase or redemption by the holder thereof, and which portion of the principal is not required to be amortized below such percentage by mandatory redemption or prepayment prior to such date.

“Bond” or “Bonds” means any bond or bonds authenticated and delivered under the Indenture, including the 2017 Bonds and any Additional Bonds.

“Bondholder” or “holder of Bonds” or “owner of Bonds” or a word or phrase of similar import means the registered holder of any Bond.

“Bond Fund” means the Bond Fund created pursuant to the Indenture.

“Business Day” means any day on which banks located in the city in which the Principal Office of the Trustee is located are not required or authorized to remain closed and on which The New York Stock Exchange is not closed.

“Capital Lease” shall mean at any time any lease which is, or is required under Generally Accepted Accounting Principles to be, capitalized on the balance sheet of the lessee at such time.

“Cash Equivalent Investments” shall mean shall mean any of the following, to the extent acquired for investment and not with a view to achieving trading profits: (a) obligations fully backed by the full faith and credit of the United States of America maturing not in excess of six months from the date of acquisition, (b) commercial paper maturing not in excess of nine months from the date of acquisition and rated “P-1” by Moody's Investors Service or “A-1” by S&P Global Ratings on the date of acquisition, (c) the following obligations of any domestic commercial bank, including any affiliate of the Trustee, having capital and surplus in excess of $500,000,000, which has, or the holding company of which has, a commercial paper rating meeting the requirements specified in clause (b) above: (i) time or demand deposits, certificates of deposit (including those placed by a third party pursuant to an agreement between the University and the Collateral Agent) and bankers’ acceptances maturing not in excess of nine months from the date of acquisition, or (ii) repurchase obligations with a term of not more than seven days for underlying securities of the type referred to in clause (a) above, and (d) a money market mutual fund, including, without limitation, any mutual fund for which the Collateral Agent or an affiliate of the Collateral Agent serves as investment manager, administrator, shareholder servicing agent, and/or custodian or subcustodian, notwithstanding that (i) the Collateral Agent or an affiliate of the Collateral Agent receives fees from such funds for services rendered, (ii) the Collateral Agent charges and collects fees for services rendered pursuant to this Agreement, which fees are separate from the fees received from such funds, and (iii) services performed for such

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funds and pursuant to this Agreement may at times duplicate those provided to such funds by the Collateral Agent or its affiliates.

“Certificate” shall mean a written statement signed by or on behalf of the person charged with responsibility therefor.

“Certified Resolution” means a copy of one or more resolutions certified by the Secretary or the Assistant Secretary of the Authority or the University, as the case may be, under its respective seal to have been duly adopted by the relevant governing board of the Authority or the University, as the case may be, and to be in effect on the date of such certification.

“Code” means the Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder.

“Collateral” shall mean all receipts, revenues, rentals, income and other moneys held, received or receivable by or on behalf of the University from any source, including, without limitation, all operating and nonoperating revenues, and all rights to receive the same whether in the form of accounts, contract rights, chattel paper, instruments or general intangibles, and the proceeds thereof (whether cash or non-cash), in each case whether now owned or held or hereafter acquired by the Grantor, but excluding, however, any gifts, grants, bequests, donations and contributions, and the income and gains derived therefrom, that are designated at the time of making by the donor as being for specific purposes inconsistent with the payment of debt service on Parity Obligations of the University. Collateral shall include all books and records relating to the foregoing Collateral, including, without limitation, all correspondence, memoranda, computer programs, tapes, discs, ledger sheets, papers, books and other documents or transcribed information of any type and whether expressed in ordinary or machine readable language, and all products and proceeds of any and all of the foregoing Collateral

“Collateral Agent Obligations” shall mean all obligations from time to time of the University to the Collateral Agent in its capacity as such, including but not limited to certain amounts payable to the Collateral Agent for its fees and expenses pursuant to the Collateral Agency Agreement, in each case whether such obligations are direct or indirect, otherwise secured or unsecured, joint or several, absolute or contingent, due or to become due, whether for payment or performance, now existing or hereafter arising (specifically including but not limited to obligations arising or accruing after the commencement of any bankruptcy, insolvency or similar proceedings with respect to the University, or which would have arisen or accrued but for the commencement of such proceeding, even if the claim for such obligation is not allowed in such proceeding under applicable law).

“Completion Certificate” shall have the meaning given to that term under “SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE - Project Fund” below.

“Completion Debt” shall mean any Long-Term Debt incurred by the University for the purpose of (a) financing the completion of constructing or equipping facilities for which Long-Term Debt has theretofore been incurred in accordance with the provisions of the Loan Agreement, to the extent necessary to provide a completed and equipped facility of the type and scope contemplated at the time that such Long-Term Debt was originally incurred, and in accordance with the general plans and specifications for such facility as originally prepared with only such changes as have been made in conformance with the documents pursuant to which such Long-Term Debt was originally incurred, and (b) providing for capitalized interest during the period of construction, funding or increasing the funding of a related reserve fund and paying costs and expenses of issuing such Completion Debt.

“Consultant” shall mean a person, who shall be Independent, appointed by the University who is generally recognized as being expert as to matters as to which such person’s Certificate or advice is required or contemplated by the Loan Agreement.

“Cost” or “Costs”, when used with respect to any Project or Project Facilities, means the cost of acquiring the Project Facilities by construction, installation or purchase, and the cost of financing the Project Facilities, whether directly paid by the University or reimbursed to the University and, without limiting the generality of the foregoing, shall include (a) amounts paid to acquire any interest in real estate or leasehold interests which constitutes a part of, or which may be deemed to be necessary for, the Project Facilities; (b) amounts paid for

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constructing or installing any part of the Project Facilities, including amounts paid for labor, services, materials, supplies, equipment, contractors’ bonds, insurance, and engineering, architectural and design services; (c) amounts paid to purchase any part of the Project Facilities, including design charges and shipping charges; (d) expenses incurred in connection with the authorization, issuance and sale of Bonds, including accounting, legal, financial and printing fees and the fees and expenses of the Trustee and the Authority and any fees or premiums to be paid to any Credit Facility Issuer with respect to any Credit Facility securing any Bonds; (e) administrative, engineering and overhead expenses of the University constituting a cost of planning, designing, acquiring, purchasing, installing or constructing the Project Facilities; (f) interest on Bonds during construction to the extent that such interest may be properly financed under the Act and, with respect to Tax-Exempt Bonds, under the Code; (g) any sums required to reimburse the Authority or the University or others for advances made for any of the above items, or for any other costs incurred and for work done by any of them, which are properly chargeable to the particular Project; (h) any sums required to repay, refinance or refund any indebtedness of the Authority or the University incurred in connection with any Project; and (i) such other costs and expenses payable by the Authority or the University not specified in the Indenture as may be necessary or incident to the construction and/or acquisition of the Project and the placing in operation thereof as aforesaid, all to the extent permitted under the Act.

“Counsel” means an attorney-at-law or law firm, not unsatisfactory to the Trustee, who may be counsel for the Authority, the University or the Trustee and who may be an officer or employee of the Authority, the University, the Trustee or any of their affiliates.

“Coverage Ratio A” shall mean, for any particular Fiscal Year of the University under consideration, the ratio (expressed as a percentage) obtained by dividing the Net Revenues Available for Debt Service for such Fiscal Year by the actual Debt Service Requirements on outstanding Long-Term Parity Debt during such Fiscal Year.

“Coverage Ratio B” shall mean, for any particular Fiscal Year of the University under consideration, the ratio (expressed as a percentage) obtained by dividing Adjusted Net Revenues Available for Debt Service for such Fiscal Year by the actual Debt Service Requirements on outstanding Long-Term Parity Debt during such Fiscal Year.

“Credit-Enhanced Bonds” means any Bonds which are secured by or otherwise entitled to the benefits of any Credit Facility.

“Credit Facility” means and includes any financial guaranty insurance policy, letter of credit or other form of credit facility issued to or for the benefit of the Trustee to secure or guaranty the payment when due of the principal or purchase price (upon tender) of and interest on any Bonds, in each case as amended, supplemented or otherwise modified and in effect from time to time.

“Credit Facility Issuer” means and includes the issuer of any particular Credit Facility, together with in each case the successors and assigns of such issuer.

“Credit Facility Issuer Adverse Change” means, with respect to any Credit Facility Issuer at any particular time, the occurrence and continuance of one or more of the following events: (a) such Credit Facility Issuer shall have failed to pay or perform when due its obligations under the Credit Facility issued by it; (b) the Credit Facility issued by such Credit Facility Issuer or any material term or provision thereof shall cease to be in full force and effect (except in accordance with the express terms of such Credit Facility), or such Credit Facility Issuer shall, or shall purport to, terminate (except in accordance with the terms of such Credit Facility), repudiate, declare voidable or void or otherwise contest the validity of, such Credit Facility or any term or provision thereof or any obligation or liability of such Credit Facility Issuer thereunder; (c) the commencement by such Credit Facility Issuer of a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect including, without limitation, the appointment of a trustee, receiver, liquidator, custodian or other similar official for itself or any substantial part of its property; or (d) the consent of such Credit Facility Issuer to any relief referred to in the previous clause (c) in an involuntary case or other proceeding commenced against it.

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“Debt Service Requirement” with respect to any Bonds or other Indebtedness under consideration and with reference to a specified period shall mean:

(a) interest on such Bonds or other Indebtedness payable during such period, excluding (i) interest funded from the proceeds thereof and (ii) interest on such Bonds or Indebtedness to be redeemed during such period through any sinking fund account which would otherwise accrue after the redemption date;

(b) amounts required to be paid into any mandatory sinking fund account for such Bonds or Indebtedness during the period;

(c) amounts required to pay the principal of such Bonds or Indebtedness maturing during the period and not to be redeemed prior to maturity through any mandatory sinking fund account; and

(d) in the case of any Indebtedness in the form of a Capital Lease (as defined in the Loan Agreement), the lease rentals payable during the period;

provided, however, that in determining the Debt Service Requirement with respect to Bonds or Indebtedness for any future period of time to the extent required under the Indenture or the Loan Agreement, the following rules and assumptions shall apply:

(i) (A) In the case of Variable Rate Debt with respect to which the interest rate is required to be reset every seven days or more frequently, the interest payable on such Variable Rate Debt for any such future period shall be calculated on the assumption that the interest rate per annum on such Variable Rate Debt for such period will be equal to 120% of the average rate of interest per annum that was payable on such Variable Rate Debt during the period of twenty-four calendar months ending on the last day of the last full calendar month preceding the date as of which such calculation is required be made; provided that if such Variable Rate Debt under consideration has been outstanding for less than such twenty-four-month period but has been outstanding for at least a twelve calendar month period ending on the last day of the last full calendar month preceding the date as of which such calculation is required be made, then the interest payable on such Variable Rate Debt for such future period shall be calculated on the assumption that the interest rate per annum on such Variable Rate Debt for such future period will be equal to the higher of (x) the interest rate on such Variable Rate Debt in effect as of the relevant required date of calculation, or (y) 120% of the average rate of interest per annum that was payable on such Variable Rate Debt during the period of twelve calendar months ending on the last day of the last full calendar month preceding the date as of which such calculation is required to be made; and provided further, that if such Variable Rate Debt under consideration has been outstanding for less than such twelve-month period, then the interest payable on such Variable Rate Debt for such future period shall be calculated on the assumption that the interest rate per annum on such Variable Rate Debt for such future period will be equal to (x) 120% of The Securities Industry and Financial Markets Association™ (SIFMA) Municipal Swap Index (or, if such index is no longer published, then such other comparable index as may be selected by the University) as last published during the last full calendar month immediately preceding the date as of which such calculation is required to be made, if such Variable Rate Debt represents Indebtedness the interest on which is excluded from the gross income of the holders thereof for federal income tax purposes, or (y) 120% of the one-month London Interbank Offered Rate as most recently published in the The Wall Street Journal (or, if such rate is no longer published in such publication, then as published in such comparable publication or derived from such other reputable source as may be selected by the University) during the last full calendar month preceding the date as of which such calculation is required to be made. (B) In the case of any other Variable Rate Debt, the interest payable on such Variable Rate Debt for any such future period shall be calculated on the assumption that the interest rate per annum on such Variable Rate Debt for such period will be equal to the average rate of interest per annum that was payable on such Variable Rate Debt

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during the period of twenty-four calendar months (or such shorter period during which such Variable Rate Debt has been outstanding) ending on the last day of the last full calendar month preceding the date as of which such calculation is required to be made; provided that if such Variable Rate Debt under consideration has not been incurred as of the date such calculation is required to be made, then the interest payable on such Variable Rate Debt for such future period shall be calculated on the assumption that the interest rate per annum for such future period will be equal to the numerical interest rate in effect or reasonably expected to be in effect on the date such Variable Rate Debt is incurred.

(ii) The principal and interest payable on any Balloon Debt for any such future period shall be calculated on the assumption that such Balloon Debt is amortized on a level debt service basis over a period of twenty-five years (or such shorter period as represents the weighted economic life of the assets being financed) from the date of incurrence of such Balloon Debt. Alternatively, if there exists a binding commitment from a financial institution rated at least “A2” by Moody's or “A” by S&P to pay such Balloon Debt upon maturity (whether at stated final maturity or any earlier date when such Balloon Debt must be paid or purchased in whole by the University) then, at the election of the University, such Balloon Debt may be assumed to mature and be payable in accordance with the terms of such commitment.

(iii) The principal and interest payable in respect of any Guaranteed Indebtedness for any future period shall be calculated on the following basis:

(A) If, for the last complete fiscal year of the person (other than the University) that is the primary obligor of such Guaranteed Indebtedness (such person being referred to herein as the "Primary Obligor"), the ratio of (1) the excess of (x) the unrestricted revenues of the Primary Obligor for such period, adjusted by subtracting realized and unrealized gains and losses on investments and pledges made by donors during such period but not actually collected during such period, over (y) all unrestricted operating and nonoperating expenses of the Primary Obligor for such period, less any depreciation, amortization, interest expense and loss or gain on extinguishment of debt included in unrestricted operating or nonoperating expenses during such period, all as determined in accordance with generally accepted accounting principles, to (2) the maximum amount of principal and interest on long-term indebtedness of the Primary Obligor payable or accruing in the then-current or any future fiscal year of the Primary Obligor, such long-term indebtedness of the Primary Obligor being subject to adjustment in the same manner as set forth in this definition of “Debt Service Requirement” with respect to Indebtedness of the University that is Variable Rate Debt, Balloon Debt, Derivative Indebtedness or Guaranteed Indebtedness, mutatis mutandis (such ratio for such last complete fiscal year being referred to herein as the "Primary Obligor Coverage Ratio"), as calculated by the University from the financial statements of the Primary Obligor for such fiscal year, exceeds 2 to 1, then only 25% of the guaranteed debt service payable on such Guaranteed Indebtedness during such future period shall be assumed to be payable by the University and included in any relevant calculation of Debt Service Requirements on Indebtedness of the University;

(B) If for the last complete fiscal year of the Primary Obligor, the Primary Obligor Coverage Ratio is 2 to 1 or less but greater than 1.5 to 1, then only 50% of the guaranteed debt service payable on such Guaranteed Indebtedness during such future period shall be assumed to be payable by the University and included in any relevant calculation of Debt Service Requirements on Indebtedness of the University;

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(C) If for the last complete fiscal year of the Primary Obligor, the Primary Obligor Coverage Ratio is less than or equal to 1.5 to 1 and greater than or equal to 1.25 to 1, then only 75% of the guaranteed debt service payable on such Guaranteed Indebtedness during such future period shall be assumed to be payable by the University and included in any relevant calculation of Debt Service Requirements on Indebtedness of the University; and

(D) If for the last complete fiscal year of the Primary Obligor, the Primary Obligor Coverage Ratio is less than 1.25 to 1, or if the University has been required to make any payment under the relevant Guaranty during any of the last three Fiscal Years of the University, then 100% of the guaranteed debt service payable on such Guaranteed Indebtedness during such future period shall be assumed to be payable by the University and included in any relevant calculation of Debt Service Requirements on Indebtedness of the University.

(iv) No debt service shall be deemed to be payable with respect to any Reimbursement Debt until such time as an amount is paid under the credit or liquidity facility or commitment that gave rise to such Reimbursement Debt, and from and after such funding the amount of such debt service shall be calculated in accordance with the actual amount required to be paid in connection with such Reimbursement Debt and the actual interest rate and principal amortization requirements, if any, applicable thereto.

(v) Derivative Indebtedness shall be deemed to bear interest for the period of time the relevant Interest Rate Hedge Agreement is in effect at a net rate that takes into account the interest payments made by the University on such Indebtedness and the net periodic payments made or received by the University on such Interest Rate Hedge Agreement, provided the long-term credit rating of the provider of such Interest Rate Hedge Agreement (or any guarantor thereof) is in one of the three highest rating categories of any Rating Agency (without regard to any refinements of gradation of rating category by numerical modifier or otherwise).

“Debt Service Reserve Fund” means the Debt Service Reserve Fund created pursuant to the Indenture.

“Debt Service Reserve Requirement” means, with respect to the 2017 Bonds Outstanding at any particular time, an amount equal to the lesser of (i) the Maximum Annual Debt Service Requirement on such 2017 Bonds, or (ii) 125% of the Average Annual Debt Service Requirement with respect to such 2017 Bonds, or (iii) zero dollars. In the event that any series of Additional Bonds are issued under this Indenture, the Debt Service Reserve Requirement with respect to such series of Additional Bonds shall have the following meaning: (a) in the event that any series of Additional Bonds is issued under this Indenture and either (i) immediately after the issuance of such series of Additional Bonds, such series of Additional Bonds will be the only series of Bonds then Outstanding under this Indenture or (ii) a separate account within the Debt Service Reserve Fund is established for such series of Additional Bonds or (iii) each other series of Bonds which will be Outstanding immediately after the issuance of such Bonds is secured by a separate account within the Debt Service Reserve Fund, then the Debt Service Reserve Requirement with respect to such series of Additional Bonds shall be as set forth in the Supplemental Indenture authorizing such series; and (b) in the event that any series of Additional Bonds is issued and (i) a separate account within the Debt Service Reserve Fund is not established for such series of Additional Bonds and (ii) there will be another series of Bonds Outstanding immediately after the issuance of such Additional Bonds that is not secured by a separate account within the Debt Service Reserve Fund, then the Debt Service Reserve Requirement as of any particular date of computation with respect to all Outstanding Bonds (including such Additional Bonds then being issued) as to which a separate account within the Debt Service Reserve Fund has not been established shall be an amount equal to (i) the lesser of (A) the Maximum Annual Debt Service Requirement on all such Outstanding Bonds or (B) one hundred twenty-five percent (125%) of the Average Annual Debt Service Requirement on all such Outstanding Bonds, or (C) ten percent (10%) of the principal amount of such Outstanding Bonds, or (ii) such greater amount as may be set forth in the Supplemental Indenture authorizing such series of Bonds.

