Athletic Facilities Revenue Bonds Series 2018A

AMENDMENT DATED JANUARY 12, 2018 TO PRELIMINARY OFFICIAL STATEMENT DATED JANUARY 9, 2018 RELATING TO

$10,650,000* CLEMSON UNIVERSITY, SOUTH CAROLINA ATHLETIC FACILITIES REVENUE BONDS SERIES 2018A

The Preliminary Official Statement (the “Preliminary Official Statement”) of Clemson University, South Carolina (the “University”) dated January 9, 2018 in reference to its Athletic Facilities Revenue Bonds, Series 2018A (the “Series 2018A Bonds”) has been amended to reflect (i) a lower anticipated par amount of $10,650,000* and a revised anticipated maturity schedule and (ii) that proceeds of the Series 2018A Bonds together with other funds of the University will be used for the purposes of (a) defraying a portion of the costs of planning, developing, constructing and equipping a tennis facility on the campus of the University (the “Tennis Facility Project”), and (b) paying the costs of issuance of the Series 2018A Bonds. The revised anticipated maturity schedule is as follows:

May 1 Principal Amount* May 1 Principal Amount* 2022 $ 125,000 2035 $ 430,000 2023 135,000 2036 440,000 2024 265,000 2037 455,000 2025 275,000 2038 455,000 2026 290,000 2039 470,000 2027 305,000 2040 485,000 2028 315,000 2041 500,000 2029 330,000 2042 520,000 2030 350,000 2043 535,000 2031 365,000 2044 560,000 2032 380,000 2045 590,000 2033 395,000 2046 620,000 2034 410,000 2047 650,000 ______* Preliminary, subject to change.

In addition, the section of the Preliminary Official Statement entitled, “DEBT STRUCTURE OF THE UNIVERSITY – Future Debt Issuances” located on page 42 of the Preliminary Official Statement has been revised to add the following disclosure:

“The University intends to issue approximately $1 million of taxable debt at a future date, in the form of either a public bond issuance or privately-placed bank loan, for the purpose of funding a portion of the Tennis Facility Project.”

January 12, 2018. This Preliminary Official Statement and the information contained herein are subject to completion or amendment without notice. Under no circumstances shall this Preliminary Official Statement constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the Series 2018A Bonds in any jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of that jurisdiction. transfer, andcertainfranchisetaxes.See“TAX MATTERS” herein foradescriptionoftheseandothertaxconsiderations. State, county, municipal,schooldistrict,andothertaxesassessmentsimposedwithintheStateofSouthCarolina, exceptestate, tax imposedonindividuals.IntheopinionofBondCounsel,Series2018A Bondsandtheinterest thereon are exemptfrom all gross incomeforfederaltaxpurposesandisnotanitemofpreference forpurposesofthefederalalternativeminimum University withcertaincovenantsandtheaccuracyofrepresentations, interest ontheSeries2018A Bondsisexcludedfrom * Preliminary, subjectto change. Dated: January__, 2018 Dated: January1,2018 BOOK-ENTRY-ONLY NEW ISSUE Paying Agent fortheSeries2018A Bonds. as serve will Carolina South of Trustee2018ASeries the for National Bank U.S. Bonds. and Registrar the as serve will Association State the of State Treasurer the of Office The 2018. 1, May commencing 1, November and 1 May each on semiannually payable is years and in the amounts, and bear interest at the rates as set forth on the inside cover page hereof. Interest on the Series 2018ASeries such on interest and of principal 2018Aof payment 2018Areceive Bond. Series to The order in the of each in mature Bonds Bonds Each Bonds. 2018A Series the of delivery beneficial ownerphysical of a Seriesreceive 2018Ato Bond must maintainentitled an account withbe a broker ornot dealer who is,will or acts through,Purchasers a DTC participant participants. DTC through, act or are, who dealers and brokers through DTC by maintained system book-entry-only a under 2018ABonds Series the for depository the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York (“DTC”), which will act as securities 2018A SERIES “THE See regarding theuseofproceeds. Bonds. 2018A Series the of issuance of costs details additional for herein Proceeds” of Uses and Sources the Estimated “- The Tennis“- Purposes,” and – Project,” BONDS Facility paying (ii) and University,facility tennis the a of equipping and campus constructing the developing, planning, on of costs the defraying (i) of purposes the for issued being are the facilitiesof DTC onoraboutJanuary30,2018. University with respect to the Series 2018A Bonds. It is expected that the Series 2018A Bonds will be available for delivery through University by Chip Hood, Esquire, General Counsel to the University. Hilltop Securities, Inc. has served as Financial Advisor to the the for and University; the for Counsel Disclosure as LLC, Nettles, & Linkous Howell by upon passed be will matters legal other withdrawal or modification of the offer without notice, and to the approval of legality by Pope Flynn, LLC, as Bond Counsel. Certain the entireOfficialStatementtoobtaininformationessential to themakingofaninformedinvestmentdecision. AND ANY SPECIAL STUDENT FEE. THE UNIVERSITY DOESNOT HAVE TAXING POWER. EXCEPT FROM THE NET REVENUES AND THE RECEIPTSFROM THE IMPOSITIONOF ANY ADMISSIONS FEE UNIVERSITY ISNOT OBLIGATED TO PAY THE SERIES2018A BONDS,OR THE INTEREST THEREON, SAVE AND ARE NOT PLEDGEDFOR THE PAYMENT OF PRINCIPAL ORINTEREST ON THE SERIES 2018A BONDS. THE INVOLVING REVENUESFROM ANY TAX). THE FULL FAITH AND CREDIT OF THE STATE OF SOUTHCAROLINA CAROLINA CONSTITUTION AUTHORIZING OBLIGATIONS PAYABLE FROMSPECIAL SOURCESNOT STATUTES OF THE STATE OF SOUTHCAROLINA (OTHER THAN ARTICLE X,SECTION13OF THE SOUTH WITHIN THE MEANINGOF ANY PROVISION,LIMITATION, ORRESTRICTIONOF THE CONSTITUTIONOR Facilities RevenuesBondsandanyadditionalparity Athletic FacilitiesRevenueBondsissuedpursuanttotheBondResolution. outstanding the Athletic securing pledges the with respects all in parity a on be shall pledge Such Fee. Student Special any and Fee Net Revenues of the University’s Athletic Department and the gross receipts from the imposition by the University of any Admissions C attachedhereto,towhichattentionisdirected. otherwise defined on this cover page shall have the meanings given to such terms in the body of this Official Statement and Appendix In theopinionofPopeFlynn,LLC,BondCounseltoUniversity, underexistinglaw, assumingcontinuingcompliancebythe The Series 2018A Bonds are issuable as fully-registered bonds in the denomination of $5,000 or any integral multiple thereof in “University”) (the University Clemson of Bonds”) 2018A “Series (the 2018A Series Bonds, Revenue Facilities Athletic The The Series 2018A Bonds are offered when, as, and if issued and received by the Underwriter, subject to prior saleorto prior to subject bythe Underwriter, andreceived ifissued and as, when, offered are Bonds 2018A Series The read should Investors issue. the of summary a not is only.It reference quick for information certain contains page cover This THE SERIES2018A BONDSSHALL NOT IN ANY EVENT CONSTITUTE AN INDEBTEDNESSOF THE STATE the of pledge a by secured and from solely payable are and University the of obligations special 2018Aare Series Bonds The not and used terms Capitalized herein. described as maturity to prior redemption to subject are Bonds 2018A Series The

PRELIMINARY OFFICIAL STATEMENT DATED JANUARY 9, 2018

CLEMSON UNIVERSITY, SOUTH CAROLINA ATHLETIC FACILITIES REVENUEBONDS SERIES 2018A $11,310,000* ® (See “MISCELLANEOUS-Rating”herein) Due: As shownontheinsidecover page. RATING: Moody’s: “Aa3”

MATURITY SCHEDULE

$11,310,000* CLEMSON UNIVERSITY, SOUTH CAROLINA ATHLETIC FACILITIES REVENUE BONDS SERIES 2018A

Due Principal Interest Due Principal Interest May 1 Amount* Rate Yield CUSIP† May 1 Amount* Rate Yield CUSIP† 2019 $190,000 2034 $390,000 2020 200,000 2035 405,000 2021 210,000 2036 420,000 2022 220,000 2037 440,000 2023 235,000 2038 455,000 2024 245,000 2039 475,000 2025 255,000 2040 495,000 2026 270,000 2041 515,000 2027 280,000 2042 535,000 2028 295,000 2043 555,000 2029 310,000 2044 585,000 2030 325,000 2045 610,000 2031 345,000 2046 640,000 2032 360,000 2047 675,000 2033 375,000

$______% Term Bonds, due May 1, ____, Yield ______%, CUSIP† ______$______% Term Bonds, due May 1, ____, Yield ______%, CUSIP† ______

______* Preliminary, subject to change. † Copyright, American Bankers Association. CUSIP data herein are provided by Standard & Poor’s, CUSIP Service Bureau, a division of The McGraw-Hill Companies, Inc. The CUSIP numbers listed above are being provided solely for the convenience of Bondholders only at the time of issuance of the Series 2018A Bonds and the University makes no representation with respect to such numbers nor undertakes any responsibility for their accuracy now or at any time in the future. The CUSIP number for a specific maturity is subject to being changed after the issuance of the Series 2018A Bonds as a result of various subsequent actions including, but not limited to, a refunding in whole or in part of such maturity or as a result of the procurement of secondary market portfolio insurance or other similar enhancement by investors that is applicable to all or a portion of certain maturities of the Series 2018A Bonds.

For purposes of compliance with Rule 15c2-12 (“Rule 15c2-12”) of the U.S. Securities and Exchange Commission, this document, as the same may be supplemented or corrected by Clemson University (the “University”) from time to time (collectively, the “Official Statement”), may be treated as an “Official Statement” with respect to the Series 2018A Bonds described herein that is deemed final as of the date hereof (or as of the date of any such supplement or correction) by the University. The Official Statement, when further supplemented by a Final Official Statement specifying the interest rates, principal amounts, in the aggregate and per maturity, and delivery dates of the Series 2018A Bonds, together with any other information required by law, shall constitute a “Final Official Statement” of the University with respect to the Series 2018A Bonds, as that term is defined in Rule 15c2-12. Any addendum or amendment shall, on and after the date thereof, be fully incorporated herein and made a part hereof by reference.

This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the Series 2018A Bonds by any person in any jurisdiction in which it is unlawful to make such offer, solicitation, or sale. No dealer, broker, salesperson, or other person has been authorized by the Board of Trustees of Clemson University (the “Board of Trustees”) to give any information or to make any representation, other than as contained in this Official Statement, in connection with the offering described herein, and if given or made, such other information or representation must not be relied upon as having been authorized by the Board of Trustees. This Official Statement is submitted in connection with the sale of the Series 2018A Bonds described herein, and may not be reproduced, used, or relied upon, in whole or in part, for any other purpose.

The University designates the senior managing underwriter of the syndicate to which the Series 2018A Bonds are awarded as its agent for purposes of distributing copies of the final Official Statement to each participating underwriter. Any underwriter executing and delivering a bid with respect to the Series 2018A Bonds agrees thereby that if its bid is accepted by the University (i) it shall accept such designation and (ii) it shall enter into a contractual relationship with all participating underwriters of the Series 2018A Bonds for purposes of assuring the receipt by each participating underwriter of the final Official Statement.

By awarding the Series 2018A Bonds to any underwriting syndicate submitting a bid pursuant to the terms of the Official Notice of Sale, the University agrees that, no more than seven business days after the date of such award, it shall provide without cost to the senior managing underwriter of the syndicate to which the Series 2018A Bonds are awarded copies of the final Official Statement in the amount specified in the Series 2018A Official Notice of Sale.

CERTAIN INFORMATION CONTAINED IN THIS OFFICIAL STATEMENT MAY HAVE BEEN OBTAINED FROM SOURCES OTHER THAN RECORDS OF THE UNIVERSITY AND, WHILE BELIEVED TO BE RELIABLE, IS NOT GUARANTEED AS TO COMPLETENESS OR ACCURACY. THE INFORMATION AND EXPRESSIONS OF OPINION IN THIS OFFICIAL STATEMENT ARE SUBJECT TO CHANGE, AND NEITHER THE DELIVERY OF THIS OFFICIAL STATEMENT NOR ANY SALE MADE HEREUNDER SHALL CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE UNIVERSITY SINCE THE DATE HEREOF.

Reference herein to laws, rules, regulations, resolutions, agreements, reports, and other documents do not purport to be comprehensive or definitive. All references to laws, rules, regulations, agreements, reports, and other documents are qualified in their entirety by reference to the particular laws, rules, regulations, agreements, reports, and other documents, the full text of which may contain qualifications of and exceptions to statements made herein. Where full texts have not been included as appendices to this Official Statement, they will be furnished on request.

The Series 2018A Bonds will not be registered under the Securities Act of 1933, as amended, or any state securities law, and the same will not be listed on any stock or other securities exchange. Neither the U.S. Securities and Exchange Commission nor any other federal, state, or other governmental entity or agency will have passed upon the accuracy or adequacy of this Official Statement or approved the Series 2018A Bonds for sale. Any representation to the contrary is a criminal offense.

IN MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE UNIVERSITY AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED. THESE SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY OF THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS IN THIS OFFICIAL STATEMENT

This Official Statement contains statements which should be considered “forward-looking statements,” meaning they refer to possible future events or conditions. Such statements are generally identifiable by the use of the future tense or by terms such as “may,” “intend,” “will,” “expect,” “forecast,” “project,” “anticipate,” “estimate,” “plan,” “budget,” “believe,” “should,” “strategy,” “position,” or the negative of such terms or variations of such words or similar expressions. In particular, any statements, express or implied, concerning future operating results or the ability to generate Net Revenues to service indebtedness are forward-looking statements. Investors are cautioned that reliance on any of those forward-looking statements involves risks and uncertainties and that, although the University’s management believes that the assumptions on which those forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate. Those forward-looking statements, including forecasts, projections, and estimates, are based on currently available information, expectations, estimates, assumptions, and projections, and management’s judgment about future revenues of the University’s Athletic Department, expenses of operations, and general economic conditions. The forward-looking statements are not guarantees of future performance. Actual results may vary materially and adversely from what is contained in a forward-looking statement. Factors which may cause results different from those expected or anticipated include, among others, decrease in student enrollment, increases in costs of operation, decreases in levels of State financial support, general economic and business conditions, and various other events, conditions, and circumstances, many of which are beyond the control of the University. As a result, the forward-looking statements based on those assumptions also could be incorrect, and actual results may differ materially and adversely from any results indicated or suggested by those assumptions.

Although the University believes in making any such forward-looking statement, and its expectations are based on assumptions considered reasonable by the University, any such forward-looking statement involves uncertainties and is qualified in its entirety by reference to factors both identified within this Official Statement and from publicly available sources about trends in higher education and collegiate athletics that could cause the actual financial operating results of the University to differ materially and adversely from those contemplated in such forward-looking statements.

Any forward-looking statement speaks only as of the date such statement is made, and the University undertakes no obligation to update any forward-looking statement in this Official Statement to reflect events or circumstances after the date of this Official Statement or to reflect the occurrence of unanticipated events. New factors arise or emerge from time to time, and it is not possible for the University to predict all such factors, nor can it assess the impact of each such factor or the extent to which any factor, or combination of factors, may cause results to differ materially and adversely from those contained in any forward-looking statement.

CLEMSON UNIVERSITY, SOUTH CAROLINA

BOARD OF TRUSTEES

E. Smyth McKissick, III, Chairman

Ronald D. (Ronnie) Lee, Vice Chairman David E. Dukes Louis B. Lynn Patricia (Patti) Herring McAbee John N. (Nicky) McCarter, Jr. Robert (Bob) L. Peeler Cheri M. Phyfer Mark S. Richardson William (Bill) C. Smith, Jr. Joseph (Joe) D. Swann Kim Wilkerson David H. Wilkins EXECUTIVE OFFICERS

James P. Clements, President Robert H. Jones, Executive Vice President for Academic Affairs and Provost Brett A. Dalton, Executive Vice President for Finance and Operations Max Allen, Vice President and Chief of Staff George Askew, Vice President for Public Service and Agriculture Lee A. Gill, Chief Diversity Officer and Special Assistant to the President for Inclusive Excellence Chip Hood, General Counsel Almeda R. Jacks, Vice President for Student Affairs Tanju Karanfil, Vice President for Research Mark Land, Vice President for University Relations Angela E. Leidinger, Executive Secretary to the Board of Trustees and Vice President for External Affairs Brian O’Rourke, Vice President of Development and Alumni Relations Russell Kaurloto, Vice President and CIO, Clemson Computing and Information Technology Vacant, Chief Human Resources Officer Dan Radakovich, Director of Athletics Theresa Singletary, Director of Operations BOND COUNSEL

Pope Flynn, LLC, Columbia, South Carolina

DISCLOSURE COUNSEL

Howell Linkous & Nettles, LLC, Charleston, South Carolina

FINANCIAL ADVISOR

Hilltop Securities Inc., New York, New York

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TABLE OF CONTENTS

SUMMARY STATEMENT ...... vii THE SERIES 2018A BONDS ...... 1 General ...... 1 Purposes ...... 1 Authorization ...... 1 Security for the Series 2018A Bonds ...... 2 Redemption ...... 2 Book-Entry-Only System ...... 3 Plan of Finance ...... 3 The Tennis Facility Project ...... 3 Estimated Sources and Uses of Proceeds ...... 4 SECURITY FOR THE SERIES 2018A BONDS ...... 4 Pledge of Net Revenues and Certain Fee Receipts; Outstanding Bonds ...... 4 Rate Covenants ...... 6 Flow of Funds ...... 7 Additional Bonds ...... 9 Junior Lien Bonds ...... 9 THE ATHLETIC DEPARTMENT ...... 10 General Description ...... 10 The Athletic Facilities ...... 10 Recently Completed Improvements to the Athletic Facilities ...... 11 Planned Improvements to the Athletic Facilities ...... 11 NCAA Compliance ...... 12 Football ...... 12 Basketball ...... 14 Baseball ...... 15 Soccer ...... 15 Scholarships ...... 16 IPTAY ...... 16 Atlantic Coast Conference ...... 17 Significant Contracts ...... 18 CERTAIN FINANCIAL INFORMATION OF THE UNIVERSITY AND THE ATHLETIC DEPARTMENT ...... 18 Components of Revenues, Expenses and Transfers of the Athletic Department ...... 20 Historical Net Revenues ...... 20 Admissions Fee Rates ...... 21 Admissions Fee Receipts ...... 21 Debt Service Requirements ...... 22 Debt Service Coverage ...... 23 Historical Fund Balance of the Athletic Department ...... 23 Current Budget of the Athletic Department ...... 24 DESCRIPTION OF CLEMSON UNIVERSITY ...... 27 General ...... 27 Organization and Administration ...... 28 Faculty Members ...... 32 Staff Members ...... 32 Student Enrollment and Applications ...... 33 Applications, Admissions and Matriculations...... 34 Average SAT Scores ...... 35 Tuition and Fees at the University ...... 35 Pension Plans ...... 36 Physical Plant ...... 37 Insurance ...... 38 Tort Liability and Insurance ...... 38 Budgeting Procedure ...... 39 State Support and Its Effect...... 39 v

DEBT STRUCTURE OF THE UNIVERSITY ...... 41 Outstanding Debt ...... 41 Future Debt Issuances ...... 42 Debt Payment Record ...... 42 LEGAL MATTERS ...... 42 Litigation ...... 42 United States Bankruptcy Code ...... 42 Proceedings ...... 43 TAX MATTERS ...... 43 Disclaimer ...... 43 General ...... 43 The Series 2018A Bonds ...... 44 Original Issue Premium ...... 45 Original Issue Discount ...... 45 State Tax Exemption ...... 45 MISCELLANEOUS ...... 46 Underwriting ...... 46 Rating ...... 46 Independent Audits and Other Financial Information ...... 46 Continuing Disclosure ...... 47 Paying Agent’s Disclaimer ...... 48 Closing Certifications ...... 48 Financial Advisor ...... 48 CONCLUSION ...... 49

APPENDIX A Comprehensive Annual Financial Report of the University for Fiscal Year ended June 30, 2017. APPENDIX B Summary of Certain Provisions of the Bond Resolution and the 2017 Series Resolution. APPENDIX C Form of Bond Counsel Opinion. APPENDIX D Form of Disclosure Dissemination Agreement. APPENDIX E DTC and Book-Entry-Only System.

SUMMARY STATEMENT

The following Summary Statement is qualified in its entirety by the more detailed information and financial statements contained elsewhere in this Official Statement and the Appendices hereto (collectively, the “Official Statement”). The Official Statement, including the cover page, the inside cover page and the attached Appendices, contains specific information relating to the Series 2018A Bonds, the University, the Athletic Department, and other information pertinent to this issue. See Appendix A for the Comprehensive Annual Financial Report of the University, including the University’s Annual Financial Statement for Fiscal Year ended June 30, 2017 with Independent Auditor’s Report thereon. Unless otherwise defined in this Official Statement, all capitalized terms shall have the meanings ascribed to them in Appendix B. The offering of the Series 2018A Bonds to potential investors is made only by means of this entire Official Statement, and no person is authorized to detach this Summary Statement from this Official Statement or to otherwise use it without the entire Official Statement.

The Issuer Clemson University (the “University”) is a State-supported land grant institution located in Clemson, South Carolina. Initially established by the General Assembly of the State of South Carolina in 1889, the University is governed by the Board of Trustees (the “Board of Trustees”), a body politic and corporate of the State. See “DESCRIPTION OF CLEMSON UNIVERSITY” herein for additional information regarding the University and the Board of Trustees.

Athletic Department The Athletic Department, also known as the Clemson University Intercollegiate Athletics Program, is an auxiliary operation of the University which supports competition by more than 500 student-athletes of the University in 9 men’s and 9 women’s sports. The University is a member of the Atlantic Coast Conference and the National Collegiate Athletic Association. See “THE ATHLETIC DEPARTMENT” and “CERTAIN FINANCIAL INFORMATION OF THE UNIVERSITY AND THE ATHLETIC DEPARTMENT” herein for additional information regarding the Athletic Department.

Series 2018A Bonds General. The University’s $11,310,000* Athletic Facilities Revenue Bonds, Series 2018A (the “Series 2018A Bonds”), are being issued initially as fully-registered bonds in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York (“DTC”), which will act as securities depository for the Series 2018A Bonds under a book-entry-only system maintained by DTC through brokers and dealers who are, or act through, DTC participants. Purchasers will not be entitled to receive physical delivery of the Series 2018A Bonds. For so long as any purchaser is the beneficial owner of a Series 2018A Bond, such purchaser must maintain an account with a broker or dealer who is, or acts through, a DTC participant in order to receive payment of principal of and interest on such Series 2018A Bond. See “THE SERIES 2018A BONDS– Book-Entry-Only System” and Appendix E herein.

Date of Issue and Delivery. The Series 2018A Bonds will be dated January 1, 2018. It is expected that the Series 2018A Bonds will be available for delivery through the facilities of DTC on or about January 30, 2018.

Interest Payments. Interest on the Series 2018A Bonds is payable on each May 1 and November 1, commencing May 1, 2018.

Maturities. The Series 2018A Bonds mature as set forth on the inside cover page hereof.

Redemption. The Series 2018A Bonds will be subject to redemption prior to maturity as described herein under “THE SERIES 2018A BONDS – Redemption.”

Security The Series 2018A Bonds, including interest thereon, are payable solely from, and are secured by a pledge of, the Net Revenues of the University’s Athletic Department and gross receipts from the imposition by the University of any Admissions Fee and any Special Student Fee, as such terms are defined in the Bond Resolution. Upon the issuance of the Series 2018A Bonds, such pledge shall be on a parity in all respects with the pledges previously given by the University securing the payment of the University’s outstanding Athletic Facilities Revenue Bonds, and the pledges to be given by the University in the future to secure the payment of any additional parity bonds issued pursuant to the Bond Resolution. See “SECURITY FOR THE SERIES 2018A BONDS” herein for additional information regarding the security for the Series 2018A Bonds.

THE SERIES 2018A BONDS SHALL NOT IN ANY EVENT CONSTITUTE AN INDEBTEDNESS OF THE STATE WITHIN THE MEANING OF ANY PROVISION, LIMITATION, OR RESTRICTION OF THE CONSTITUTION OR STATUTES OF THE STATE OF SOUTH CAROLINA (OTHER THAN ARTICLE X, SECTION 13 OF THE SOUTH CAROLINA CONSTITUTION AUTHORIZING OBLIGATIONS PAYABLE FROM SPECIAL SOURCES NOT INVOLVING REVENUES FROM ANY TAX). THE FULL FAITH AND CREDIT OF THE STATE OF SOUTH CAROLINA ARE NOT PLEDGED FOR THE PAYMENT OF PRINCIPAL OR INTEREST ON THE SERIES 2018A BONDS. THE UNIVERSITY IS NOT OBLIGATED TO PAY THE SERIES 2018A BONDS, OR THE INTEREST THEREON, SAVE AND EXCEPT FROM THE NET REVENUES AND THE RECEIPTS FROM THE IMPOSITION OF ANY ADMISSIONS FEE ______AND ANY SPECIAL STUDENT FEE. THE UNIVERSITY DOES NOT HAVE TAXING POWER. *Preliminary, subject to change.

vii

Use of Proceeds The Series 2018A Bonds are being issued for the purposes of (i) defraying the costs of planning, developing, constructing and equipping a tennis facility on the campus of the University, and (ii) paying the costs of issuance of the Series 2018A Bonds. See “THE SERIES 2018A BONDS - Purposes” and “- Plan of Finance” herein for additional information regarding the purposes for issuing the Series 2018A Bonds.

Authorization The Series 2018A Bonds are being issued under the authority of the Constitution and laws of the State of South Carolina, including Article 9, Chapter 119, Title 59 of the Code of Laws of South Carolina, 1976, as amended (the “Enabling Act”), a bond resolution adopted by the Board of Trustees on April 16, 1999 (the “Bond Resolution”), and a series resolution adopted by the Board of Trustees on February 3, 2017 (the “2017 Series Resolution,” which together with the Bond Resolution is referred to herein as the “Resolution”), and an approving resolution adopted by the State Fiscal Accountability Authority on October 17, 2017.

Tax Status of Interest In the opinion of Pope Flynn, LLC, Bond Counsel to the University, under existing law, assuming on the Series 2018A Bonds continuing compliance by the University with certain covenants and the accuracy of certain representations, interest on the Series 2018A 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. In the opinion of Bond Counsel, the Series 2018A Bonds and the interest thereon are exempt from all State, county, municipal, school district, and other taxes and assessments imposed within the State of South Carolina, except estate, transfer, and certain franchise taxes. See “TAX MATTERS” herein for a description of these and other tax considerations.

Continuing Disclosure The University will agree, in a Disclosure Dissemination Agent Agreement, to provide to the Municipal Securities Rulemaking Board (“MSRB”) through its Electronic Municipal Market Access system (“EMMA”), (i) annually certain financial information and operating data, including the audited financial statements of the University, prepared in accordance with accounting principles generally accepted in the United States of America, and (ii) notice of the occurrence of certain enumerated events, as provided in Rule 15c2-12 promulgated by the U.S. Securities and Exchange Commission. See “MISCELLANEOUS – Continuing Disclosure” and Appendix D herein.

General This Official Statement speaks only as of its date, and the information contained herein is subject to change. Copies of the Official Statement will be deposited with the MSRB, and accessible via EMMA. Copies of the Official Statement, other relevant documents, and information regarding the documents are available from Rick Petillo, Director, Debt and Capital Financing, Clemson University, G06 Sikes Hall, Clemson, South Carolina 29634 (telephone: (864) 656-2421; email: [email protected]).

Professionals Involved in The Office of State Treasurer of the State of South Carolina is serving as Trustee with respect to the Series the Offering 2018A Bonds. U.S. Bank National Association, Columbia, South Carolina, is serving as Registrar and Paying Agent. Pope Flynn, LLC, Columbia, South Carolina, is serving as Bond Counsel to the University. Howell Linkous & Nettles, LLC, Charleston, South Carolina, is serving as Disclosure Counsel to the University. Hilltop Securities, Inc., New York, New York, is serving as Financial Advisor to the University. Certain legal matters in connection with the execution and delivery by the University of the Series 2018A Bonds will be passed upon for the University by Chip Hood, its General Counsel.

viii

OFFICIAL STATEMENT

$11,310,000* CLEMSON UNIVERSITY, SOUTH CAROLINA ATHLETIC FACILITIES REVENUE BONDS, SERIES 2018A

All information included herein has been provided by the University except where attributed to other sources. The summaries and references to all laws, rules, regulations, resolutions, agreements, reports, and other documents referred to herein do not purport to be complete, comprehensive, or definitive, and each such reference or summary is qualified in its entirety by reference to each such laws, rules, regulations, resolutions, agreements, reports, and other documents.

THE SERIES 2018A BONDS

General

This Official Statement of Clemson University (the “University”), including the cover page and appendices hereto, sets forth certain information concerning the University and its $11,310,000* Athletic Facilities Revenue Bonds, Series 2018A (the “Series 2018A Bonds”). All capitalized terms not defined herein shall have the meanings ascribed to such terms in “APPENDIX B – SUMMARY OF CERTAIN PROVISIONS OF THE BOND RESOLUTION AND THE 2017 SERIES RESOLUTION” attached hereto. Clemson University is referred to herein as the “University.” References herein to the “Athletic Department” shall mean the University’s Athletic Department.

The Series 2018A Bonds will be issued in fully-registered book-entry-only form in denominations of $5,000 or any integral multiple thereof, registered in the name of Cede & Co., as nominee for The Depository Trust Company, New York, New York (“DTC”). See Appendix E attached hereto for a more complete description of DTC and the book-entry-only system for the Series 2018A Bonds. The Series 2018A Bonds will bear interest from January 1, 2018, payable semiannually on May 1 and November 1 of each year, commencing May 1, 2018 (each, a “Bond Payment Date”), at the rates set forth on the inside cover page hereof, to the person in whose name the Series 2018A Bond is registered (the “Registered Owner”) at the close of business on the 15th day of the month preceding the applicable Bond Payment Date (the “Record Date”). The Series 2018A Bonds will mature on May 1 in each of the years and in the principal amounts as set forth on the inside cover page hereof. The Registrar and Paying Agent for the Series 2018A Bonds is U.S. Bank National Association, Columbia, South Carolina (the “Registrar” or, as the case may be, the “Paying Agent”). The Trustee for the Holders of the Series 2018A Bonds is the Office of State Treasurer of the State of South Carolina (the “State Treasurer”) in Columbia, South Carolina (the “Trustee”). See “CERTAIN FINANCIAL INFORMATION OF THE UNIVERSITY AND THE ATHLETIC DEPARTMENT – Debt Service Requirements” herein for the scheduled debt service on the Series 2018A Bonds.

Purposes

The Series 2018A Bonds are being issued for the purposes of (i) defraying the costs of planning, developing, constructing and equipping a tennis facility on the campus of the University, and (ii) paying the costs of issuance of the Series 2018A Bonds. See “– Plan of Finance” under this heading.

Authorization

The Series 2018A Bonds are being issued under the authority of the Constitution and laws of the State of South Carolina (the “State”), including Article 9, Chapter 119, Title 59 of the Code of Laws of South Carolina, 1976, as the same may be amended from time to time (the “Enabling Act”), a bond resolution adopted by the Board of Trustees of Clemson University (the “Board of Trustees”) authorizing the issuance of Athletic Facilities Revenue Bonds (“Athletic Facilities Revenue Bonds”) on April 16, 1999 (the “Bond Resolution”), and series resolution adopted by the Board of Trustees on February 3, 2017 (the “2017 Series Resolution,” which together with the Bond Resolution is referred to herein as the “Resolution”), and approving resolution adopted by the State Fiscal Accountability Authority on October 17, 2017.

______*Preliminary, subject to change. 1

Security for the Series 2018A Bonds

The Series 2018A Bonds are special obligations of the University and are payable solely from and secured by a pledge of the Net Revenues of the University’s Athletic Department and the gross receipts from the imposition by the University of any Admissions Fee and any Special Student Fee. The pledges given in the Resolution to secure payment of the Series 2018A Bonds will be on a parity in all respects with (i) the pledges previously given by the University securing the payment of the outstanding Athletic Facilities Revenue Bonds, and (ii) the pledges to be given by the University in the future to secure the payment of any additional bonds issued by the University pursuant to the authority set forth in the Resolution. See “SECURITY FOR THE SERIES 2018A BONDS – Pledge of Net Revenues and Certain Fee Receipts; Outstanding Bonds,” herein for information regarding the University’s outstanding Athletic Facilities Revenue Bonds.

Each capitalized term not defined herein, unless context clearly indicates to the contrary, has the meaning provided for the same in the Resolution. See “APPENDIX B – SUMMARY OF CERTAIN PROVISIONS OF THE BOND RESOLUTION AND THE 2017 SERIES RESOLUTION – The Bond Resolution – Definitions” attached hereto.

Redemption

Optional Redemption. The Series 2018A Bonds maturing on or prior to May 1, 2027 are not subject to redemption prior to their stated maturities. The Series 2018A Bonds maturing after May 1, 2027, are subject to redemption upon 30 days written notice, in whole or in part, at any time in any order of maturity to be determined by the University on or after May 1, 2027, at par plus accrued interest to the date fixed for redemption.

[Mandatory Sinking Fund Redemption.

The Series 2018A Bonds maturing on May 1, 20__ and May 1, 20__ (collectively, the “Series 2018A Term Bonds”) are subject to mandatory sinking fund redemption commencing on the dates shown in the following tables and will be redeemed (to the extent not previously redeemed as described above), at 100% of the principal amount thereof, plus interest accrued thereon to the redemption date, on May 1 of each of the following years in the respective principal amounts specified in the following tables:

Series 2018A Term Bonds Due May 1, 20__

Year Amount Year Amount

Series 2018A Term Bonds Due May 1, 20__

Year Amount Year Amount

______* Maturity, not a redemption.

The amount of any such mandatory sinking fund redemption shall be reduced to the extent Series 2018A Bonds of the applicable maturity have been purchased or redeemed by the University pursuant to any optional redemption provisions, in such manner as the University shall direct, or absent such direction, on a pro rata basis.]

Notice of Redemption. If any of the Series 2018A Bonds, or portions thereof, are called for redemption, the Registrar shall give or cause to be given notice to DTC or its nominee or, if DTC or its nominee is no longer the Registered Owner of the Series 2018A Bonds, the Holders of any Series 2018A Bonds to be redeemed, in the name

of the University, of the redemption of such Series 2018A Bonds, or portions thereof, which notice shall specify the Series 2018A Bonds to be redeemed, the redemption date and the place or places where amounts due upon such redemption will be payable and, if less than all of the Series 2018A Bonds are to be redeemed, the numbers of the Series 2018A Bonds to be redeemed, and, in the case of Series 2018A Bonds to be redeemed in part only, such notice shall also specify the respective portions of the principal amount thereof to be redeemed. Such notice shall be given by mailing a copy of the redemption notice by first class mail at least thirty (30) days but not more than sixty (60) days prior to the date fixed for redemption to the Holder of each Series 2018A Bond at the address shown on the registration books; provided, however, that failure to give such notice by mail, or any defect in the notice mailed to the Holder of any Series 2018A Bond to be redeemed, shall not affect the validity of the proceedings for the redemption of any other Series 2018A Bond.

Effect of Call for Redemption. Provided funds for their redemption are on deposit with the Trustee or Paying Agent, all Series 2018A Bonds so called for redemption shall cease to bear interest on the specified redemption date and shall no longer be deemed to be Outstanding under the Bond Resolution. If said money shall not be so available on the redemption date, such Series 2018A Bonds or portions thereof shall continue to bear interest until paid at the same rate as they would have borne had they not been called for redemption.

Book-Entry-Only System

The Series 2018A Bonds will be available to purchasers under the book-entry-only system maintained by DTC, which will act as securities depository for the Series 2018A Bonds. Purchasers will not be entitled to receive physical delivery of the Series 2018A Bonds. For so long as any purchaser is a beneficial owner of a Series 2018A Bond, such purchaser must maintain an account with a broker or dealer who is, or acts through, a DTC participant in order to receive payment of principal of and interest on such Series 2018A Bonds. See “APPENDIX E – DTC AND BOOK-ENTRY-ONLY SYSTEM” attached hereto for a more complete description of the book-entry-only system for the Series 2018A Bonds.

In the event the Series 2018A Bonds are no longer held in book-entry-only form, bond certificates registered in the name of DTC or its nominee will be cancelled and the University will execute and deliver Series 2018A Bonds to the Beneficial Owners as shown on the records of the DTC Participants. See “APPENDIX B— SUMMARY OF CERTAIN PROVISIONS OF THE BOND RESOLUTION AND THE 2017 SERIES RESOLUTION” attached hereto for a description of the payment, registration, transfer, and exchange provisions for the Series 2018A Bonds if the book-entry-only system is discontinued.

Plan of Finance

Proceeds of the Series 2018A Bonds together with other funds of the University will be used for the purposes of (i) defraying the costs of planning, developing, constructing and equipping a tennis facility on the campus of the University (the “Tennis Facility Project”), and (ii) paying the costs of issuance of the Series 2018A Bonds. See “THE SERIES 2018A BONDS – Estimated Sources and Uses of Proceeds” herein.

The Tennis Facility Project

The Tennis Facility Project includes the construction of a new state-of-the-art tennis center for the men’s and women’s varsity tennis teams. The new center will retain and continue to utilize existing tennis facilities, including outdoor competition courts and a 700-seat permanent stadium. The new, approximately 60,000 square foot tennis center is contemplated to include a new, six-court indoor tennis facility, a clubhouse containing locker rooms, a training room, equipment rooms, a players’ lounge, laundry and coaches’ offices, a ticket office and public restroom building, two new outdoor courts, and related sitework. It is anticipated that the new facilities will enhance recruiting efforts, improve student athlete playing experiences, improve opportunities for NCAA regionals and other championships, and provide for better pedestrian circulation and vehicular access.

Estimated Sources and Uses of Proceeds

The following table sets forth the estimated sources and uses of proceeds of the Series 2018A Bonds.

Sources of Funds Par Amount $______Accrued Interest ______Premium ______

Total Sources $______

Uses of Funds Construction Fund Deposit $______Accrued Interest ______Cost of Issuance(1) ______

Total Uses $______(1) Includes Underwriter’s discount, legal, accounting, consulting, printing and other costs of issuing the Series 2018A Bonds.

SECURITY FOR THE SERIES 2018A BONDS

Pledge of Net Revenues and Certain Fee Receipts; Outstanding Bonds

The Series 2018A Bonds are payable solely from, and secured by a pledge of, the Net Revenues (as such term is defined below) and the gross receipts from the imposition by the University of any Admissions Fee and any Special Student Fee (as such terms are defined below). Such pledge shall be on a parity in all respects with that given to secure all Outstanding Bonds issued by the University from time to time pursuant to the Bond Resolution.

The table below sets forth the currently outstanding (the “Outstanding Bonds”) Athletic Facilities Revenue Bonds of the University under the Bond Resolution.

Outstanding Bonds

Original Outstanding Series Dated Date Principal Amount Principal Amount(1) 2012 February 1, 2012 $12,335,000 $ 5,590,000 2014A December 1, 2014 30,695,000 30,695,000 2014B December 1, 2014 9,240,000 7,670,000 2014C December 1, 2014 10,545,000 9,635,000 2015 May 1, 2015 60,695,000 58,570,000 2015B December 1, 2015 18,875,000 18,445,000

(1) As of June 30, 2017.

The University’s remaining outstanding Athletic Facilities Refunding Revenue Bonds, Series 2012 (the “Series 2012 Bonds”), Athletic Facilities Revenue Bonds, Series 2014A (the “Series 2014A Bonds”), Athletic Facilities Taxable Revenue Bonds, Series 2014B (the “Series 2014B Bonds”), Athletic Facilities Refunding Revenue Bonds, Series 2014C (the “Series 2014C Bonds” and, together with the Series 2014A Bonds and Series 2014B Bonds, the “Series 2014 Bonds”), Athletic Facilities Revenue Bonds, Series 2015 (the “Series 2015 Bonds”), Athletic Facilities Revenue Bonds, Series 2015B (the “Series 2015B Bonds”), together with the Series 2018A Bonds, are herein referred to as the “Outstanding Bonds.” The Outstanding Bonds and any other bonds issued pursuant to the Bond Resolution on a parity with the Outstanding Bonds, are hereinafter collectively referred to as the “Bonds.” See “CERTAIN FINANCIAL INFORMATION OF THE UNIVERSITY AND THE ATHLETIC DEPARTMENT – Debt Service Requirements” herein for a schedule of debt service payments to be made on the Outstanding Bonds.

THE SERIES 2018A BONDS SHALL NOT IN ANY EVENT CONSTITUTE AN INDEBTEDNESS OF THE STATE WITHIN THE MEANING OF ANY PROVISION, LIMITATION, OR RESTRICTION OF THE CONSTITUTION OR STATUTES OF THE STATE OF SOUTH CAROLINA (OTHER THAN ARTICLE X, SECTION 13 OF THE SOUTH CAROLINA CONSTITUTION AUTHORIZING OBLIGATIONS PAYABLE FROM SPECIAL SOURCES NOT INVOLVING REVENUES FROM ANY TAX). THE FULL FAITH AND CREDIT OF THE STATE OF SOUTH CAROLINA ARE NOT PLEDGED FOR THE PAYMENT OF PRINCIPAL OR INTEREST ON THE SERIES 2018A BONDS. THE UNIVERSITY IS NOT OBLIGATED TO PAY THE SERIES 2018A BONDS, OR THE INTEREST THEREON, SAVE AND EXCEPT FROM THE NET REVENUES AND THE RECEIPTS FROM THE IMPOSITION OF ANY ADMISSIONS FEE AND ANY SPECIAL STUDENT FEE. THE UNIVERSITY DOES NOT HAVE TAXING POWER.

Net Revenues. The term “Net Revenues” is defined in the Bond Resolution to mean, for the period in question, all Revenues remaining after payment of the operating and maintenance expenses of the Athletic Department and the Athletic Facilities but before provision is made for depreciation, amortization, nonmandatory transfers, and interest expenses of the Athletic Department for a given Fiscal Year; provided that there shall be excluded from the calculation made to determine Net Revenues gains or losses on the sale or other disposition of investments of fixed or capital assets which do not result from the ordinary course of business.

Revenues. The term “Revenues” is defined in the Bond Resolution to mean, for the period in question, (i) all revenues or other income received by the Athletic Department from the operation of the Athletic Department and the Athletic Facilities, including, without limitation, amounts received from the sale of tickets for and guarantees with respect to intercollegiate athletic events, from any athletic conference (collectively, the “Conference”) with respect to the University’s share of proceeds from Conference members’ television and bowl appearances, from the University’s participation in Conference and National Collegiate Athletic Association tournaments, from rentals of executive boxes at Athletic Facilities, from sale of game programs and concessions, or commissions therefrom, from the University’s sports radio and television rights, from corporate sponsorships, and from license fees, (ii) all gifts, bequests, contributions and donations received by the Board of Trustees or the University from any persons, including from any athletic booster organization, for use in connection with the operations of the Athletic Department, (iii) any other unrestricted revenues of the Athletic Department not otherwise pledged that may be made applicable by the Board of Trustees to the payment of the principal and interest of the Bonds including such revenues which may fall into the category of non-mandatory transfers as such term is used in generally accepted accounting principles and (iv) all income from the investment of the above; but excluding:

(i) gifts, bequests, contributions and donations restricted to a particular purpose inconsistent with their use for the payment of the principal, premium or interest on the Bonds;

(ii) the proceeds of any borrowings;

(iii) State appropriations of any sort; and

(iv) investment income restricted to a purpose inconsistent with the payment of operating expenses of the Athletic Department or debt service on Bonds including (whether or not so restricted) interest earned on any construction fund or construction account created with the proceeds of borrowing by the University.

The Bond Resolution defines “Athletic Facilities” to mean all of the facilities of the University designated from time to time by the Board of Trustees as intercollegiate athletic facilities, including any facilities providing support for facilities where intercollegiate events are held, including without limitation any related infrastructure and any administration, maintenance, practice, training, physical therapy and related facilities of the Athletic Department, whether now owned or hereafter acquired by the University.

Admissions Fee and Special Student Fee. Pursuant to the Bond Resolution, proceeds of any Admissions Fee and any Special Student Fee are pledged to the payment of the Bonds. Beginning with the 2003 football season, the University imposed a $4.00 Admissions Fee, which is a per-ticket charge (in addition to the normal ticket price)

to all non-students in attendance at University varsity football games and all other events held at Memorial Stadium for which admission is charged by the University. The Admissions Fee imposed for football games from 2000 through 2002 was $2.00 and from 1971 to 1999 was $1.00. The University currently imposes a $2.00 Admissions Fee for men’s and women’s basketball games. A $1 Admissions Fee is charged for men’s baseball and men’s soccer games.

The University currently does not impose a Special Student Fee. From Fiscal Year 1973-74 through Fiscal Year 1999-2000, the University imposed a Special Student Fee ranging from a high of $52.00 (in 1975-76) to a low of $12.00.

The University is authorized pursuant to the Enabling Act to impose such Admissions Fee and Special Student Fee as it may deem necessary from time to time, provided that the proceeds of the same are utilized to pay debt service on outstanding Bonds. Pursuant to the Bond Resolution, the University is only obligated to impose any Admissions Fee or Special Student Fee to the extent Net Revenues are not otherwise sufficient to enable the University to meet its obligations under the Bond Resolution, including its obligations to meet the rate covenants thereunder (see “– Rate Covenants” below under this heading).

Rate Covenants

The University covenants and agrees in the Bond Resolution to maintain and collect rates and charges for attendance at events held at any Athletic Facilities which, when combined with other Revenues and the gross receipts of any Admissions Fee and any Special Student Fee, shall at all times be sufficient:

(1) To provide for the payment of the expenses of administration of the Athletic Department and such expenses for operation and maintenance of the Athletic Facilities as may be necessary to preserve the same in good repair and condition;

(2) To provide for the punctual payment of the principal of and interest on all Bonds and any Junior Lien Bonds that may from time to time hereafter be Outstanding;

(3) To maintain all Debt Service Funds and thus provide for the punctual payment of the principal of and interest on the Bonds;

(4) To maintain any and all Debt Service Reserve Funds established with respect to a particular series of Bonds;

(5) To build and maintain a reserve for contingencies and for improvements, renovations and expansions of the Athletic Facilities other than those necessary to maintain the same in good repair and condition;

(6) To pay all amounts owing under a reimbursement agreement with any provider of a debt service reserve insurance policy, insurance policy, line of credit, letter of credit or similar instrument established with respect to a Reserve Requirement for any particular series of Bonds; and

(7) To discharge all obligations imposed by the Enabling Act and by the Bond Resolution.

The University further covenants and agrees in the Bond Resolution that it will at all times prescribe and maintain rates and thereafter collect charges in accordance with such rates and charges for attendance at events held at any Athletic Facilities or the use thereof which are reasonably expected to yield, along with all other Revenues, annual Net Revenues which when added to all gross receipts from the imposition of any Admissions Fee and any Special Student Fee, in the current Fiscal Year will equal at least one hundred percent (100%) of the Combined Annual Principal and Interest Requirement for all Bonds Outstanding in such Fiscal Year; and, promptly upon any material change in the circumstances which were contemplated at the time such rates and charges were most recently reviewed, but not less frequently than once in each Fiscal Year, shall review the rates and charges for such use and shall promptly revise such rates and charges as necessary to comply with the foregoing requirement.

In connection with its covenants and agreements described in the two preceding paragraphs, the University is only obligated pursuant to the Bond Resolution to establish, impose and collect any Admissions Fee or any Special Student Fee to the extent Net Revenues are not otherwise sufficient to enable the University to meet its obligations contained in such covenants and agreements.

Flow of Funds

For so long a time as any sums remain due and payable by way of principal or interest on the Bonds, the funds or accounts described below shall be established and maintained, and deposits shall be made therein in the manner required in the Bond Resolution and as described below, and in the order set forth below. When any of such funds or accounts are not required to be held by the Trustee, they may, if required by State law or otherwise agreed to by the University and the State Treasurer, be held by the State Treasurer on behalf of the University. One or more accounts or subaccounts may be established within any such funds or accounts by the University, the State Treasurer or the Trustee (if other than the State Treasurer), as the case may be, in order to enable the proper administration of such funds or accounts in the judgment of such party.

Operation and Maintenance Fund. The University is required to establish and maintain a fund or account designated as the Operation and Maintenance Fund. The Operation and Maintenance Fund is intended to provide for the payment of all expenses incurred in connection with the administration and operation of the Athletic Department and the Athletic Facilities, including, without limiting the generality of the foregoing, such expenses as may be reasonably necessary to preserve the Athletic Facilities in good repair and condition and to pay the fees and charges of the Trustee, the Paying Agent, the Registrar and the custodian or trustee of any other fund created or to be created under the Bond Resolution, the costs of audits required under the Bond Resolution, and the premiums for all insurance policies and any fidelity bonds required by the Bond Resolution. In addition, the operating expenses of IPTAY are payable from the Operation and Maintenance Fund, with funds from IPTAY Scholarship Fund to provide reimbursement therefor.

The Revenues, as received by the University, are promptly deposited in the Operation and Maintenance Fund. Withdrawals from the Operation and Maintenance Fund are made by the University in accordance, as nearly as practicable, with the Annual Budget then in effect.

Debt Service Funds. There is established and maintained a Debt Service Fund for each Series of Bonds Outstanding. The Debt Service Funds are intended to provide solely for the payment of the principal of, premium, if any, and interest on the respective Series of Bonds as the same respectively fall due. The Debt Service Funds shall be kept in the custody and control of the Trustee and withdrawals from the Debt Service Funds shall be made only by the Trustee who shall transmit to the Paying Agent, for payment to each Bondholder, at such times as may be appropriate, the sums required to pay the principal of, premium, if any, and interest on the respective Series of Bonds.

As receipts from the imposition of any Admissions Fee and any Special Student Fee are collected by the University, the same are remitted to the Trustee, who deposits the same as received, pro-rata with respect to the Outstanding Series of Bonds, in the respective Debt Service Funds.

On or before the fifteenth day of the month immediately preceding each Bond Payment Date, payments are made from the Operation and Maintenance Fund, for deposit in the respective Debt Service Funds, an amount sufficient to discharge all interest to become due on the respective Series of Bonds on the next ensuing interest payment date; provided, however, that if provision has been made for the payment of all or part of the next installment of interest to become due on any Series of Bonds, pursuant to any other provision of the Resolution, or by reason of investment earnings, then, in such event, the deposits required by this paragraph may be omitted, or reduced accordingly.