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“Defeasance Securities” means and includes any of the following: (a) non-callable Direct Obligations and (b) Pre-Refunded Municipal Obligations.

“Derivative Indebtedness” shall mean any Indebtedness of the University with respect to which the University has entered into an Interest Rate Hedge Agreement.

“Directing Party” shall mean at any relevant time any Parity Obligee, or group of Parity Obligees acting together, holding at such time over fifty percent (50%) in amount of the Parity Obligations.

“Direct Obligations” means direct general obligations of, or obligations the payment of principal of and interest on which are fully and unconditionally guaranteed by, the United States of America (provided that the full faith and credit of the United States of America are pledged to any such direct obligation or guarantee), and including but not limited to “CATS,” “TIGRS” and “STRPS”.

“Event of Default” means, with respect to the Indenture, any of the events specified as such in the Indenture and means, with respect to the Loan Agreement, any of the events specified as such in the Loan Agreement, and means, with respect to the Collateral Agency Agreement, any event of default under and as defined in any Secured Party Document.

“Expendable Funds” of the University shall mean, with respect to the last day of any Fiscal Year of the University, (a) unrestricted net assets of the University as of such last day, plus (b) temporarily restricted net assets of the University as of such last day, minus (c) the sum of the land, building and equipment of the University at such time, net of accumulated depreciation and net of outstanding long term debt of the University at such time (including the current portion thereof), all as determined in accordance with Generally Accepted Accounting Principles.

“Expendable Funds Ratio” shall mean, as of the last day of each Fiscal Year of the University, the ratio (expressed as a percentage) of (a) the Expendable Funds of the University as of such last day, to (b) the aggregate principal amount of all outstanding Long-Term Debt of the University as of such last day, net of any debt service reserve funds on deposit with or pledged to the holders of such Long-Term Debt (or a trustee or agent for such holders or the issuer of a credit or liability enhancement facility for such holders.)

“Financial Covenant” shall mean covenant of the University set forth in the Loan Agreement with respect to Coverage Ratio A, Coverage Ratio B and the Expendable Funds Ratio.

“Financing Documents” shall mean the Loan Agreement, any Tax Compliance Agreement, the Shared Security Documents and any other documents, instruments and agreements to which the University is a party and which are related to any of the foregoing.

“Fiscal Year” means the fiscal year of the University ending on June 30 of each calendar year.

“Fund” means any fund created under the Indenture.

“Generally Accepted Accounting Principles” shall mean those accounting principles, not contrary to those promulgated by a nationally recognized financial standards body, applicable in the preparation of financial statements of nonprofit institutions of higher education.

“Government Obligations” means and includes any certificates or interest-bearing notes or obligations of the United States of America, or those for which the full faith and credit of the United States of America are pledged for the payment of principal and interest.

“Guaranteed Indebtedness” shall mean any indebtedness or obligation of another person that is supported by a particular Guaranty of the University.

“Historic Test Period” shall mean, at any particular time, the Fiscal Year of the University most recently ended prior to such time.

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“Guaranty” shall mean any direct or indirect guaranty or agreement of suretyship by the University that covers or secures any indebtedness or obligation of another person, which indebtedness or obligation of such other person would, if it were the direct indebtedness or obligation of the University, constitute “Indebtedness” of the University as defined in the Loan Agreement. In no event, however, shall any endorsements by the University of negotiable or other instruments for deposit or collection or similar transactions in the ordinary course of business be deemed to constitute a Guaranty for the purposes of the Loan Agreement.

“Indebtedness” shall mean, without duplication, all indebtedness of the University for borrowed money; all obligations of the University evidenced by bonds, debentures, notes or other similar instruments; all obligations of the University in respect of letters of credit or other similar instruments (or reimbursement obligations with respect thereto), including Reimbursement Debt; all obligations of the University to pay the deferred and unpaid purchase price of property or services, except trade payables and accrued expenses incurred in the ordinary course of business; all obligations of the University as lessee under Capital Leases; and all Guaranteed Indebtedness. For avoidance of doubt, Interest Rate Hedge Agreements shall not constitute Indebtedness.

“Independent” shall mean (a) in the case of an individual, a person who is not a member of the University Board or the Issuer Board and who is not an officer or employee of the Authority or the University, and (b) in the case of a partnership, corporation or association, one who does not have a partner, director, officer, member or substantial stockholder who is either a member of the University Board or the Issuer Board or an officer or employee of the Authority or the University; provided, however, that the fact that a person is retained regularly by or transacts business with the Authority or the University shall not make such person an employee within the meaning of this definition.

“Independent Public Accountant” shall mean any Independent accounting firm which is appointed by the University for the purpose of examining and reporting on or passing on questions relating to its financial statements and has all certifications necessary for the performance of such functions.

“Insurance Consultant” shall mean a person who shall be Independent, appointed by the University, qualified to survey risks and to recommend insurance coverage for higher educational facilities and services and organizations engaged in like operations as the University and having a favorable reputation for skill and experience in such surveys and such recommendations, and who may be a broker or agent with whom the University regularly transacts business, and if the University has coverage through a captive insurance company or a consortium, includes an Independent insurance consultant retained by such captive insurance company or consortium.

“Interest Rate Hedge Agreement” shall mean any interest rate swap, cap, floor, collar or other form of interest rate hedge or protection agreement.

“Investment Securities” means any of the following investments, if and to the extent the same are at the time legal for investment of the funds held under the Indenture:

(a) Government Obligations.

(b) Obligations issued or guaranteed by any of the following agencies (stripped securities are only permitted if they have been stripped by the agency itself): Federal Home Loan Bank System, Federal Home Loan Mortgage Corporation (participation certificates or senior debt obligations), Federal National Mortgage Association (mortgage-backed securities and senior debt obligations), Student Loan Marketing Association (senior debt obligations), Resolution Funding Corp., and Farm Credit System (consolidated system-wide bonds and notes).

(c) Certificates of deposit or deposit accounts issued by commercial banks, savings and loan associations or mutual savings banks, including the Trustee and its affiliates, which certificates of deposit, to the extent not insured by the Federal Deposit Insurance Corporation, are secured at all times as required by applicable law.

(d) Certificates of deposit, including those placed by a third party pursuant to an agreement between the Trustee and the University, savings accounts, demand deposit accounts, trust funds, trust accounts,

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deposit accounts, or money market deposits, in each case which are fully insured by the Federal Deposit Insurance Corporation.

(e) Federal funds or bankers acceptances with a maximum term of one year of any bank, including the Trustee and its affiliates, which has an unsecured, uninsured and unguaranteed obligation rating of “P-1” or “A3” or better by Moody’s and “A-1” or “A” or better by S&P.

(f) Obligations of a state, a territory, or a possession of the United States, or any political subdivision of any of the foregoing, or of the District of Columbia, if such obligations are rated by Moody’s and S&P in one of the two highest rating categories assigned by such rating agencies.

(g) Commercial paper rated, at the time of purchase, not less than “P-1” by Moody’s and “A-1” by S&P.

(h) Any money market fund registered under the Investment Company Act of 1940, as amended, whose shares are registered under the Securities Act of 1933, as amended, and having a rating by S&P of “AAAm-G”, “AAA-m”, or “AA-m” and if rated by Moody’s rated “Aaa”, “Aa1” or “Aa2”, including, without limitation, any mutual fund for which the Trustee or an affiliate of the Trustee serves as investment manager, administrator, shareholder servicing agent, and/or custodian or subcustodian, notwithstanding that (i) the Trustee or an affiliate of the Trustee receives fees from such funds for services rendered, (ii) the Trustee charges and collects fees for services rendered pursuant to this Indenture, which fees are separate from the fees received from such funds, and (iii) services performed for such funds and pursuant to this Indenture may at times duplicate those provided to such funds by the Trustee or its affiliates.

(i) Investment or repurchase agreements with, or which are guaranteed by, a financial institution which has an unsecured, uninsured and unguaranteed obligation rated, at the time such agreement is entered into, in one of the three highest rating categories by Moody’s or S&P, or is the lead bank of a parent bank holding company with an uninsured, unsecured and unguaranteed obligation meeting such rating requirements, including any affiliate of the Trustee provided (i) interest is paid at least semi-annually at a fixed rate during the entire term of the agreement, consistent with the relevant Interest Payment Dates, (ii) moneys invested thereunder may be withdrawn for any purpose required under this Indenture without any penalty, premium or charge upon not more than seven day’s notice (provided such notice may be amended or cancelled at any time prior to the withdrawal date), (iii) the agreement is not subordinated to any other obligations of such financial institution or bank, (iv) the same guaranteed interest rate will be paid on any future deposits permitted to be made under such investment agreement, and (v) the Trustee receives an opinion of counsel that such agreement is an enforceable obligation of such financial institution or bank.

(j) Any other investment expressly approved in writing by each Credit Facility Issuer.

“Issuer Board” shall mean the governing board of the Authority.

“Issuer’s Unassigned Rights” means all rights of the Authority (a) to receive certain payments of fees and expenses pursuant to the Loan Agreement; (b) to be indemnified by the University pursuant to the Loan Agreement; and (c) to give or withhold consents and approvals to the extent such rights are reserved to the Authority under any provision of the Loan Agreement.

“Lien” shall mean any mortgage, deed of trust, pledge, lien, security interest or other security arrangement of any nature whatsoever, including but not limited to any conditional sale or title retention arrangement, or any assignment, deposit arrangement or lease intended as, or having the effect of, security.

“Long-Term Debt” shall mean all Indebtedness with a stated term to maturity (regardless of any rights or requirements of the holder thereof to tender all or any portion of such Indebtedness for purchase or redemption prior to the stated maturity thereof) greater than one year or with a term to maturity that may be extended beyond one year at the option of the University. Subordinated Indebtedness and Non-Recourse Debt shall not be treated as Long-Term Debt for purposes of the calculation of the Financial Covenant at any time or for

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purposes of calculating compliance with any of the tests for incurring additional Long-Term Debt set forth in the Loan Agreement (except as may be otherwise expressly set forth therein).

“Long-Term Parity Debt” shall mean any Long-Term Debt of the University that constitutes a Parity Obligation.

“Majority Credit Facility Issuers” means, at any particular time, such Credit Facility Issuer or group of Credit Facility Issuers which has or have issued a Credit Facility or Credit Facilities securing at least a majority in aggregate principal amount of the Credit-Enhanced Bonds Outstanding at such time. For the purpose of this definition, any Credit-Enhanced Bonds secured by a Credit Facility issued by a Credit Facility Issuer as to which, at the time in question, a Credit Facility Issuer Adverse Change has occurred and remains continuing, shall be disregarded.

“Maximum Annual Debt Service Requirement” means with respect to any Bonds or other Indebtedness under consideration, as of the relevant date of any calculation thereof, the highest Debt Service Requirement in the current or any subsequent Fiscal Year on the Bonds or Indebtedness scheduled to be outstanding (or Outstanding, in the case of Bonds) at the time of such calculation, provided that solely for purposes of computing compliance with the tests for incurring additional Indebtedness of the University set forth in the Loan Agreement, there may be subtracted from the Debt Service Requirement during the final year of any such Bonds or Indebtedness any amounts held in a debt service reserve fund established or held for such Bonds or Indebtedness that are reasonably expected to be available for the payment of such Debt Service Requirement.

“Moody’s” means Moody’s Investors Service, Inc., a corporation organized and existing under the laws of the State of Delaware, its successors and assigns, and if such corporation shall for any reason no longer perform the functions of a securities rating agency, “Moody’s” shall be deemed to refer to any other nationally recognized securities rating agency designated in writing by the University. Whenever rating categories of Moody’s are specified in the Indenture or the Loan Agreement, such categories shall be irrespective of any refinements or gradations within a category (whether by numerical modifier or otherwise) unless otherwise expressly provided in the Indenture.

“Nationally Recognized Bond Counsel” means any Counsel nationally recognized as experienced in matters pertaining to the issuance of debt obligations by governmental bodies.

“Net Revenues Available for Debt Service” shall mean, for any period, the sum of (a) the increase in unrestricted net assets from operations of the University for such period, exclusive of (i) any realized or unrealized gain or loss on investments for such period and (ii) any losses from the early extinguishment of indebtedness allocable to such period, plus (b) the amount of depreciation expense, interest expense, amortization expense and any other non-cash operating expenses or charges of the University for such period, all as determined in accordance with Generally Accepted Accounting Principles.

“Non-Recourse Debt” shall mean Indebtedness incurred or assumed by the University to finance (a) the acquisition of equipment, which debt is not a general obligation of the University and is secured solely by a Lien on the equipment acquired with the proceeds of the debt; or (b) the construction or acquisition of any other real property, buildings, improvements or fixtures, which debt is not a general obligation of the University and is secured solely by revenues derived from the operation or sale of the financed property and/or a Lien on the financed property and not by a lien on any Shared Collateral.

“Outstanding”, in connection with any Bonds, means, as of the time in question, all such Bonds authenticated and delivered under the Indenture, except (a) Bonds theretofore canceled or required to be canceled under certain provisions of the Indenture; (b) Bonds for the payment or redemption of which the necessary amount shall have been or shall concurrently be deposited with the Trustee or for which provision for the payment of which shall have been made in accordance with the defeasance provisions of the Indenture; provided, that if such Bonds are being redeemed prior to maturity, the required notice of redemption shall have been given or provision satisfactory to the Trustee shall have been made therefor; and (c) Bonds in substitution for which other Bonds have been authenticated and delivered pursuant to the Indenture. Bonds paid with the proceeds of any Credit Facility

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shall be Outstanding until the Credit Facility Issuer has been reimbursed for the amount of the payment or has presented such Bonds for cancellation.

“Periodic Scheduled Payments” with respect to any Interest Rate Hedge Agreement shall mean the net periodic payments scheduled to be made by the University to the counterparty thereunder with reference to the notional amount thereof, but shall not include any Termination Payments.

“Permitted Encumbrances” shall mean, with respect to any property of the University, as of any particular time, the following:

(a) Liens on the Shared Collateral in favor of the Collateral Agent to secure any Parity Obligations;

(b) Liens on moneys, funds and accounts held by or for the Trustee under the Indenture to secure any Bonds and Liens on moneys, funds and accounts held by or for any other trustee under any other indenture of trust securing any other bonds or notes issued by or for the benefit of the University;

(c) Liens for ad valorem taxes, special assessments and other governmental charges not then delinquent or being contested in good faith;

(d) Such minor defects, encroachments, irregularities, easements, rights-of-way and clouds on title as normally exist with respect to properties similar in character to the University Facilities and do not in the aggregate, in the opinion of Counsel to the University or in the opinion of a Consultant, materially impair the ability of the University to meet its payment obligations in respect of Indebtedness of the University;

(e) Any Lien arising by reason of good faith deposits by the University in connection with leases of real estate, bids or contracts (other than contracts for the payment of money), deposits by the University to secure public or statutory obligations, or to secure, or in lieu of, surety, stay or appeal bonds, and deposits as security for the payment of taxes or assessments or other similar charges;

(f) Any Lien arising by reason of deposits with, or the giving of any form of security to, any governmental agency or any body created or approved by law or governmental regulation for any purpose as required by law or regulation (i) as a condition to the transaction of any business or the exercise of any privilege or license, or (ii) to enable the University to maintain self-insurance or to participate in any funds established to cover any insurance risks or in connection with worker’s compensation, unemployment insurance, or pension or profit sharing plans or other social security plans or programs, or to share in the privileges or benefits required for companies participating in such arrangements;

(g) Any judgment lien against the University, so long as the finality of such judgment is being contested and execution thereon is stayed and (i) provision for payment of the judgment has been made in accordance with applicable law or by the deposit of cash or investments with a commercial bank or trust company or (ii) adequate insurance coverage is available to satisfy such judgment;

(h) Any mechanic’s, laborer’s, materialman’s, supplier’s or vendor’s lien or right in respect thereof if payment is not yet due under the contract in question or if such lien is being contested in good faith;

(i) Any zoning laws and similar restrictions which are not violated by the property affected thereby;

(j) Any right, title and interest of the state, municipalities and the public in and to tunnels, bridges and passageways over, under or upon a public way;

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(k) Any Lien on property received by or pledged to the University in connection with gifts, grants or bequests, such lien or encumbrance being due to restrictions on such gifts, grants or bequests or property or income thereon;

(l) Any lien on property (other than real estate) in the nature of a purchase money security interest resulting from installment sale agreements or borrowings, financing leases or similar agreements relating to the acquisition of property, or liens of a lessee or a vendee on the property being leased or sold under a lease, installment sale or similar agreement;

(m) Liens permitted as described under “SUMMARY OF CERTAIN PROVISIONS OF THE LOAN AGREEMENT – Security for Permitted Indebtedness” in this Appendix C;

(n) Any Liens existing on any property of a person at the time such person is merged or consolidated with or into the University, provided that (i) such Liens are not extended to other property of the University or otherwise extended or renewed, unless such Liens as so extended or renewed otherwise qualify as Permitted Encumbrances under the Loan Agreement, (ii) no additional Indebtedness may be thereafter incurred that is secured by such Liens unless such Liens are otherwise permitted under Section 8.04 hereof, and (iii) such Liens were not created in order to avoid the limitations contained herein on the impositions of Liens on the property of the University;

(o) Any Lien existing on any property at the time of the acquisition thereof by the University, provided that (i) such Liens are not extended to other property of the University or otherwise extended or renewed, unless such Liens as so extended or renewed otherwise qualify as Permitted Encumbrances under the Loan Agreement; (ii) no additional Indebtedness may be thereafter incurred that is secured by such Liens unless such Liens are otherwise permitted under the Loan Agreement, and (iii) such Liens were not created in order to avoid the limitations contained herein on the impositions of Liens on the property of the University; and

(p) Liens existing on the date of the Loan Agreement.