On or before the fifteenth day of the month immediately preceding each Bond Payment Date on which no payment of principal is due to be made, there is paid from the Operation and Maintenance Fund, for deposit in the respective Debt Service Funds, a sum equal to one-half of the aggregate amount of principal of all Bonds becoming due and payable on the next ensuing Bond Payment Date on which a payment of principal is due to be made. On or before the fifteenth day of the month immediately preceding each Bond Payment Date on which a payment of

principal is due to be made, there is deposited in the respective Debt Service Funds a sum equal to the amount necessary, when added to the payment made pursuant to the preceding sentence, to discharge the aggregate amount of principal of all Bonds becoming due and payable on such ensuing Bond Payment Date (whether at stated maturity or by sinking fund installment); provided, however, that if provision has been made for the payment of all or part of either of the above-referenced installments of principal to become due on the Bonds, pursuant to any other provision of the Resolution, or by reason of investment earnings, then, in such event, the deposits required by the preceding sentence of this paragraph may be omitted, or reduced accordingly.

Debt Service Reserve Funds.

The Bond Resolution provides that there may be established in a Series Resolution a special fund of the University to be designated as a “Debt Service Reserve Fund” (the “Debt Service Reserve Fund”). Any Debt Service Reserve Fund is kept on deposit with the Trustee.

For a description of the requirements for a Debt Service Reserve Fund, see “APPENDIX B – SUMMARY OF CERTAIN PROVISIONS OF THE BOND RESOLUTION AND THE 2017 SERIES RESOLUTION.” Pursuant to the 2017 Series Resolution, the University has not provided for the creation of or a deposit to a Debt Service Reserve Fund in connection with the issuance of the Series 2018A Bonds. There are no moneys or surety bonds currently on deposit in the Debt Service Reserve Fund that are expected to be available to pay debt service on the Series 2018A Bonds in the event that moneys on deposit in the Debt Service Funds are insufficient for that purpose.

Improvement Fund. The Improvement Fund is established and maintained by the Trustee in order to provide a reasonable reserve for contingencies and for improvements, expansions and renovations of the Athletic Facilities. After all necessary deposits have been made to all Debt Service Funds, and, if required, to all Debt Service Reserve Funds, and payment of all current debt service on any Junior Lien Bonds, then, to the extent funds are available, there is paid from the Operation and Maintenance Fund into the Improvement Fund amounts such that the entire amount deposited during a Fiscal Year equal that sum which has been budgeted for the Improvement Fund for that Fiscal Year as provided in the Annual Budget; provided, however, that if provision has been made for the payment of all or part of the Fiscal Year’s deposit to the Improvement Fund, due to accumulations of moneys therein or by reason of investment earnings, then, in such event, the deposits otherwise required under this paragraph may be omitted, or reduced accordingly.

Money in the Improvement Fund is withdrawn by the University from time to time, upon direction to the Trustee, and used solely:

(1) for the purpose of restoring depreciated or obsolete items of the Athletic Facilities;

(2) for improvements, expansions and renovations to the Athletic Facilities, other than for those things which are reasonably necessary to maintain such facilities in good repair and condition;

(3) to defray the cost of unforeseen contingencies;

(4) to prevent defaults of Junior Lien Bonds; and

(5) for optional redemption of Bonds; provided, however, that prior to any withdrawals from the Improvement Fund, the Trustee shall determine that no deficiency exists at such time in any Debt Service Fund or Debt Service Reserve Fund.

In the event the State Treasurer no longer serves as Trustee under the Bond Resolution, the University reserves the right to operate and maintain the Improvement Fund, under the terms and conditions prescribed in the Bond Resolution, on its own.

Surplus Amounts. At any time that there is in the Operation and Maintenance Fund an amount sufficient to make all payments permitted or required under the subheadings above in this Section, through the next ensuing Bond Payment Date, the University may withdraw any moneys in excess of such amount and use them (a) to make additional deposits to the Improvement Fund (whether or not in excess of the amounts budgeted therefrom) or (b) in the discretion of the Board of Trustees, for any other lawful purpose of the University.

Additional Bonds

The University may issue Additional Bonds from time to time which shall be payable on a parity with the Outstanding Bonds upon compliance with certain provisions of the Bond Resolution. With respect to non-refunding Bonds, the University must satisfy among other things, the following test prior to and in connection with the issuance of a Series of Additional Bonds: Net Revenues plus gross receipts from the imposition of any Admissions Fee and any Special Student Fee during the most recent Fiscal Year for which audited financial statements are completed must be not less than one hundred ten percent (110%) of the maximum Combined Annual Principal and Interest Requirement on all Bonds Outstanding immediately prior to the issuance of such proposed Series of Bonds and on such proposed Series of Bonds. For these purposes, Net Revenues and any such additional gross receipts may be adjusted to reflect: (1) any ticket, rate or fee increases currently adopted and to be in effect prior to or coincident with the issuance of such proposed Series of Bonds and determined pro forma as though such ticket, rate or fee increases had been in continuous effect during such recent Fiscal Year; (2) in the event proceeds of such proposed Series of Bonds will be used to pay interest on such proposed Series, one hundred percent (100%) of the interest that will accrue on such Series of Bonds during the first twelve (12) full months following the date of delivery of the proposed Series and that will be paid from such proceeds, provided, however, that any such interest accruing in such twelve (12) month period that is to be paid on a date within the Fiscal Year of maximum Combined Annual Principal and Interest Requirements shall not be so added to such Net Revenues and additional gross receipts; and (3) any amount allowed by clause (2) above as an adjustment with respect to a previously-issued Series of Bonds if the proposed Series of Bonds is being issued prior to the end of the Fiscal Year in which capitalized interest on the previously-issued Series of Bonds is exhausted. See “APPENDIX B – SUMMARY OF CERTAIN PROVISIONS OF THE BOND RESOLUTION AND THE 2017 SERIES RESOLUTION – Additional Bonds – Conditions To The Issuance of Additional Bonds” attached hereto.

Junior Lien Bonds

Notwithstanding that Bonds may be Outstanding, the University is permitted by the terms of the Bond Resolution to issue Junior Lien Bonds in such amount as it may from time to time determine, payable from the Revenues and the receipts of the imposition of any Admissions fee and any Special Student Fee; provided that any such pledge of the Revenues and the receipts of any Admissions Fee and any Special Student Fee granted for the protection of said Junior Lien Bonds shall at all times be subordinate and inferior in all respects to the pledges of Net Revenues and the receipts of any Admissions Fee and any Special Student Fee made or authorized for the Bonds; and provided, further, that the maturity of Junior Lien Bonds may not be accelerated and paid in full unless all of the Bonds shall have been paid or provision therefor has been made. See “APPENDIX B – SUMMARY OF CERTAIN PROVISIONS OF THE BOND RESOLUTION AND THE 2017 SERIES RESOLUTION – Right to Issue Junior Lien Bonds; Accession Thereof to Senior Lien Status” attached hereto for a more detailed summary of the provisions of the Bond Resolution pertaining to Junior Lien Bonds. The University has no Junior Lien Bonds outstanding, and no current plans to issue Junior Lien Bonds.

THE ATHLETIC DEPARTMENT

General Description

The Athletic Department, also known as the Clemson University Intercollegiate Athletics Program, is an auxiliary operation of the University that supports competition by approximately 500 University student-athletes in intercollegiate sports. The University is a member of the Atlantic Coast Conference (“ACC”) and the National Collegiate Athletic Association (“NCAA”). The University’s “Tigers,” as its teams are known, currently compete in the varsity sports listed below.

MEN’S SPORTS WOMEN’S SPORTS(1) Baseball Basketball Basketball Cross Country Cross Country Golf Football Rowing Golf Soccer Soccer Tennis Tennis Track and Field (Indoor) Track and Field (Indoor) Track and Field (Outdoor) Track and Field (Outdoor) Volleyball

______(1) On, March 14 2017, the University announced plans to sponsor intercollegiate softball as a substitute for the women's diving program, which competed in its final season in 2017. On November 3, 2017, John Rittman was named as the first head coach of Clemson Softball. The University is expected to play its first competitive game in February 2020.

Of the above sports, an Admissions Fee is charged at home contests for men’s football, baseball, basketball and soccer, as well as women’s basketball.

The current Director of Athletics is Dan Radakovich, who has served in that position since December 2012 (see “DESCRIPTION OF CLEMSON UNIVERSITY – Organization and Administration” herein). Mr. Radakovich reports directly to the President of the University. The Athletic Department currently has the equivalency of 198 regular full-time employees. In addition to the Director, principal positions within the Athletic Department include a deputy director of athletics, 8 associate athletic directors; administrators responsible for various oversight aspects of all sports, directors of facilities and communications; a director of facilities and grounds; a director of student enrichment; a director for tickets and parking; a team physician; a director of sports medicine and head trainer; and an NCAA compliance officer (who reports to both the Director of Athletics and the University President). The Chief Executive Officer of IPTAY is also an employee of the Athletic Department and reports to the University President.

The Athletic Facilities

Primary Athletic Facilities include Memorial Stadium (football), Allen N. Reeves Football Complex serving all football coaches and staff and related support services; Poe Indoor Football Facility; Littlejohn Coliseum (men’s and women’s basketball) and Swann Pavilion (practice facility for the same); Doug Kingsmore Stadium (baseball); the Rock Norman Outdoor Track Complex; Clemson Indoor Track and Field Complex; Historic Riggs Field (Soccer); Hoke Sloan Tennis Center (tennis); Clemson Rowing Center and Boathouse (rowing); the intercollegiate locker room and lounge portions of the Walker Golf Course; Larry B. Penley Golf Building and Robinson Practice Facility; Jervey Gymnasium (volleyball); Jervey Athletic Center; and the McFadden Building (athletic administration and Olympic coaches offices), related practice facilities and Nieri Family Student-Athlete Enrichment Center (educational support facility for student-athletes). All of such facilities are located on the campus of the University.

In 2013-14, the University commenced a $176 million improvement program to enhance its intercollegiate facilities and fan amenities at certain varsity sports venues. In general, this program has included renovations to Memorial Stadium and improvements to playing and practice fields (see discussion under “– Football” under this heading below) and Doug Kingsmore Stadium (see “– Baseball” under this heading below), renovations to Littlejohn Coliseum and construction of the adjacent Swann Pavilion practice facility (see

discussion under “– Basketball” under this heading below), renovation of the Jervey Athletic Facility and McFadden Building, and renovation of the Nieri Family Student-Athlete Enrichment Center. This improvement program was paid from proceeds of certain Outstanding Bonds, Athletic Department funds, and gifts through IPTAY.

Recently Completed Improvements to the Athletic Facilities

Doug Kingsmore Stadium Renovations. In 2015, the University completed additions and renovations to the Doug Kingsmore Stadium, which was financed with a portion of the proceeds of the Series 2014A Bonds. The $8.7 million investment included 20,000 square feet of new construction. The project included new locker rooms, a player lounge, player dining, sports medicine, and team meeting rooms for the student athletes. The facility also included a museum display area and coach’s offices. The project added 163 field level seats and expanded the home and visitor dugouts.

Memorial Stadium Renovations. In 2015, the University also completed significant renovations to Memorial Stadium, including the West Zone Phase III Oculus Project and the Memorial Stadium Suites Renovations Project. The $6.6 million Memorial Stadium West Zone Phase III Oculus Project was financed with a portion of the proceeds of the Series 2014A Bonds. One main element was the addition of an oculus that completes the architectural vision set forth in the original design of the West Zone project. The other element was the addition of an expanded walkway that connects the North and South side concourses. The $26.4 million Memorial Stadium Suites Renovations Project renovated the North and South side suite levels of Memorial Stadium, with a portion of the proceeds of the University’s Series 2014A Bonds and Series 2014B Bonds. The project scope on the North side suites included updating the interiors, enclosing the concourse, and updating all heating and cooling units to more energy efficient models. On the South side, the project included building new open air club seating with enclosed club on the 2nd floor. The project also included relocating the press box down to the 1st floor as well as adding 20 suites on the 1st floor.

Littlejohn Coliseum Renovation. In 2016, the University completed a comprehensive renovation of Littlejohn Coliseum. The $63.5 million project, funded primarily from proceeds of the Series 2015 Bonds, included a new basketball operations area that will include a practice facility, player’s locker room, lounge, film area, sports medicine area, weight room and coach’s offices. The renovation inside Littlejohn Coliseum included changing the seating configuration, adding a new courtside club, adding a new premium seat club area and a redesign of the concourse for better views into the lower bowl.

New Football Operations Facility. In February 2017, the University completed construction of the Allen N. Reeves Football Complex. The $55 million project is located adjacent to the indoor practice facility and outdoor practice fields, and includes locker rooms, meeting rooms, and coaches’ offices along with strength and conditioning, sports medicine and a dining area. The project was funded with approximately $19.5 million of Series 2015B Bonds and $35.5 million of private gifts.

Planned Improvements to the Athletic Facilities

Tennis Facility. The Series 2018A Bonds are being used to defray the costs of planning, developing, constructing and equipping a tennis facility on the campus of the University. See “THE SERIES 2018A BONDS – The Tennis Facility Project” herein.

IPTAY Center Renovations. The University is planning to renovate and expand IPTAY’s facilities, including enhanced office space for fundraising staff and game day amenities. The planned project would be funded with private gifts and would enhance fundraising capabilities and accommodate staffing growth since the existing facility was constructed.

Softball Complex. In connection with the announcement of its plans to begin competitive play in softball starting in February 2020, the University is currently conducting a design study for a softball complex. Although Board of Trustees has authorized a design study for this project, further consideration and approval by the Board of Trustees regarding the funding plan, scope of work, and project budget are necessary before the project may proceed.

NCAA Compliance

Clemson University submitted reports to the NCAA of twenty (20) secondary violations during the 2016- 17 academic year. As of November 7, 2017, Clemson University has submitted reports to the NCAA of 6 (six) secondary violations for the 2017-18 academic year. As of November 7, 2015, there are two (2) pending secondary violation cases that are expected to be resolved this academic year. Otherwise, there are no other outstanding matters pending with the NCAA.

Football

Memorial Stadium. Memorial Stadium was built in 1942 with an original seating capacity of 20,000. An additional 23,600 seats were added from 1958 to 1960. In 1978, the South stands were double-decked, and East end zone seats were added in 1982, resulting in total additional seating of 14,800. The North stands were double- decked in 1983. Today, total capacity of Memorial Stadium is over 81,100, making it the 16th largest on-campus football stadium in the nation. From 1999 through 2001, the stadium underwent a series of improvements to the east, south and north sides of the stadium. These improvements included grading, paving, fencing, new restrooms, new concession areas and new concourse lighting, as well as new signage and graphics, in the concourse areas. In addition, a new stadium lighting system was installed and the playing field and adjacent practice fields, were replaced. These improvements cost approximately $12,600,000. In 2002, the University embarked on a three-phase project to construct improvements to the west end zone portion of Memorial Stadium (the “West Zone Project”). In 2006, the University completed Phase I of the West Zone Project, the West Zone seating. Phase II of the West Zone Project was completed in summer of 2009 and included coaches’ offices, administrative offices, a new strength and conditioning area, a large team room/auditorium, an expanded equipment room and athletic training facilities. Phase III of the West Zone Project, which was completed in August 2015, included the addition of a Northwest Plaza and second level athletic training table facility. Phase III also included an oculus and a pedestrian bridge. The project was funded with a portion of the proceeds of the Series 2014A Bonds. The West Zone Project costs totaled approximately $64,000,000, with funding provided by a combination of Athletic Facilities Revenue Bonds, private donations, and Athletic Department operating revenue. As described above under “– Recently Completed Improvements to the Athletic Facilities,” the suites and related infrastructure were substantially renovated and upgraded using proceeds from the Series 2014A and Series 2014B Bonds.

General Information. The University has historically played a minimum of seven home football games each season in Memorial Stadium, out of a 12-game regular season. The University currently has scheduled seven home games in each of the 2017, 2018, and 2019 seasons.

The University’s football team has participated in a post-season bowl game every year for the past twelve seasons, and won the ACC Championship in 2011, 2015, 2016, and 2017. Additionally, the football team participated in the 2016 and 2017 College Football Playoff National Championship Games. The thrilling 35-31 win over Alabama on January 9, 2017, capped the team’s second straight 14-1 season and secured the second football national championship in school history.

For the 2017 season, the University’s football team finished the regular season ranked #1 in the College Football Playoff Rankings and Associated Press and Coaches Polls, secured its third straight ACC Championship, and appeared in the Sugar Bowl as part of the College Football Playoff while compiling a 12-2 record.

Set forth below is the University football team’s win-loss record (including post-season bowl games) for the past ten seasons:

Football Record Record Record Year (wins-losses) Year (wins-losses) 2017 12-2 2012 11-2 2016 14-1 2011 10-4 2015 14-1 2010 6-7 2014 10-3 2009 9-5 2013 11-2 2008 7-6

Set forth in the following table are the ticket prices, number of season tickets purchased and issued, student attendance and average attendance per game at Memorial Stadium, and related information, for the past ten seasons:

Football Ticket Sales and Attendance Average Student Average Attendance Per Attendance Per Fiscal Year Home Games Ticket Prices(1) Season Tickets(2) Game(3) Game 2016-17 7 $40-95 57,420 10,284 79,759 2015-16 7 30-95 55,253 10,438 80,970 2014-15 7 30-95 52,016 12,000 81,752 2013-14 7 35-75 55,086 10,982 82,048 2012-13 7 35-75 52,221 11,945 81,427 2011-12 7 35-65 49,650 11,149 78,301 2010-11 7 35-65 51,009 10,121 77,774 2009-10 7 35-60 57,941 9,589 77,954 2008-09 7 35-60 56,058 9,589 79,164 2007-08 7 38-55 57,356 10,260 81,334

______(1) Non-student prices. Includes Admission Fee (see “SECURITY FOR THE SERIES 2018A BONDS—Pledge of Net Revenues and Certain Fee Receipts; Outstanding Bonds - Admissions Fee and Special Student Fee” herein). In addition, the rules of the NCAA and the ACC provide that certain complimentary tickets may be distributed. (2) Season ticket purchases typically carry an aggregate discount over individual ticket purchases. (3) Indicates the number of student tickets allotted, actual student attendance not tracked.

Premium Seating. With completion of the Memorial Stadium suites renovation project, the University now maintains over 90 executive suites (skyboxes) at Memorial Stadium, including the suites of the University President and IPTAY. Additional premium seating in the form of 994 West Zone Club Seats were constructed in 2007, and additional club seating expanded by an additional 600 seats in 2015. Annual gross revenues derived from premium seats by IPTAY were approximately $5.5 million for the 2016 season. Suite arrangement terms currently range from one to three year periods. All suites were leased for the 2017 season.

Guarantees to Visiting Teams. Non-conference football games currently command between $250,000 to $1,250,000 to visiting non-conference schools, depending on the opponent.

Head Football Coach. The current men’s head football coach at the University is Dabo Swinney, who has held that position since December 1, 2008. Coach Swinney has served on the University’s coaching staff since 2003, serving as assistant coach prior to October 2008, when he was named interim head coach. Coach Swinney is under contract with the University through December 31, 2024. Under the contract, Coach Swinney is paid a base annual salary of $245,000. He is also guaranteed supplemental annual compensation of $4,155,000.

Basketball

Littlejohn Coliseum. The University’s men’s and women’s varsity basketball teams compete in Littlejohn Coliseum. The coliseum was constructed in 1968, substantially renovated in 2016, and has a current seating capacity of 8,805.

Men’s Basketball. The men’s basketball team typically plays approximately 16 home games each season, including eight ACC games. Set forth in the following table is the men’s basketball team’s record for the past ten seasons:

Basketball Record

Record Record Fiscal Year (wins-losses) Fiscal Year (wins-losses) 2016-17 17-16 2011-12 16-15 2015-16 17-14 2010-11 22-12 2014-15 17-15 2009-10 21-11 2013-14 23-13 2008-09 23-9 2012-13 13-18 2007-08 24-10

Set forth in the following table are the ticket prices, number of season tickets purchased and issued, student attendance, average home attendance and total home attendance at Littlejohn Coliseum for men’s basketball games for the past ten seasons, and related information:

Basketball Ticket Sales and Attendance Average Attendance Fiscal Year Ticket Prices(1) Season Tickets Per Game Total Attendance 2016-17 $15-75 4,442 7,403 118,585 2015-16(2) 15-28 4,693 8,703 147,958 2014-15 15-28 4,251 7,298 124,062 2013-14 18-28 4,398 7,203 115,247 2012-13 18-28 4,651 7,441 111,622 2011-12 18-28 5,091 7,770 124,312 2010-11 18-28 6,115 8,289 140,917 2009-10 18-28 6,208 8,681 141,847 2008-09 18-26 5,412 8,476 135,619 2007-08 18-26 5,228 8,179 131,874

______(1) Non-student prices. In addition, the rules of the NCAA and the ACC provide that certain complimentary tickets may be distributed. (2) Games were played in Bon Secours Wellness Arena in Greenville, SC due to renovation of Littlejohn Coliseum.

Guarantees to Visiting Teams. Guarantees paid by the University to visiting non-conference teams range from $50,000 to $100,000 per game. Conference members do not exchange guarantees.

Men’s Head Basketball Coach. The University men’s head basketball coach is Brad Brownell. Coach Brownell became the University’s head coach on April 13, 2010 after four seasons at Wright State. Prior to his tenure at Wright State, Coach Brownell was head coach at the University of North Carolina at Wilmington. In Coach Brownell’s first season at the University, he set a Clemson record for wins by a first-year coach when he took the Tigers to a 22-12 overall record. Coach Brownell finished second in voting for ACC Coach of the Year for his efforts during the 2010-11 season. Coach Brownell is under contract with the University through April 30, 2021, and receives a base salary of $245,000 per year. Under the contract, Coach Brownell is guaranteed a supplementary income of $1,555,000 in 2017-18.

Women’s Basketball. Audra Smith was named the Head Coach of the Women’s basketball program on April 8, 2013. Coach Smith, a 1992 Virginia graduate, spent the previous nine seasons at the helm of the UAB

program. Coach Smith’s compensation package is valued at $245,000 per year. Under the contract, Coach Smith is guaranteed a supplementary income of $58,876 in 2017-18.

The University’s women’s basketball team plays approximately 16 home games each season. Average per-game attendance for women’s home basketball games over the past 10 seasons has ranged from a high of 1,526 in 2005-06 to a low of 296 in 2016-17. Total annual attendance over the same period has ranged from a high of 22,891 in 2005-06 to a low of 11,201 in 2009-10. Admission for women’s basketball at Littlejohn Coliseum is $6 (non-students). Total and average attendance is listed below for the years shown.

Year Total Attendance Average Attendance 2016-17 4,471 296 2015-16 N/A(1) N/A(1) 2014-15 12,600 788 2013-14 11,563 723 2012-13 14,511 967 ______(1) Due to renovation of Littlejohn Coliseum, Women’s Basketball played in Jervey Gym and did not sell tickets or track attendance.

Baseball

Doug Kingsmore Stadium, home to Tiger baseball, is entering its 48th year of service to the University’s baseball team. The stadium has over 4,500 permanent seats, but holds up to 6,016 fans due to a grassy hill area along the left-field line. Beginning in the summer of 2002, Doug Kingsmore Stadium underwent a $5.3 million improvement program, including construction of a new press box facility, enlarged dugouts, a new batting cage, improved bullpens, expanded concession areas and improvements to facilitate pedestrian circulation. The 1,000-seat Thomas F. Chapman Grandstands were completed prior to 2010 and funded from gifts. Prior to the 2015 season, renovations to the player facility have been made and additional seating was added behind home plate. The most recent additions, finished in fall 2015, included a new facility with new locker rooms, a player lounge, player dining, sports medicine, and team meeting rooms for the student athletes. The facility also included a museum display area and coach’s offices. The project added 163 field level seats and expanded the home and visitor dugouts.

Monte Lee is in his third season as the Head Coach of the Baseball program. Lee was named Clemson’s Head Coach on June 18, 2015, after serving as Head Coach at College of Charleston for the previous seven seasons (2009-15), leading the program to a 276-145 (.656) record and four berths in the NCAA Tournament, including 2014 and 2015.

The Tigers have had a winning record in all 48 seasons at Doug Kingsmore Stadium. Clemson has played in numerous NCAA postseason tournaments at the facility as well. The baseball team plays approximately 33 regular-season home games each season. Average per-game attendance at Doug Kingsmore Stadium over the past 10 seasons has been higher than 4,000. Clemson has had a top-20 national figure in average attendance 25 straight seasons and a top-10 figure 17 years in a row as well.

Soccer

Historic Riggs Field, with a seating capacity of 6,500, is home to the University’s men’s and women’s soccer teams. The men’s team, which won NCAA championships in 1984 and 1987 and appeared in the championship game in 2015, has been ranked in the top twenty teams nationally thirty times and won 15 ACC championships. The University’s men’s soccer team plays approximately 11 home games each season. Clemson has been ranked in the top 20 in attendance since the 2000 season. On September 2, 2011, a regular season record crowd of 7,432 was on hand to witness the Clemson- South Carolina men’s match. Ticket prices (non-student) range from $4.00 to $6.00. The women’s soccer program, a non-revenue sport, has also enjoyed much success over the years. The program was started in 1994 and since that time, Clemson has played in the NCAA Tournament 18 times and has been to the NCAA Final Eight four times and the NCAA Final six times.

Scholarships

The University offers the maximum number of athletic scholarships allowed by the NCAA in the respective sports offered by the University. The costs of such scholarships are funded from contributions to the University by IPTAY (see “– IPTAY” under this heading below).