“Obligations” shall mean all Parity Obligations and all Collateral Agent Obligations.

“Parity Obligations” shall mean all obligations of the University from time to time arising under or in connection with or related to or evidenced by or secured by the Loan Agreement and any other Secured Party Documents, in each case together with any and all extensions, renewals or refinancings thereof, whether such obligations are direct or indirect, otherwise secured or unsecured, joint or several, absolute or contingent, due or to become due, whether for payment or performance, now existing or hereafter arising (specifically including but not limited to obligations arising or accruing after the commencement of any bankruptcy, insolvency or similar proceedings with respect to the University, or which would have arisen or accrued but for the commencement of such proceeding, even if the claim for such obligation is not allowed in such proceeding under applicable law). Whenever for the purposes of determining the "Directing Party" under the Collateral Agency Agreement it is necessary to determine the amount of Parity Obligations owing to any Secured Party at any particular time, (a) such amount shall be the amount of principal, accrued interest and other accrued payment obligations (including without limitation any reimbursement obligations owing in respect of payments made under a letter of credit) at the time owing by the University to such Secured Party; (b) in the case of any Parity Obligations in the form of contingent reimbursement obligations in respect of an undrawn irrevocable letter of credit or similar irrevocable commitment or guaranty issued by the relevant Parity Obligee for the account of the University, the amount of Parity Obligations with respect thereto shall be deemed to include the amount of all such contingent reimbursement obligations that will become absolute upon any payment under such letter of credit, commitment or guaranty as certified by the relevant Parity Obligee to the Collateral Agent; (c) where one Parity Obligee (the "Guarantor Parity Obligee") has issued an irrevocable letter of credit, irrevocable commitment, guaranty or other similar assurance of payment to or for the benefit of another Parity Obligee (the "Guaranteed Parity Obligee") to secure the payment of all or a portion of any Parity Obligations owing to the Guaranteed Parity Obligee (the "Guaranteed Parity Obligations"), that portion of the Guaranteed Parity Obligations covered by such letter of credit, commitment, guaranty or other assurance of payment shall not be counted; and (d) in the case of any Parity Obligations in the form of interest rate swap agreements or similar derivatives or hedging agreements between the University and another counterparty, the

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amount of Parity Obligations with respect thereto on at any particular date shall be the amount of the net accrued payment obligations (other than any termination payment due upon any early termination of such agreement) at the time owing by the University to such Secured Party.

“Parity Obligees” shall mean the Authority, the Trustee, and each Additional Parity Obligee.

“Person” or “person” means an individual, a corporation, a partnership, an association, a joint stock company, a trust, an unincorporated organization, a limited liability company or partnership, a municipality or a government or a political subdivision thereof.

“Pre-Refunded Municipal Obligations” means any bonds or other obligations of any state of the United States of America or of any agency, instrumentality or local governmental unit of any such state which are not callable at the option of the obligor prior to maturity or as to which irrevocable instructions have been given by the obligor to call on a date certain specified in such instructions, and (a) which are rated, based on the escrow described below, in the highest rating category of S&P and Moody's, and (b) which are fully secured as to principal and interest and redemption premium, if any, by an escrow fund consisting only of cash or Government Obligations, which escrow fund may be applied only to the payment of such principal of and interest and redemption premium, if any, on such bonds or other obligations on the maturity date or dates thereof or the specified redemption date or dates pursuant to such irrevocable instructions, as appropriate, and which escrow fund is sufficient, as verified by a nationally recognized firm of independent public accountants, to pay principal of and interest and redemption premium, if any, on such bonds or other obligations on the maturity date or dates thereof or on the redemption date or dates specified in the irrevocable instructions referred to above, as appropriate.

“Principal Office” means (a) with respect to the Trustee, its office currently located at 1735 Market Street, 9th Floor, Philadelphia, PA 19103, or such other address as the Trustee may designate in writing to the University and the Authority from time to time as its “Principal Office” for any purposes of this Indenture; and (b) with respect to any other person, such office the location of which is designated by such person in writing to the Trustee, the Authority and the University at any time.

“Project” means and includes the “Project” to be financed with the 2017 Bonds as described in the forepart of this Official Statement and any lawful undertaking of the Authority or the University which may be designated in a Supplemental Indenture as a “Project” to be financed in whole or in part with Bonds issued under the Indenture.

“Project Facilities” means the real or personal property of the University financed or refinanced with the proceeds of any Bonds issued under the Indenture.

“Project Fund” means the Project Fund created under the Indenture.

“Rating Agency” means Moody’s, S&P, or any other nationally-recognized securities rating agency, if and to the extent that any such entity has issued and maintains a rating on any of the Bonds at the request of the University. If any such Rating Agency shall no longer perform the functions of a securities rating service for whatever reason, the term “Rating Agency” shall thereafter be deemed to refer to the others, but if all of the others shall no longer perform the functions of a securities rating service for whatever reason, the term “Rating Agency” shall thereafter be deemed to refer to any other nationally recognized rating service or services as shall be designated in writing by the University to the Trustee. Whenever rating categories of a particular Rating Agency are specified in the Indenture, such categories shall be irrespective of any refinements or gradations within a category unless otherwise expressly provided in the Indenture.

“Rebate Fund” means the Rebate Fund created under the Indenture.

“Reimbursement Debt” shall mean any obligation or liability of the University to reimburse or repay any person for a payment made by that person under a letter of credit or other form of credit or liquidity enhancement facility or commitment issued by that person for the account of the University to secure any other Indebtedness of the University permitted under the terms of the Loan Agreement.

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“Revenues” means all moneys payable by the University under the Loan Agreement in respect of the principal of, premium if any, and interest on the Bonds, and any other moneys held by the Trustee under the Indenture and available to pay the principal of, premium if any, and interest on the Bonds, including without limitation the proceeds of any Shared Collateral received by the Trustee; provided, however, that such term shall not include amounts paid (a) on account of the Issuer’s Unassigned Rights or (b) to or for the account of the Trustee for its fees or expenses or for the purpose of indemnifying the Trustee under the Indenture and under the terms and provisions of the Loan Agreement.

“Secured Parties” shall mean the Collateral Agent and the Parity Obligees.

“Secured Party Documents” shall mean the Loan Agreement, each Additional Parity Debt Agreement and each Shared Security Document.

“S&P” means S&P Global Ratings, a division of Standard & Poor’s Financial Services LLC, and its successors, and if such entity shall for any reason no longer perform the functions of a securities rating agency, “S&P” shall be deemed to refer to any other nationally recognized securities rating agency designated in writing by the University. Whenever rating categories of S&P are specified in the Indenture or the Loan Agreement, such categories shall be irrespective of any refinements or gradations within a category (whether by numerical modifier or otherwise) unless otherwise expressly provided in the Indenture.

“Shared Collateral” shall mean the collateral from time to time subject to or intended or purported to be subject to a Lien in favor of the Collateral Agent under the Shared Security Documents.

“Shared Security Documents” shall mean the Collateral Agency Agreement, the Security Agreement and any other agreements or instruments from time to time granting or purporting to grant the Collateral Agent a Lien in any property for the benefit of the Secured Parties to secure the Obligations, or constituting a guaranty for the Obligations, or subordinating any obligation to the Obligations.

“Short-Term Debt” shall mean all Indebtedness of the University other than Long-Term Debt.

“Subordinated Indebtedness” has the meaning given to that term under “SUMMARY OF CERTAIN PROVISIONS OF THE LOAN AGREEMENT - Security for Permitted Indebtedness” below.

“Supplemental Indenture” means any indenture of the Authority amending or supplementing the Indenture for any purpose, in accordance with the terms of the Indenture.

“Tax Compliance Agreement” means any agreement executed by the Authority and the University regarding compliance with provisions of the Code to assure that interest on any Tax-Exempt Bonds is excludable from the gross income of the holders thereof for federal income tax purposes.

“Tax-Exempt Bonds” mean any Bonds the interest on which is intended to be excludable from the gross income of the holders thereof for federal income tax purposes.

“Termination Payments” with respect to any Interest Rate Hedge Agreement shall mean the net amount payable by the University to the counterparty thereof upon any early termination thereof.

“2017 Bonds” means the Authority’s Revenue Bonds (Cabrini University), Series of 2017.

“2017 Term Bonds” means the 2017 Bonds maturing on July 1, 2037, July 1, 2042 and July 1, 2047.

“2017 Bonds Sinking Fund Account” shall mean the account of such name within the Bond Fund created pursuant to the Indenture.

“University Board” shall mean the then legally constituted governing board of the University vested with the power of management of the University or a duly authorized committee thereof.

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“University Facilities” shall mean and include at any particular time (a) all Project Facilities and (b) all other land, buildings, structures, real estate and any appurtenant facilities and fixtures owned or leased by the University that are part of the University’s main campus in Radnor Township, Delaware County, Pennsylvania as of the date of the Loan Agreement.

“Unrestricted Revenues” shall mean and include all receipts, revenues, rentals, income and other moneys held, received or receivable by or on behalf of the University from any source, including, without limitation, all operating and non-operating revenues, and all rights to receive the same whether in the form of accounts, contract rights, chattel paper, instruments or general intangibles, and the proceeds thereof (whether cash or non-cash), including the proceeds of any insurance coverages on and condemnation awards in respect of any portion of the University’s facilities and any gain on the sale or other disposition of property of the University and all gifts, grants, bequests, donation and contributions, in each case whether now owned or held or hereafter acquired by the University, but excluding, however, any gifts, grants, bequests, donations and contributions, and the income and gains derived therefrom, that are designated at the time of making by the donor as being for specific purposes inconsistent with the payment of debt service on indebtedness of the University.

“Variable Rate Debt” shall mean any Indebtedness the interest on which is expressed to be calculated at a varying rate, a formula rate, a fixed rate per annum based on a varying index, or which otherwise does not bear a fixed rate of interest to maturity.

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SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE

General

The Indenture provides for the issuance of and security for the 2017 Bonds and all other terms pertaining to the 2017 Bonds.

Pledge of Trust Estate

Under the Indenture, the Authority sells, assigns, transfers, sets over and pledges unto the Trustee, and to its successors in the trust and their assigns forever, and grants to the Trustee and to such successors and assigns a continuing security interest in, all of the right, title and interest of the Authority in and to the Loan Agreement, including but not limited to all payments due the Authority under the Loan Agreement (except for or in respect of the Issuer’s Unassigned Rights), and in and to all moneys, instruments, securities and funds at any time held by the Trustee pursuant to the provisions of the Indenture (except such as may be held in the Rebate Fund and as otherwise expressly provided in the Indenture) and all other Revenues, in trust, nevertheless, for the equal and ratable benefit and security of all present and future holders of the Bonds issued and to be issued under the Indenture, without preference, priority or distinction (except as expressly provided in the Indenture), of any one Bond over any other Bond, upon the terms and subject to the conditions set forth in the Indenture.

Project Fund

There is created and established with the Trustee a trust fund to be designated with respect to the Authority and the University as the “Project Fund.” There shall be paid into the Project Fund the amounts required to be so paid by or pursuant to the provisions of the Indenture, including without limitation any amounts representing the proceeds of the issuance and sale of Bonds as the Authority may specify. At the written direction of the Authority or the University at any time (whether such direction is contained in a Supplemental Indenture or otherwise), the Trustee shall establish separate accounts or subaccounts within the Project Fund with respect to separate Projects or separate series of Bonds or separate sources of funds and shall administer the Project Fund accordingly.

Amounts in the Project Fund shall be applied only to pay the Costs properly attributable to the Projects in respect of which any Bonds are issued under the Indenture. Investment earnings from the investment of moneys held in the Project Fund shall be expended at any time or from time to time to pay Costs of the Projects in the same manner as the proceeds of Bonds or other moneys deposited in the Project Fund are expended.

The Trustee shall make payments from the Project Fund upon receipt of a written requisition from the University stating:

(a) the nature of the payments and the particular Project and series of Bonds (and, if appropriate, the particular account or subaccount within the Project Fund) to which such requisition relates;

(b) the payee, which may include the University in the case of work furnished by the University and in the case of reimbursement for payments previously made or expenses previously incurred by the University on account of the Cost of the Project, and which may include the Trustee in the case of a payment of interest on any Bonds;

(d) that the payment constitutes a proper Cost of the Project and a proper use of the proceeds of the relevant series of Bonds pursuant to any relevant Tax Compliance Agreement; and

(e) that no Event of Default under the Indenture has occurred and is continuing and that there exists no event or condition which, with the giving of notice or the lapse of time or both, would constitute an Event of Default.

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The University shall have the right to enforce payments from the Project Fund upon compliance with the procedures set forth in the Indenture, provided, however, that during the continuance of an Event of Default of which the Trustee is required to take or is deemed to have notice pursuant to the Indenture, the University shall not be entitled to any payments from the Project Fund, and the Project Fund shall be held for the benefit of the Bondholders in accordance with the provisions of the Indenture.

When all Projects the Costs of which are to be paid in whole or in part from the proceeds of any series of Bonds in the Project Fund shall have been completed and the certificate of the University with respect thereto required by the Loan Agreement (the “Completion Certificate”) shall have been filed with the Authority and the Trustee, the balance of any proceeds of such series of Bonds and investment earnings thereon remaining in the Project Fund in excess of any amount to be reserved in the Project Fund for payment of unpaid items of the Cost of such Projects shall be applied as directed in writing by the University and approved in an opinion of Nationally Recognized Bond Counsel delivered to the Authority and the Trustee, which opinion shall be to the effect that such application is permitted under the Act and will not adversely affect the exclusion of interest on any Tax-Exempt Bonds from the gross income of the holders thereof for Federal income tax purposes.

Bond Fund

There is created and established with the Trustee a trust fund to be designated with respect to the Authority and the University as the “Bond Fund.” Within the Bond Fund, there is created and established with the Trustee, with respect to the 2017 Bonds, a separate account to be designated as the “2017 Bonds Sinking Fund Account”. At the written direction of the Authority or the University at any time (whether such direction is contained in a Supplemental Indenture or otherwise), the Trustee shall establish additional separate accounts or subaccounts within the Bond Fund with respect to separate series of Bonds and shall administer the Bond Fund accordingly.

There shall be deposited in the Bond Fund, as and when received by the Trustee, all payments under the Loan Agreement in respect of the principal or redemption price of or interest on the Bonds and all other moneys received by the Trustee which are required, or which are accompanied by directions that such moneys are, to be paid into the Bond Fund, or which are otherwise intended to be applied to the payment of the principal or redemption price of or interest on the Bonds. The Trustee shall, without further direction from the Authority, make available to the paying agent from the Bond Fund sufficient amounts to pay the principal and mandatory sinking fund installments of and premium, if any, and interest on the Bonds as the same become due and payable. Any amount deposited into the Bond Fund with respect to any series of Bonds representing accrued interest, if any, on such series of Bonds paid by the initial purchasers thereof, or representing capitalized interest in respect of such series of Bonds funded out of the proceeds thereof shall, until such moneys are exhausted, be applied to pay the interest coming due on the related series of Bonds on the next succeeding Interest Payment Dates therefor prior to any other source of funds.

The Trustee shall establish the 2017 Bonds Sinking Fund Account as a part of the Bond Fund as a sinking fund for the retirement of 2017 Term Bonds. Moneys deposited in the 2017 Bonds Sinking Fund Account shall be held by the Trustee for the sole benefit of the holders of 2017 Term Bonds and shall be applied as hereinafter provided. The Trustee shall establish such other sinking fund accounts for series of Additional Bonds as may be directed in the respective Supplemental Indentures authorizing such series of Additional Bonds.

The 2017 Term Bonds are subject to mandatory sinking fund redemption on the dates and in the amounts set forth in this Official Statement under “THE BONDS - Redemption Prior to Maturity- Mandatory Sinking Fund Redemption.” The Trustee shall transfer moneys from the Bond Fund to the 2017 Bonds Sinking Fund Account in the amounts required to retire the 2017 Term Bonds on the dates and in the amounts so described. If 2017 Term Bonds of any particular maturity are redeemed by optional redemption at any time, the principal amount of such 2017 Term Bonds of such maturity redeemed pursuant to such optional redemption shall be credited against the mandatory redemption requirements for such maturity of such 2017 Term Bonds in such manner as the University shall determine and specify in writing to the Trustee or, in the absence of such written direction from the University, in the inverse order of such mandatory redemption requirements.

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Debt Service Reserve Fund

(a) There is created and established with the Trustee a trust fund to be designated with respect to the Authority and the University as the “Debt Service Reserve Fund.” The Debt Service Reserve Fund shall be required to be funded at all times in an amount equal to the relevant Debt Service Reserve Requirement relating to each series of Bonds Outstanding from time to time, as hereinafter provided. Specifically, if a separate account within the Debt Service Reserve Fund has been established for a particular series of Bonds, the separate account established for such series of Bonds shall be required to be funded at all times in an amount equal to the Debt Service Reserve Requirement for such series of Bonds, and the portion of the Debt Service Reserve Fund which is not in any such separate account shall be required to be funded at all times in an amount equal to the aggregate Debt Service Reserve Requirement for all series of Bonds with respect to which a separate account within the Debt Service Reserve Fund has not been established. The Debt Service Reserve Fund may be funded by any combination of cash or Investment Securities.

(b) A separate account is created within the Debt Service Reserve Fund with respect to the 2017 Bonds, but no deposit to such separate account shall be made and the Debt Service Reserve Requirement for the 2017 Bonds is zero. Concurrently with the issuance of any series of Additional Bonds, (i) if a separate account within the Debt Service Reserve Fund has been established for that series of Additional Bonds, there shall be deposited into that separate account an amount equal to the Debt Service Reserve Requirement for such series of Additional Bonds, or (ii) if a separate account within the Debt Service Reserve Fund has not been established for that series of Additional Bonds, the balance in the portion of the Debt Service Reserve Fund which is not in any such separate account shall be increased or otherwise adjusted to an amount equal to the Debt Service Reserve Requirement with respect to all Bonds then to be Outstanding (including the Additional Bonds then being issued) as to which a separate account within the Debt Service Reserve Fund has not been established. If a separate account within the Debt Service Reserve Fund is created for any series of Additional Bonds as aforesaid, the assets from time to time credited to such account shall secure only the related series of Bonds and not any other series of Bonds, but the assets within the Debt Service Reserve Fund which are not in such separate account shall not secure that series of Bonds.

(c) If, on the date of any permitted or required payment of principal of or interest on any series of Bonds, moneys in the Bond Fund are insufficient to make such payment, moneys in the Debt Service Reserve Fund or a separate account thereof allocable to such series shall be withdrawn and applied to cure the deficiency. The amount of any such withdrawal shall be restored to the Debt Service Reserve Fund in twenty-four (24) substantially equal monthly deposits (which may be prepaid in whole or in part by the University at any time), commencing with the calendar month next following the date of the withdrawal, from payments required to be made by the University for such purpose under the Loan Agreement.

(d) Except to the extent paragraph (c) above applies, if with respect to any series of Bonds at the time of any required valuation of the assets in the Debt Service Reserve Fund, the sum of (i) the amount of any cash on deposit to the credit of the Debt Service Reserve Fund allocable to such series, plus (ii) the value of any Investment Securities on deposit to the credit of the Debt Service Reserve Fund allocable to such series, equals an amount which is less than the Debt Service Reserve Requirement with respect to such series, the Trustee shall promptly notify the University in writing, and such deficiency shall be eliminated in twenty-four (24) substantially equal monthly deposits (which may be prepaid by the University at any time), commencing with the calendar month next following the date the Trustee notifies the University of the deficiency, from payments required to be made by the University for such purpose under the Loan Agreement. If such sum exceeds the relevant Debt Service Reserve Requirement, the Trustee shall promptly notify the University and shall transfer such excess to either the Project Fund, the Bond Fund or the Rebate Fund, as may be directed in writing by the University, and in the absence of any such written direction from the University, the Trustee shall transfer such excess to the Bond Fund. For purposes of this paragraph (d), in the case of a series of Bonds with respect to which a separate account within the Debt Service Reserve Fund has not been established, references to the Debt Service Reserve Requirement with respect to such a series of Bonds shall mean the aggregate Debt Service Reserve Requirement for all such series as to which a separate account within the Debt Service Reserve Fund has not been established, and references to amounts allocable to such a series shall mean the aggregate amount allocable to all such series.

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(e) Unless otherwise specified in a Supplemental Indenture with respect to any series of Additional Bonds, all investment earnings derived from funds on deposit in the Debt Service Reserve Fund shall be retained or transferred, as applicable, in the following order and priority:

(i) the Trustee shall retain in the Debt Service Reserve Fund the amount necessary to eliminate any deficiencies therein; and

(ii) the Trustee shall transfer any remaining amount in the manner specified in paragraph (d) above with respect to excess funds in the Debt Service Reserve Fund.

Rebate Fund

Amounts shall be deposited in the Rebate Fund in order to comply with rebate requirements of Section 148 of the Code and shall not be subject to any security interest, pledge, assignment, lien or charge in favor of the Trustee, any Bondholder or any other Person. The provisions of the Indenture regarding the Rebate Fund may be amended upon receipt by the Trustee and the Authority of an opinion of Bond Counsel that such amendment will not adversely affect the tax-exempt status of interest on any Tax-Exempt Bonds. Under the Indenture, the University is generally required, with the cooperation of the Trustee in providing certain information, to determine the arbitrage rebate amount owing from time to time to the United States under Section 148 of the Code and to cause such rebate amount to be deposited into the Rebate Fund for payment to the United States in a timely manner.

Investment or Deposit of Funds

The Trustee shall, at the written request and direction of an Authorized University Representative as to specific investments, invest balances in any Fund not needed for immediate application in Investment Securities; provided, that all Investment Securities shall mature or be subject to redemption or withdrawal by the holder at not less than the principal amount thereof or the cost of acquisition, whichever is lower, not later than the date when the amounts will foreseeably be needed for purposes of the Indenture. Subject to the limitations on investment contained in the Indenture, the University shall have the right to specify to the Trustee the precise nature of any investments of balances in any Fund not needed for immediate application. The Trustee may conclusively rely on the direction of the Authorized University Representative as to both the legality and suitability of the directed investment. The Trustee shall value the investments credited to each Fund under the Indenture no less frequently than quarterly, and in any event within 30 days prior to the settlement date for each series of Additional Bonds, and shall promptly after each such valuation send a written report of such valuation to the University. The value of such investments shall be determined as follows:

(a) for securities:

(1) such value shall be computed on the basis of the bid price last quoted by the Federal Reserve Bank of New York on the valuation date and printed in the Wall Street Journal or the New York Times; or

(2) such value shall be determined through a valuation performed by a nationally recognized and accepted pricing service whose valuation method consists of the composite average of various bid price quotes on the valuation date; or

(3) such value shall be the lower of two dealer bids on the valuation date, and the dealers or their parent holding companies must be rated at least investment grade by S&P and Moody’s and must be market makers in the securities being valued; and

(b) for certificates of deposit and banker’s acceptances, such value shall be the face amount thereof, plus accrued interest; and

(c) for repurchase agreements and investment agreements, such value shall be the principal amount thereof, plus accrued interest.

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All investments made with the balances in any Fund shall be deemed part of such Fund. The interest and income received upon such investments and any profit or loss resulting from any investment shall be added or charged to such Fund, except as otherwise expressly provided in the Indenture. The Trustee shall sell and reduce to cash a sufficient amount of investments belonging to a particular Fund whenever the cash balance in such Fund is insufficient for the purposes of such Fund. Neither the Authority nor the Trustee shall be responsible or liable for any loss suffered in connection with any investment of funds made by it at the written request and direction of an Authorized University Representative (including without limitation any loss suffered on a liquidation of investments pursuant to the immediately preceding sentence) or for whether any such investment is an Investment Security. Ratings of investments shall be determined at the time of purchase of such investments and without regard to ratings subcategories. The Trustee shall have no responsibility to monitor the ratings of investments after the initial purchase of such investments. In the absence of written investment instructions from an Authorized University Representative, the Trustee shall not be responsible or liable for keeping the moneys held by it under the Indenture fully invested.

Events of Default and Remedies

Each of the following events constitutes an Event of Default under the Indenture:

(a) If payment of the principal or redemption price or premium, if any, of any Bond is not made or provided for when it becomes due and payable at maturity or upon call for mandatory redemption; or

(b) If payment of any installment of interest on any Bond is not made or provided for when it becomes due and payable; or

(d) If the University or the Authority shall file a voluntary petition under any bankruptcy or insolvency law; or if a petition under any bankruptcy or insolvency law is filed against the Authority or the University and is not discharged by a court of competent jurisdiction within 60 days of the date of such filing; or if the Authority or the University shall be adjudicated as a bankrupt; or if the Authority or the University makes any assignment for the benefit of creditors; or if the Authority or the University enters into any agreement or composition with its creditors; or if by final order, judgment or decree of a court of competent jurisdiction a receiver is appointed for all or a substantial portion of the properties of the University, unless such receiver is removed or discharged within 60 days of the date of such appointment; or

(e) If the Authority shall default in the observance or performance of any covenant, warranty or representation of the Authority contained in the Indenture (other than a default described in clauses (a) or (b) above), provided that written notice of such default shall have been given to the Authority and the University by the Trustee or by the holders of at least 25% in aggregate principal amount of the Bonds Outstanding or by any Credit Facility Issuer, and the Authority and the University shall have had sixty (60) days after receipt of such notice to correct such default or cause such default to be corrected, and shall have failed to do so, but in the event, however, that the default be such that it cannot be corrected within such sixty (60) day period, it shall not constitute an Event of Default if, with the consent of each Credit Facility Issuer, corrective action is instituted by the Authority or the University, as the case may be, within such period and diligently pursued (as determined by the Trustee) until the default is corrected.

If an Event of Default occurs and is continuing, the Trustee may, and upon request of the holders of not less than a majority in principal amount of all Bonds then Outstanding and provision to the Trustee of indemnity satisfactory to it against all costs, expenses and liabilities, shall, by notice in writing to the Authority and the University, declare the principal of all Bonds that are not Credit-Enhanced Bonds and, with the consent of the Credit Facility Issuer for the particular series of Credit-Enhanced Bonds, declare the principal of each series of Credit-Enhanced Bonds, to be due and payable, and upon such declaration the said principal, together with interest accrued thereon, shall become due and payable on the date such notice is given to the parties entitled thereto at the place of payment provided therein.

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Upon any declaration of acceleration under the Indenture, the Trustee shall immediately exercise such rights as it may have under the Loan Agreement corresponding to the Bonds so accelerated to declare all or a portion of the payments thereunder to be due and payable on even date with that of the Bonds.

The foregoing provisions are subject to the condition that if, after the principal of the Bonds shall have been so declared to be due and payable, and before any judgment or decree for the payment of the moneys due shall have been obtained or entered, the Authority or the University shall cause to be deposited with the Trustee a sum sufficient to pay all matured installments of interest upon all Bonds and the principal of and premium, if any, on any and all Bonds which shall have become due otherwise than by reason of such declaration and such amount as shall be sufficient to cover reasonable compensation and reimbursement of expenses payable to the Trustee, and all Events of Default under the Indenture other than nonpayment of the principal of and interest on Bonds which shall have become due by said declaration shall have been remedied, then, in every such case, such Event of Default shall be deemed waived and such declaration and its consequences rescinded and annulled, and the Trustee shall promptly give written notice of such waiver, rescission or annulment to the Authority and the University, and shall give notice thereof to all registered holders of Bonds; but no such waiver, rescission and annulment shall extend to or affect any subsequent Event of Default or impair any right or remedy consequent thereon.

Notwithstanding the foregoing provisions, any acceleration of the principal of any Credit- Enhanced Bonds, any waiver of any Event of Default affecting any Credit-Enhanced Bonds and any annulment of acceleration of any Credit-Enhanced Bonds as described above shall be subject to the prior consent of the related Credit Facility Issuer.

In addition, if an Event of Default occurs and is continuing, the Trustee may (but only with the consent of the Majority Credit Facility Issuers in the case of Credit-Enhanced Bonds), and, subject to the rights of each Credit-Facility Issuer to be treated as the holder of all related Credit-Enhanced Bonds, upon receipt of the written request of the holders of not less than a majority in principal amount of all Bonds then Outstanding and indemnity to its satisfaction against all costs, expenses and liabilities shall, in its own name:

(a) By mandamus, or other suit, action or proceeding at law or in equity, enforce all rights of the Bondholders, including without limitation the right to require the Authority to collect the sums payable by the University under the Loan Agreement and to require the Authority or the Collateral Agent to carry out any other provisions of the Indenture or the Loan Agreement or any Shared Security Documents for the benefit of the Bondholders and to require the Authority perform its duties under the Act;

(b) Bring suit upon the Bonds or any applicable Credit Facility;

(c) By action or suit in equity require the Authority to account as if it were the trustee of an express trust for the Bondholders;

(d) By action or suit in equity enjoin any acts or things which may be unlawful or in violation of the rights of the Bondholders; and

(e) Enforce (or, if appropriate, direct the Collateral Agent to enforce) all of its rights and remedies under the Loan Agreement or any Shared Security Documents.

Subject to the rights of each Credit-Facility Issuer to be treated as the holder of all related Credit- Enhanced Bonds, the holders of at least a majority in principal amount of the Bonds Outstanding shall have the right, after furnishing indemnity satisfactory to the Trustee against all costs, expenses and liabilities (including attorney’s fees and expenses), to direct the time, method and place of conducting all remedial proceedings by the Trustee under the Indenture; provided, that such direction shall not be otherwise than in accordance with the provisions of law and of the Indenture; and provided, further, that the Trustee may take any other action deemed proper by it which is not inconsistent with such direction.

No Bondholder shall have any right to pursue any remedy under the Indenture unless:

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(a) the Trustee shall have been given written notice of an Event of Default;

(b) the holders of not less than a majority in principal amount of all Bonds then Outstanding shall have requested the Trustee, in writing, to exercise the powers granted under the Indenture or to pursue such remedy in its name as Trustee;

(c) the Trustee shall have been offered indemnity satisfactory to it against costs, expenses and liabilities (including attorney’s fees and expenses); and

(d) the Trustee shall have failed for 30 days to comply with such request.

All moneys received by the Trustee pursuant to any right given or action taken under the provisions of the Indenture, and any moneys then in the Project Fund and the Debt Service Reserve Fund, shall, after payment of the outstanding fees and expenses, if any, of the Trustee and of the costs and expenses of the proceedings resulting in the collection of such moneys and of the expenses, liabilities and advances incurred or made by the Trustee (provided that moneys held in the Debt Service Reserve Fund for Bonds of a particular series shall be applied with respect to such series only and any moneys received from a drawing or claim under a Credit Facility shall be applied only to pay principal and interest on the related Credit-Enhanced Bonds), be deposited in the Bond Fund and all moneys in the Bond Fund from whatever source shall be applied as follows:

(a) Unless the principal of all the Bonds shall have become or shall have been declared due and payable, all such moneys shall be applied:

FIRST - To the payment to the persons entitled thereto of all installments of interest then due on the Bonds, in the order of the maturity of the installments of such interest and, if the amount available shall not be sufficient to pay in full any particular installment, then to the payment ratably, according to the amounts due on such installment, to the persons entitled thereto, without any discrimination or preference; and

SECOND - To the payment to the persons entitled thereto of the unpaid principal of and premium, if any, on any of the Bonds which shall have become due (other than Bonds matured or called for redemption for the payment of which moneys are held pursuant to the provisions of the Indenture, but including any Bonds whose maturity has been accelerated pursuant to the Indenture), in order of their due dates, together with interest on such Bonds from the respective dates upon which they became due and, if the amount available shall not be sufficient to pay in full Bonds due on any particular date, together with such interest, then to the payment ratably, according to the amount of principal due on such date, to the persons entitled thereto without any discrimination or preference.

(b) If the principal of all the Bonds shall have become due or shall have been declared due and payable, all such moneys shall be applied to the payment of the principal, premium, if any, and interest then due and unpaid upon the Bonds, without preference or priority of principal or premium over interest or of interest over principal or premium, or of any installment of interest over any other installment of interest, or of any Bond over any other Bond, ratably according to the aggregate amounts due for principal, premium and interest, to the persons entitled thereto without any discrimination or preference.

(c) If the principal of all the Bonds shall have been declared due and payable, and if such declaration shall thereafter have been rescinded and annulled if permitted under the provisions of the Indenture, then, subject to the provisions of clause (b) above in the event that the principal of all the Bonds shall subsequently become due or be declared due and payable, the moneys shall be applied in accordance with the provisions of clause (a) above.

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(d) If the principal of a series of Credit-Enhanced Bonds shall not have been declared due and payable but the principal of other series of Bonds has been declared to be due and payable, paragraphs (b) and (c) shall nevertheless be applied with respect to those series of Bonds the principal of which has been declared to be due and payable.

Whenever moneys are to be applied pursuant to the foregoing provisions, such moneys shall be promptly applied at such times, and from time to time, as the Trustee shall determine, having due regard to the amount of such moneys becoming available for application and the likelihood of additional moneys becoming available for such application in the future. Whenever the Trustee shall apply such funds, it shall fix the date (which shall be an Interest Payment Date unless the Trustee shall deem another date more suitable) upon which such application is to be made and upon such date interest on the amounts of principal to be paid on such dates shall cease to accrue. The Trustee shall give notice of the deposit with it of any such moneys and of the fixing of any such date, and shall not be required to make payment to the holder of any Bond until such Bond shall be presented to the Trustee for appropriate endorsement or for cancellation if fully paid.

For purposes of the giving of consents, approvals, waivers and directions by the holders of Bonds under the default and remedies provisions of the Indenture, each Credit Facility Issuer shall be deemed to be the sole holder of the Bonds entitled to the benefit of the Credit Facility issued by such Credit Facility Issuer if and for so long as no Credit Facility Issuer Adverse Change shall have occurred and remain continuing with respect to such Credit Facility Issuer. Accordingly, upon the occurrence and continuance of an Event of Default and so long as no Credit Facility Issuer Adverse Change shall have occurred and remain continuing with respect to such Credit Facility Issuer, each Credit Facility Issuer shall be entitled (to the extent of its percentage vote, based upon the proportion by which the aggregate principal amount of the Credit-Enhanced Bonds secured by it bears to the aggregate principal amount of all Bonds then Outstanding) to control and direct the enforcement of all rights and remedies granted to the holders of the related Credit-Enhanced Bonds or the Trustee under the Indenture as if, and to the extent that, it were an actual registered owner of the related Credit-Enhanced Bonds, and each Credit Facility Issuer shall be entitled to notify the Trustee of the occurrence of an Event of Default and request the Trustee to intervene in judicial proceedings that affect the related Credit-Enhanced Bonds or the security therefor.

Amendments and Modifications of Indenture and Other Documents

The Indenture may be amended or supplemented at any time and from time to time, without the consent of the Bondholders, by a Supplemental Indenture authorized by a Certified Resolution of the Authority filed with the Trustee, for one or more of the following purposes:

(a) to add additional covenants of the Authority or the University or to surrender any right or power conferred upon the Authority or the University;

(b) to amend the Indenture to contain provisions which would be required if the Indenture were qualified under the Trust Indenture Act of 1939, as amended;

(d) to provide for or to facilitate the issuance of any Credit Facility for any Bonds, provided that, in the judgment of the Trustee, the rights of the holders of any Bonds then Outstanding are not materially adversely affected;

(e) to cure any ambiguity or inconsistency or to cure, correct or supplement any defective provision of the Indenture;

(f) to permit the Trustee to comply with any obligations imposed upon it by law;

(g) to permit the use of a book-entry system to identify the owner of an interest in an obligation issued by the Authority under the Indenture, whether that obligation was formerly, or could be, evidenced by a tangible security;

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(h) to bring the Indenture into compliance with applicable federal securities or tax laws;

(i) to amend or supplement the Indenture in order to comply with Section 103 and Sections 141 through 150 of the Code to the extent applicable to any Tax-Exempt Bonds;

(j) to authorize the issuance and establish the terms of any series of Additional Bonds on terms not inconsistent with the Indenture;

(k) if at the time all Bonds Outstanding that will be affected by any such amendment or supplement are Credit-Enhanced Bonds, to make any other change or modification to the Indenture which is approved by each Credit Facility Issuer relating to such Bonds, except a change that requires the consent of the holders of all Outstanding Bonds; or

(l) to make any other changes as shall not impair the security of the Indenture or materially adversely affect the interests of the Bondholders.