Athletic Scholarships(1)

Full-Scholarship Full-Scholarship Sport Equivalents Sport Equivalents Men’s Basketball 13.0 Men’s Soccer 9.9 Baseball 11.7 Women’s Soccer 14.0 Women’s Basketball 15.0 Men’s Tennis 4.5 Women’s Cross County/Track 18.0 Women’s Tennis 8.0 Football 85.0 Men’s Cross Country/Track 12.6 Men’s Golf 4.5 Volleyball 12.0 Women’s Golf 6.0 Rowing 20.0 ______(1) In addition to these athletic scholarships, the University expects to offer 12 athletic scholarships for intercollegiate softball starting in Fiscal Year 2019.

IPTAY

The IPTAY Scholarship Fund (the “IPTAY Scholarship Fund”) is a non-profit organization originally organized in 1934 whose primary purpose is to provide scholarships for student-athletes attending the University. Effective as of November 21, 2012, the IPTAY Scholarship Fund incorporated a South Carolina nonprofit corporation, which was named “IPTAY.” By resolution of the Board of Directors of the IPTAY Scholarship Fund, upon the recognition of IPTAY as a tax exempt organization on July 9, 2014 pursuant to Internal Revenue Code sections 501(c)(3) and 509(a)(3), the assets and operations of the IPTAY Scholarship Fund were assigned to IPTAY. In addition to its new corporate existence, with new Articles of Incorporation and Bylaws, IPTAY has entered into an affiliation agreement with the University (the “Affiliation Agreement”). IPTAY generates its funds through solicitation of membership and support. IPTAY is governed by an active Board of Directors, which includes approximately 15 at-large directors, each of whom serves a two-year term, and certain directors appointed ex officio by the University and affiliates and include the President of the University, two Trustees of the University, the President of the Clemson Alumni Association and the University NCAA Faculty Athletic Representative. Hired in 2013, Davis Babb serves as the Chief Executive Officer of IPTAY, responsible for all annual fund, major gift, and planned giving fundraising.

Upon its recognition as a tax-exempt entity on July 9, 2014, IPTAY completed its incorporation and began operating as an independent entity. Previously, although recognized as a tax-exempt organization by the Internal Revenue Service, all receipts of the IPTAY Scholarship Fund were deposited to the University into its State Treasurer-held bank accounts and related disbursements were also made from these accounts. Amounts on deposit in such accounts were expended in Fiscal Years 2015 and 2016 by the University for qualifying athletic scholarship, capital and operations purposes and were fully exhausted in Fiscal Year 2016. Approximately $75.8 million was transferred to the University to fund athletic scholarships, capital projects, debt service obligations, and other athletic operations during the fiscal year ending June 30, 2017. This amount included approximately $33.73 million representing IPTAY’s contribution towards the construction costs for the Allen N. Reeves Football Complex. IPTAY is considered a component unit of the University and its financial statements are discretely presented in the University’s Comprehensive Annual Financial Report.

All annual donations to IPTAY are deposited directly with IPTAY immediately upon receipt. Pursuant to the Affiliation Agreement, expenses supported by IPTAY, such as athletic scholarships, operational expenses of IPTAY and academic services are directly paid by the University, and reimbursed monthly by IPTAY. Such receipts from IPTAY, as and when received by the University, comprise a component of the Net Revenues pledged for the payment of debt service on the Bonds. Also, pursuant to the Affiliation Agreement, the University may

present to IPTAY’s Board of Directors a capital asset to be acquired by IPTAY for the benefit of the University’s athletic program as well as additional items of direct and indirect support. IPTAY has agreed to provide up to $6.5 million in direct annual support for projects of the Athletic Department, through June 30, 2045, subject to a cumulative cap of $186 million. IPTAY committed to these payments under resolutions dated November 21, 2014 and February 13, 2015 pursuant to the Affiliation Agreement between IPTAY and the University. Direct annual support is available to pay debt service on the Outstanding Bonds and the Series 2018A Bonds.

A provision of recently-enacted congressional legislation (the Tax Cuts and Jobs Act) eliminates the deductibility of certain charitable donations linked to the purchase of athletic tickets from universities. Based on this change in law impacting the deductibility of these charitable donations, IPTAY’s revenues will likely be impacted and, consequently, IPTAY’s ability to make transfers to the University for various purposes may also be impacted, although it is not possible to predict the extent of any such impact.

For information pertaining to the relationship of the accounting for the finances of IPTAY to that of the Athletic Department, see “CERTAIN FINANCIAL INFORMATION OF THE UNIVERSITY AND THE ATHLETIC DEPARTMENT” herein.

Atlantic Coast Conference

The University is a charter member of the ACC, which was founded in 1953. Other members of the ACC are Duke University, Georgia Institute of Technology, Florida State University, the Universities of Maryland, North Carolina and Virginia, North Carolina State University, Wake Forest University, Miami University, Virginia Tech, Boston College, the University of Pittsburgh, and Syracuse University. The latter two schools commenced competition in the ACC in the 2012-13 academic year. In fall 2005, following the addition of Virginia Tech, Miami University, and Boston College as new member institutions, the ACC was split into two divisions which compete in a divisional playoff competition. The ACC, on behalf of its members, contracts with established television networks covering the television appearances of conference members in football, basketball and certain other sports. A new twelve-year agreement with ESPN entered into in 2010 calls for coverage of both football and basketball broadcasts and an opportunity for basketball regional broadcast assignment to Raycom Sports. Additionally, the ACC Network is scheduled to begin a full linear network in August 2019. This network will produce a significant revenue increase for the member institutions. ACC revenue distributions per school in Fiscal Year 2016-17 were approximately $24.6 million, and are expected to be approximately $26.3 million in Fiscal Year 2017-18.

ACC revenues consist of bowl revenues, revenue from the football and basketball television packages referred to above, the NCAA’s broad-based distribution, and NCAA and ACC men’s basketball tournament television revenues. Such amounts are net of any Conference expenses and ACC bowl, or basketball post-season tournament, expense distributions to participating bowl, or tournament, teams.

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The University received the following distributions from the ACC for the years indicated:

ACC/NCAA Distributions

Other Sports/Not Fiscal Year Football Basketball Program Specific Total 2016-17 $14,841,182 $8,286,512 $1,470,550 $24,598,244 2015-16 13,896,420 7,137,595 1,701,357 22,735,371 2014-15 18,071,549 4,543,840 3,428,649(1) 26,044,038 2013-14 15,629,983 4,526,269 269,683 20,425,935 2012-13 12,770,737 4,483,954 - 17,254,691 2011-12 12,413,500 4,460,580 254,744 17,128,824 2010-11 6,266,848 5,100,278 199,604 11,566,730 2009-10 6,433,762 4,369,706 159,960 10,963,428 2008-09 6,589,446 4,943,802 214,948 11,748,196 2007-08 6,396,316 3,895,947 53,929 10,346,192 2006-07 5,128,270 4,821,284 412,861 10,362,415 2005-06 7,079,980 3,008,746 277,302 10,366,028 2004-05 5,049,867 2,909,086 809,874 8,768,827 ______(1) Includes $2.6 million settlement from the ACC due to the withdrawal of the University of Maryland from the ACC.

Significant Contracts

The Athletic Department outsources food and drink concessions and novelty concessions for all athletic events. ARAMARK is the food and drink vendor through June 30, 2022, for all athletic events.

Other significant contracts of the Athletic Department include corporate sponsorships (with, among others, Coca-Cola, Verizon, Nike, and ARAMARK) which currently yield approximately $2.8 million per year, and a trademark licensing program which yielded over $4.6 million in Fiscal Year 2016-17 thanks in large part to the national championship in football. Additionally, the new total campus marketing partnership with JMI Sports which includes game programs, stadium seatbacks, various corporate sponsors and radio and TV revenues is expected to yield approximately $7.7 million in Fiscal Year 2017-18 increasing to $9.35 million in Fiscal Year 2021-22.

CERTAIN FINANCIAL INFORMATION OF THE UNIVERSITY AND THE ATHLETIC DEPARTMENT

The Financial Statements for the Fiscal Year ended June 30, 2017, included in “APPENDIX A COMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE UNIVERSITY FOR FISCAL YEAR ENDED JUNE 30, 2017,” have been audited by Elliott Davis Decosimo, LLC, independent accountants, as stated in their report appearing herein.

Set forth on the following page are the summary statements of revenues, expenditures and transfers of the Athletic Department of the University for the past five Fiscal Years. With respect to each of the years in the five- year period ended June 30, 2017, the University has complied with the National Collegiate Athletic Association 1996 Financial Audit Guidelines through agreed-upon procedures engagements.

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ATHLETIC DEPARTMENT STATEMENT OF REVENUES, EXPENDITURES AND TRANSFERS(1)

2012-13 2013-14 2014-15 2015-16 2016-17 Operating Revenue: Ticket sales $ 23,974,060 $ 23,685,793 $ 21,889,772 $ 23,537,149 $ 25,960,272 Bowl revenues, away game sales & guarantees 2,304,793 254,000 301,760 4,707,260 5,136,925 Contributions 21,256,447 23,208,573 24,050,026 44,750,036 38,533,696 Direct institutional support 3,753,479 4,375,744 4,190,747 4,634,488 5,472,888 NCAA/Conference distributions including all tournament revenue 17,254,691 20,425,935 26,044,038 6,770,568 7,962,827 Broadcast, television, radio and internet rights 2,250,000 2,690,000 2,400,000 18,439,803 19,235,419 Program sales, concessions, novelty sales and parking 1,833,245 2,069,361 1,591,633 1,473,590 1,912,305 Royalties, advertisements and sponsorships 4,777,101 4,880,917 5,704,903 7,054,399 11,514,471 Endowment and investment income 430,213 306,026 311,210 202,244 42,238 Other 295,745 190,826 747,161 1,425,954 1,378,496 Total Operating Revenue $ 78,129,774 $ 82,087,175 $ 87,231,250 $112,995,491 $117,149,537

Operating Expenses: Athletic student aid $ 11,236,449 $ 13,006,286 $ 12,988,395 $ 15,364,539 $ 16,682,991 Guarantees 1,577,425 1,355,590 1,556,703 1,799,711 1,776,484 Coaches salaries, benefits, and bonuses paid by the University 14,157,676 15,242,057 15,986,017 17,177,291 19,089,916 Support staff/administrative salaries, benefits and bonuses 14,554,137 15,281,628 15,983,422 16,818,645 19,288,892 Recruiting 1,298,134 1,461,399 1,712,511 1,867,038 1,985,838 Team travel 4,249,323 6,015,192 5,773,942 5,890,614 5,539,676 Equipment, uniforms and supplies 1,945,691 2,310,084 2,514,851 2,865,919 3,181,153 Game expenses 3,183,803 3,798,685 3,360,202 3,796,407 4,374,614 Fund raising, marketing and promotion 2,759,085 2,924,359 3,345,775 4,357,296 5,218,560 Direct facilities, maintenance and rental 1,427,381 1,656,351 3,738,443 5,489,643 6,385,699 Indirect facilities and administrative support 865,899 1,181,770 1,310,357 1,112,348 - Other operating expenses 8,333,065 8,528,724 8,781,667 8,226,324 10,571,094 Bowl Expenses - - - 7,507,935 7,227,197 Total Operating Expenses $ 65,588,068 $ 72,762,125 $ 77,052,285 $ 92,273,710 $101,322,114

Mandatory Transfers: Principal and Interest - - - - Total Operating Expenditures and Mandatory Transfers $ 65,588,068 $ 72,762,125 $ 77,052,285 $ 92,273,710 $101,322,114

Nonmandatory Transfers (In)/Out: Student services 349,746 164,653 498,442 558,236 537,476 Construction projects 13,907,437 4,585,447 3,371,296 9,619,788 7,870,007 Student Band support 240,897 219,001 444,207 258,355 130,200 Debt service 2,226,062 1,049,690 3,056,482 8,183,337 8,793,260 Annual contributions 249,500 250,000 249,000 - - Clemson Athletic Trust 9,648,363 - - -

Departmental support - (4,995) 111,265 - (414,683) Institutional Research - - - - - Total Nonmandatory Transfers $ 16,973,642 $ 15,912,159 $ 7,730,692 $ 18,619,716 $16,916,260

Excess (deficiency) of Revenues Over Expenditures and Transfers ($4,431,936) ($6,587,109) $ 2,448,273 $ 2,102,065 ($1,088,837)

(1) Due to year-to-year variations in the presentation format determined by the NCAA Agreed Upon Procedures, the table above is intended as an unaudited summary which consolidates certain line items that are not consistently present in every year’s presentation format. The Schedule of Pledged Net Revenues provided in the University’s Comprehensive Annual Financial Report for each fiscal year should be reviewed for the full presentation per the NCAA Agreed Upon Procedures in any given fiscal year.

Components of Revenues, Expenses and Transfers of the Athletic Department

Over the past five complete Fiscal Years, revenues directly attributable to football have constituted approximately 43 to 55% of total Athletic Department revenues (46% in Fiscal Year 2017). Over the same period, expenses directly attributable to football have constituted approximately 31 to 42% of total Athletic Department expenses (42% in Fiscal Year 2017).

Over the past five Fiscal Years, revenues directly attributable to men’s and women’s basketball have constituted approximately 9 to 10% of total Athletic Department revenues (10% in Fiscal Year 2017). Over the same period, expenses directly attributable to men’s and women’s basketball have constituted approximately 10 to 11% of total Athletic Department expenses (10% in Fiscal Year 2017).

The revenues directly attributable to all other sports over the past five complete Fiscal Years constituted approximately 8 to 9% of total Athletic Department revenues (9% in Fiscal Year 2016-17). Over the same period, expenses directly attributable to all other sports constituted approximately 19 to 21% of total Athletic Department expenses (20% in Fiscal Year 2016-17).

Nonprogram-specific revenues, which consist of radio and television rights (other than through ACC distributions, and net of direct payments to coaches by media providers), University logo licensing, and corporate sponsorships constituted approximately 27 to 40% of the total Athletic Department revenues over the past five complete Fiscal Years (35% in Fiscal Year 2016-17). Nonprogram-specific expenses, which primarily consist of the expenses of the general administration of the Athletic Department over the same period constituted approximately 28% to 38% of the total Athletic Department Revenues over the past five Fiscal Years (28% in Fiscal Year 2016- 17).

For income statement purposes, operational expenses of IPTAY are reflected as expenditures of the Athletic Department. However, only an equal amount corresponding to such operational expense, plus amounts equal to the cost of annual athletic scholarships funded by IPTAY are reflected as revenues to the Athletic Department. In this regard, the revenues of the Athletic Department attributable to IPTAY represented approximately 17% to 32% of total Athletic Department Revenues over the past five Fiscal Years (32% in Fiscal Year 2016-17).

Historical Net Revenues

All revenues or other income received by the Athletic Department from the operation of the Athletic Department and the Athletic Facilities (“Revenues”), net of operating and maintenance expense, for the last five Fiscal Years are as follows (the “Net Revenues”):

Fiscal Year 2012-2013 2013-2014 2014-2015 2015-2016 2016-2017 Revenues $ 78,129,774 $ 82,087,175 $ 87,231,250 $112,995,491 $117,149,537 Less Admission (2,055,773) (703,730) (2,064,128) -0- -0- Receipts(1) Less O&M Expense (65,588,068) (72,762,125) (77,052,285) (92,273,710) (101,322,114) Net Revenues: $ 10,485,933 $ 8,621,320 $ 8,114,837 $ 20,794,781 $ 15,827,423

______(1) Beginning in the Fiscal Year ended June 30, 2013 and ending in the Fiscal Year ended June 30, 2015, the University included Admissions Fees receipts in the ticket sales component of revenues in its “Clemson University Intercollegiate Athletic Program Statement of Revenues, Expenditures, and Transfers (unaudited)” prepared pursuant to certain agreed-upon procedures (the “Agreed Upon Procedures Statement”) in compliance with the National Collegiate Athletic Association (NCAA) Constitution Provisions. Beginning in the Fiscal Year ended June 30, 2016 and continuing thereafter, Admissions Receipts are not included in the ticket sales component of revenues in its “Clemson University Intercollegiate Athletic Program Statement of Revenues, Expenditures, and Transfers (unaudited).” Admissions fees as presented include investment income earned on fees collected (see table on following page).

Admissions Fee Rates

The below table shows the amount of the Admissions Fee charged per ticket for each applicable sport for the years shown.

Schedule of Admissions Fees

Fiscal Year Football Men’s Basketball Woman’s Basketball Baseball Men’s Soccer 2016-17 $4 $2 $2 $1 $1 2015-16 4 0(1) 0(1) 1 1 2014-15 4 2 2 1 1 2013-14 4 2 2 1 1 2012-13 4 2 2 1 1 2011-12 4 2 2 1 1 2010-11 4 2 2 1 1 ______(1) Due to renovation of Littlejohn Coliseum, Men’s Basketball played at Bon Secours Wellness Arena in Greenville, SC and Women’s Basketball played in Jervey Gym and did not sell tickets.

Admissions Fee Receipts

The below table reflects revenues received by the University from imposition of Admissions Fees for the past five Fiscal Years.

Fiscal Year Admissions Fee(1) Investment Income Total 2016-17 $2,214,184 $ 7,027 $2,221,211 2015-16 1,927,123 14,932 1,942,055 2014-15 2,046,429 17,699 2,064,128 2013-14 667,178(2) 36,552 703,730 2012-13 2,031,494 24,279 2,055,773

______(1) The price of season tickets, which are purchased in advance of the sports’ season, include the applicable Admissions Fee. Such Admissions Fees are accounted for as revenues in the Fiscal Year of receipt. See “SECURITY FOR THE SERIES 2018A BONDS—Pledge of Net Revenues and Certain Fee Receipts; Outstanding Bonds - Admissions Fee and Special Student Fee” herein for a discussion of the history of Admissions Fee imposition by the University. (2) Due to an installment payment plan option that was offered beginning in the 2014 football season, only the admission fees collected prior to June 30, 2014 were reported as revenue in Fiscal Year 2013-14. Additional admission fees for the 2014 football season totaling $1,479,563 were recognized in Fiscal Year 2014-15. The installment payment plan had the effect of shifting payment into the future on a rolling basis.

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Debt Service Requirements

The following table sets forth the principal and interest requirements on the Outstanding Bonds together with the principal and interest requirements on the Series 2018A Bonds:

Fiscal Year Debt Service on Ending Outstanding Series 2018A Bonds Total June 30 Bonds Principal Interest Total Debt Service 2018 $ 9,199,460 2019 9,198,110 2020 9,199,610 2021 9,199,460 2022 9,195,890 2023 9,195,090 2024 9,197,078 2025 9,198,828 2026 6,774,528 2027 6,772,013 2028 6,773,113 2029 6,768,863 2030 6,776,663 2031 6,768,163 2032 6,772,038 2033 6,773,038 2034 6,772,963 2035 6,775,613 2036 6,770,500 2037 6,773,575 2038 6,773,094 2039 6,777,863 2040 6,770,150 2041 6,774,188 2042 6,765,125 2043 6,768,400 2044 6,767,625 2045 6,772,600 2046 967,725 2047 -0- Total† $209,991,359

† Numbers may not foot due to rounding; numbers rounded to the nearest dollar.

Debt Service Coverage

The following table sets forth the historical debt service coverage by the Athletic Department for the Fiscal Years indicated.

2012-2013 2013-2014 2014-2015 2015-2016 2016-17 Net Revenues $10,485,933 $8,621,320(1) $ 8,114,837 $20,721,781 $15,827,423 Admissions Fee Receipts(2) 2,055,773 703,730 2,064,128 1,942,055 2,284,636 Total Pledged Revenues $12,541,706 $9,325,050 $10,178,965 $22,663,836 $18,112,059

Debt Service $ 2,402,298 $ 2,272,466 $ 2,995,933 $ 8,052,257 $ 8,790,732

Total Pledged Revenues(3) Coverage Ratio 5.22x 4.10x 3.40x 2.81x 2.06x ______(1) The Schedule of Bond Coverage included in the University’s Comprehensive Annual Financial Report for Fiscal Year 2013-2014 did not adjust Net Revenues for the fact that Admissions Fee Receipts were included in ticket revenues for that year (See Page 20). This had the effect of overstating Total Pledged Revenues by approximately $667,000. (2) The Schedule of Bond Coverage included in the University’s Comprehensive Annual Financial Report does not include the effect of investment income earned on admissions fees, which is available and pledged to the repayment of debt service. (3) Net Revenues, Admissions Fee Receipts, and Special Student Fee receipts encompass all revenue streams pledged for the payment of the Bonds pursuant to the Bond Resolution. No Special Student Fee is currently imposed. Admissions Fee Receipts include investment earnings thereon.

Historical Fund Balance of the Athletic Department

The historical fund balance of the Athletic Department is comprised of accumulated Net Revenues and such fund balance is available for the payment of the Bonds. The table below shows the historical fund balance of the Athletic Department for the Fiscal Years indicated.

2012-2013 2013-2014 2014-2015 2015-2016 2016-2017 Fund Balance $ 10,393,737 $ 10,468,066 $ 10,700,707 $ 13,783,885 $ 11,211,271

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Current Budget of the Athletic Department

Set forth below and on the following pages is the current budget of the Athletic Department for Fiscal Year 2017-18.

Fiscal Year 2017-18 Budgeted REVENUES Ticket Sales Football $ 22,442,183 Basketball 1,423,568 Other Sports 737,224 Bond Fees 2,140,000 Conference Distribution 26,312,000 Corporate Sponsorships 8,200,000 Concessions 1,735,000 Licensing 2,730,000 Miscellaneous 434,000 Interest Income 105,000 Facility Rental/Camp Fees 75,000 Internal Charges 1,200,000 Transfers from IPTAY – Operations 3,753,647 Transfers from IPTAY – Capital Fundraising 843,059 Transfers from IPTAY – Academic Support 3,283,586 Transfers from IPTAY – Letterwinners 463,497 Transfers from IPTAY – Student Services 738,448 Transfers from IPTAY – Premium Seats 1,769,706 Transfers from IPTAY – CUAD Supplement 7,600,000 Transfers from IPTAY – LJC Weight Room 278,963 Transfers from IPTAY – Jervey Weight Room 453,897 Transfers from IPTAY – WEZ Weight Room 1,203,558 Transfers from IPTAY – Scholarships 11,750,798 Transfers from IPTAY – Debt Service 6,500,000 Transfers from IPTAY – Band & Uniforms 290,414 Transfers from IPTAY – Other 857,547 Total Revenue $107,321,095

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EXPENDITURES Support Costs Administration $ 7,315,076 Student Services 655,887 Compliance 669,460 Communications 1,499,959 Public Relations/Marketing 1,437,047 Ticket Office 1,663,127 Video 1,115,536 Facilities 4,095,964 Training Room 2,484,882 Grounds 1,223,193 Equipment Room 714,387 Weight Room-LJC 278,963 Weight Room-Jervey 479,897 Weight Room-FB 1,229,558 Spirit Squad 460,708 Aviation 1,178,087 Athletic Enrichment 3,350,146 IPTAY Operations 3,662,787 IPTAY Capital Fundraising 843,059 IPTAY Letterwinners 463,497 IPTAY Premium Seats 1,769,706 Reserve for Unallocated Costs 2,982,440 Total Support Costs $39,573,366

Direct Support Baseball $2,703,179 Women’s Softball 309,528 Men’s Basketball 6,103,872 Women’s Basketball 3,132,172 Football 31,962,531 Bowl -0- Volleyball 1,486,042 Men’s Golf 664,606 Women’s Golf 696,298 Men’s Soccer 1,401,908 Women’s Soccer 1,415,636 Women’s Diving 259,867 Men’s Tennis 850,305 Women’s Tennis 1,004,023 Men’s Track 1,769,546 Women’s Track 1,962,387 Rowing 1,780,139 Total Direct Sport Costs $57,502,039

Transfers to:

Institutional Research (7101) $15,000 Creative Services Position 40,860 Redfern (7101) 82,561 IPTAY Special Projects 50,000 Band Support except Travel (7113) 151,950 Transfers to Debt Service 9,199,461 Human Resources (7101) 76,858 Diversity Office 4,000 Undergrad/Grad Student Senate 25,000 IPTAY Loan Requirement 600,000 Total Misc & Transfers $10,245,690 Total Budgeted Expenditures $107,321,095

Excess Revenue over Expenditures $0

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DESCRIPTION OF CLEMSON UNIVERSITY

General

The University was founded in 1889, a legacy of Thomas Green Clemson, who willed his Fort Hill plantation home, its surrounding farmlands and forest, and other property to the State of South Carolina to establish a technical and scientific institution. Today, as at its inception, the University is dedicated to teaching, research, and public service, and to improving the quality of life through education. The University is classified by the Carnegie Foundation as a Doctoral/Research University-Extensive, a category comprising less than 4 percent of all universities in the United States.

Approximately 24,400 (Fall 2017) students, including 5,000 (Fall 2017) graduate students, are enrolled at the University. Students may choose degree programs offered through the University’s seven colleges: Agriculture, Forestry and Life Sciences; Architecture, Arts and Humanities; Behavioral, Social, and Health Sciences; Business; Education; Engineering, Computing and Applied Sciences; and Science. Programs leading to baccalaureate degrees in approximately 80 fields of study and 110 graduate programs are offered.

The University is ranked among the nation’s top 25 national public universities by U.S. News and World Report. A related U.S. News and World report study ranked the University 8th in a listing of most efficient schools among all national universities.

Research is an integral part of most post-baccalaureate education, and the University provides research opportunities in practically all fields in which graduate instruction is offered. The University’s mandate in agriculture and natural resources, architecture, engineering, textiles, basic sciences and technologies is extended to address the State’s cultural and economic needs through the health sciences, business, education and the humanities. The University has generated, on average, $144 million in research expenditures per year over the past four years.

The University’s approximately 1,400-acre main campus, located in the northwest corner of South Carolina on the shores of Lake Hartwell, is surrounded by approximately 17,000 acres of farms and woodlands devoted to research. The University is approximately two and one half hours from Atlanta, Georgia, Columbia, South Carolina and Charlotte, North Carolina, and is less than an hour west of Greenville, South Carolina. In addition, approximately 12,000 acres throughout the State are devoted to research by the University.

In addition to the undergraduate and graduate academic units at the State’s land grant university, the University provides various public service activities (“PSA”) through its Cooperative Extension Service, the South Carolina Agriculture and Forestry Research System, the Strom Thurmond Institute, and the Division of Regulatory and Public Service Programs, which include Pesticide Regulation, Fertilizer Inspection and Seed Certification, and Plant Industries. The PSA also administers the South Carolina Livestock-Poultry Health Department with headquarters in Columbia, South Carolina.

The University is accredited by the Commission on Colleges of the Southern Association of Colleges and Schools (1866 Southern Lane, Decatur, Georgia, 30033-4079; Telephone (404) 679-4500) to award bachelor’s, master’s, specialist, and doctor’s degrees. All of its professional colleges, schools, and curricula are fully accredited by accrediting agencies in their respective fields.

Organization and Administration

The Board of Trustees consists of thirteen members, including seven successor Trustees and six Trustees elected by the General Assembly of the State of South Carolina. At the present time, the Board of Trustees is comprised of the following members:

Members Occupation E. Smyth McKissick, III, Chairman CEO, Alice Manufacturing Company, Inc. Ronald D. (Ronnie) Lee, Vice Chairman Ronald D. Lee, DMD, P.C. David E. Dukes Attorney, Nelson Mullins Riley & Scarborough LLP Louis B. Lynn President, ENVIRO AgScience, Inc. Patricia Herring McAbee Vice President, Custom Development Solutions John N. (Nicky) McCarter, Jr. President, Defender Services, Inc. Robert L. Peeler Manager, Waste Management Inc. Cheri M. Phyfer President and General Manager, Diversified Brands, The Sherwin Williams Company Mark S. Richardson Owner, MAR Real Estate, LLC William C. Smith, Jr. CEO, Red Rock Developments Joseph D. Swann Retired President of Rockwell Automation Power Systems Kim Wilkerson President, South Carolina Bank of America David H. Wilkins Attorney, Nelson Mullins Riley & Scarborough LLP

The President of the University is the chief executive and administrative officer appointed by the Board of Trustees. The Administration of the University is divided into eight areas, each headed by Vice Presidents responsible to the President: Academic Affairs, Finance and Operations, Research, Student Affairs, Public Service and Agriculture, Development and Alumni Relations, External Affairs, and University Relations. In addition, the University’s Chief Diversity Officer, Chief Information Officer, Director of Athletics, and General Counsel each report directly to the President.

Set forth below is selected biographical data relating to the President and the Executive Officers of the University.

James P. Clements, President. James P. Clements is Clemson University’s 15th president. Under his leadership, Clemson has achieved record-breaking levels of success in academic rankings, admissions, enrollment, research funding, retention and graduation rates, athletics and fundraising, including the successful completion of the $1 billion Will to Lead capital campaign. In addition, Clemson is currently undergoing the largest construction boom in the history of the university. Clements is a nationally recognized leader in higher education who serves as Chair of the ACC Council of Presidents. He is also on the board of directors of the American Council on Education (ACE) and on the executive committee of the Business Higher Education Forum and on the national Council on Competitiveness. He previously served as the Chair of the Board of Directors for the Association of Public and Land-Grant Universities; on the executive committee of the APLU’s Commission on Innovation, Competitiveness and Economic Prosperity; and as co-chair and the only university president on the U.S. Department of Commerce’s National Advisory Council on Innovation and Entrepreneurship. He holds a B.S. in Computer Science and an M.S. and Ph.D. in Operations Analysis from the University of Maryland Baltimore County, and an M.S. in Computer Science from Johns Hopkins University. Before he came to Clemson, Clements served as the president of West Virginia University for nearly five years and served in the University System of Maryland for 20 years where he was a distinguished professor and provost at Towson University.

Robert H. Jones Jr., Executive Vice President for Academic Affairs and Provost. Dr. Robert H. Jones is an accomplished scholar and researcher who understands the land-grant mission and knows Clemson well. Dr. Jones served most recently as professor of biology and dean of West Virginia University’s Eberly College of Arts and Sciences. Prior to this appointment he served as a department head and professor at Virginia Tech and a faculty member at Auburn University. He earned his bachelors degree in forest management, masters in forestry both from Clemson and his doctorate in forest ecology from the State University of New York College of Environmental

Science and Forestry, Syracuse University. He has published more than 60 refereed articles and was the principal investigator or co-principal investigator on more than $4.8 million in externally funded research.

Brett Dalton, Executive Vice President for Finance and Operations and Interim Chief Human Resources Officer. Brett A. Dalton was appointed Vice President for Finance and Operations for Clemson University in 2012 and promoted to Executive Vice President in 2016. He is responsible for the leadership and management of the University’s facilities, maintenance, procurement, environmental safety and human resources departments. He has responsibility in the area of University strategic planning and implementation of the University’s 10-year plan. As Executive Vice President, he is also an advisor to the President on financial strategy and resource development and is responsible for assessment, accountability and management of the University’s financial resources. From 1996 to June 2007 he was Executive Assistant for Finance and Administration to the Vice President for Academic Affairs and Provost. Before that, as Director of Financial Planning, he created the University’s first comprehensive financial plan. He has authored and co-authored research articles and publications ranging from environmental policy research and financial markets analyses to tax and income studies. He received a B.S. and Master of the Arts from the Walker School of Economics at Clemson University.

As of August 2017, Mr. Dalton has also been serving at the interim Chief Human Resources Officer (“CHRO”) while the University conducts a nationwide search to fill the position upon the departure of the previous Chief Human Resources Officer. The CHRO reports to the Executive Vice President of Finance and Operations and manages and leads all human resources staff at the University; consisting of more than 1,400 faculty, 3,000 staff, and 10,000 student and temporary employees and handles the overall leadership, direction, planning, and evaluation of the human resources organization, including employee relations, benefits administration, recruitment, classification and compensation, database and records, compliance, and human resource information management.

Max Allen, Vice President and Chief of Staff. Max Allen became Clemson University’s Chief of Staff on June 1, 2015. Since his arrival, he has helped strengthen the overall national reputation and awareness of the Clemson brand. On February 3, 2017, he was promoted to Vice President and Chief of Staff. At Clemson, Allen serves as the president’s chief advisor and is the primary liaison with the vice presidents and other direct reports to the president. Under his leadership, he has helped design and implement the Clemson Forward strategic plan, coordinate a strategic reorganization of the campus diversity efforts, serve as the primary liaison with key community leaders and partners, serves as a member of the university’s crisis decision team, and helped with the successful completion of the $1 billion Will to Lead capital campaign. Allen is an experienced nationally known higher education administrator. Prior to Clemson, Allen served as the chief of staff at the University of North Carolina Wilmington for twelve years and the executive assistant to the president and director of university relations at Georgia College & State University in Milledgeville, GA for nine years.

Allen serves on the Greenville, South Carolina Chamber of Commerce Board of Directors, the Clemson Chamber of Commerce Board of Directors, and the BB&T Local Advisory Board in Greenville, South Carolina. Previous leadership service includes, Past President of the 100 Black Men of Coastal North Carolina and Past Chair of the National Association of Presidential Assistants in Higher Education. He is a member of Sigma Pi Phi (Gamma Sigma) fraternity. A retired Navy Lieutenant Commander, Allen has had many successful years of challenging assignments as a public affairs officer, including serving as spokesman for the Navy’s involvement in the Challenger space shuttle disaster and spokesman for the closure of a major naval installation in Charleston, South Carolina. Allen holds a bachelor’s degree from Jacksonville University in Florida and is a graduate of the Naval War College in Newport, Rhode Island, and the Leadership Georgia Class of 2000.

George Askew, Vice President for Public Service and Agriculture. Dr. Askew earned his Ph.D. in Agronomy in 1981 from Clemson University, where he also matriculated for his B.S. and M.S. degrees. The University recruited him as a forest geneticist and assistant professor stationed at the Belle W. Baruch Forest Science Institute in Georgetown, S.C. In 1985, he was promoted to associate professor and institute director. Dr Askew has served as the first director of the Belle W. Baruch Institute for Coastal Ecology and Forest Science, as director of the Clemson University Pee Dee Research and Education Center in Florence, and as Regional Director for a 12-county Extension Service program was added to his responsibilities. After serving as an associate dean and as Associate Vice-President for Public Service and Agriculture and Director of the Experiment Station. In 2014, Dr. Askew was named Vice-President for Public Service and Agriculture by President Jim Clements and also continued to serve as the Experiment Station Director. In June 2014, Dr. Askew was asked to serve as the Interim Dean for the

College of Agriculture, Forestry and Life Sciences. As Interim Dean, he is responsible for the administration of 4 departments and the school within the college including teaching, research, and outreach activities.

Lee A. Gill, Chief Diversity Officer and Special Assistant to the President for Inclusive Excellence. Lee Gill assumed his duties as the Chief Diversity Officer and Special Assistant to the President for Inclusive Excellence at Clemson University on April 18, 2016. In that role, he directs outreach efforts to diverse populations of students, faculty, staff, and community members to foster a climate of inclusive excellence and to raise cultural awareness, expand cultural competencies, and promote greater understanding and valuing of differences in people. Mr. Gill brought to Clemson his 25 years of private and public sector experience working with major corporations, law firms, hospitals, and institutions of higher education. Lee Gill passionately believes that to succeed and thrive, organizations must harness the rainbow of demographic change for a competitive advantage. Prior to joining Clemson, Mr. Gill had served The University of Akron's first Associate Vice President for Inclusion & Equity/Chief Diversity Officer for eight years. He received his B.A. degree in Political Science and Sociology from the University of Michigan, Ann Arbor, MI, and his Juris Doctor Degree from the Illinois Institute of Technology, Kent College of Law, Chicago, Illinois.

Chip Hood, General Counsel. W.C. “Chip” Hood, Jr., is the General Counsel for Clemson University where he leads a team of attorneys and staff that provide legal advice to the Board of Trustees, President, Administration, Faculty, and Staff on matters involving or affecting the University. Prior to joining Clemson, Mr. Hood was the Executive Director for the Medical University of South Carolina Foundation for Research Development (MUSC FRD) which serves as the technology transfer office for MUSC. He has also served as the in- house legal counsel for the MUSC FRD where he not only filed patent applications but was also involved in the evaluation of new technology, the development of technology commercialization strategies, and the negotiation and drafting of license agreements. Mr. Hood is a registered patent attorney and also ran his own litigation practice. Prior to becoming a lawyer, he was employed as an engineer for the Department of Defense. Chip Hood has a Juris Doctor from the University of South Carolina, a M.S. in Biomedical Sciences from MUSC, and a B.S. in Electrical Engineering from Clemson University.

Almeda R. Jacks, Vice President for Student Affairs. Dr. Jacks received her Bachelor’s degree from Clemson University in Secondary Education/Psychology in 1974, Masters of Education from Clemson University in 1975, and Doctorate of Philosophy in Educational Leadership from Clemson University in 2009. Dr. Jacks’ professional experience includes work at the University from 1975 through 2010, in several positions including Vice President for Student Affairs from 1992 through 2006. From 2010 until returning to the University in 2014, Dr. Jacks served as the Interim Vice President for Student Development with Manhattan College, in Purchase, New York, and as a Senior Consultant with Keeling & Associates, LLC, in Provincetown, Massachusetts. Dr. Jacks currently serves Clemson University as the Vice President for Student Affairs.

Tanju Karanfil, Vice President for Research. Dr. Karanfil has served as Vice President for Research since February 2016. In this role, Dr. Karanfil is responsible for operations and oversight of Clemson University’s research enterprise including research support functions like industry contracts administration; technology transfer; animal resources; grants and contracts administration; and sponsored programs. As vice president for research, Dr. Karanfil develops strategy for continued growth while managing research compliance, safety, and policy. Dr. Karanfil completed his Ph.D. in environmental engineering at the University of Michigan. He joined the faculty of Clemson University in 1996 and is currently a professor in the Department of Environmental Engineering and Earth Sciences. In addition to his work as an educator, Dr. Karanfil has also served as department chair and as associate dean for research prior to becoming vice president for research. Dr. Karanfil is a registered professional engineer in the state of South Carolina, is a registered professional engineer certified by the American Academy of Environmental Engineers, and is a Fellow of the International Water Association.

Russell Kaurloto, Vice President and Chief Information Officer. Russell Kaurloto was appointed as Vice President for Information Technology and Chief Information Officer on July 17, 2017. He brings more than 35 years of IT experience to Clemson University, where he leads Clemson Computing and Information Technology (CCIT) in providing IT services and facilitating the strategic deployment of technology in support of Clemson’s research, education, and public service missions. Previously, he served as the deputy chief information officer and assistant general manager for the City of Los Angeles, where he oversaw IT support for 35,000 employees across 41 departments in 704 buildings and was responsible for all communications, data and voice networks, systems,

systems integration, middleware, application support and operations centers, including all 911 communications infrastructure for the Los Angeles Police and Fire departments. Prior to that, he spent 16 years heading operations for IT at University of Southern California (USC). As executive director and deputy chief information and operations officer, he oversaw IT operational services on the USC campus and its 19 schools, the USC Keck Health Sciences campus and the Keck Medical Center. His team supported classroom and educational technologies, information security, computing systems operations, data services, research infrastructure and voice and video communications services. Before his time at USC, he spent 22 years at The Associated Press, the world’s largest news-gathering organization. There, he worked his way up from a field engineer to the Western Region executive director and chief of communication — the youngest IT chief in AP history. He led communications, technical operations and IT support services for more than 1,500 newspapers, radio, TV, financial institutions and AP offices across 17 Western states.

Mark Land, Vice President for University Relations. Mark Land became Clemson’s first vice president for University Relations in August 2016. He is responsible for leading the University’s marketing and strategic communications work, and also serves as the University’s primary spokesman. Prior to joining Clemson, Mr. Land spent five years as Associate Vice President for Public Affairs and university spokesman at Indiana University. Mr. Land spent the first 18 years of his career as a newspaper journalist, serving as an editor for daily newspapers in Pennsylvania, New York, Michigan and Indiana. From 2003-2011, Mr. Land was a communications leader at Cummins Inc., a Fortune 200 manufacturing company based in Indiana, ultimately serving as Executive Director of Corporate Communications. Mr. Land earned a B.A. degree from Indiana University in 1985 and an MBA from Columbia University in 1989. He currently serves on the executive committee of the Association of Public and Land-Grant Universities’ Council on Strategic Communications and is an adjunct faculty member at Clemson, where he teaches strategic communications-related courses.

Angela E. Leidinger, Vice President of External Affairs and Executive Secretary to the Board of Trustees. Ms. Leidenger has primary responsibility for directing Clemson’s government relations activity at both the state and federal levels and coordinates Clemson’s work with industry and developing strategic partnerships to strengthen the University’s economic and industry engagement. In addition, she serves as executive secretary to the Board of Trustees. In that role, she serves as the liaison between the University and its Board of Trustees, facilitating relationships and information sharing between the Board of Trustees and University administration, faculty, staff and students. She began her career in Government Relations with the McNair Law Firm in Columbia, South Carolina. In 1999, she joined the South Carolina Department of Commerce as Director of Governmental Affairs. In March 2002, Leidinger was named Executive Director of Governmental Affairs for Clemson University. She was named Executive Secretary to the Board of Trustees in February of 2008. In 2016, Leidinger was promoted to her current position of Vice President of External Affairs and Executive Secretary to the Board of Trustees. Leidinger earned a BS degree in Graphic Communications from Clemson University in 1990.

Brian O’Rourke, Vice President of Development and Alumni Relations. Mr. O’Rourke has served as the Vice President of Development and Alumni Relations since February 2016 and oversees all aspects of fundraising and alumni relations for the University. Recently O’Rourke led the University’s successful $1B Will To Lead Campaign. He earned a bachelor’s degree in administrative management in 1983 and a master’s in personnel services in 1985, both from Clemson. While a student at Clemson, he was a basketball manager and was inducted into Tiger Brotherhood, Alpha Tau Omega and Blue Key Honor Society. After graduation, he spent five years as Director of Field Activities for the Clemson Alumni Association. O’Rourke went on to become vice president of development for St. Francis Health System in Greenville, where he also served as executive director of its foundation. And more recently he was a senior consultant for Corporate DevelopMint, and Charleston-based fundraising consulting firm. Throughout his career, he’s remained an active donor to Clemson academic and athletic programs and has served in volunteer and leadership roles. From 1990-2001 he was the VP of Development/Executive Director of the St. Francis Foundation in Greenville, SC. During his 11 year period, the Foundation’s assets grew to over $8 million, while granting over $3 million back to the health system.

Dan Radakovich, Director of Athletics. Named the 13th director of athletics in Clemson history on Dec. 1, 2012, Radakovich has continuously led the Tiger athletic department to high achievements both on the field and in the classroom while developing significant upgrades in finance and facilities. Radakovich was named the SportsBusiness Journal Athletics Director of the Year for 2017, after being named a finalist in 2015. Since his arrival in December 2012, the athletic department has received approvals for $176 million in capital project

improvements and has increased spending on direct student-athlete development programs including nutrition, mental health and professional development. His department has increased overall revenue from $69 million in fiscal year 2014 to a budgeted $110 million in FY18. His administrative career spans over 306 years. Prior to Clemson, Radakovich was Director of Athletics at Georgia Tech from 2006-2012. He worked as a senior associate athletic director at Louisiana State from 2001-06 and became a director of athletics for the first time at American University in Washington, D.C. in 2000. Between the 1994-2000 seasons, Radakovich served as chief financial officer for the University South Carolina athletics. Radakovich gained experience on the West Coast from 1989-94, when he was a senior associate athletic director at Long Beach State. Radakovich is a 1980 graduate of Indiana University of Pennsylvania, where he earned a bachelor of science degree in finance. He earned his master’s degree in business administration from Miami (Fla.) in 1982.

Faculty Members

For the 2016-17 academic year, the University had a total faculty of 1,486, including 1,207 regular faculty and 279 temporary faculty.

The distribution by rank of the regular faculty at the University for the past nine academic years, is shown below:

Academic Associate Assistant Other (e.g. Total Tenured Year Professors Professors Professors Lecturers) Regular Faculty Faculty

2016-17 378 309 273 247 1,207 647 2015-16 360 307 269 258 1,194 640 2014-15 345 325 266 242 1,178 629 2013-14 351 304 254 255 1,164 620 2012-13 350 287 237 243 1,117 611 2011-12 341 250 248 222 1,061 560 2010-11 353 256 271 217 1,097 573 2009-10 353 258 278 216 1,105 577 2008-09 358 258 308 205 1,129 580

A total of 1,011 out of 1,173 (86.2%) full-time instructional faculty hold a terminal degree. The student/faculty ratio (in full time equivalents) for the 2016-17 academic year was approximately 17.9:1.

Staff Members

The University staff is presently comprised of 2,651 regular full-time employees and 1,085 part-time or temporary employees.

Student Enrollment and Applications

The enrollment (headcount) for the 2017-18 academic year is 19,502 undergraduates and 4,985 graduate students, or a total undergraduate and graduate enrollment of 24,387. The following table shows the University’s student enrollment for the academic years set forth below.

Academic Year Undergraduate Graduate Total(1) Out-of-State 2017-18 19,402 4,985 24,387 9,136 2016-17 18,599 4,807 23,406 8,637 2015-16 18,016 4,682 22,698 8,484 2014-15 17,260 4,597 21,857 8,217 2013-14 16,931 4,372 21,303 7,859 2012-13 16,562 4,206 20,768 7,534 2011-12 15,836 4,078 19,914 7,161 2010-11 15,459 3,994 19,453 6,939 2009-10 15,346 3,765 19,111 6,737 2008-09 14,713 3,604 18,317 6,266 ______(1) Average enrollment reduction (due to December graduation and attrition) from fall semester to spring semester is approximately 6%. For purposes of this table, full-time is defined as 12 or more credit hours. Out-of-State is the count of those students who are not eligible to pay in-state tuition and fees.

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Applications, Admissions and Matriculations

The following table shows University applications, admissions and matriculations for the years indicated.

CLEMSON UNIVERSITY Applications, Admissions, and Matriculations

Fall Semester of the Year: Freshmen Transfers Total 2017-18 Applications 26,242 3,218 29,460 Admissions 12,380 2.069 14,449 Matriculations 3,650 1,572 5,222

2016-17 Applications 23,506 3,206 26,712 Admissions 11,890 1,885 13,775 Matriculations 3,684 1,428 5,112

2015-16 Applications 22,396 2,964 25,360 Admissions 11,483 1,791 13,274 Matriculations 3,448 1,361 4,809

2014-15 Applications 20,756 2,709 23,466 Admissions 10,694 1,714 12,404 Matriculations 3,482 1,293 4,768

2013-14 Applications 18,604 2,478 21,082 Admissions 10,645 1,572 12,217 Matriculations 3,290 1,147 4,433

2012-13 Applications Admissions 18,500 2,317 20,812 Matriculations 10,706 1,577 12,279 3,465 1,166 4,623 2011-12 Applications 17,016 2,357 19,373 Admissions 10,215 1,571 11,786 Matriculations 2,935 1,155 4,086

2010-11 Applications 16,865 2,255 19,120 Admissions 9,724 1,461 11,185 Matriculations 3,017 1,064 4,084

2009-10 Applications 16,282 2,014 18,296 Admissions 10,224 1,392 11,616 Matriculations 3,386 980 4,353

2008-09 Applications 15,542 1,933 17,475 Admissions 8,355 1,317 9,672 Matriculations 2,927 960 3,883

Average SAT Scores

The average Scholastic Aptitude Test (“SAT”) scores of freshmen enrolling at the University and of freshmen enrolling at all State colleges and universities for the past ten academic years, including the current year, are as follows:

All State Academic Year University Average Colleges and Universities 2017-18 1,302 Not Available 2016-17 1,242 987 2015-16 1,251 978 2014-15 1,252 978 2013-14 1,246 971 2012-13 1,246 969 2011-12 1,229 972 2010-11 1,231 979 2009-10 1,225 982 2008-09 1,227 985

Tuition and Fees at the University

Set forth below are tuition and fees charged by the University for the 2017-18 academic year.

In-State Out-of-State Undergraduate Full-Time(1) $ 7,351 $ 17,822 Matriculation(1) 5 5

Part-Time(2) 638 1,548 Matriculation(1) 5 5

Graduate Full-Time(1), (3) 4,197 8,932 Matriculation(1) 5 5

Part-Time(2), (3) 542 1,099 Matriculation(1) 5 5

Graduate Assistant(1) 1,117 1,117 Matriculation(1) 5 5 ______(1) Per Semester. (2) Per Credit Hour. (3) Graduate Tuition is an average of five different tuition fee tiers.

Pension Plans

The Retirement Division of the South Carolina Public Employees Benefits Authority (the “Retirement Division”) maintains various independent defined benefit plans and issues its own publicly available Comprehensive Annual Financial Report (“Retirement System CAFR”) which includes financial statements and required supplementary information. A copy of the most recent separately issued Retirement System CAFR and other financial information may be accessed at www.peba.sc.gov. Furthermore, the Retirement Division and its pension plans are included in the Retirement System CAFR of the State.

Article X, Section 16 of the South Carolina Constitution requires that all State-operated retirement systems be funded on a sound actuarial basis. Title 9 of the Code of Laws of South Carolina, 1976, as amended, prescribes requirements relating to membership, benefits, and employee/employer contributions for each pension plan. Employee and employer contribution rates for the South Carolina Retirement System and the Police Officers Retirement System are actuarially determined. Annual benefits, payable monthly for life, are based on length of service and on average final compensation.

South Carolina Retirement System. The majority of employees of the University are covered by a retirement plan through the South Carolina Retirement System (“SCRS”), a cost-sharing multiple-employer defined benefit pension plan administered by the Retirement Division, a public employee retirement system. Generally all State employees are required to participate in and contribute to the SCRS as a condition of employment unless exempted by law as provided in Section 9-1-480 of the Code of Laws of South Carolina, 1976, as amended. This plan provides retirement annuity benefits as well as disability, cost of living adjustment, death, and group-life insurance benefits to eligible employees and retirees.

Effective July 1, 2016, employees participating in the SCRS were required to contribute 8.66 percent of all compensation. Effective July 1, 2016, the employer contribution rate was 11.41 percent. The University’s actual contributions to the SCRS for the three most recent Fiscal Years ended June 30, 2017, 2016, and 2015 were $20,992,216, $19,109,463 and $18,570,838, respectively.

Police Officers Retirement System. The South Carolina Police Officers Retirement System (“PORS”) is a cost-sharing multiple-employer defined benefit public employee retirement plan administered by the Retirement Division. Generally, all full-time employees whose principal duties are the preservation of public order or the protection against or prevention and control of property destruction by fire are required to participate in and contribute to the System as a condition of employment. This plan provides annuity benefits as well as disability and group life insurance benefits to eligible employees and retirees. In addition, participating employers in the PORS contribute to the accidental death fund which provides annuity benefits to beneficiaries of police officers and firemen killed in the actual performance of their duties. These benefits are independent of any other retirement benefits available to the beneficiary.

Effective July 1, 2016, employees participating in the PORS were required to contribute 8.66 percent of all compensation. Effective July 1, 2016, the employer contribution rate was 11.41 percent. The University’s actual contributions to the PORS for the years ending June 30, 2017, 2016, and 2015 were $564,457, $485,671, and $428,310 respectively, and equaled the required contributions for each year.