In addition to amendments and supplements permitted as described above, the Indenture may be amended from time to time by a Supplemental Indenture approved by the holders of at least a majority in aggregate principal amount of the Bonds then Outstanding; provided, that no amendment shall be made (a) which affects the rights of some but less than all of the Outstanding Bonds without, in addition to the above approval, the consent of the holders of at least a majority in aggregate principal amount of the Bonds so affected, (b) which affects the principal, premium, if any, or interest payable upon, or the dates of maturity or redemption provisions of, any Bond without, in addition to the above approval, the consent of the holder of such Bond, (c) which affects the provisions of the Indenture relating to amendments and supplements without the consent of the holders of all the Outstanding Bonds, (d) which, except as otherwise expressly contemplated in the Indenture, creates a privilege or priority of any Bond or Bonds over any other Outstanding Bond or Bonds without the consent of the holders of all Bonds Outstanding which would be adversely affected thereby, or (e) which causes the deprivation of the holder of any Outstanding Bond of the lien created by the Indenture on the trust estate assigned and pledged under the Indenture without the consent of the holders of all Bonds Outstanding which would be adversely affected thereby. Any Supplemental Indenture that requires the consent of all or a portion of the Bondholders must also be approved by each related Credit Facility Issuer, if any, if the Outstanding Bonds affected by such Supplemental Indenture are Credit-Enhanced Bonds.

The Trustee may, without the consent of the Bondholders, enter into or consent to any amendment of supplement to the Loan Agreement entered into for the purposes enumerated under “SUMMARY OF CERTAIN PROVISIONS OF THE LOAN AGREEMENT - Amendments and Supplements to the Loan Agreement” below. The Trustee may, without the consent of the Bondholders, enter into or consent to any amendment of or supplement to any of the Shared Security Documents entered into (a) to cure any ambiguity, defect, or inconsistency or omission therein or in any amendment thereto, or (b) to grant to or confer upon the Trustee or the Collateral Agent any additional rights, remedies, powers, authority or security that lawfully may be granted to or conferred upon it, or (c) to reflect a change in applicable law including, but not limited to, any change in the Code, or (d) to amend, modify or supplement such Shared Security Document in such manner as may be necessary or appropriate in connection with any amendment of or supplement to the Indenture which is effected in accordance with the terms of the Indenture, or (e) if at the time all Bonds Outstanding that will be affected by any such amendment or supplement are Credit-Enhanced Bonds, to make any other change or modification to such Shared Security Document which is approved by each Credit Facility Issuer relating to such Bonds, except a change specified below as requiring the consent of the holders of all Outstanding Bonds, or (f) to amend, modify or supplement such Shared Security Document in any other manner, provided, however, that the rights and security of the Bondholders are not materially adversely affected thereby. If the Authority and the University or any other relevant parties propose to amend or supplement the Loan Agreement or any of the Shared Security Documents for any other purpose, the Trustee shall notify the Credit Facility Issuers and the Bondholders of the proposed amendment or supplement and may consent thereto or enter into the same with the approval of the holders of at least a majority in aggregate principal amount of the Bonds then Outstanding; provided, that no amendment or supplement shall be entered into or consented to (i) which affects the rights of some but less than all the Outstanding Bonds without, in addition to such approval, the consent of the holders of at least a majority in aggregate principal amount of the Bonds so affected, (ii) which would decrease any amount payable under, or change any date of payment under or any prepayment provision of, the Loan

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Agreement without, in addition to such approval, the consent of the holders of all the Bonds affected thereby, or (iii) which would change the provisions of the Loan Agreement relating to amendments thereof without the consent of the holders of all the Outstanding Bonds.

The Trustee may, without the consent of the Bondholders, enter into or otherwise consent to any amendment of or supplement to any Credit Facility that shall not materially adversely affect the interests of any Bondholders. If any proposed amendment of or supplement to any Credit Facility shall materially adversely affect the interests of any Bondholders, the Trustee shall notify the Credit Facility Issuers and the affected Bondholders of the proposed amendment or supplement and may consent thereto with the approval of the holders of at least a majority in aggregate principal amount of the Bonds Outstanding which are affected thereby.

So long as any Credit Facility remains in effect and no Credit Facility Issuer Adverse Change has occurred and remains continuing with respect to such Credit Facility, (a) the prior written consent of each Credit Facility Issuer shall be required for the execution and delivery of any Supplemental Indenture (other than any Supplemental Indenture executed and delivered to authorize the issuance and establish the terms of any series of Additional Bonds) or any amendment or supplement to the Loan Agreement (other than a supplement to the Loan Agreement entered into in connection with the issuance of Additional Bonds) or any of the Shared Security Documents (other than to add additional Shared Collateral or to add an “Additional Parity Obligee” pursuant to the terms of the Collateral Agency Agreement), and (b) each Credit Facility Issuer shall be deemed to be the sole holder of the Bonds entitled to the benefit of the Credit Facility issued by such Credit Facility Issuer for the purpose of giving all consents and approvals that the holders of such Bonds are authorized or required to give in connection with amendments or supplements to the various financing documents, except with respect to matters that require the consent or approval of the holders of each of the Bonds affected thereby or the holders of all of the Bonds, as the case may be.

Defeasance of Bonds

Any Bond shall be deemed to be paid within the meaning of the Indenture when payment of the principal of and premium, if any, on such Bond, plus interest thereon to the due date thereof (whether such due date be by reason of maturity or upon redemption as provided in the Indenture, or otherwise), either (a) shall have been made or caused to be made in accordance with the terms thereof, or (b) shall have been provided for by irrevocably depositing with the Trustee, in trust and irrevocably setting aside exclusively for such payment, any combination of cash and Defeasance Securities maturing as to principal and interest in such amounts and at such times that such combination of cash and Defeasance Securities will provide sufficient moneys to make such payment, and all necessary and proper fees, compensation and expenses of the Trustee and any paying agent pertaining to the Bonds with respect to which such deposit is made shall have been paid or the payment thereof provided for. At such time as a Bond shall be deemed to be paid as aforesaid, it shall no longer be secured by or entitled to the benefits of the Indenture, except for the purposes of certain administrative provisions of the Indenture and of any such payment from such combination of cash and Defeasance Securities. Notwithstanding the foregoing, no deposit under clause (b) of this paragraph shall be deemed a payment of any Bonds which are to be redeemed prior to their stated maturity until such Bonds shall have been irrevocably called or designated for redemption on a date thereafter on which such Bonds may be redeemed in accordance with the provisions of the Indenture and proper notice of such redemption shall have been mailed in accordance with the Indenture or the University shall have given the Trustee on behalf of the Authority, in form satisfactory to the Trustee, irrevocable instructions to mail, in the manner and at the times prescribed by the Indenture, a notice to the holders of such Bonds that the deposit required by said clause (b) above has been made with the Trustee and that said Bonds are deemed to have been paid in accordance with the Indenture and stating such maturity or redemption date upon which moneys are to be available for the payment of the principal of and premium, if any, and interest on said Bonds. In addition, no deposit under said clause (b) above shall be deemed a payment of any Bonds unless (i) a firm of independent certified public accountants of recognized standing (which firm must be acceptable to the relevant Credit Facility Issuer if the Bonds in question are Credit- Enhanced Bonds) shall have delivered a written report verifying that the cash and Defeasance Securities so deposited will be adequate to provide sufficient moneys to pay when due the principal of, redemption premium, if any, and interest on the relevant Bonds to the due date thereof (whether at maturity or upon prior redemption, as appropriate); (ii) there shall have been delivered to the Trustee and each relevant Credit Facility Issuer an opinion of Nationally Recognized Bond Counsel to the effect that all of the requirements of the Indenture for the defeasance of the relevant Bonds have been complied with; and (iii) if the relevant Bonds are Credit-Enhanced Bonds, the cash

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and Defeasance Securities deposited must constitute (or in the case of Defeasance Securities must have been acquired with) Available Moneys.

Additional Bonds

The Authority may, in its sole discretion at the request and with the consent of the University, issue from time to time under the Indenture Additional Bonds for any of the following purposes:

(a) to provide funds for any Project for the University as may be financed under the Act; or

(b) to pay the cost of refunding through redemption or payment at maturity of all or part of the Outstanding Bonds of any series or other indebtedness of the Authority or the University to the extent permitted by the terms thereof and by law.

In any such event the Trustee shall, at the request and authorization of the Authority, authenticate the Additional Bonds and deliver them as specified in the request and authorization, but only upon receipt by the Trustee of:

(a) a Certified Resolution of the Authority and an executed counterpart of a Supplemental Indenture

(i) establishing the series to be issued and providing the terms of the Bonds of such series,

(ii) authorizing the execution, authentication and delivery of the Bonds to be issued,

(iii) stating the purpose of the issue,

(iv) if the purpose is refunding, authorizing the payment or redemption of the Bonds or other indebtedness to be refunded and

(v) setting forth any other matters relating to the issuance of the Additional Bonds or the purpose for which they are to be issued, including the amount and disposition of the proceeds thereof and the Debt Service Reserve Requirement, if any, applicable thereto;

(b) a certificate of the Authority

(i) stating that, to the knowledge of the Authority, no Event of Default under the Indenture has occurred and is continuing and that there exists no event or condition which, with the giving of notice or the lapse of time or both, would constitute an Event of Default and

(ii) if the purpose is refunding, stating

(A) in the case of a refunding of Bonds or other indebtedness by redemption, that notice of redemption of the Bonds or indebtedness to be refunded has been duly given or that provision has been made therefor and

(B) that the proceeds of the issue plus any other amounts stated to be available for the purpose will be sufficient to pay the principal or redemption price of such Bonds or other indebtedness at maturity or on an earlier permitted redemption date, plus interest accrued to such date or dates together with all other costs and expenses related to the refunding;

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(c) an executed counterpart of an amendment or supplement to the Loan Agreement increasing the loan payments thereunder so as to include the debt service on the Additional Bonds, and an executed counterpart of each amendment or supplement to any of the Shared Security Documents not previously delivered;

(d) a request and authorization to the Trustee on behalf of the Authority to authenticate and deliver the Additional Bonds to the purchasers therein identified upon payment to the Trustee, but for the account of the Authority, of a sum specified in such request and authorization plus accrued interest, if any, on the Additional Bonds to the date of delivery, together with directions as to the disposition of such sum and accrued interest, if any;

(e) an opinion of Nationally Recognized Bond Counsel to the effect that

(i) the purpose of the issue is one for which Bonds may be issued under the Indenture,

(ii) all conditions prescribed in the Indenture as precedent to the issuance have been fulfilled,

(iii) the Additional Bonds have been validly authorized, executed and issued and, when authenticated and delivered pursuant to the request of the Authority, will be valid and binding obligations of the Authority entitled to the benefits and security of the Indenture and the trust created thereby and enforceable in accordance with their terms,

(iv) all consents and approvals of any governmental authorities required in connection with the issuance of the Additional Bonds and related transactions have been obtained (in stating such opinion, bond counsel may rely as to this item (iv) for matters pertaining to the University upon the opinion of counsel for the University), and

(v) the issue of the Additional Bonds will not in and of itself have an adverse effect on the exemption of interest on any Tax-Exempt Bonds then Outstanding under the Indenture from Federal income taxes, and stating the extent to which, in the opinion of such counsel, the Additional Bonds are Tax-Exempt Bonds on the date of the opinion; and

(f) the proceeds of the issue and sale of the Additional Bonds.

[THE BALANCE OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]

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SUMMARY OF CERTAIN PROVISIONS OF THE LOAN AGREEMENT

General

Under the Loan Agreement, the Authority agrees to lend the proceeds of the 2017 Bonds to the University for application to the Costs of the Project.

Loan Repayments and Other Payments

In consideration of the loan made by the Authority to the University under the Loan Agreement and as and for the repayment of such loan, the University shall pay or cause to be paid to the Trustee for deposit in the Bond Fund established under the Indenture in lawful money of the United States of America and in immediately available funds, at least five Business Days before each date when principal or premium, if any, or interest on the 2017 Bonds is due, and continuing until payment in full of the principal of, premium, if any, and interest on the 2017 Bonds (or provision for such payment) has been made as provided in the Indenture, a sum which, together with other moneys available therefor in the Bond Fund, will equal the sum of (i) the interest which is then due or then coming due on the 2017 Bonds and (ii) the principal amount of and premium, if any, on the 2017 Bonds which are then due or then coming due through redemption, at maturity, by acceleration or otherwise. If for any reason the amounts paid by the University pursuant to this provision or pursuant to the other provisions of the Loan Agreement, together with any other amounts available therefor under the Indenture, are at any time insufficient to make payments of the principal of, premium, if any, and interest on the 2017 Bonds when due, whether at maturity, upon redemption, by acceleration or otherwise, the University will forthwith pay to the Trustee the amount required to make up such deficiency.

The University may, at its option, make loan payments to the Trustee in advance from time to time for application to the optional redemption of Bonds in accordance with the terms thereof and, in such event, the Authority shall exercise its rights to redeem such Bonds as directed in writing by the University. The University shall be required to prepay the aggregate amount of loan payments due under the Loan Agreement at such time and in such amount as shall be required under the Indenture to duly effect a mandatory redemption of the Bonds in accordance with the terms thereof.

The University agrees to make additional payments as follows:

(a) to the Authority, as billed to the University, the annual administrative fee of the Authority as separately agreed to between the Authority and the University;

(b) to the Authority upon its written request, as reimbursement for any and all costs, expenses and liabilities paid or incurred by the Authority in satisfaction of any obligations of the University under the Loan Agreement not performed in accordance with the terms thereof by the University;

(c) to the Trustee upon its written request, an amount equal to the reasonable fees and charges of the Trustee for its services and the reasonable expenses incurred by it in connection with the Indenture, the Loan Agreement and the other Financing Documents (including without limitation the reasonable fees and charges of its Counsel and of any agent appointed by the Trustee with the consent of the University pursuant to the Indenture);

(d) to the Trustee, for deposit to the credit of the Debt Service Reserve Fund established under the Indenture, any amount required to be paid by the University for deposit into such Fund pursuant to the Indenture and at the time or times so required pursuant to the relevant provisions of the Indenture; and

(e) to the Trustee, for deposit to the credit of the Rebate Fund established under the Indenture, any amount required to be deposited in the Rebate Fund pursuant to the Indenture and any relevant Tax Compliance Agreement and at the time or times required under the Indenture and such Tax Compliance Agreement;

The obligations of the University to make the loan payments and other payments required pursuant to the Loan Agreement and to perform and observe the other agreements contained therein shall be absolute and unconditional until such time as the principal of, premium, if any, and interest on all Bonds issued

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under the Indenture are paid in full. The University will not suspend or discontinue, or permit the suspension or discontinuance of, any payment provided for in the Loan Agreement or the performance of observance of any of the University’s obligations thereunder, for any reason or cause whatsoever, including (without limiting the generality of the foregoing) failure to complete any Project; destruction of or damage to any property of the University; any acts or circumstances which may constitute failure of consideration, commercial frustration of purpose, any change in the tax or other laws or administrative rulings of or administrative actions by the United States or the Commonwealth of Pennsylvania or any political subdivision of either; or any failure of the Authority to perform and to observe any agreement, whether express or implied, or any duty, liability or obligation, arising out of or connected with the Loan Agreement.

The Loan Agreement is a general obligation of the University and the full faith and credit of the University is pledged to the payment of all sums due or to become due thereunder. To secure the payment of the amounts payable by the University under the Loan Agreement and the performance of all other of its obligations thereunder, the University pledges, assigns and grants to the Authority a continuing lien on and a security interest in all of the University’s right, title and interest in and to all moneys, instruments, securities, funds and accounts held by the Trustee under the Indenture, other than the Rebate Fund. The obligations of the University under the Loan Agreement shall constitute a “Parity Obligation” pursuant to the Collateral Agency Agreement, and accordingly the Issuer and the Trustee shall each be a “Parity Obligee” and one of the “Secured Parties” within the meaning of the Collateral Agency Agreement with respect to the Loan Agreement and the 2017 Bonds.

Construction of Projects

The Loan Agreement contains provisions and agreements of the University relating to the construction of Projects by the University and the maintenance of certain insurance during construction.

Insurance

The University covenants and agrees that it shall continuously maintain insurance on its properties and against such risks (including casualty, accident and worker’s compensation) in such amounts and with such deductibles as are consistent with customary coverage, as from time to time in effect, in connection with the operation of properties of type and size comparable to those of the University.

The University shall employ each year an Insurance Consultant. All policies of insurance required by the Loan Agreement shall be in such amounts and contain such provisions as shall have been recommended by the Insurance Consultant.

All policies of insurance and bonds shall be issued by (i) responsible insurance companies, qualified to do business in the Commonwealth of Pennsylvania and qualified under the laws of the Commonwealth of Pennsylvania (or, if acceptable to the Authority, under the laws of any other jurisdiction) to assume risks covered by such policy or policies or bond or bonds and shall be nonassessable and having a claims paying ability rating from A.M. Best of “A-” or better, or (ii) responsible risk pooling trusts organized and operating pursuant to the authority of, and subject to examination by, the insurance commissioner of one of the states of the United States or the District of Columbia, having authority to assume risks covered by such policy or policies or bond or bonds and acceptable to the Authority.

Subject to any contrary requirements of any of the Shared Security Documents, all policies of insurance required under these provisions of the Loan Agreement shall be for the benefit of the University; provided, however, that to the extent that and for so long as, under applicable law or prevailing commercial insurance practice (as certified by the Insurance Consultant) the Authority and/or the Trustee shall have the insurable interest under any such policy, the Trustee and/or the Authority shall be required to be an additional insured under the policy so affected. Subject to any contrary requirements of any of the Shared Security Documents, the University shall have the right to receive payments due and to receipt for claims under all policies of insurance specified above.

The University may self-insure solely for professional liability, employee health insurance, workers compensation insurance, unemployment insurance, commercial general liability insurance, automobile

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insurance, student health and accident insurance, directors and officers insurance, travel insurance, broadcasters liability insurance, publishers liability insurance, and excess liability insurance, so long as the University’s self- insurance plan provides for (i) the establishment by the University of a separate segregated self-insurance fund funded in an amount confirmed as to sufficiency through the annual auditing process by an independent auditor or the Insurance Consultant or a nationally recognized independent actuarial consultant employing accepted actuarial techniques and (ii) the establishment and maintenance of a claims processing and risk management program. If the University elects to self-insure for professional liability, the University shall notify the Trustee in writing of such election and within 150 days after the end of each Fiscal Year cause the Insurance Consultant or a nationally recognized Independent actuarial consultant to submit a report to the Trustee to the effect that such self-insurance plan maintains adequate reserves and has been adequately funded.