Optional Retirement Program. State employees may elect to participate in the Optional Retirement Program (“ORP”), a 401(a) qualified governmental defined contribution plan. The ORP was established in 1987 under Title 9, Chapter 17, of the Code of Laws of South Carolina, 1976, as amended. The ORP provides retirement and death benefits through the purchase of individual fixed or variable annuity contracts which are issued to, and become the property of, the participants. The State assumes no liability for this plan other than for payment of contributions to designated insurance companies.

ORP participation is available to all employees who meet all eligibility requirements for membership in the SCRS. To elect participation in the ORP, eligible employees must waive SCRS membership within their first thirty days of employment.

Under State law, both employee and employer contributions to the ORP are identical to the contribution rates of the SCRS.

Certain of the University’s employees have elected to be covered under optional retirement plans. For the Fiscal Year ended June 30, 2017, total contribution requirements to the ORP were $8,064,833 (excluding the surcharge) from the University as employer and $13,968,291 from its employees as plan members. All amounts were remitted directly to the respective annuity policy providers. The obligation for payment of benefits resides with the insurance companies.

Deferred Compensation Plan. Several optional deferred compensation plans are available to State employees and employers of its political subdivisions. Certain employees of the University have elected to participate. The multiple-employer plans, created under Internal Revenue Code Sections 457, 401(k), and 403(b), are administered by third parties and are not included in the Comprehensive Annual Financial Report of the State of South Carolina. Compensation deferred under the plans is placed in trust for the contributing employee. The State has no liability for losses under the plans. Employees may withdraw the current value of their contributions when they terminate State employment. Employees may also withdraw contributions prior to termination if they meet requirements specified by the applicable plan.

Teacher and Employee Retention Incentive. Effective January 1, 2001, Section 9-1-2210 of the Code of Laws of South Carolina, 1976, as amended, allowed employees eligible for service retirement to participate in the Teacher and Employee Retention Incentive (“TERI”) Program. TERI participants may retire and begin accumulating retirement benefits on a deferred basis without terminating employment for up to five years. Upon termination of employment or at the end of the TERI period, whichever is earlier, participants will begin receiving monthly service retirement benefits which will include any cost of living adjustments granted during the TERI period. Participants who entered the TERI program prior to July 1, 2005, do not make SCRS contributions, do not earn service credit, and are ineligible to receive group life insurance benefits or disability retirement benefits. Participants who entered the TERI program as of July 1, 2005, or after are required to make SCRS contributions, but do not earn service credit and are ineligible to receive disability retirement benefits. The TERI Program will be closed effective June 30, 2018.

Physical Plant

The University owns all of its campus property. The principal physical facilities of the University include more than 300 buildings both on campus and throughout the State. Funds for construction of many of the physical structures on the University campus have come primarily from the State in the form of direct appropriations or proceeds from the sale of Capital Improvement Bonds, which are general obligations of the State and not an obligation of or payable by the University.

The following table sets forth the book value of various assets of the University for each of the Fiscal Years shown.

2013 2014 2015 2016 2017 Land $ 32,702,685 $ 32,702,685 $ 34,116,890 $34,750,526 $34,293,526 Construction in 94,522,162 23,201,848 120,386,763 261,664,562 193,607,016 Progress Utilities systems and Other Non-Structural Improvements 24,252,357 24,180,837 22,955,457 37,442,058 38,035,150 Buildings and 552,749,048 577,418,197 556,221,684 635,656,862 871,708,010 Improvements Computer Software 95,514 12,072,286 8,049,322 5,746,303 2,920,549 Equipment 55,842,759 111,208,899 118,700,095 128,166,890 124,099,068 Vehicles 10,434,252 10,879,528 2,910,897 3,163,380 5,724,105 Total $770,598,777 $791,664,280 $863,341,108 $1,106,590,851 $1,270,387,424

The University had several major capital projects underway at June 30, 2017, including Douthit Hills and electrical infrastructure upgrade projects.

Insurance

All buildings and equipment on the campus of the University are insured through the Insurance Reserve Fund, a self-funded insurance plan operated by the State.

The University is exposed to various risks of loss and maintains State or commercial insurance coverage for each of those risks. The University believes such coverage is sufficient to preclude any significant uninsured losses to the University. Settled claims have not exceeded this coverage in any of the past three years. The University pays insurance premiums to certain other State agencies to cover risks that may occur in normal operations. Several State funds accumulate assets and the State itself assumes substantially all risks for the following:

(1) Claims of State employees for unemployment compensation benefits;

(2) Claims of covered employees for workers’ compensation benefits; and

(3) Claims of covered employees for health, dental, and group-life insurance benefits.

In addition, the University pays premiums to the State’s Insurance Reserve Fund which accumulates assets to cover the risks of loss related to the following assets and activities:

(1) Real property and its contents;

(2) Motor vehicles and aircraft;

(3) General tort liability claims;

(4) Business interruption;

(5) Builder’s risk;

(6) Inland marine; and

(7) Data processing.

The State’s Insurance Reserve Fund reinsures for a portion of the coverage for these liabilities.

Tort Liability and Insurance

The State Supreme Court, in the case of McCall v. Batson, decided April 18, 1985, abolished the doctrine of sovereign immunity in the State of South Carolina. In response to this decision, the South Carolina General Assembly in its 1986 session enacted the South Carolina Torts Claim Act which reestablished a qualified doctrine of sovereign immunity with respect to local government in South Carolina. Subject to specific immunity set forth in the South Carolina Tort Claims Act, local governments including the University are liable for damages not to exceed $300,000 per incident/person and $600,000 per occurrence/aggregate (except in the case of physicians and dentists employed by local governments, for which the per incident limit is $1,200,000). No punitive or exemplary damages are permitted under the South Carolina Tort Claims Act. Insurance protection to local government is provided by either the Insurance Reserve Fund, private carriers, self-insurance or pooled insurance funds. The University currently maintains liability insurance coverage with the Insurance Reserve Fund.

Budgeting Procedure

The University is a State-supported land grant institution governed by the Board of Trustees. State appropriations supporting the University are derived from two sources. First, as is true of other South Carolina higher education institutions, the South Carolina Commission on Higher Education recommends the distribution of legislated funding. Second, in support of its land grant mission, Public Service Activities also receive appropriations directly from the State Legislature. The Board of Trustees approves the annual operating budget and is authorized to establish tuition and fee amounts. In Fiscal Year 2017-18, the University’s budget for total current funds exceeds $1.155 billion, of which approximately 11% is appropriated State funds. Total State support for unrestricted operations of the University at the beginning of the current Fiscal Year increased by $4.6 million.

The University, like all other public institutions of higher education in South Carolina, depends upon the State of South Carolina as a significant source of revenue. Each year the University, like other public institutions of higher education, submits a Budget Request to the State Commission on Higher Education (“CHE”). CHE then compiles the requests, modifies or adopts the request and then presents the combined requests of all institutions to the Governor. The Governor reconciles the State’s available resources with the total requests and then proposes a lump sum increase or decrease for all state post-secondary education. The appropriation process then moves to the General Assembly and ultimately results in a final lump sum appropriation to higher education. CHE distributes this appropriation using the prior year base plus other methodologies related to relative enrollments or performance.

State appropriations may not lawfully be pledged and are not pledged for payment of debt service on the Series 2018A Bonds. There can be no assurance that future legislatures will continue to make appropriations at current or increased levels or that, if made, such appropriations will be timely or sufficient, when added to operating revenues remaining after debt service, to cover, in full, the operating expenses of the University.

State Support and Its Effect

The moneys required to meet the operating budget of the University are received both from appropriations from the State and from student fees and other revenues received by the University. The State appropriations are provided on a year-to-year basis and there is no assurance that the appropriations will continue at the present level. As in the case of all other State appropriations (except for debt), State appropriations made to the University are subject to reduction by the State Fiscal Accountability Authority (the “State Authority”) in the event projected revenues prove insufficient.

The State Authority is perhaps the most important State agency from a fiscal standpoint. The State Authority is comprised of the Governor, who serves as its Chairman, the State Treasurer, the Comptroller General, the Chairman of the Senate Finance Committee, and the Chairman of the Ways and Means Committee of the House of Representatives.

The Governor is required to submit an Executive Budget to the General Assembly within five (5) days after the beginning of each regular session. Such budget is required to conform to the funding requirements contained in Article III, Section 36 of the South Carolina Constitution. The Governor is required, by law, to complete a survey of all departments, bureaus, divisions, offices, boards, commissions, institutions and other agencies to obtain information upon which to base his budget recommendations no later than November 1 of each year. In this connection, each of several State departments, bureaus, divisions, offices, boards, commissions, institutions and other agencies receiving or requesting financial aid from the State are required to report to the Governor in itemized form, no later than November 1, of each year, the amount needed or requested in the succeeding Fiscal Year. In addition, on or before November 1 of each year the Comptroller General is required to furnish to the Governor detailed statements as to appropriations and expenditures for certain prior Fiscal Years and appropriation years. The Comptroller General is also required to furnish to the Governor on or before December 1 of each year an estimate of the financial needs of the State itemized in accordance with the budget classifications adopted by the State Authority.

The budget presented to the General Assembly by the Governor must be accompanied by detailed statements of prior year’s revenues and expenditures, a statement of current assets and liabilities and other

information with respect to the State’s finances and economic condition. The General Assembly is authorized by law to increase or decrease items in the budget bill.

The South Carolina Constitution requires a procedure for the monitoring of revenues and expenditures with a view to a reduction of appropriations as may be necessary to prevent a deficit. For the purpose of providing projections and forecasts of revenues and expenditures and advising the State Authority on economic trends, the General Assembly established the Board of Economic Advisors. With respect to the Constitutional requirement of monitoring revenues, statutory provisions require that the Board of Economic Advisors provide to the State Authority quarterly estimates of State revenues. If at the end of the first or second quarter of any Fiscal Year quarterly revenue collections are four percent (4%) or more below the amount projected for such quarter by the Board of Economic Advisors, the State Authority is required, within fifteen (15) days of such determination, to take action to avoid a Fiscal Year-end deficit.

The South Carolina Constitution mandates the General Assembly to provide a balanced budget and provides that if there is a casual deficit, such deficit must be provided for in the succeeding Fiscal Year. For many years, each annual appropriation bill has contained a provision requiring the State Authority to monitor the collection of revenues and the expenditure of funds. It has been further provided that if because of a shortfall in revenues, a deficit appears likely, the State Authority shall effect such reductions of appropriations as may be necessary to prevent a deficit.

The Educational and General (“E&G”) portion of the University’s budget represents the primary unrestricted budget for general non-public service operations. Two primary revenue streams support E&G operations: State appropriations and student fees.

Student fees represent the largest single source of revenue for the University, comprising approximately 46.9% of the Fiscal Year 2017-18 unrestricted budget and 36.0% of the Fiscal Year 2017-18 total budget. The Board of Trustees approved tuition and fee increases of 2.75% for residents and 4.25% for non-residents for fall 2017. The tuition increase will provide increased student engagement opportunities, improved academic facilities, protect infrastructure and enhance safety, and other activities adding value to the educational experience and directly benefiting students. The tuition increase, along with enrollment growth and growth in online and continuing education, is expected to generate $23.4 million in additional general fund revenue for the coming year.

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The table below demonstrates budgeted State appropriations as a percentage of total budgeted operating funds of the University for the years indicated:

Percentage of Budgeted State Appropriations to Total Budgeted Current Operating Funds of the University Percentage of Budgeted State Appropriations to Fiscal Year Total Budgeted Current Budgeted State Total Budgeted Ended June 30 of: Operating Funds Appropriations Current Operating Funds 2018 $1,155,074,000 $124,043,000 10.70% 2017 1,091,752,000 118,702,000 10.90 2016 989,249,000 109,266,000 11.04 2015 956,204,000 105,903,000 11.08 2014 907,040,000 99,453,000 10.96 2013 859,763,000 91,904,000 10.69 2012 815,276,000 87,325,000 10.71 2011 797,382,000 90,648,000 11.37 2010 479,094,000 114,120,000 23.82 2009 449,009,000 128,279,000 28.57

DEBT STRUCTURE OF THE UNIVERSITY

Outstanding Debt

The University’s debt consists of the following categories:

(1) General Obligation State Institution Bonds of the State of South Carolina (“State Institution Bonds”), may be issued by the State upon an approved request of a State institution, such as the University. State Institution Bonds may be issued to construct, reconstruct, maintain, improve, furnish and refurnish the buildings and other permanent improvements of a State institution, to defray the costs of acquiring or improving land needed as sites for such improvements or for the campus of a State institution, to reimburse such institution for expenses incurred in anticipation of the issuance of such bonds, or to refund State Institution Bonds. State Institution Bonds are secured by a pledge of the full faith, credit and taxing power of the State, and in addition, by a pledge of designated tuition fees collected by the University. State Institution Bonds are issued by the State on behalf of the University.

(2) Higher Education Revenue Bonds (“Revenue Bonds”) may be issued by the University for the purpose of financing or refinancing in whole or in part the cost of the acquisition, construction, reconstruction, renovation and improvement of land, buildings and other improvements to real property and equipment for the purpose of providing facilities serving the needs of the University including, but not limited to, dormitories, apartment buildings, dwelling houses, bookstores and other stores operated by the University, laundry, dining halls, cafeterias, parking facilities, student recreational, entertainment and fitness related facilities, inns, conference and other nondegree educational facilities and similar auxiliary facilities of the University and other facilities which are auxiliary to any of the foregoing, excluding, however, Athletic Department projects which primarily serve varsity athletic teams of the University. Revenue Bonds are payable from and secured by a pledge of the net revenues derived from the operation of the Facilities and the Additional Funds, as such terms are defined in the bond resolution authorizing the issuance of Revenue Bonds dated December 1, 1997, as from time to time amended.

(3) Athletic Facilities Revenue Bonds may be issued by the University for the purpose of financing or refinancing in whole or in part the cost of constructing and improving facilities designated by the Board of Trustees as intercollegiate athletic facilities. Athletic Facilities Revenue Bonds are secured by a pledge of Net Revenues, Admissions Fees and any Special Student Fee.

The following table shows the categories of outstanding long-term obligations of the University as of December 1, 2017.

Category of Indebtedness Amount Outstanding

State Institution Bonds $ 222,695,000 Revenue Bonds 289,205,000 Athletic Facilities Revenue Bonds 130,605,000(1) Total $ 642,505,000 ______(1) Does not include the Series 2018A Bonds.

Future Debt Issuances

State Institution Bonds. The Board of Trustees has given project approval to construct a $12.5 million Outdoor Fitness & Wellness Center, and approved a request to the State Authority for not exceeding $6.75 million of State Institution Bonds to fund the project. The State approved the project, including and the issuance of not exceeding $6.75 million of State Institution Bonds to support this project on December 12, 2017, however timing of the bond issuance is currently under development.

Debt Payment Record

There has been no default in the payment of principal or interest on any bonds issued by or on behalf of the University. The University has never borrowed for the purpose of refunding any bonds in order to prevent a default, nor has the University borrowed for the purpose of paying the cost of operations or for funding a deficit.

LEGAL MATTERS

Litigation

No litigation is presently pending or, to the knowledge of the University, threatened in any court to restrain or enjoin the sale, execution, issuance, or delivery or otherwise affect the validity of the Series 2018A Bonds, or in any way contesting or affecting the validity of the Series 2018A Bonds or any proceedings of the Board of Trustees taken with respect to the authorization, sale, or issuance of the Series 2018A Bonds or the pledge or application of any moneys provided for the payment of or security for the Series 2018A Bonds. Certifications to those effects will be delivered at the time of the original delivery of the Series 2018A Bonds.

The University is involved in a number of legal proceedings and claims with various parties arising in the normal course of business. However, these claims should be covered by the University’s insurance or by contingency funds reserved for that purpose should the University be found at fault, and these are not expected to have a material adverse effect on the financial position of the University.

United States Bankruptcy Code

The undertakings of the University should be considered with reference to Chapter 9 of the Bankruptcy Code, 11 U.S.C. §§ 901, et seq., as amended, and other laws affecting creditors’ rights and certain public bodies generally. Chapter 9 permits a municipality, political subdivision, public agency, or other instrumentality of a State that is insolvent or unable to meet its debts as such debts mature to file a petition in the United States Bankruptcy Court for the purpose of effecting a plan to adjust its debts; directs such a petitioner to file with the court a list of its creditors; provides that the filing of the petition under that Chapter operates as a stay of the commencement or continuation of any judicial or other proceeding against the petitioner; directs a petitioner to file a plan for the adjustment of its debts; permits the petitioner in its plan to modify the rights to payment of its creditors; and provides that the plan must be accepted in writing by or on behalf of creditors of each impaired class of claims holding at least two-thirds in amount and more than one-half in number of the creditors which have accepted or rejected the plan. The plan may be confirmed notwithstanding the negative vote of one or more classes of claims if the court finds that the plan is in the best interest of creditors, is feasible, and is fair and equitable with respect to the

dissenting classes of creditors. A petitioner has the right to reinstate indebtedness under its plan according to the original maturity schedule of such indebtedness notwithstanding any provision in the documents under which the indebtedness arose relating to the insolvency or financial condition of the debtor before the confirmation of the plan, the commencement of a case under the Bankruptcy Code, or the appointment of or taking possession by a trustee in a case under the Bankruptcy Code or by a receiver or other custodian prior to the commencement of a case under the Bankruptcy Code.

Proceedings

All quotations from and summaries and explanations of provisions of laws of the United States of America and of the State herein do not purport to be complete and are qualified in their entirety by reference to the official compilations thereof. All references to the Series 2018A Bonds, the Resolution and the 2017 Series Resolution are qualified in their entirety by reference to the definitive forms of the Series 2018A Bonds, the Resolution and the 2017 Series Resolution. All such summaries, explanations and references are further qualified in their entirety by reference to the exercise of the sovereign powers of the State and the constitutional powers of the United States of America, and to valid bankruptcy, insolvency, reorganization, moratorium and other laws for the relief of debtors.

Certain legal matters with regard to the issuance of the Series 2018A Bonds are subject to the approval of Pope Flynn, LLC, Columbia, South Carolina, Bond Counsel, whose approving opinion will be available at the time of the delivery of the Series 2018A Bonds. Certain other legal matters will be passed upon for the University by Howell Linkous & Nettles, LLC, as Disclosure Counsel for the University and by Chip Hood, Esquire, General Counsel to the University.

The various legal opinions to be delivered concurrently with the delivery of the Series 2018A Bonds express the professional judgment of the attorneys rendering the opinions as to the legal issues explicitly addressed therein. By rendering a legal opinion, the opinion giver does not become an insurer or guarantor of that expression of professional judgment, of the transaction opined upon, or of the future performance of parties to such transaction. Nor does the rendering of an opinion guarantee the outcome of any legal dispute that may arise out of the transaction.

TAX MATTERS

Disclaimer

Any discussion of the tax issues relating to the Series 2018A Bonds in this Official Statement was written to support the promotion or marketing of the Series 2018A Bonds. Such discussion was not intended or written to be used, and it cannot be used, by any person for the purpose of avoiding any tax penalties that may be imposed on such person. Each investor should seek advice with respect to the Series 2018A Bonds based on its particular circumstances from an independent tax advisor.

General

The following is a summary of certain anticipated United States federal income tax consequences of the purchase, ownership and disposition of the Series 2018A Bonds. The summary is based upon the provisions of Internal Revenue Code of 1986, as amended (the “Code”), the regulations promulgated thereunder and the judicial and administrative rulings and decisions now in effect, all of which are subject to change. The summary generally addresses Series 2018A Bonds held as capital assets and does not purport to address all aspects of federal income taxation that may affect particular investors in light of their individual circumstances or certain types of investors subject to special treatment under the federal income tax laws, including but not limited to financial institutions, insurance companies, dealers in securities or currencies, those holding such bonds as a hedge against currency risks or as a position in a “straddle” for tax purposes, or those whose functional currency is not the United States dollar. Potential purchasers of the Series 2018A Bonds should consult their own tax advisors in determining the federal, state or local tax consequences to them of the purchase, ownership and disposition of the Series 2018A Bonds.

The Series 2018A Bonds

General. On the date of issuance of the Series 2018A Bonds, Bond Counsel will render an opinion that, under existing laws, regulations, rulings, and judicial decisions, and assuming compliance by the University with certain covenants, the interest on the Series 2018A Bonds is excluded from gross income for purposes of federal income taxation and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals.

The Code imposes various restrictions, conditions and requirements relating to the exclusion of interest on obligations, such as the Series 2018A Bonds, from gross income for federal income tax purposes, including, but not limited to, the requirement that the University rebate certain excess earnings on proceeds and amounts treated as proceeds of the Series 2018A Bonds to the United States Treasury, restrictions on the investment of such proceeds and other amounts, and restrictions on the ownership and use of the facilities financed or refinanced with proceeds of the Series 2018A Bonds. The foregoing is not intended to be an exhaustive listing of the post-issuance tax compliance requirements of the Code, but is illustrative of the requirements that must be satisfied by the University subsequent to issuance of the Series 2018A Bonds to maintain the excludability of the interest on the Series 2018A Bonds from gross income for federal income tax purposes. Bond Counsel’s opinion is given in reliance on certifications by representatives of the University as to certain facts material to the opinion and requirements of the Code.

The University has covenanted to comply with all requirements of the Code that must be satisfied subsequent to the issuance of the Series 2018A Bonds in order that the interest on the Series 2018A Bonds be, or continue to be, excluded from gross income for federal income tax purposes. The opinion of Bond Counsel assumes compliance by the University with such covenants, and Bond Counsel has not been retained to monitor compliance by the University with such covenants subsequent to the date of issuance of the Series 2018A Bonds. Failure to comply with certain of such requirements may cause the interest on the Series 2018A Bonds to be included in gross income for federal income tax purposes retroactive to the date of issuance of the Series 2018A Bonds. No other opinion is expressed by Bond Counsel regarding the federal tax consequences of the ownership of or the receipt or accrual of interest with respect to the Series 2018A Bonds.

If the interest on the Series 2018A Bonds subsequently becomes included in gross income for federal income tax purposes due to a failure by the University to comply with any requirements described above, the University is not required to redeem the Series 2018A Bonds or to pay any additional interest or penalty.

The IRS (the “IRS”) has established an ongoing program to audit tax-exempt obligations to determine whether interest on such obligations is includible in gross income for federal income tax purposes. Bond Counsel cannot predict whether the IRS will commence an audit of the Series 2018A Bonds. Prospective purchasers of the Series 2018A Bonds are advised that, if the IRS does audit the Series 2018A Bonds, under current IRS procedures, at least during the early stages of an audit, the IRS will treat the University as the taxpayer, and the owners of the Series 2018A Bonds may have limited rights, if any, to participate in the audit. The commencement of an audit could adversely affect the market value and liquidity of the Series 2018A Bonds until the audit is concluded, regardless of the ultimate outcome.

Collateral Federal Tax Considerations. Prospective purchasers of the Series 2018A Bonds should be aware that ownership of tax-exempt obligations may result in collateral federal income tax consequences to certain taxpayers, including, but not limited to, financial institutions, property and casualty insurance companies, life insurance companies, certain foreign corporations, certain S corporations, individual recipients of Social Security or Railroad Retirement benefits, and taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry tax-exempt obligations. The Series 2018A Bonds are not “qualified tax-exempt obligations” under Section 265(b)(3) of the Code. Bond Counsel expresses no opinion concerning such collateral income tax consequences, and prospective purchasers of the Series 2018A Bonds should consult their tax advisors as to the applicability thereof.

Proposed legislation is considered from time to time by the United States Congress that, if enacted, would affect the tax consequences of owning the Series 2018A Bonds. No assurance can be given that any future legislation, or clarifications or amendments to the Code, if enacted into law, will not contain provisions which could

cause interest on the Series 2018A Bonds to be subject directly or indirectly to federal and/or State of South Carolina income taxation, adversely affect the market price or marketability of the Series 2018A Bonds or otherwise prevent the owners of the Series 2018A Bonds from realizing the full current benefit of the status of the interest on the Series 2018A Bonds.

Bond Counsel’s opinion is based on existing law, which is subject to change. Such opinion is further based on factual representations made to Bond Counsel as of the date thereof. Bond Counsel assumes no duty to update or supplement its opinion to reflect any changes in law that may thereafter occur or become effective. Moreover, Bond Counsel’s opinion is not a guarantee of a particular result and is not binding on the IRS or the courts; rather, such opinion represents Bond Counsel’s professional judgment based on its review of existing law, and in reliance on the representations and covenants that Bond Counsel deems relevant to such opinion. Bond Counsel’s opinion expresses the professional judgment of the attorney’s rendering the opinion regarding the legal issues expressly addressed therein. By rendering its opinion, Bond Counsel does not become an insurer or guarantor of the result indicated by that expression of professional judgment, of the transaction on which the opinion is rendered, or of the future performance of the University, nor does the rendering of such opinion guarantee the outcome of any legal dispute that may arise out of the transaction.

[Original Issue Premium

The difference between the amount payable at maturity of the Series 2018A Bonds maturing on ______1, _____ through ____, inclusive and the Series 2018A Bonds maturing on ______1, _____ through ____, inclusive (collectively, the “Premium Bonds”), and the tax basis of such Series 2018A Bonds to a purchaser (other than a purchaser who holds such Series 2018A Bonds as inventory, stock in trade or for sale to customers in the ordinary course of business) who purchases the Premium Bonds at the initial offering price, is “Bond Premium.” Bond Premium is amortized over the term of the Series 2018A Bonds for federal income tax purposes. Owners of Series 2018A Bonds are required to decrease their adjusted basis in Series 2018A Bonds by the amount of amortizable Bond Premium attributable to each taxable year that Series 2018A Bonds are held. Owners of Series 2018A Bonds should consult their tax advisors with respect to the precise determination for federal income tax purposes of the treatment of Bond Premium upon the sale or other disposition of Series 2018A Bonds and with respect to the State of South Carolina and local tax consequences of owning and disposing of Series 2018A Bonds.]