Proceeds of Property Damage Insurance; Condemnation

If the University Facilities shall be wholly or partially destroyed or damaged by fire or other casualty covered by insurance required under the Loan Agreement, or the use of the University Facilities or any part thereof, or the interest of the University in the University Facilities or any part thereof, shall be taken under the exercise of the power of eminent domain by any governmental body or by any person acting under governmental authority, either temporarily or permanently, the University will take all actions and will do all things which may be reasonably necessary to enable recovery to be made upon such policies of insurance or on account of such taking, condemnation, conveyance, damage or injury in order that moneys due on account of losses suffered may be collected by the University.

Immediately after occurrence of loss or damage covered by insurance, or after notice of condemnation has been received, as the case may be, the University shall notify the Authority, the Trustee and each Credit Facility Issuer in writing of such occurrence. The University shall promptly determine and advise the Authority, the Trustee and each Credit Facility Issuer whether it is practicable and desirable to repair, reconstruct or replace such damaged, destroyed or condemned property. If the University determines that such repair, reconstruction or replacement is practicable and desirable, the University shall proceed promptly to repair, reconstruct or replace that part of the University Facilities so damaged, destroyed or condemned to substantially the same condition as it existed prior to such damage, destruction or condemnation, with such changes, alterations and modifications (including the substitution and addition of other property) as may be desired by the University, using the proceeds of insurance received by the University or any other available funds of the University. If the University determines that such repair, reconstruction or replacement is not so practicable or desirable, the University may, at its option, direct the Trustee and the Authority to call Bonds for extraordinary optional redemption in accordance with the terms of the Bonds and the Indenture in a principal amount not exceeding the amount of the insurance proceeds or condemnation award received by the University with respect to such damage, destruction or condemnation, or otherwise apply such insurance proceeds or condemnation award to such other purpose or purposes as the University may elect and as shall not, in the opinion of Nationally Recognized Bond Counsel, adversely affect the tax-exempt status of interest on any Tax-Exempt Bonds then Outstanding under the Indenture.

These provisions are subject to any contrary or different requirements as may be applicable under any of the Shared Security Documents.

The University covenants to furnish to the Issuer, the Trustee and each Credit Facility Issuer on or before the execution and delivery of the Loan Agreement, and thereafter prior to the beginning of each Fiscal Year, an Insurance Consultant’s Certificate, setting forth the amounts and types of insurance then in force with respect to the University Facilities and the operation thereof, stating whether, in the opinion of such Insurance Consultant, such insurance is equivalent to insurance customarily carried by similar institutions and whether such insurance then in force is in compliance with the requirements of the Loan Agreement, and stating the amounts and types of insurance to be maintained during the next ensuing Fiscal Year. In addition, the University covenants that prior to the commencement of any Project involving construction (or prior to commencement of that portion of any Project involving construction if only a portion of such Project involves construction), it shall furnish the Issuer, the Trustee and each Credit Facility Issuer with an Insurance Consultant’s Certificate evidencing compliance with the requirements of the Loan Agreement.

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Permitted Indebtedness of the University

The University covenants and agrees that it will not incur or assume (the terms “incur” and “assume” mean and include the guaranteeing of, or the direct or indirect assumption of liability for, the debts of others) any Indebtedness (including any Indebtedness under the Loan Agreement in connection with the issuance of any Additional Bonds) other than as hereinafter permitted. No such additional Indebtedness may be incurred or assumed if and so long as any Event of Default under the Loan Agreement shall have occurred and be continuing.

(a) The University may from time to time incur or assume Long-Term Debt if prior to incurrence of the Long-Term Debt, there is delivered to the Trustee a Certificate of the President or the chief financial officer of the University certifying that either (i) Coverage Ratio A for the Historic Test Period, taking into account the proposed additional Long-Term Debt as if it had been incurred at the beginning of such Historic Test Period (and assuming for purposes of such calculation that the Debt Service Requirement on the proposed Long-Term Debt for the Historic Test Period was equal to the Maximum Annual Debt Service Requirement on the proposed Long-Term Debt), was not less than 120%, or (ii) Coverage Rate B for the Historic Test Period, taking into account the proposed additional Long-Term Debt as if it had been incurred at the beginning of such Historic Test Period (and assuming for purposes of such calculation that the Debt Service Requirement on the proposed Long-Term Debt for the Historic Test Period was equal to the Maximum Annual Debt Service Requirement on the proposed Long-Term Debt), was not less than 160%.

(b) The University may from time to time incur or assume Long-Term Debt without complying with subsection (a) if prior to incurrence of the Long-Term Debt, there is delivered to the Trustee (i) a Certificate of the President or the chief financial officer of the University certifying that the University has satisfied the Financial Covenant for the Historic Test Period and (ii) either (1) a Certificate of a Consultant to the effect that Coverage Ratio A projected for each of the two Fiscal Years immediately following the Fiscal Year in which such new Long- Term Debt is being incurred or assumed (which projected coverage ratio shall be based upon assumptions detailed in such Certificate that are certified by both the University and such Consultant to be reasonable) is not less than 1.20%, or (2) a Certificate of a Consultant to the effect that Coverage Ratio B projected for each of the two Fiscal Years immediately following the Fiscal Year in which such new Long-Term Debt is being incurred or assumed (which projected coverage ratio shall be based upon assumptions detailed in such Certificate that are certified by both the University and such Consultant to be reasonable) is not less than 1.60%.

(c) The University may from time to time incur or assume Long-Term Debt without complying with subsection (a) or subsection (b) above, provided that such Long-Term Debt is issued solely to refund other Long-Term Debt and, if relevant, to fund any required debt service reserve fund deposit for, and to pay any costs of issuance of, such new refunding Long-Term Debt, and provided further that this subsection (c) shall not apply to the refunding of Non-Recourse Debt or Subordinated Indebtedness.

(d) The University may from time to time incur or assume Non-Recourse Debt without limit.

(e) The University may from time to time incur or assume Completion Debt without complying with subsection (a), subsection (b) or subsection (f), provided that the aggregate principal amount of such Completion Debt does not exceed, with respect to the particular capital project for which it is issued, the lesser of (i) 15% of the original principal amount of the Long-Term Debt originally incurred or assumed for that capital project or (ii) the amount of money needed to complete such capital project, as certified to the Trustee and the Authority by an Independent architect.

(f) The University may, from time to time, incur or assume Short-Term Debt in any Fiscal Year without limit so long as such Short-Term Debt is incurred in the ordinary course of business of the University for general working capital purposes. The University agrees that, during each Fiscal Year, the amount of Short-Term Debt outstanding shall either (i) be zero for a period of at least seven consecutive days or (ii) not exceed an amount equal to five percent (5%) of the Unrestricted Revenues of the University for the immediately preceding Fiscal Year for a period of at least twenty consecutive days.

(g) The University may, from time to time, without complying with subsection (a), subsection (b) or subsection (f) above, incur or assume Indebtedness in the form of Capital Leases, installment purchase contracts

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or purchase money debt with respect to equipment or other tangible personal property, provided that the Average Annual Debt Service Requirement with respect to all Indebtedness described in this subsection (g) outstanding at the time, including the Indebtedness proposed to be incurred under the authority of this subsection (g), does not exceed two percent (2%) of the Unrestricted Revenues of the University for the Historic Test Period.

(h) The University may, from time to time, issue or otherwise enter into a Guaranty, provided that the Guaranteed Indebtedness shall be deemed to be Indebtedness of the University of the corresponding type classified and defined in the Loan Agreement (e.g., Long-Term Debt, Short-Term Debt, Balloon Debt, Variable Rate Debt, etc.) and the University must satisfy the relevant test for incurring or assuming such type of Indebtedness under these provisions, using (if appropriate) the calculation rules for Guaranteed Indebtedness set forth under the definition of “Debt Service Requirement”.

(i) The University may from time to time incur or assume Reimbursement Debt without limit. No additional or new Indebtedness shall be deemed to arise when any funding occurs under the credit or liquidity facility or commitment that gave rise to such Reimbursement Debt.

(j) No additional or new Indebtedness shall be deemed to arise when the interest rate on any Variable Rate Indebtedness is converted to a fixed rate in accordance with the terms of such Indebtedness or when the method of computing the variable interest rate on such Variable Rate Indebtedness is changed in accordance with the terms of such Indebtedness.

(k) No additional or new Indebtedness shall be deemed to arise if any lease properly classified as an operating lease under Generally Accepted Accounting Principles is required, as a result of a change in Generally Accepted Accounting Principles, to be classified as a Capital Lease or similar liability on the balance sheet of the University.

(l) The University may from time to time incur or assume Subordinated Indebtedness without limit.

Interest Rate Hedge Agreements

The University shall not enter into any Interest Rate Hedge Agreement unless the following requirements are satisfied:

(a) the Interest Rate Hedge Agreement shall be entered into by the University for the purpose of hedging its interest rate risk with respect to any Indebtedness of the University permitted under the Loan Agreement;

(b) the Interest Rate Hedge Agreement shall not contain any leverage element or multiplier component unless there is a matching hedge arrangement that effectively offsets the exposure from any such element or component; and

(c) the University Board shall expressly authorize such Interest Rate Hedge Agreement (including without limitation all covenants and collateral security) and expressly determines that such Interest Rate Hedge Agreement is in the best interest of the University.

In addition, for so long as any Indebtedness of the University is deemed to bear interest at a rate taking into account any Interest Rate Hedge Agreement (pursuant to the definition of “Debt Service Requirement”), any payments made by the University on such Interest Rate Hedge Agreement shall be excluded from expenses, and any payments received by the University on such Interest Rate Hedge Agreement shall be excluded as revenues, for purposes of any financial or accounting computations required under this Loan Agreement.

Security for Permitted Indebtedness and Interest Rate Hedge Agreements

Any Indebtedness incurred or assumed as provided above and any Interest Rate Hedge Agreements entered into in compliance with the Loan Agreement may be secured only as hereinafter provided:

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(a) Long-Term Debt and Short-Term Debt (including without limitation any Reimbursement Debt and any Guaranty) and the Periodic Scheduled Payments (but not the Termination Payments) of the University under Interest Rate Hedge Agreements entered into in compliance with the Loan Agreement may be designated as Parity Obligations pursuant to the Collateral Agency Agreement and as such shall be secured equally and ratably with the holders of other Parity Obligations by the Liens on the Shared Collateral created under the Shared Security Documents, provided that:

(i) such Indebtedness or Interest Rate Hedge Agreement is expressly designated and recognized as a Parity Obligation in a joinder supplement executed by the University, the Collateral Agent and the holder of such Indebtedness or counterparty to such Interest Rate Hedge Agreement as required under the Collateral Agency Agreement, in which joinder supplement such holder or counterparty expressly agrees to be bound by the terms and provisions of the Collateral Agency Agreement; and

(ii) except for commercially reasonable debt service funds or debt service reserve funds or other funds containing unexpended proceeds of Parity Obligations held by a trustee or other fiduciary or agent under a trust indenture or similar instrument for the benefit of the holder or holders of any particular Parity Obligations (including without limitation the Bond Fund, the Debt Service Reserve Fund and the Project Fund held by the Trustee under the Indenture), no Lien on any other or additional collateral may be granted by the University to secure the holder of any Parity Obligation unless such Lien is granted to the Collateral Agent for the equal and ratable benefit of the holders of all Parity Obligations and the document or instrument creating such Lien is in form and substance satisfactory to the Authority, the Trustee, each Credit Facility Issuer and the Collateral Agent and is expressly designated as a Shared Security Document pursuant to the Collateral Agency Agreement.

(b) Long-Term Debt incurred under subsection (b) under “Permitted Indebtedness of the University” above may be secured in the same manner as the Long-Term Debt which it refunds.

(c) Non-Recourse Debt or Capital Leases incurred or assumed by the University to finance the acquisition of equipment or tangible personal property may be secured solely by a purchase money security interest in the equipment or tangible personal property acquired with the proceeds of the Non-Recourse Debt or leased under the Capital Lease, and Non-Recourse Debt incurred or assumed by the University to finance the construction or acquisition of any other property may be secured solely by revenues derived from the operation or sale of the financed property and/or a mortgage lien on or security interest in the financed property and not by a Lien on any Shared Collateral.

(d) Indebtedness incurred or assumed by the University for the purpose of financing all or a portion of the price of purchasing or acquiring any equipment or other tangible personal property (including without limitation an installment sale agreement, financing lease or other form of purchase money debt) may be secured by a Lien on the equipment or tangible personal property being purchased or acquired.

(e) Bonds issued under the Indenture may be secured as provided therein, but in no event shall any other Indebtedness other than Bonds be secured by a lien on the moneys and investments held by the Trustee in the funds created under the Indenture.

(f) Any Indebtedness may be secured by a Lien on Shared Collateral that is expressly junior and subordinate in rank and priority to the Lien on such Shared Collateral securing Parity Obligations (such Indebtedness being herein referred to as “Subordinated Indebtedness”), provided that:

(i) The documents and instruments evidencing such Subordinated Indebtedness must expressly provide that the principal of such Subordinated Indebtedness may not be accelerated without the prior written consent of the holders of all Parity Obligations.

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(ii) The indebtedness evidenced by the Subordinated Indebtedness, and any renewals or extensions thereof, shall at all times be wholly subordinate and junior in right of payment to all Parity Obligations, in the manner and with the force and effect hereafter set forth:

(A) In the event of any liquidation, dissolution or winding up of the University, or of any execution, sale, receivership, insolvency, bankruptcy, liquidation, readjustment, reorganization, or other similar proceedings relative to the University or its property, all principal, interest and other amounts owing on all Parity Obligations shall first be paid in full before any payment is made upon the Subordinated Indebtedness, provided, however, that, except for Unrestricted Revenues, this sentence shall not apply to payments made on such Subordinated Indebtedness from the proceeds of collateral specifically securing such Subordinated Indebtedness, and in any such event any payment or distribution of any kind or character from sources other than the proceeds of collateral specifically securing such Subordinated Indebtedness, except for Unrestricted Revenues, whether in cash, property or securities (other than in securities, including equity securities, or other evidences of indebtedness, the payment of which is subordinated to the payment of all Parity Obligations which may at the time be outstanding) which shall be made upon or in respect of the Subordinated Indebtedness shall be paid over to the Collateral Agent for application pro rata to the payment of Parity Obligations unless and until all such Parity Obligations shall have been paid or satisfied in full; and

(B) In the event that the Subordinated Indebtedness is declared or becomes due and payable because of the occurrence of any Event of Default under the Loan Agreement or under the Indenture or otherwise than at the option of the University, under circumstances when the foregoing clause (A) shall not be applicable, the holders of the Subordinated Indebtedness shall be entitled to payments only after there shall first have been paid in full all Parity Obligations outstanding at the time the Subordinated Indebtedness so becomes due and payable because of any such event, or payment shall have been provided for in a manner satisfactory to the holders of such Parity Obligations, provided, however, that, except for Unrestricted Revenues, this sentence shall not apply to payments made on such Subordinated Indebtedness from the proceeds of collateral specifically securing such Subordinated Indebtedness;

(iii) The University agrees, for the benefit of the holders of Parity Obligations, that in the event that any Subordinated Indebtedness is declared due and payable before its expressed maturity because of the occurrence of a default under the Loan Agreement, (A) the University will give prompt notice in writing of such happening to the holders of the Parity Obligations and (B) all Parity Obligations shall forthwith become immediately due and payable upon demand, regardless of the expressed maturity thereof.

(iv) If the holder of the Subordinated Indebtedness is a commercial bank, savings bank, savings and loan association or other financial institution which is authorized by law to accept and hold deposits of money or issue certificates of deposit, such holder must agree to waive any common law or statutory right of setoff with respect to any deposits of the University maintained with or held by such holder.

(v) Obligations of the University under an Interest Rate Hedge Agreement (including, without limitation, Periodic Scheduled Payments and Termination Payments) may be secured by a Lien on Shared Collateral that is expressly junior and subordinate in rank and priority to the Lien on such Shared Collateral securing Parity Obligations in the same manner as described above with respect to Subordinated Indebtedness, mutatis mutandis.

(g) Indebtedness incurred or assumed by the University for the purpose of financing the acquisition, construction, renovation or improvement of any real property or fixtures that are not part of the University Facilities may be secured by a Lien on such real property or fixtures that need not be made part of the Shared Collateral.

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Additional Covenants of the University

The University agrees to various other covenants under the Loan Agreement, including covenants relating to maintenance of its corporate existence, properties and tax-exempt status, compliance with laws, payment of taxes and other impositions, keeping proper books and records of account, and the following covenants:

Financial Covenant.

The University covenants that, as of the last day of each Fiscal Year, either (a) Coverage Ratio A shall be at least 110%, or (b) Coverage Ratio B shall be at least 150%, or (c) the Expendable Funds Ratio shall be at least 50%. The failure of the University to comply with the Financial Covenant for any one Fiscal Year shall not be an Event of Default hereunder. The failure of the University to comply with the Financial Covenant for two consecutive Fiscal Years shall be an Event of Default unless the University engages a Consultant within 180 days of the close of the second Fiscal Year to make a report to the University Board containing recommendations as to how the University may achieve compliance with the Financial Covenant. The failure of the University to comply with the Financial Covenant for three consecutive Fiscal Years shall be an Event of Default.

Corporate Existence.

The University covenants that it will preserve and maintain its existence as a nonprofit corporation under the laws of the Commonwealth of Pennsylvania and preserve and maintain its authority to operate the University Facilities as an institution of higher education in the Commonwealth of Pennsylvania.

The University covenants that it will maintain the necessary accreditation to enable it to maintain its authority to operate the University as an institution of higher education. The University covenants that it shall not take any action or fail to take any action required so that the University shall at all times be and remain an “eligible educational institution” within the meaning of the Act.