[Original Issue Discount

The initial public offering prices of the Series 2018A Bonds maturing on ______1, ____ through ____, inclusive and the Series 2018A Bonds maturing on ______1, ____ through ____, inclusive (collectively, the “Discount Bonds”) are less than the amounts payable with respect to such Discount Bonds at maturity. An amount not less than the difference between the initial public offering prices of the Discount Bonds and their stated redemption price at maturity constitutes original issue discount which, to the extent deemed to accrue, will be excludable from gross income for federal and State of South Carolina income tax purposes. Such original issue discount is not a specific item of tax preference for purposes of the federal alternative minimum tax.]

State Tax Exemption

Bond Counsel is of the opinion that the Series 2018A Bonds and the interest thereon are exempt from all taxation by the State of South Carolina, its counties, municipalities and school districts except estate, transfer or certain franchise taxes. Interest paid on the Series 2018A Bonds is currently subject to the tax imposed on banks by Section 12-11-20 of the Code of Laws of South Carolina 1976, as amended, which is enforced by the South Carolina Department of Revenue as a franchise tax. The opinion of Bond Counsel is limited to the laws of the State of South Carolina and federal tax laws. No opinion is rendered by Bond Counsel concerning the taxation of the Series 2018A Bonds or the interest thereon under the laws of any other jurisdiction.

MISCELLANEOUS

Underwriting

The Series 2018A Bonds have been purchased by ______(the “Underwriter”) at a competitive sale from the University for resale. The Underwriter has agreed, subject to certain conditions, to purchase the Series 2018A Bonds at an aggregate purchase price of $______(representing the aggregate principal amount of the Series 2018A Bonds of $______plus a premium, net of underwriter’s discount, of $______, plus accrued interest from January 1, 2018). The initial public offering yields of the Series 2018A Bonds are as set forth on the inside front cover of this Official Statement and may be changed from time to time by the Underwriter. The Underwriter may also allow a concession from the public offering prices to certain dealers. The Underwriter has received no fee from the University for underwriting the Series 2018A Bonds. If the Series 2018A Bonds are sold at the public offering yields as set forth on the inside front cover of this Official Statement, the Underwriter anticipates an underwriter’s discount in the amount of $______for the Series 2018A Bonds.

Rating

Moody’s Investors Service, Inc. (“Moody’s”), has assigned the Series 2018A Bonds a rating of “Aa3.” The rating reflects only the views of Moody’s. The University has furnished Moody’s the information contained in this Official Statement and certain other publicly available materials and information about the University. Generally, the rating agency bases its rating on such materials and information, as well as investigations, studies, and assumptions of the rating agency. The rating may be changed at any time, and no assurance can be given that it will not be lowered or withdrawn entirely by Moody’s if, in its judgment, circumstances so warrant. A downward change in or withdrawal of the rating may have an adverse effect on the market price of the Series 2018A Bonds. An explanation of the rating can be received from Moody’s at the following address: Moody’s Investors Service, Inc., 7 World Trade Center, 250 Greenwich Street, New York, New York.

Independent Audits and Other Financial Information

The University’s financial statements were audited by Elliott Davis Decosimo, LLC, Greenville, South Carolina, for the Fiscal Years ended June 30, 2012 through 2016. The University’s Comprehensive Annual Financial Report (the “CAFR”) for the Fiscal Year ended June 30, 2017, including the audited financial statements for the Fiscal Year ended June 30, 2017 (the “2017 Financial Statements”), is included in this Official Statement as Appendix A. The report of Elliott Davis Decosimo, LLC, dated September 29, 2017, is set forth in Appendix A. The 2017 Financial Statements, including the footnotes thereto, should be reviewed in their entirety by prospective purchasers of the Series 2018A Bonds. Elliott Davis Decosimo, LLC has consented to the inclusion of its report in Appendix A but has not undertaken to update its report or to take any action intended or likely to elicit information concerning the accuracy, completeness, or fairness of the statements made in this Official Statement, and no opinion is expressed by Elliott Davis Decosimo, LLC with respect to any event subsequent to its report dated September 29, 2017, relating to the 2017 Financial Statements.

The University’s Comprehensive Annual Financial Reports, including its audited financial statements for the Fiscal Years ended June 30 of the years 2009 through 2016 are available for review on the website of the Municipal Securities Rulemaking Board (“MSRB”) at www.emma.msrb.org and for the Fiscal Years ended June 30 in the years 2002 through 2016 on the website of the University at http://www.clemson.edu/finance/comptroller/cafr/. No other information from the University’s website is incorporated by reference into this Official Statement.

With respect to evaluating the ability of the University to make timely payment of debt service on the Series 2018A Bonds based on information contained in the CAFR, no representation is made that such information contains all factors material to such an evaluation or that any specific information should be accorded any particular significance. The 2017 Financial Statements represent a comprehensive report of the University’s finances and include funds, accounts, and revenues that are not pledged to the payment of debt service on the Series 2018A Bonds. This Official Statement should be considered in its entirety and no one factor should be considered more or less important than any other solely by reason of its location herein. See “APPENDIX A - COMPREHENSIVE

ANNUAL FINANCIAL REPORT OF THE UNIVERSITY FOR FISCAL YEAR ENDED JUNE 30, 2017” attached hereto.

Continuing Disclosure

Rule 15c2-12 Undertaking.

In order to assist the Underwriter of the Series 2018A Bonds to comply with the provisions of Rule 15c2- 12 of the United States Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time (the “Rule”), the University will enter into a Disclosure Dissemination Agent Agreement (the “Disclosure Dissemination Agreement”) for the benefit of the holders and beneficial owners of the Series 2018A Bonds with Digital Assurance Certification, L.L.C. (“DAC”), under which the University has designated DAC as Disclosure Dissemination Agent. The form of the Disclosure Dissemination Agreement is set forth in Appendix D to this Official Statement.

Under the Disclosure Dissemination Agreement, the University has undertaken for the benefit of the Holders of the Series 2018A Bonds to provide annually financial information and operating data regarding the University, which is the only “obligated person” (within the meaning of the Rule) for which financial information or operating data is provided in this Official Statement, by not later than February 1 of each year, commencing February 1, 2019 (the “Annual Report”) for the Fiscal Year 2017-18. The Annual Report shall include, at a minimum, the annual audited financial statements of the University prepared in accordance with accounting principles generally accepted within the United States of America as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board and other financial information and operating data as described in the Disclosure Dissemination Agreement. Under the Disclosure Dissemination Agreement, the University has also undertaken for the benefit of the Holders of the Series 2018A Bonds, to provide notices of certain enumerated events (the “Event Notices”) as provided in the Rule within the time frame required by the Rule. The Annual Reports and Event Notices will be filed with the MSRB’s Electronic Municipal Market Access system (“EMMA”) in the manner prescribed by the Rule. See Appendix D to this Official Statement for a more complete description of the University’s undertaking under the Rule.

Currently, the only “obligated person” (within the meaning of the Rule) with respect to the Series 2018A Bonds is the University. No other person or entity is obligated to provide, or is expected to provide, any continuing disclosure information with respect to the Rule.

The Disclosure Dissemination Agent has only the duties specifically set forth in the Disclosure Dissemination Agreement. The Disclosure Dissemination Agent’s obligation to deliver the information at the times and with the contents described in the Disclosure Dissemination Agreement is limited to the extent the University has provided such information to the Disclosure Dissemination Agent as required by this Disclosure Dissemination Agreement. The Disclosure Dissemination Agent has no duty with respect to the content of any disclosures or notice made pursuant to the terms of the Disclosure Dissemination Agreement. The Disclosure Dissemination Agent has no duty or obligation to review or verify any information in the Annual Report (including the financial statements contained therein), any Event Notices, or any Voluntary Report (as defined therein), or any other information, disclosures or notices provided to it by the University and shall not be deemed to be acting in any fiduciary capacity for the University, the holders or beneficial owners of the Series 2018A Bonds, or any other party. The Disclosure Dissemination Agent has no responsibility for the University’s failure to report to the Disclosure Dissemination Agent an Event Notice or a duty to determine the materiality thereof. The Disclosure Dissemination Agent shall have no duty to determine nor liability for failing to determine whether the University has complied with the Disclosure Dissemination Agreement. The Disclosure Dissemination Agent may conclusively rely upon certifications of the University at all times.

On July 24, 2015, the University discovered that some financial information filed on EMMA on a timely basis, contained in its 2013 Annual Report and 2014 Annual Report, had been incorrectly calculated. On August 4, 2015, the University made a voluntary filing on EMMA to correct the information that had been inadvertently misreported.

On December 22, 2016, Standard & Poor’s Ratings Services raised its long-term rating relating to certain series of the University’s outstanding Revenue Bonds from “AA-” to “AA.” On January 17, 2017, the University filed a Notice of Material Event regarding the rating change on EMMA for the affected bonds. The University subsequently engaged DAC to assist the University in maintaining compliance in the future with its disclosure obligations under its continuing disclosure undertakings related to the University’s Revenue Bonds and Outstanding Bonds.

State Law Requirement.

Pursuant to Section 11-1-85 of the Code of Laws of South Carolina 1976, as amended (“Section 11-1-85”), the University has covenanted to file with a central repository for availability in the secondary bond market when requested: (i) an annual independent audit within thirty days of the University’s receipt of the audit; and (ii) event specific information within thirty days of an event adversely affecting more than five percent of the revenues of the University.

The only remedy for failure by the University to comply with these covenants is an action for specific performance. Moreover, the University has specifically reserved the right to amend the covenants to reflect any change in Section 11-1-85 without the consent of any Bondholder.

Paying Agent’s Disclaimer

U.S. Bank National Association, as Paying Agent and Registrar has not provided, or undertaken to determine, the accuracy of, any of the information contained in this Official Statement and makes no representation or warranty, express or implied, as to (i) the accuracy or completeness of such information, (ii) the validity of the Series 2018A Bonds, or (iii) the tax exempt status of the interest on the Series 2018A Bonds.

Closing Certifications

Upon the delivery of the Series 2018A Bonds, the University will furnish the purchaser with certifications of appropriate officials of the University stating in substance: (a) that there is no litigation pending or, to the knowledge of the University, threatened in any court to restrain or enjoin the issuance or delivery of any of the Series 2018A Bonds or the collection of revenues pledged or to be pledged to pay the principal of and interest on the Series 2018A Bonds, or in any way contesting or affecting the validity of the Series 2018A Bonds or the Resolution, or the power to collect and pledge revenues to pay the Series 2018A Bonds, or contesting the power or authority of the University to issue the Series 2018A Bonds or adopt the Resolution; (b) establishing that the Series 2018A Bonds are not “arbitrage” bonds, within the meaning of Section 148 of the Code and the applicable Treasury Regulations thereunder; and (c) that this Official Statement, as of its date and as of the date of delivery of the Series 2018A Bonds, does not contain any untrue statement of a material fact and does not omit to state a material fact which should be included therein for which this Official Statement is intended to be used or which is necessary to make any statement contained therein, in the light of the circumstances under which it was made, not misleading.

Financial Advisor

Hilltop Securities Inc., New York, New York (“Hilltop Securities”) is acting as Financial Advisor (the “Financial Advisor”) to the University in connection with the issuance of the Series 2018A Bonds. The Financial Advisor’s fee for services rendered with respect to the sale of the Series 2018A Bonds is contingent upon the issuance and delivery of the Series 2018A Bonds. Hilltop Securities, in its capacity as Financial Advisor, has not verified and does not assume any responsibility for the information, covenants and representations contained in any of the legal documents with respect to the federal income tax status of the Series 2018A Bonds, or the possible impact of any present, pending or future actions taken by any legislative or judicial bodies or rating agencies.

CONCLUSION

Further inquiries should be addressed to Rick Petillo, Director, Debt and Capital Financing, Clemson University, G06 Sikes Hall, Clemson, South Carolina 29634 (telephone: (864) 656-2421; email: [email protected]); Kayla J. MacEwen, Director, Hilltop Securities Inc., 54 Canal Street, Suite 320, Boston, Massachusetts 02114 (telephone: (617) 619-4403; email: [email protected]) or Gary T. Pope, Jr., Esquire, Bond Counsel, Pope Flynn, LLC, 1411 Gervais Street, Suite 300, Columbia, South Carolina 29201 (telephone: (803) 354-4917; email: [email protected]).

CLEMSON UNIVERSITY

By: Richard D. Petillo Director, Debt and Capital Financing

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APPENDIX A

COMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE UNIVERSITY FOR FISCAL YEAR ENDED JUNE 30, 2017

[THIS PAGE INTENTIONALLY LEFT BLANK] Clemson, South Carolina

Comprehensive Annual Financial Report For the Year Ended June 30, 2017

A component unit of the State of South Carolina On the cover: Core Campus Core Campus is the newest addition to the Clemson University campus. It is a mixed -use facility which includes student housing, dining facilities, convenience store and a retail restaurant. Also included is an academic oriented facility that has shared-use seminar and meeting space for faculty and students as well as space for administrative support. Comprehensive Annual Financial Report A component unit of the State of South Carolina

For the Year Ended June 30, 2017

Prepared by the Controller's Office [THIS PAGE INTENTIONALLY LEFT BLANK] TABLE OF CONTENTS

TITLE PAGE Introductory Section: Clemson Forward Strategic Plan...... 7 President's Letter...... 9 Letter of Transmittal...... 10 Certificate of Achievement...... 14 Clemson University Board of Trustees...... 15 Clemson University Organization Chart...... 16

Financial Section: Independent Auditor's Report...... 19 Management's Discussion and Analysis...... 22 Basic Financial Statements: Clemson University - Statement of Net Position...... 30 Clemson University - Statement of Revenues, Expenses and Changes in Net Position...... 31 Clemson University - Statement of Cash Flows...... 32 Clemson University Foundation - Statement of Financial Position ...... 33 Clemson University Foundation - Statement of Activities ...... 34 Clemson University Land Stewardship Foundation - Statement of Financial Position ...... 35 Clemson University Land Stewardship Foundation - Statement of Activities ...... 36 IPTAY - Statement of Financial Position...... 37 IPTAY - Statement of Activities...... 38 Notes to Financial Statements: Note 1 - Summary of Significant Accounting Policies...... 39 Note 2 - Cash and Cash Equivalents, Deposits and Investments...... 44 Note 3 - Receivables...... 45 Note 4 - Capital Assets...... 47 Note 5 - Unearned Revenues, Deposits and Funds Held for Others...... 47 Note 6 - Bonds Payable...... 48 Note 7 - Lease Obligations...... 51 Note 8 - Pension Plans...... 53 Note 9 - Post-Employment Benefits Other than Pensions...... 59 Note 10 - Deferred Compensation Plans...... 59 Note 11 - Long-Term Liabilities...... 60 Note 12 - Construction Costs and Commitments...... 61 Note 13 - Related Parties...... 62 Note 14 - Transactions with State Entities...... 62 Note 15 - Risk Management...... 63 Note 16 - Contingencies and Litigation...... 65 Note 17 - Operating Expenses by Function...... 65 Note 18 - Donor-Restricted Endowments...... 65 Note 19 - Details of Restricted Assets...... 66 Note 20 - Component Units...... 66 Note 21 - Subsequent Events...... 68 Required Supplementary Information: Schedule of University's Proportionate Share of the Net Pension Liability...... 69 Schedule of University Contributions...... 70

~ 3 ~ TABLE OF CONTENTS . (continued)

TITLE PAGE Statistical Section: Schedule of Revenues by Source...... 74 Schedule of Expenses by Use ...... 76 Schedule of Expenses by Function...... 77 Schedule of Net Position and Changes in Net Position...... 78 Schedule of Ratios of Outstanding Debt...... 79 Schedule of Bond Coverage...... 80 Admissions, Enrollment and Degree Statistics...... 82 Undergraduate Average Annual Tuition and Fees...... 84 Faculty and Staff Statistics...... 86 Schedule of Capital Asset Information...... 87 Demographic Statistics...... 88 Ten Largest Employers...... 89

Supplementary Information to the Financial Statements: Schedule of Pledged Net Revenues - Auxiliary Revenue Bonds (Series 2005, 2012, 2015 and 2015B)...... 92 Schedule of Pledged Net Revenues - Athletic Facilities Revenue Bonds (Series 2012, 2014A, 2014B, 2014C, 2015 and 2015B)...... 93 Clemson University Reporting Entity - Combined Statement of Net/Financial Position...... 94 Clemson University Reporting Entity - Combined Statement of Revenues, Expenses, Activities and Changes in Net Position...... 96

~ 4 ~ Introductory Section (unaudited) [THIS PAGE INTENTIONALLY LEFT BLANK] ClemsonForward Strategic Plan

ClemsonForward is built on four key foundations: Research, Engagement, the Academic Core and Living, which spells the acronym REAL. Specific goals and tactics will guide each of those four areas.

RESEARCH ClemsonForward sets a new bar for research funding and scholarly work. Clemson’s goal is to continuously improve its research quality, quantity and impact; to foster a rich, curiosity-driven intellectual environment; to solve real problems; and to create more opportunities for graduates and alumni. This includes continuing unique public/private partnerships driven by the University’s Innovation Campuses, building a culture of innovation and entrepreneurship, and focusing on six strategic innovation areas — advanced materials; cyberinfrastructure and big data science; energy, transportation and advanced manufacturing; human resilience; health innovation; and the sustainable environment.

ENGAGEMENT Engagement was a cornerstone of the 2020 Road Map and is at the heart of the land-grant mission. ClemsonForward capitalizes on existing strengths and opportunities to emphasize high-impact, evidence- based academic and global engagement. It also emphasizes rigorous assessment so that we are better able to understand and measure the links between these engagement experiences and student learning and success.

ACADEMIC CORE We will create an optimal path for academic programs — both undergraduate and graduate — to achieve national prominence. ClemsonForward enhances the undergraduate academic core with initiatives in interdisciplinary curricula, a new approach to general education, and enhanced advising. ClemsonForward also extends the focus on quality to the arena of graduate education and contains a greater commitment to graduate education and the graduate student experience at both the main campus and the innovation campuses.

LIVING ClemsonForward will strengthen the cherished sense of community and connectedness that defines the Clemson Family by creating an environment that is diverse, respectful and inclusive, further enhancing the quality of student life and developing policies, facilities and support systems that will make Clemson a great place to work, study and live.

KEY ENABLERS Together these pieces will support the real impact, real experience, real intellect, and real family that make up the heart of today’s Clemson. The research, engagement, academic and living goals of ClemsonForward plan rest on four critical enablers: • Strategic Revenue Growth — Manage enrollment, entrepreneurial activities, development priorities, operational efficiencies and revenue allocation to support ClemsonForward initiatives. • College reorganization —Enhance the learning and working environment in the seven academic colleges. • Building Futures — Build state-of-the-art new facilities, renovate aging structures and create multi- function spaces that provide a vibrant academic environment. • Focus and Accountability — Prudently manage existing resources. Concentrate metrics on measuring impact rather than activity.

~ 7 ~ [THIS PAGE INTENTIONALLY LEFT BLANK] President’s Letter 2017

Dear Friends of Clemson:

Clemson University continues to be a leader in academics, research and athletics. This past year was another record-setting year for Clemson in admissions, enrollment, graduation and retention rates, research funding, private fundraising, athletics, and facilities development. We were ranked among the top-25 public universities by U.S.News & World Report for the ninth consecutive year, and we were once again designated as a Research 1 University by Carnegie Classification for Institutions of Higher Education. We are also ranked number one in South Carolina, and in the Top 10 nationally by Princeton Review in five categories — students love their college, career services, town- gown relations, students pack the stadium and play intramural sports.

Several major construction projects were completed this year, ribbons were cut, and many organizations and programs moved into renovated spaces.

We are moving forward with our new Clemson Forward Strategic Plan, which has now been endorsed by the Board of Trustees. The plan builds upon the strong foundation of the existing 2020 Road Map and focuses on enhancing four primary areas — research, the academic core, engagement, and living. The plan advances the university’s land- grant mission of providing a practical and intellectual education and serving as a “high seminary of learning” for the State of South Carolina, as originally outlined in Thomas Green Clemson’s will. It also provides the flexibility and forward thinking that will allow the university to evolve to meet the needs of the generations that follow.

The priorities of Clemson Forward will be funded, in part, by the money raised during the Will to Lead capital campaign, and I am proud to report that we successfully completed the campaign last year, raising a total of $1,062,528,346! I am extremely grateful to all of the alumni, friends, corporate partners, and foundations for their generosity and support over the past 10 years. Not only did we complete the largest campaign for an institution with an alumni base smaller than 150,000, but we also completed the largest fundraising campaign ever in the state of South Carolina! The money raised during the campaign will benefit students, faculty, and staff for generations to come.

Thank you for supporting Clemson University as we work together for a great future.

Sincerely,

James P. Clements, Ph.D. President

~ 9 ~ LETTER OF TRANSMITTAL

September 30, 2017

To President Clements, Members of the Board of Trustees, and Citizens of South Carolina

We are pleased to present to you the Comprehensive Annual Financial Report of Clemson University for the year ended June 30, 2017. The report provides financial information about the University’s operations during the year and describes its financial position at the end of the year. Management assumes full responsibility for the completeness and reliability of the information contained in this report, based upon a comprehensive framework of internal controls that was established for this purpose. Because the cost of internal controls should not exceed the anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of material misstatements. State law, federal guidelines, and certain bond covenants require that the University’s accounting and financial records be audited each year. For the fiscal year ended June 30, 2017, the University contracted with the independent certified public accounting firm of Elliott Davis Decosimo, LLC, to perform the University’s annual audit. The auditors have issued an unmodified opinion, the most favorable outcome of the audit process. The independent auditor’s report is located at the front of the financial section. Management’s discussion and analysis (MD&A) immediately follows the independent auditor’s report and provides a narrative introduction, overview, and analysis of the basic financial statements. MD&A complements this letter of transmittal and should be read in conjunction with it.

Profile of the University Clemson University was founded in 1889, a legacy of Thomas Green Clemson, who willed his Fort Hill plantation home, its surrounding farmlands and forest, and other property to the state of South Carolina to establish a technical and scientific institution for South Carolina. Clemson opened its doors to 446 students as a military college in 1893. Today, Clemson is classified by the Carnegie Foundation as a Research/High University, a category attained by approximately 4 percent of all universities in America. Students can choose from more than 70 undergraduate and over 100 graduate degree programs in five colleges. As the state’s land-grant university, Clemson reaches out to citizens, communities, and businesses all over South Carolina through county-based Cooperative Extension offices, five off-campus Research and Education Centers, and critical regulatory responsibilities for plant and animal health. Clemson University is governed by a board of thirteen members, including six elected by the State General Assembly and seven appointed self-perpetuating life members. Clemson University operates as a unit of the State of South Carolina (the primary government) as a state assisted institution of higher education. The State Budget and Control Board requires the University to submit an annual balanced budget for both its Educational and General and Extension and Public Service components. Each recognized college or budget center of the University is provided with a level of appropriation. This appropriation limits total annual expenditures. Budgetary controls are incorporated into both the University’s accounting system and the State’s financial management system to ensure that imposed expenditure constraints are observed. Periodic financial reports comparing actual results with budgeted amounts are provided at both the University and State level.