The University covenants that during the term of the Loan Agreement it will not initiate any proceedings or take any action whatsoever to dissolve or liquidate or to terminate its existence as a corporation or otherwise dispose of all or substantially all of its assets, either in a single transaction or in a series of related transactions, except as provided below. The University covenants that during the term of the Loan Agreement it will not consolidate with, transfer all or substantially all of its assets to, or merge into any other corporation, unless the following conditions shall be met:

(a) the successor formed by such consolidation or merger or to which all or substantially all of the University’s assets are transferred (the “successor corporation”) shall be a not-for-profit corporation organized under the laws of the United States or any state, district or territory thereof and which is an organization described in Section 501(c)(3) of the Code;

(b) the successor corporation shall expressly assume in writing the full and faithful performance of the University’s duties and obligations under the Loan Agreement and under the other Financing Documents to the same extent as if such successor corporation had been the original party under the Loan Agreement and such Financing Documents, and in the opinion of the Authority, which may be based upon a Consultant’s Certificate or a Certificate of the University at the discretion of the Authority, the successor corporation is financially capable of fulfilling the duties and obligations of the University under the Loan Agreement and under the other Financing Documents and the transaction will not adversely affect the security of the Bonds;

(c) immediately after such consolidation, merger or transfer of assets, no Event of Default shall have occurred and be continuing or shall exist;

(d) an Independent Public Accountant’s Certificate shall be delivered to the Authority, the Trustee and each Credit Facility Issuer demonstrating and concluding (i) that the successor corporation would have been in compliance with the Financial Covenant had the merger or consolidation taken place as of the last day of the immediately preceding Fiscal Year of the University and (ii) that the successor corporation, as of the effective date

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of the merger, consolidation or transfer of assets, would be able to incur one dollar ($1.00) of additional Long-Term Debt pursuant to the test described in paragraph (a) under “Permitted Indebtedness of the University” above on the date of such merger, consolidation or transfer of assets;

(e) the Authority and Trustee shall have received an opinion of Nationally Recognized Bond Counsel that the Federal tax-exempt status of the interest payable on any Tax-Exempt Bonds will not be adversely affected by the merger, transfer or consolidation; and

(f) each Credit Facility Issuer shall have consented to such merger, transfer or consolidation.

Restrictions on Liens.

The University covenants that it will not at any time create, incur, assume or suffer to exist any Lien on any of its property (now owned or hereafter acquired), except for Permitted Encumbrances.

Sectarian Use of Project Facilities.

The University covenants that it shall not use or permit the use of any of the Project Facilities for sectarian instruction or as a place of religious worship or in connection with any program of a school or department of divinity or theology or a theological seminary for any religious denomination.

Events of Default and Remedies

The following are defined as “Events of Default” under the Loan Agreement:

(a) if the University fails to make any payment of principal or interest on the loan from the Authority on the date such payment shall have become due and payable; or

(b) if the University fails to make any other payment required by the Loan Agreement and such failure continues for 45 days after the Authority or the Trustee gives written notice that such other payment is due and unpaid; or

(c) if the University fails to observe or perform any of its other covenants or obligations under the Loan Agreement or any of its covenants or obligations under any of the Shared Security Documents and such failure continues for 45 days after the Authority or the Trustee gives the University written notice thereof; provided, however, that if such performance requires work to be done, actions to be taken, or conditions to be remedied, which by their nature cannot reasonably be done, taken or remedied, as the case may be, within such 45-day period, no Event of Default shall be deemed to have occurred or to exist if, and so long as, the University shall commence such performance within such 45-day period and shall diligently and continuously prosecute the same to completion and each applicable Credit Facility Issuer shall have consented to such extension of time; or

(d) if an “Event of Default” as defined in the Indenture shall have occurred and be continuing; or

(e) if the University shall fail to make any payment when due under any obligation (or set of related obligations), as principal or as guarantor or other surety, in respect of any Indebtedness in excess of $1,000,000 in principal amount that is not a Parity Obligation or in respect of any Interest Rate Hedge Agreement that is not (with respect to either Periodic Scheduled Payments or Termination Payments) a Parity Obligation and such failure represents a failure to pay all or any part of such indebtedness at its stated maturity or otherwise causes all or any part of such indebtedness to become due (by acceleration, mandatory prepayment or repurchase, or otherwise) before its otherwise stated maturity, or causes an early termination of any such Interest Rate Hedge Agreement with a Termination Payment owing by the University in excess of $1,000,000; or

(f) if the University (i) shall default (as principal or as guaranty or other surety) in any payment of principal of or interest on any obligation (or set of related obligations) constituting a Parity Obligation beyond any period of grace with respect thereto or, if such obligation or obligations is or are payable or repayable on demand,

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shall fail to pay or repay such obligation or obligations when demanded, or (ii) shall default in the observance of any covenant, term or condition contained in any agreement or instrument by which such obligation or obligations constituting a Parity Obligation is or are created, secured or evidenced, if the effect of such default is to cause, or to permit the holder or holders of such obligation or obligations (or a trustee or agent on behalf of such holder or holders) to cause, all or part of such obligation or obligations to become due (or, in the case of any Interest Rate Hedge Agreement, to be terminated) before its or their otherwise stated maturity or expiration date; or

(g) a judgment for the payment of money in an amount in excess of $1,000,000 shall be entered against the University, and such judgment, to the extent not covered by independent third-party insurance as to which the insurer does not dispute coverage, shall remain undischarged and unstayed for a period of 45 consecutive days.

If an Event of Default described in clause (d) above occurs which results in the acceleration of the payments on any of the Bonds pursuant to the Indenture, the Trustee shall, and if any other Event of Default occurs, the Trustee may, upon written notice immediately effective, declare all amounts then due and thereafter to become due and payable during the term of the Loan Agreement in respect of the principal amount of the Bonds then Outstanding (or, if less than all of the Bonds have been accelerated pursuant to the Indenture, then in respect of the Bonds which have been so accelerated), together with all interest accrued thereon and all other amounts then payable to the Authority or the Trustee, to be immediately due and payable; and upon such declaration the said amounts shall become due and payable immediately.

Upon the occurrence of any Event of Default, the Authority or the Trustee may take whatever action at law or in equity may appear necessary or desirable to collect the payments and other amounts then due and thereafter to become due or to enforce performance and observance of any obligation, agreement or covenant of the University under the Loan Agreement and the other Financing Documents.

Any amounts collected pursuant to action taken under these provisions, except for amounts collected in respect of the Issuer’s Unassigned Rights, shall be paid over to the Trustee and applied in accordance with the provisions of the Indenture.

Amendments and Supplements to the Loan Agreement

If the Authority issues Additional Bonds as contemplated by the Indenture, the Authority and the University shall execute an appropriate supplement or amendment to the Loan Agreement as contemplated by the Indenture. In addition, the Authority and the University from time to time may enter into any written amendments or supplements to the Loan Agreement without the consent of the holders of any Bonds for the following purposes:

(a) to cure any ambiguity, defect, or inconsistency or omission in the Loan Agreement or in any amendment thereto; or

(b) to grant to or confer upon the Authority any additional rights, remedies, powers, authority or security that lawfully may be granted to or conferred upon it; or

(d) to reflect the implementation by the University of changes in Generally Accepted Accounting Principles as the result of the issuance of financial accounting standards or audit guidelines or revisions thereto by the Financial Accounting Standards Board or any other similar United States or international organization promulgating Generally Accepted Accounting Principles or generally accepted auditing standards in connection with the preparation of financial statements for institutions of higher education or non-profit organizations, if there shall be delivered to the Trustee, together with the amendment, a Certificate of the University’s Independent Public Accountant setting forth the nature of the changed accounting or auditing standard and that the amendment to the Loan Agreement is necessary or appropriate to conform to the new or revised standards or is required or appropriate in order that the intended economic effect of provisions of the Loan Agreement containing financial terms or covenants will not be distorted; or

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(e) to amend, modify or supplement the Loan Agreement in such manner as may be necessary or appropriate in connection with any amendment of or supplement to the Indenture which is effected in accordance with the terms of the Indenture; or

(f) if at the time all Bonds Outstanding that will be affected by any such amendment or supplement are Credit-Enhanced Bonds, to make any other change or modification to the Loan Agreement which is approved by each Credit Facility Issuer relating to such Bonds; or

(g) to amend, modify or supplement the Loan Agreement in any other manner; provided, however, that the rights and security of the Bondholders are not materially adversely affected thereby.

All other amendments must be approved by the Trustee consistent with the requirements of the Indenture. Each Credit Facility Issuer (for so long as no Credit Facility Issuer Adverse Change shall have occurred and be continuing with respect to such Credit Facility Issuer) shall have the right to consent to amendments and supplements to this Loan Agreement except to the extent such amendment or supplement relates to the issuance of Additional Bonds issued in accordance with the Indenture.

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SUMMARY OF CERTAIN PROVISIONS OF THE SECURITY AGREEMENT

Under the Security Agreement, as security for the full and timely payment and performance of each of the Obligations, the University assigns, pledges, transfers and sets over unto the Collateral Agent for the benefit of the Secured Parties, and grants and creates in favor of the Collateral Agent for the benefit of the Secured Parties a Lien on and security interest in, all of the University’s right, title and interest in, to and under the Collateral.

In the Security Agreement, the University makes and agrees to certain representations, warranties and covenants relating to the Collateral. The Security Agreement provides that, upon the occurrence of any Event of Default (as defined under the Collateral Agency Agreement), the Collateral Agent may exercise in respect of the Collateral, in addition to other rights and remedies provided for in the Security Agreement or otherwise available to it, all the rights and remedies of a secured party on default under the Uniform Commercial Code as in effect in the Commonwealth of Pennsylvania (the “UCC”) (whether or not the UCC applies to the affected Collateral, except to the extent that the application of the UCC to the affected Collateral is prohibited by another applicable law). All payments and distributions on account of the Collateral and the proceeds of any sale or other disposition of, collection from, or other realization upon, any part of the Collateral shall be deposited in the Shared Collateral Account for application or distribution in accordance with the provisions of the Collateral Agency Agreement.

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SUMMARY OF CERTAIN PROVISIONS OF THE COLLATERAL AGENCY AGREEMENT

Under the Collateral Agency Agreement, the Parity Obligees irrevocably appoint The Bank of New York Mellon Trust Company, N.A., to act as Collateral Agent for each Secured Party under the Collateral Agency Agreement and the other Shared Security Documents. Each of the Parity Obligees irrevocably authorizes the Collateral Agent to take such action on behalf of each Secured Party under the provisions of the Collateral Agency Agreement and the other Shared Security Documents, and to exercise such powers and to perform such duties, as are specifically delegated to or required of the Collateral Agent by the terms thereof, together with such powers as are reasonably incidental thereto. Each Secured Party irrevocably authorizes the Collateral Agent to execute and deliver each of the Shared Security Documents and to accept delivery of such of the Shared Security Documents as may not require execution by the Collateral Agent. Each Secured Party agrees that the rights and remedies given to the Collateral Agent under the Shared Security Documents shall be exercised exclusively by the Collateral Agent, and that no Secured Party shall have any right individually to exercise any such right or remedy, except to the extent, if any, otherwise expressly provided therein or in the Collateral Agency Agreement.

The Collateral Agent shall take any action of the type specified in the Collateral Agency Agreement or in any other Shared Security Documents as being within the Collateral Agent's rights, powers or discretion in accordance with written directions from the Directing Party (or, to the extent the Collateral Agency Agreement or such Shared Security Document specifically requires the consent or direction of some other Person or set of Persons, then instead in accordance with the directions of such other Person or set of Persons). In the absence of any such directions, the Collateral Agent shall have the authority (but under no circumstances shall be obligated), in its sole discretion, to take such action, to the extent not inconsistent with written directions by the Directing Party, unless the Collateral Agency Agreement or such Shared Security Document specifically requires the consent or direction of the Directing Party (or some other Person or set of Persons), in which case the Collateral Agent shall not take such action absent such direction or consent. Any action or inaction pursuant to such direction, discretion or consent shall be binding on all of the Secured Parties. The Collateral Agent shall not have any liability to any Person as a result of (a) the Collateral Agent acting or refraining from acting in accordance with the directions of the Directing Party (or other applicable Person or set of Persons), (b) the Collateral Agent refraining from acting in the absence of written instructions to act from the Directing Party (or other applicable Person or set of Persons), whether or not the Collateral Agent has discretionary power to take such action, or (c) the Collateral Agent taking discretionary action it is authorized to take.

An Additional Parity Debt Agreement shall be entitled to the benefit of the Collateral Agency Agreement, and the holder (or trustee, agent or other representative of such holder) of the related Additional Parity Debt shall constitute an Additional Parity Obligee, if and only if: (a) such Person executes a Joinder Supplement in substantially the form of Exhibit A to the Collateral Agency Agreement (a “Joinder Supplement”), pursuant to which such Person shall agree to become a party to and bound by the Collateral Agency Agreement as an “Additional Parity Obligee”, and pursuant to which a particular Additional Parity Debt Agreement is designated as such for the purposes of the Collateral Agency Agreement, and (b) the University consents thereto.

The Collateral Agency Agreement provides that the provisions thereof relating to priority of distributions by the Collateral Agent apply solely to priorities of distributions resulting from realization on the Shared Security Documents, and not to the priorities of the Obligations. Nothing contained in the Collateral Agency Agreement or in any other Shared Security Document is intended to effect a subordination of any Obligation to any other Obligation. The Secured Parties agree that, upon any realization on the Shared Collateral pursuant to the Shared Security Documents, the Secured Parties shall share in the proceeds of such realization in the manner provided in the Collateral Agency Agreement, and if any Secured Party shall realize any funds on the Shared Collateral otherwise than pursuant to the Collateral Agency Agreement, such Secured Party shall remit the same to the Collateral Agent, which shall apply the same as provided in the Collateral Agency Agreement. The Collateral Agency Agreement applies to realization on the Shared Collateral pursuant to the Shared Security Documents, and nothing in the Collateral Agency Agreement or in any other Shared Security Document, express or implied, shall be construed to require any Parity Obligee to share with any other Parity Obligee any collections received on account of Obligations other than on account of the Shared Security Documents.

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Under the Collateral Agency Agreement there is created and established with the Collateral Agent a special account referred to as the “Shared Collateral Account”. The Collateral Agent shall maintain the Shared Collateral Account as agent under the Collateral Agency Agreement, and the assets therein shall be segregated and not commingled with other assets of the Collateral Agent. The Collateral Agent shall invest and reinvest moneys on deposit in the Shared Collateral Account in Cash Equivalent Investments as shall be specified by the Directing Party from time to time in its own name as agent under the Collateral Agency Agreement, and all such investments and the interest and income received thereon and the net proceeds on the sale or redemption thereof shall be held in the Shared Collateral Account. The Collateral Agent shall deposit in the Shared Collateral Account all money or proceeds received by it from any of the Shared Collateral or from the enforcement of or realization upon any of the Shared Collateral and all other funds required to be so deposited under any Shared Security Document. No other funds shall be deposited in the Shared Collateral Account or commingled with funds in the Shared Collateral Account. The Collateral Agent may establish such subaccounts within the Shared Collateral Account as it deems appropriate from time to time.

The Collateral Agent shall make distributions from the Shared Collateral Account from time to time when directed in writing by the Directing Party or at such other times as may be required by law, except that (x) the Collateral Agent shall have the right at any time to apply monies held by it in the Shared Collateral Account to the payment of due and unpaid Collateral Agent Obligations, and (y) if and so long as no Event of Default shall have occurred and be continuing and the University shall have delivered to the Collateral Agent an opinion of nationally-recognized bond counsel that such action is necessary to maintain the exclusion from gross income of interest payable on any tax-exempt obligations issued for the benefit of the University (collectively, “Tax-Exempt Obligations”), the Collateral Agent shall, at the written direction of the University, apply monies in the Shared Collateral Account representing casualty insurance proceeds or condemnation awards received by the Collateral Agent pursuant to any Secured Party Document with respect to property financed with the proceeds of such Tax- Exempt Obligations to the payment or redemption of such Tax-Exempt Obligations. Except as otherwise provided in the immediately preceding sentence, on any date a distribution from the Shared Collateral Account is made pursuant to this section of the Collateral Agency Agreement (a “distribution date”), all monies held by the Collateral Agent in the Shared Collateral Account shall, to the extent available for distribution, be distributed by the Collateral Agent as follows:

First: to the Collateral Agent for any Collateral Agent Obligations due and unpaid upon such distribution date;

Second: to each Parity Obligee, in an amount equal to all amounts due and payable to such Parity Obligee on such distribution date with respect to the Parity Obligations relating to such Parity Obligee; provided, that if such moneys to be distributed by the Collateral Agent shall be insufficient to pay in full the amounts owing to each Parity Obligee, then such distribution shall be made ratably (without priority of any one over any other) to each Parity Obligee in proportion to the respective amounts so owing to each Parity Obligee on such distribution date; and

Finally: if all Secured Obligations shall have been paid in full in cash, all commitments to lend or extend credit under the Secured Party Documents shall have terminated, and all other Secured Party Documents shall have terminated, any surplus then remaining shall be paid to the University or its successors or assigns or to whomsoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct.

The Parity Obligees may amend item “Second” above to provide for a different order of distribution among themselves in a writing signed by each Parity Obligee and the Collateral Agent and delivered to the University. [End of Appendix C]

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APPENDIX D

FORM OF CONTINUING DISCLOSURE AGREEMENT

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CONTINUING DISCLOSURE AGREEMENT

This Continuing Disclosure Agreement (the “Disclosure Agreement”) made as of June 20, 2017, by and among Cabrini University (the “University”), The Bank of New York Mellon Trust Company, N.A., as trustee for the Bonds hereinafter defined (the “Trustee”) and The Bank of New York Mellon Trust Company, N.A., as Dissemination Agent,

W I T N E S S E T H:

WHEREAS, pursuant to the Bond Purchase Agreement (the “Purchase Agreement”) dated May 31, 2017, by and among the Delaware County Authority (the “Authority”), RBC Capital Markets, LLC and Wells Fargo Bank, National Association (collectively, the “Underwriter”) and the University, the Authority is selling $49,265,000 aggregate principal amount of its Revenue Bonds (Cabrini University) Series of 2017 (the “Bonds”) to the Underwriter; and

WHEREAS, Rule 15c2-12(b)(5) promulgated under the Securities Exchange Act of 1934, as amended (the “Rule”), provides that a Participating Underwriter (as defined in the Rule) shall not purchase or sell municipal securities in connection with an Offering (as defined in the Rule) unless the Participating Underwriter has reasonably determined that an issuer of municipal securities, or an obligated person for whom financial or operating data is presented in the final official statement has undertaken, either individually or in combination with other issuers of such municipal securities or obligated persons, in a written agreement or contract for the benefit of holders of such securities, to provide, either directly or indirectly through an indenture trustee or a designated agent, certain specified financial information and operating data and notices of certain material events; and

WHEREAS, the University currently is the only obligated person with respect to the Bonds for purposes of the Rule; and

WHEREAS, in order to assist the Underwriter in complying with the requirements of the Rule, the University, as such obligated person, has agreed to enter into this Disclosure Agreement.

NOW, THEREFORE, in consideration of the premises, the parties hereto, intending to be legally bound hereby, agree as follows:

Section 1. Definitions. In addition to the terms defined in the above recitals, the following terms shall have the meanings specified below:

“Dissemination Agent” shall mean The Bank of New York Mellon Trust Company, N.A., or any successor Dissemination Agent designated in writing by the University and which has filed with the University a written acceptance of such designation.

“EMMA” shall mean the MSRB’s Electronic Municipal Market Access System (www.emma.msrb.org).

“MSRB” shall mean the Municipal Securities Rulemaking Board.

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“Official Statement” shall mean the Authority’s Official Statement dated May 31, 2017 prepared in connection with the offering of the Bonds.

Capitalized terms not defined herein shall have the meaning ascribed to such terms in the Purchase Agreement.

Section 2. Covenants of the University.

The University covenants as follows:

(a) The University shall deliver, or provide to the Dissemination Agent and direct the Dissemination Agent in writing to deliver, to the MSRB, through EMMA, or such other entity then required or permitted under the Rule, within 180 days after the end of each fiscal year commencing with the fiscal year ending June 30, 2017:

(1) A copy of its annual financial statements prepared in accordance with generally accepted accounting principles and audited by a certified public accountant; and

(2) An update of the financial information and operating data relating to the University in the tables contained in Appendix A of the Official Statement under the following captions: “Enrollment”, “Student Tuition/Fees and Comparative Information from Competing Institutions” (excluding the table of tuition and fees of institutions other than the University), “Student Financial Aid”, “Gifts, Contributions and Grants” and “University Finances”.

(b) In a timely matter, not in excess of ten (10) business days after the occurrence of the event, the University shall deliver, or provide to the Dissemination Agent and direct the Dissemination Agent in writing to deliver, to the MSRB, through EMMA, or such other entity then required or permitted under the Rule, notice of any of the following events (collectively, “Reportable Events”) with respect to the Bonds:

(1) Principal and interest payment delinquencies;

(2) Non-payment related defaults, if material;

(3) Unscheduled draws on any debt service reserves reflecting financial difficulties;

(4) Unscheduled draws on credit enhancements reflecting financial difficulties;

(5) Substitution of any credit or liquidity providers, or their failure to perform;

(6) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of

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Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the Bonds, or other material events affecting the tax status of the Bonds;

(7) Modifications to rights of the Owners, if material;

(8) Bond calls, if material;

(9) Tender offers;

(10) Defeasances;

(11) Release, substitution, or sale of property securing payment of the Bonds, if material;

(12) Rating changes on the Bonds or on any other debt for which the University is obligated;

(13) Bankruptcy, insolvency, receivership or similar proceeding of the University;

(14) The consummation of a merger, consolidation, or acquisition involving the University or the sale of all or substantially all of the assets of the University, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; and

(15) Appointment of a successor or additional trustee or the change of name of a trustee, if material.

(c) In a timely manner, the University shall deliver, or provide to the Dissemination Agent and direct the Dissemination Agent in writing to deliver, to the MSRB, through EMMA, or such other entity then required or permitted under the Rule, notice of any failure by the University to provide any information required pursuant to subsection (a) above on or before the date specified in subsection (a) above.

(d) The University agrees that the provisions of this Section 2 shall be for the benefit of the registered holders and beneficial owners of the Bonds, and shall be enforceable by any holders or beneficial owners of the Bonds, or by the Trustee on their behalf, in accordance with the provisions of Section 8 herein.

Section 3. Duties of Trustee and Dissemination Agent.

(a) The Trustee shall have no responsibility or liability in connection with the University’s filing obligations under this Disclosure Agreement; and the Trustee shall have no responsibility to retain or maintain any filings or notices accepted by the Trustee hereunder, if any. The Trustee shall have only those duties specifically set forth in this Disclosure Agreement

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and no covenants or other obligations shall be read into this Disclosure Agreement against the Trustee. The University agrees to indemnify and save the Trustee, its officers, directors, employees and agents, harmless against any loss, expense or liability arising out of the performance of its duties hereunder, excluding any loss, expense or liability due to the Trustee’s gross negligence or willful misconduct.

(b) The initial Dissemination Agent shall be The Bank of New York Mellon Trust Company, N.A. The Dissemination Agent shall not be responsible pursuant to the provisions of this Disclosure Agreement in any manner for the content of any financial statements, notice or report prepared by the University or its agents pursuant to or in connection with this Disclosure Agreement. Notwithstanding anything to the contrary herein, the Dissemination Agent shall have no liability other than for its gross negligence or willful misconduct and in no event shall the Dissemination Agent be liable for special, indirect or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Dissemination Agent has been advised of the likelihood of such loss or damage and regardless of the form of action. The University may, from time to time, appoint or engage a new Dissemination Agent, and may discharge any Dissemination Agent upon thirty (30) days written notice, with or without appointing a successor Dissemination Agent. The Dissemination Agent may resign from its duties hereunder at any time upon thirty (30) days written notice to the University. The Dissemination Agent shall have only those duties specifically set forth in this Disclosure Agreement and no covenants or other obligations shall be read into this Disclosure Agreement against the Dissemination Agent. The University agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense or liability arising out of the performance of its duties hereunder, excluding any loss, expense or liability due to the Dissemination Agent’s gross negligence or willful misconduct.

(c) The indemnifications provided herein shall survive the termination of this Disclosure Agreement or the sooner resignation or removal of the Trustee or the Dissemination Agent, as applicable.

Section 4. Termination of Reporting Obligations. The University’s obligations under this Disclosure Agreement shall terminate upon the legal defeasance, prior redemption, or payment in full of all of the Bonds. If the University’s obligations with respect to the payment of the Bonds are assumed in full by some other entity, such other entity shall be responsible for compliance with this Disclosure Agreement in the same manner as if it were the University, and the University shall have no further responsibility hereunder. In addition, the University’s obligation to provide information and notices as specified in Section 2 hereof shall terminate (i) at such other times as such information and notices (or any portion thereof) are no longer required to be provided by the Rule as it applies to the Bonds, (ii) in the event of a repeal or rescission of the Rule or (iii) upon a determination that the Rule is invalid or unenforceable.

Section 5. Amendment. This Disclosure Agreement may be amended by written agreement of the Trustee and the University, and, in the event the obligations of the Dissemination Agent shall be materially different subsequent to the effectiveness of the amendment, the Dissemination Agent. The Trustee shall agree to any amendment requested by the University (i) that is made in connection with a change in legal requirements, change in law or change in the identity, nature or status of the University; (ii) that results in this Disclosure

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Agreement, as amended, complying with the requirements of the Rule, taking into account any amendments or interpretations of the Rule; and (iii) which does not impose any obligation upon Trustee which would materially differ from the obligations assumed by the Trustee under this Disclosure Agreement as originally executed. Prior to executing any requested amendment, the Trustee may request the University to provide, and upon making such request shall receive, an opinion of counsel that is knowledgeable in federal securities laws and not unacceptable to the Trustee, to the effect that the proposed amendment satisfies the requirements described above, upon which opinion the Trustee may exclusively rely. In the event of any amendment or waiver of a provision of this Disclosure Agreement, the University shall describe such amendment in its next annual report delivered pursuant to Section 2(a) hereof, and shall include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the financial information or operating data being presented by the University. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements (i.e., changes other than those prescribed by generally accepted accounting principles in the U.S.) (i) notice of such change shall be given pursuant to the Reportable Event notice requirements as set forth in this Disclosure Agreement; and (ii) the annual report for the year in which the change is made will present a comparison 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. To the extent that the Rule requires or permits an approving vote of beneficial owners of the Bonds in connection with an amendment, the approving vote of beneficial owners of Bonds constituting more than 50% of the aggregate principal amount of the then outstanding Bonds shall constitute such approval. The University shall file, or provide to and direct the Dissemination Agent in writing to file, notice of any amendment to this Disclosure Agreement with the MSRB through EMMA, or such other entity then required or permitted under the Rule.

Section 6. Remedies for Default. In the event of a breach or default by the University of its covenants to provide annual financial information and notices as provided in Section 2 hereof or the Dissemination Agent to make any filing as required hereunder, the Trustee or any holder or beneficial owner of Bonds shall have the right to bring an action in a court of competent jurisdiction to compel specific performance by the University or the Dissemination Agent, as applicable. The foregoing shall be the sole remedy available hereunder and a breach or default under this Disclosure Agreement shall not constitute an event of default under the Indenture or the Loan Agreement, the Bonds or any other agreement. The Trustee shall be under no obligation to enforce this Disclosure Agreement unless (i) directed in writing by the holders or beneficial owners of at least 25% of the outstanding principal amount of the Bonds, and (ii) furnished with indemnity and security for costs and expenses (including legal fees, costs and expenses) satisfactory to it.

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Section 7. Additional Information. Nothing in this Disclosure Agreement shall be deemed to prevent the University from disseminating any other information, using the means of dissemination set forth in this Disclosure Agreement or any other means of communication, or including any other information in any annual report or notice of occurrence of a Reportable Event, in addition to that which is required by this Disclosure Agreement. If the University chooses to include any information in any annual report or notice of occurrence of a Reportable Event, in addition to that which is specifically required by this Disclosure Agreement, the University shall have no obligation under this Disclosure Agreement to update such information or include it in any future annual report or notice of occurrence of a Reportable Event.

Section 8. Miscellaneous.

(a) Binding Nature of Agreement. This Disclosure Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. In addition, registered owners of the Bonds, which for the purposes of this Section 8 includes the holders of a book-entry credit evidencing an interest in the Bonds, from time to time shall be third party beneficiaries hereof and shall be entitled to enforce the provisions hereof as if they were parties hereto; but no consent of beneficial owners of the Bonds shall be required in connection with any amendment of this Disclosure Agreement, except as required by the Rule. Holders of book-entry credits evidencing an interest in the Bonds may file their names and addresses with the Trustee for the purposes of giving direction under this Disclosure Agreement.

(b) Notices. All notices and other communications required or permitted under this Disclosure Agreement shall be in writing and shall be deemed to have been duly given, made and received only when delivered (personally, by recognized national or regional courier service, or by other messenger, for delivery to the intended addressee) or when deposited in the United States mails, registered or certified mail, postage prepaid, return receipt requested, or when sent by facsimile or email, addressed or sent as set forth below:

If to the Trustee:

The Bank of New York Mellon Trust Company, N.A. 1735 Market Street, Ninth Floor Philadelphia, PA 19103 Facsimile: (215) 553-6915 Attention: Global Corporate Trust

If to the University:

Cabrini University 610 King of Prussia Rd. Radnor, PA 19087-3698 Attention: Vice President for Finance and Treasurer

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If to the Dissemination Agent:

The Bank of New York Mellon Trust Company, N.A. 1735 Market Street, Ninth Floor Philadelphia, PA 19103 Facsimile: (215) 553-6915 Attention: Global Corporate Trust

Any party may alter the address, email address or facsimile number to which communications are to be sent by giving notice of such change of address, email address or facsimile number in conformity with the provisions of this Section.

(c) Execution in Counterparts. This Disclosure Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original as against any party whose signature appears thereon, and all of which shall together constitute one and the same instrument. This Disclosure Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall be executed by all of the parties hereto.

(d) Controlling Law. This Disclosure Agreement and all questions relating to its validity, interpretation, performance and enforcement shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania, without regard to conflict of law principles, and Federal securities law.

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IN WITNESS WHEREOF, the parties hereto have executed this Continuing Disclosure Agreement as of the date first above written.

CABRINI UNIVERSITY

By: Authorized Officer

THE BANK OF NEW YORK MELLON TRUST COMPANY, N. A., as Trustee

By: Authorized Representative

THE BANK OF NEW YORK MELLON TRUST COMPANY, N. A., as Dissemination Agent

By: Authorized Representative

[SIGNATURE PAGE TO CONTINUING DISCLOSURE AGREEMENT – CABRINI 2017]

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APPENDIX E

PROPOSED FORM OF OPINION OF BOND COUNSEL

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Proposed Form of Opinion of Bond Counsel

[Date of Issuance of Bonds]

Delaware County Authority Media, Pennsylvania

Re: $49,265,000 Delaware County Authority Revenue Bonds (Cabrini University) Series of 2017

Ladies and Gentlemen:

We have acted as Bond Counsel in connection with the issuance by the Delaware County Authority (the “Authority”) of $49,265,000 aggregate principal amount of its Revenue Bonds (Cabrini University) Series of 2017 (the “Bonds”).

The Bonds are being issued pursuant to the Pennsylvania Municipality Authorities Act, as amended (the “Act”), and under a Trust Indenture, dated as of June 1, 2017 (the “Indenture”), between and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”), to accomplish the public purposes of the Act by aiding in the financing of certain projects (the “Projects”) for the benefit of the Cabrini University (the “University”), as described in the Indenture.

In order to finance the Projects, the Authority and the University have entered into a Loan Agreement, dated as of June 1, 2017 (the "Loan Agreement"), under which the Authority has agreed to lend the proceeds of the issuance and sale of the Bonds to the University and the University has agreed to repay such loan by making payments to the Authority or its assigns at such times and in such amounts as shall be sufficient to enable the Authority to pay when due the principal of, premium if any, and interest on the Bonds. Under the Indenture, the Authority has assigned substantially all of its rights under the Loan Agreement to the Trustee as security for the Bonds. The Authority and the University have also executed and delivered a Tax Compliance Agreement, dated the date hereof (the “Tax Compliance Agreement”), regarding compliance with certain requirements of the Internal Revenue Code of 1986, as amended (the "Code"), relating to the Bonds.

In the course of our duties as Bond Counsel and in connection with the preparation of this opinion, we have examined the law and such certified proceedings and other papers as we deemed relevant, including executed counterparts of the Indenture and the Loan Agreement. We have also examined a photocopy of an executed Bond authenticated by the Trustee and assume that all other Bonds have been similarly executed and authenticated. As to questions of fact material to our opinion, we have relied upon representations of the Authority and the University contained in the Indenture, the Loan Agreement, the Tax Compliance Agreement and the other financing documents, the certified proceedings and other certifications of public officials furnished to us, and other certifications furnished to us by or on behalf of the Authority and the University, without undertaking to verify the same by independent investigation. Additionally, in rendering this opinion we have reviewed and relied upon the opinion of Saul Ewing LLP, counsel to the University, with respect to, among other things, the status of the University as an organization described in Section 501(c)(3) of the Code.

Based upon the foregoing, we are of the opinion that:

1. The Authority is validly existing as a public body and a body corporate and politic with the corporate power and authority to issue and sell the Bonds and to enter into and perform its obligations under the Indenture and the Loan Agreement.

2. The Indenture and the Loan Agreement have been duly authorized, executed and delivered by the Authority and, assuming such documents have been duly authorized, executed and delivered by the other parties thereto, are valid and binding obligations of the Authority and are enforceable against the Authority.

3. The Bonds have been duly authorized, executed and delivered by the Authority and are valid and binding limited obligations of the Authority, payable solely from the loan payments required to be made by or on behalf of the University under the Loan Agreement and the other moneys pledged or available for such purpose under or pursuant to the Indenture. The Bonds do not constitute a pledge of the general credit of the Authority or a pledge of the credit or taxing power of the County of Delaware or of the Commonwealth of Pennsylvania or any political subdivision thereof. The Authority has no taxing power.

4. Under existing law, interest on the Bonds is exempt from Pennsylvania personal income tax and from Pennsylvania corporate net income tax, and the Bonds are exempt from personal property taxes in Pennsylvania.

5. Under existing law, interest on the Bonds is excluded from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; however, interest on the Bonds held by a corporation (as defined for federal income tax purposes) may be indirectly subject to federal alternative minimum tax because of its inclusion in the adjusted current earnings of a corporate holder. The opinion set forth in the preceding sentence is subject to the condition that the Authority and the University comply with all requirements of the Code that must be satisfied subsequent to the issuance of the Bonds in order that the interest thereon be, or continue to be, excluded from gross income for federal income tax purposes. The Authority and the University have covenanted to comply with all such requirements. Failure to comply with certain of such requirements may cause interest on the Bonds to be included in gross income for federal income tax purposes retroactive to the date of issuance of the Bonds.

In rendering our opinion above with respect to the treatment of the interest on the Bonds under the federal tax laws, we have assumed the correctness of, and relied upon the accuracy of, representations of the University concerning the use of the facilities financed with the Bonds in activities that are considered “unrelated trade or business” activities of the University, as defined in Section 513(a) of the Code. Failure of the University to maintain its qualification as an organization described in Section 501(c)(3) of the Code, or failure of the University to use the facilities financed by the Bonds in a manner that is substantially related to the University’s charitable purpose under Section 513(a) of the Code, may cause interest on the Bonds to be included in gross income retroactively to the date of the issuance of the Bonds.

Ownership of tax-exempt obligations, including the Bonds, may result in collateral federal income tax consequences to certain taxpayers, including financial institutions, property and casualty insurance companies, individual recipients of Social Security or Railroad Retirement benefits, S corporations with “excess net passive income” and taxpayers who may be deemed to have incurred or

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continued indebtedness to purchase or carry such obligations. We express no opinion as to such collateral federal income tax consequences.

We have not been engaged and have not undertaken to review the accuracy, completeness or sufficiency of any offering material of the Authority or the University relating to the Bonds and we express no opinion relating thereto.

It is to be understood that the rights of the holders of the Bonds and the enforceability of the Bonds, the Indenture and the Loan Agreement may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’ rights and that their enforcement may also be subject to the exercise of judicial discretion in appropriate cases.

The opinions herein are expressed as of the date hereof only and not as of some future date. We have not undertaken and will not undertake any responsibility to supplement or update our opinions to consider, or inform any person of, any events or actions occurring or taken (or not occurring or not taken) subsequent to the date hereof, including, but not limited to, any events or actions which may affect the tax status of interest on the Bonds.

Very truly yours,

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