~ 10 ~ Governmental Accounting Standards Board (GASB) • Managing state mandated cost increases Codification Section 2100: Defining the Financial Reporting • Enhancing safety and security with investments in Police, Entity, and Section 2600: Reporting Entity and Component Fire and EMS as well as building control and monitoring Unit Presentation and Disclosure, provides criteria for whether systems to ensure a safe learning campus environment certain organizations should be reported as component units • Protecting Clemson’s physical assets with a strategic based on the nature and significance of their relationship capital plan, maintenance and stewardship of facilities, to the related entity. Based on this criteria, the University preventative maintenance, and IT infrastructure determined that the Clemson University Foundation, the • Supporting research investments to recruit and retain Clemson University Research Foundation, the Clemson top researchers, growing externally funded research, and University Land Stewardship Foundation and IPTAY are building a world-class research environment indeed component units of the University. Consequently, the • Providing for auxiliary enterprise growth financial statements include the accounts of these four entities • Enhancing scholarship opportunities for students as discretely presented component units. • Supporting entrepreneurial growth

Local Economy The University plans for investments totaling $13.9 South Carolina’s seasonally adjusted unemployment million in core academic and living environments on campus. rate dropped to 4% at the end of June, its lowest level State mandated cost increases related to retirement funding, since December 2000. The state’s unemployment rate has increased insurance costs, and other regulatory and compliance remained below the national average for the past twelve costs will require an expected $12.3 million investment. consecutive months. A report published by the South Carolina Additional investments totaling $3.1 million will support Department of Employment and Workforce reports increases in campus safety measures as well as the University’s facility employment across almost all sectors of the economy over the stewardship and capital plan. Investments of $4.8 million past year with the strongest growth occurring in Manufacturing in scholarships are expected to enhance student quality and and Trade, Transportation, and Utilities. Almost 30,000 performance. Auxiliary Enterprise growth of $17.5 million nonfarm jobs were added over the past year, outpacing the is expected in scholarships as well as capital investments in national job growth rate for the past several years. According Athletics, Housing, and Dining facilities. Investments totaling to the South Carolina Economic Outlook published by the $15.7 million will provide support for growth in the research South Carolina Department of Commerce, the state has also area as well as support for endowments and endowed chairs. experienced increases in personal income and a strong South Investments of $4.6 million will support expenditures related Carolina stock index. to entrepreneurial growth. The state’s steady employment rate and wage growth have The State Legislature has exhibited its support of these led to a strong housing market. For the month of June, the state priorities with renewed investment to support academic and experienced a 4.5 percent increase in real estate closings, a 4.8 agriculture programs. State appropriations are expected to percent increase in median sales price, an 8.9 percent increase grow by $5.3 million in the coming fiscal year. The state has in building permits, and a 24 percent increase in the valuation provided $1.1 million in recurring funding for Agriculture and of building permits over the prior year. Chief economist Natural Resources Programming and $1.2 million in recurring Dr. Frank Nothaft with CoreLogic, a property information funding for support of Statewide Extension programs. In provider, predicts that the state’s home price index will reach addition, the state has provided funding of $1.6 million for its previous 2006 peak rate during the second half of the year. retirement and fringe benefit increases for employees and $1.4 At the state’s most recent Annual Economic Outlook million in funding for education and general operations. Conference, economists Doug Woodward and Joseph Von The University issued General Obligation State Nessen cautioned that the state’s economy is in the midst Institution Bonds totaling $52,395,000 during 2017 to fund the of a “paradigm shift” and warned that employers may soon construction of a main campus electrical distribution system experience struggles in finding qualified employees for new and to construct a water tower and utility infrastructure at positions. The impact of changes to current trade and military Douthit Hills. policies by the Trump administration could also impact the state’s historically strong manufacturing export industry as Major Initiatives well as the strong military presence in South Carolina. Clemson has continued to raise the bar in admissions, enrollment, research, facilities development, athletics, Long-Term Financial Planning graduation and retention rates, and fundraising. The University’s long-term financial plan focuses on a The 2016-17 academic and fiscal year was a very continued commitment to a Top 20 vision as outlined in the productive year for Clemson, which was once again designated ClemsonForward Plan with investments in key areas including: a Research 1 university by the Carnegie Classification for Institutions of Higher Education. Clemson was once again • Providing core academic and living investments to ensure ranked in the Top 25 of all national public universities as quality education, programming, student engagement, and announced by U.S. News & World Report for the ninth leadership consecutive year.

~ 11 ~ President Clements welcomed two new leaders to his • A groundbreaking was held for the new building at the administrative team during the course of the year including Greenville Hospital System that will be the home to our Mark Land, Vice President of University Relations; and Russell Center for Nursing, Health Innovation and Research. Kaurloto, Vice President for Information Technology and Chief And work continues on the Douthit Hills complex and Information Officer. As the university reorganized from the the Snow Family Outdoor Fitness and Wellness Center. five-college structure to seven colleges, Cynthia Young was • Many special events were held and notable speakers named the founding Dean for the College of Science. welcomed to Clemson including Convocation keynote All university departments and programs began speaker, Dr. May Jemison, a former astronaut and first implementing the Clemson Forward Strategic Plan. Clemson African-American woman in space; The President’s Forward advances the mission of providing a practical and Forum on Inclusive Excellence with keynote speaker intellectual education while also providing the flexibility and Fred Whitfield, President of the Charlotte Hornets; and forward thinking to allow the university to evolve to meet the 35th Annual Martin Luther King Jr. commemorative the needs of the generations that follow. The plan focuses on service featuring Dr. Walter Kimbro, President of research, engagement, academic core, and living, and will Dillard University. serve to further the vision of Clemson as a Top 20 university. • The Clemson History in Plain Sight event was held Diversity and inclusive excellence continue to be major on campus and featured historical building tours, factors in the Clemson Forward Strategic Plan. President storytellers, and other informative speakers. Clemson Clements’ appointed implementation committee continues to also held the first ever CU United Luncheon on work towards implementing the recommendations from the Bowman Field where more than 1500 students, faculty, Board of Trustees task force on the history of the university. and staff came together for food and fellowship. As a national leader among public universities, Clemson And the inaugural year of the President’s Leadership University is committed to diversity, inclusiveness and Institute graduated 25 faculty and staff members historical accuracy and the Board of Trustees Task Force on • Two of the significant events hosted by Clemson were the history of Clemson was created in 2015 to work with the the Regional Women’s Leadership Forum for the university administration to help tell the full, accurate history American Council on Education and the first Clemson of Clemson. University Men of Color National Summit. Private gifts to the university in the first fiscal year post- • Clemson University received a $3 million ADVANCE Will to Lead capital campaign set an annual private giving grant from the National Science Foundation that will record totaling $151.3 million. Clemson’s second-annual help increase the number of women – especially Give Day contributed over $2 million to this total from minority women – in STEM fields. The rigorous 3,265 donors. In 2016, Clemson celebrated the successful application process lasted two years and took a completion of the Will to Lead capital campaign for Clemson dedicated team of more than 40 students, faculty and raising over $1.06 billion to support students, faculty and staff staff. with scholarships, professorships, facilities, technology and enhanced opportunities for learning and research. This is the Statewide Initiatives sixth consecutive year that annual fundraising at Clemson has • At the Clemson University Restoration Institute located exceeded $100 million. in North Charleston, construction was completed on Highlights, news and major milestones of the year include: the $21.5 million Zucker Family Graduate Education • Several new facilities opened including the Core Center. The center offers masters and Ph.D. degrees Campus complex, the renovated Littlejohn Coliseum, in engineering, eventually growing to accommodate Pitner Center at the Pee Dee Research and Education 200 students, 12 faculty, 40 researchers and staff. The Center, and Self Regional Hall, which is the new center serves as the academic anchor in the CURI research facility at the Greenwood Genetic Center. applied technology park. • Ribbon-cuttings were held for the Barnes Center for • Clemson University, in conjunction with the Greenwood student activities, One Research Drive at CU-ICAR, Genetic Center, expanded existing facilities of the J.C. the Zucker Family Graduate Education Center in North Self Research Institute adding a 17,000-square-foot Charleston, the Allen N. Reeves Football Operations research and education center in human genetics on Center, and the Clemson Design Center in the historic nearly 15 acres donated by Greenwood County and Cigar Factory in Charleston. the Greenwood Commission of Public Works. The site • Several on-campus programs moved into new and is located adjacent to the Greenwood Genetic Center improved spaces for students to enjoy including the within the Greenwood Research Park and represents a Calhoun Honors College, the Gantt Multicultural cornerstone of economic development in Greenwood Center which now also includes Emerging Scholars, County. The research being conducted as a result of and the PEER and WISE program study hall. this partnership has the potential to identify better treatments for chronic disorders, such as diabetes, cancer and cardiovascular disease — known for high prevalence in South Carolina.

~ 12 ~ • Clemson implemented a new accelerated degree program options with our partners at MUSC in which students will be able to apply to nine health-related graduate programs. This program will save students time and money while producing highly skilled and highly educated professionals for South Carolina’s health care workforce. • In February, Clemson Day at the State House was held in Columbia and included a celebration of the College Football National Championship. • During the impending threat of Hurricane Matthew, Clemson’s housing and dining staff accommodated 47 students and 11 staff members who had to evacuate from Coastal Carolina University.

Awards and Acknowledgements The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to Clemson University for its comprehensive annual financial report for the fiscal year ended June 30, 2016. The Certificate of Achievement is a prestigious national award recognizing conformance with the highest standards for preparation of state and local government financial reports. In order to be awarded a Certificate of Achievement, a government unit must publish an easily readable and efficiently organized comprehensive annual financial report (CAFR), whose contents conform to program standards. Such a CAFR must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. Clemson University has received the Certificate of Achievement annually since the fiscal year ended June 30, 1993. We believe our current report continues to conform to the Certificate of Achievement program requirements, and we are submitting it to the GFOA. The preparation of the Comprehensive Annual Financial Report in a timely manner would not have been possible without the coordinated efforts of the Comptroller’s Office and other University financial staff. Each member has our sincere appreciation for their contributions in the preparation of the report.

Sincerely,

Brett A. Dalton Vice President for Finance and Operations

~ 13 ~ ~ 14 ~ CLEMSON UNIVERSITY BOARD OF TRUSTEES (as of June 30, 2017)

TRUSTEES TRUSTEE EMERITI

E. Smyth McKissick, III, Chairman Louis P. Batson, Jr. CEO, Alice Manufacturing Company, Inc. Chairman, Retired Louis P. Batson Company John N. (Nicky) McCarter, Jr., Vice Chairman President, Defender Services, Inc. J. J. Britton Sumter Family Health Center David E. Dukes Partner, Nelson Mullins Riley & Scarborough LLP Fletcher C. Derrick, Jr. Urologist Ronald (Ronnie) D. Lee Ronald D. Lee, DMD, P.C. Leon (Bill) J. Hendrix, Jr. Chairman, Retired Louis B. Lynn Remington Arms Company President, ENVIRO AgScience, Inc. Harold D. (Doug) Kingsmore Patricia Herring McAbee Chairman of the Board, Southern Weaving Company Vice President, Custom Development Solutions Thomas (Tom) B. McTeer, Jr. Robert L. Peeler President, McTeer Real Estate, Inc. Manager, Community and Municipal Relations Waste Management Inc. Allen P. Wood Retired Cheri M. Phyfer, Mosley, Wilkins, Wood Associates, Ltd. President and General Manager, Diversiefied Brands The Sherwin-Williams Company

Mark S. Richardson, Owner, MAR Real Estate, LLC

William (Bill) C. Smith, Jr., CEO, Red Rock Developments

Joseph D. Swann President, Retired Rockwell Automation Power Systems

Kim Wilkerson President, South Carolina Bank of America

David H. Wilkins. Partner, Nelson Mullins Riley & Scarborough LLP

~ 15 ~ CLEMSON UNIVERSITY ORGANIZATION CHART

CLEMSON UNIVERSITY BOARD OF TRUSTEES

EXECUTIVE SECRETARY TO THE BOARD

PRESIDENT

CHIEF OF STAFF ASSISTANTS TO THE PRESIDENT

EXECUTIVE VICE PRESIDENT FOR DIRECTOR OF ATHLETICS ACADEMIC AFFAIRS AND PROVOST

VICE PRESIDENT FOR FINANCE VICE PRESIDENT FOR VICE PRESIDENT FOR AND OPERATIONS PUBLIC SERVICE AND RESEARCH AGRICULTURE

DIRECTOR INTERNAL AUDIT VICE PRESIDENT FOR ALUMNI AND DEVELOPMENT

CHIEF HUMAN RESOURCES OFFICER VICE PRESIDENT FOR STUDENT AFFAIRS

GENERAL COUNSEL CHIEF DIVERSITY OFFICER

VICE PRESIDENT FOR ACCESS & EQUITY EXTERNAL AFFAIRS

DIRECTOR OF OPERATIONS VICE PRESIDENT FOR UNIVERSITY RELATIONS

~ 16 ~ Financial Section [THIS PAGE INTENTIONALLY LEFT BLANK]

Independent Auditor’s Report

Members of the Board of Trustees Clemson University Clemson, South Carolina

Report on the Financial Statements

We have audited the accompanying financial statements of the business-type activities and the aggregate discretely presented component units of Clemson University (the University), a component unit of the State of South Carolina, as of and for the year ended June 30, 2017, and the related notes to the financial statements, which collectively comprise the University's basic financial statements as listed in the table of contents.

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.

Auditor's Responsibility

Our responsibility is to express opinions on these financial statements based on our audit. We did not audit the financial statements of the Clemson University Research Foundation (a discretely presented component unit), the Clemson University Foundation (a discretely presented component unit), the Clemson University Land Stewardship Foundation (a discretely presented component unit), and IPTAY (a discretely presented component unit). The Clemson University Research Foundation, the Clemson University Foundation, the Clemson University Land Stewardship Foundation, and IPTAY represent 100% of total assets, 100% of net assets or position, and 100% of total revenues of the discretely presented component units. Those statements were audited by other auditors whose reports have been furnished to us, and our opinions, insofar as they relate to the amounts included for these discretely presented components units, are based solely on the reports of the other auditors. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. The financial statements of the Clemson University Foundation and IPTAY were not audited in accordance with Government Auditing Standards, issued by the Comptroller General of the United States.

www.elliottdavis.com

~ 19 ~

Auditor's Responsibility, Continued

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's 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 opinions.

Opinions

In our opinion, based on our audit and the reports of other auditors, the financial statements referred to above present fairly, in all material respects, the respective financial position of the business-type activities and the aggregate discretely presented component units of the University as of June 30, 2017, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Required Supplementary Information

Accounting principles generally accepted in the United States of America require that Management’s Discussion and Analysis on pages 22-29, Schedule of University’s Proportionate Share of Net Pension Liability on page 69 and Schedule of University Contributions on page 70 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s response to our inquiries, the basic financial statements and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient audit evidence to express an opinion or provide any assurance.

Other Information

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the University’s basic financial statements. The Introductory Section, Schedule of Pledged Net Revenues – Auxiliary Revenue Bonds (Series 2005, 2012, 2015 and 2015B), Schedule of Pledged Net Revenues – Athletic Facilities Revenue Bonds (Series 2012, 2014A, 2014B, 2014C, 2015 and 2015B), Clemson University Reporting Entity – Combined Statement of Net/Financial Position, and Clemson University Reporting Entity – Combined Statement of Revenues, Expenses, Activities and Changes in Net Position and Statistical Section, as listed in the accompanying table of contents are presented for purposes of additional analysis and are not a required part of the financial statements. Such information has not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on it.

~ 20 ~

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, we have also issued our report dated September 29, 2017 on our consideration of the University's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the University's internal control over financial reporting and compliance.

Greenville, South Carolina September 29, 2017

~ 21 ~ UNAUDITED

MANAGEMENT’S DISCUSSION AND Total Revenues – increase of $99.9 million ANALYSIS l Operating revenues increased $45.5 million, based on the following: Overview of the Financial Statements and  Student tuition and fees increased $23 million, the Financial Analysis result of a Board approved increase of 3.14 percent for Clemson University is pleased to present its financial resident students, 4.27 percent for nonresident students, statements for fiscal year 2017. While audited financial and an average of 6.09 percent for graduate students. statements for fiscal year 2016 are not presented with this Enrollment also increased by approximately three report, condensed operations and financial position data will be percent over the prior year. presented in this section in order to illustrate certain increases  Sales and services revenues increased $6.8 million. and decreases. However, the emphasis of discussions about Sales and services of pledged auxiliaries increased these statements will be on current year data. $17.3 million. Athletics revenue increased as a result There are three financial statements presented: the of post-season play including the ACC championship Statement of Net Position; the Statement of Revenues, and National Championship games, regular season Expenses and Changes in Net Position; and, the Statement of ticket sales, and an increase in ACC distributions. A Cash Flows. These statements present financial information board approved 5 percent average increase in room in a format similar to that used by private corporations. and board and dining fees and increased enrollment This discussion and analysis of the University’s financial led to increased Housing and Food Service revenues. statements provides an overview of its financial activities for Non-pledged auxiliary sales and services decreased the year. $11.4 million as the result of a reduction in scope of Information Systems Development contractual commitments for Medicaid IT Services with the Statement of Revenues, Expenses and Changes in Department of Health and Human Services. Sales and Net Position services of educational activities increased $862,000 as The Statement of Revenues, Expenses and Changes in Net the result of Youth Learning Institute camp revenues. Position presents the revenues earned and expenses incurred  Grants and contracts revenues increased $13.3 during the year. Activities are reported as either operating or million. Revenues from federal grants and contracts nonoperating. All things being equal, a public University’s increased $10.4 million. Grants from the National dependency on state aid and gifts will result in operating Science Foundation, the Department of Energy, and the deficits. The GASB requires state appropriations and gifts Department of Health and Human Services contributed to be classified as nonoperating revenues. The utilization of to the increase. Lottery funded Palmetto Fellows, long-lived assets, referred to as Capital Assets, is reflected in Life, and Hope scholarships contributed to a $3.2 the financial statements as depreciation, which amortizes the million increase in state grants and contracts. County cost of an asset over its expected useful life. funds supporting the Greenwood Genetics Center Changes in total net position as presented on the Statement contributed to an $860,000 increase in local grants. of Net Position is based on the activity presented in the Nongovernmental grants and contracts decreased Statement of Revenues, Expenses, and Changes in Net Position. $1.2 million due to a decrease in grants from private The purpose of the statement is to present the revenues received foundations. by the institution, both operating and nonoperating, and the  Other operating revenues increased $2.4 million. expenses paid by the institution, operating and nonoperating, Increases in study abroad fees, student health fees, and any other revenues, expenses, gains and losses received fraternity and sorority affiliation fees, and registration or spent by the institution. revenue for various University programs contributed to Generally speaking, operating revenues are received for the increase. providing goods and services to the various customers and constituencies of the institution. Operating expenses are those l Nonoperating revenues increased $54.4 million, based on expenses paid to acquire or produce the goods and services the following: provided in return for the operating revenues, and to carry  State appropriations increased $10.5 million. Base out the mission of the institution. Nonoperating revenues appropriations for Educational & General (E&G) are revenues received for which goods and services are not activities increased $5.5 million. Base appropriations provided. State capital appropriations and capital grants for Public Service Activities (PSA) increased $2.6 and gifts are considered neither operating nor nonoperating million. An additional $2.3 million was appropriated revenues and are reported after “Income before other revenues, to cover health and dental costs, increased retirement expenses, gains or losses.” contributions, and a state mandated 3.25 percent cost The Condensed Statement of Revenues, Expenses and of living adjustment for employees. Changes in Net Position reflects a positive year with an increase in Net Position at the end of the year. Some highlights of the information presented on this Statement are as follows:

~ 22 ~ UNAUDITED

 Federal appropriations increased $608,000 as the result of an increase in federal government funding for the University’s land-grant Smith Lever appropriations, Hatch, and McIntire Stennis funding.  Gifts and grants increased $19.4 million as the result of IPTAY gifts for qualifying scholarships and operating expenses.  Investment income increased $22.5 million. Improved market conditions led to an increase in earnings on endowment balances held by the Clemson University Foundation and Wells Fargo.  Other nonoperating revenues increased $252,000 due to an increase in timber sales.  Proceeds from the sale of capital assets increased $1.1 million. Approximately 518 acres of land in Laurens County was sold to the Department of Natural Resources.

Condensed Summary of Net Revenues, Expenses and Changes in Net Position (thousands of dollars)

Increase/ Percent Description 2017 2016 Decrease Change Revenues: Student tuition and fees, net $ 364,126 $ 341,077 $ 23,049 6.76% Sales and services, net 190,830 184,076 6,754 3.67% Grants and contracts 157,367 144,084 13,283 9.22% Other operating revenues 34,037 31,638 2,399 7.58% Total operating revenues 746,360 700,875 45,485 6.49% State appropriations 119,309 108,812 10,497 9.65% Federal appropriations 12,240 11,632 608 5.23% Gifts and grants 67,552 48,189 19,363 40.18% Investment income 23,655 1,092 22,563 2066.21% Other nonoperating revenues 330 78 252 323.08% Proceeds from the sale of capital assets 1,397 252 1,145 454.37% Total nonoperating revenues 224,483 170,055 54,428 32.01% Total revenues 970,843 870,930 99,913 11.47%

Expenses: 556,537 513,401 43,136 8.40% Services and supplies 265,758 267,423 (1,665) (0.62)% Compensation and employee benefits Utilities 19,730 18,910 820 4.34% Depreciation 51,759 49,872 1,887 3.78% Scholarships and fellowships 27,269 27,726 (457) (1.65)% Total operating expenses 921,053 877,332 43,721 4.98% Interest on capital asset related debt 21,471 17,091 4,380 25.63% Loss on disposal of capital assets 1,965 340 1,625 477.94% Refunds to grantors 120 71 49 69.01% Facilities and administrative remittances to the State 317 450 (133) (29.56)% Total nonoperating expenses 23,873 17,952 5,921 32.98% Total expenses 944,926 895,284 49,642 5.54%

Income before other revenues, expenses, gains or losses 25,917 (24,354) 50,271 (206.42)%

State capital apppropriations 5,240 15,886 (10,646) (67.01)% Capital grants and gifts 56,006 37,580 18,426 49.03% Additions to permanent endowments 20 567 (547) (96.47)% Change in net position 87,183 29,679 57,504 193.75%

Net position, beginning of year 695,931 666,252 29,679 4.45%

Net position, ending $ 783,114 $ 695,931 $ 87,183 12.53%

~ 23 ~ UNAUDITED

Total Revenues $970,843 (thousands of dollars)

Sales and Services of Educational and Other Activities $21,303 Other Operating Local and Sales and Services of Revenues Nongovernmental Auxiliary Enterprises $34,037 Grants and $169,527 Contracts $13,388 State Grants State Appropriations and Contracts $119,309 $62,055

Federal Grants and Contracts $81,924 NONOPERATING $224,483 Federal Appropriations - $12,240

Student Tuition and Fees Gifts and Grants $364,126 $67,552 Non Operating Revenues and Sale of Capital Interest Income and Endowment Assets - Income - $23,655 $1,727

Total Expenses – increase of $49.6 million decreased $1 million. Scholarship and Fellowship costs l Operating expenses increased $43.7 million, based on the increased $28,000. Auxiliary services costs decreased following: $2.4 million. Increased Athletic costs related to post-  Compensation and employee benefits increased $43.1 season play were offset by the reduction in information million. Pension expense related to the amortization systems development fees for Medicaid IT Services. of the University’s proportionate share of the state’s  Utility expenses increased $820,000 driven by increased net pension liability increased by $10 million. A state power costs for new housing and dining facilities. mandated 3.25 percent cost of living adjustment for  Depreciation expense increased $1.9 million as the result qualified faculty and staff, increased faculty and staff of the capitalization of major construction projects in the headcount, and an increase in fringe benefit expenses prior year and current year. A full year of depreciation and supplemental pay for athletic coaches also was calculated on prior year projects including Watt contributed to the increase. Innovation Center, Memorial Stadium, Kingsmore  Services and supplies expenses decreased $1.7 Stadium and Freeman Hall. Current year projects million. Instruction costs increased $828,000. Costs include Core Campus, Littlejohn Coliseum, and the associated with the Clemson Design Center and the Football Operations facility. Campbell Graduate Engineering program were offset  Scholarship and fellowship expenses decreased by a reduction in allocated information technology $457,000 due to decreases in state veteran tuition costs. Research costs increased $4.7 million over differentials. the prior year related to federal sponsored research projects with the National Science Foundation, l Nonoperating expenses increased $5.9 million based on the Department of Health and Human Services, and the following: Department of Energy. Public service costs increased  Interest expense increased $4.4 million as the result $250,000. Literacy and after school programs through of the issuance of new State Institution bond debt of the School of Education and new mobile medical unit $52 million in the current year as well as Revenue and costs contributed to the increase. Academic support Athletic Facilities bond debt totaling approximately costs decreased $6.1 million related to the reduction $210 million in the prior year. in information technology costs related to the reduced  Losses on disposal of capital assets increased $1.6 scope of contractual commitments with the Department million. Contributing factors include the sale of of Health and Human Services. An increase in student approximately 518 acres of land in Laurens County to health fees, various campus events and concerts, and the Department of Natural Resources, the demolition of Tiger Paw Production costs led to a $1.1 million increase a wharf in North Charleston, and disposals of obsolete in Student Services. The institutional support increase equipment. of $915,000 is the result of Kronos time keeping upgrade  Refunds to grantors increased $49,000 due to fixed costs, diversity and inclusion initiatives, and candidate payment amounts that had to be returned to sponsors search costs. Operation and maintenance of plant when the cost of work performed was less than amounts costs related to non-capitalized repairs and renovations previously received.

~ 24 ~ UNAUDITED

Total Expenses by Function Scholarships and Fellowships $944,926 (thousands of dollars) $27,269

Depreciation $51,759 Utilities $19,730 Services and Supplies $265,758 Interest on Capital Asset Related Debt $21,471

Loss on Disposal NONOPERATING of Capital Assets EXPENSES $1,965 $23,873 Refunds to Compensation and Grantors - Employee Benefits $120 $556,537 Facilities and Adminitrative Remittances to the State - $317

 Facilities and administrative costs remitted to the State Development bond proceeds decreased $8.7 million related decreased $133,000. The State requires such costs to prior year awards for the Clemson University Restoration collected for non-research sponsored projects in excess Institute and Greenwood Genetic Center. of $200,000 to be remitted. Education and General l Capital grants and gifts increased $18.4 million. The largest program remittances decreased $100,000 and Public contributing factor included IPTAY gifts to the University Service Activities program remittances decreased to fund the construction of the Football Operations facility. $33,000. l A $547,000 decrease in additions to permanent endowments l The State capital appropriations decrease of $10.6 million was the result of private donor gifts in the prior year. was attributable to amounts received in the prior year. Appropriations totaling $2.4 million were received in the Statement of Net Position current year for outdoor lab renovations. State Capital The Statement of Net Position presents the assets, Reserve Fund appropriations decreased $4 million. deferred outflows of resources, liabilities, deferred inflows Funds supporting the new Garrison Arena were offset of resources, and net position of the University as of the end by funds received in the prior year for the College of of the fiscal year. The Statement of Net Position is a point of Business building. Research Infrastructure and Economic time financial statement. The purpose of the Statement of Net

Total Expenses by Natural Classification $944,926 (thousands of dollars) Scholarships and Fellowships $25,467 Operation and Maintenance of Plant $68,442 Institutional Support $41,381

Student Services $40,678 Auxiliary Enterprises $ 166,599 Interest on Capital Debt $21,471 Academic Support Depreciation $53,723 $51,759 NONOPERATING EXPENSES Public Service $23,873 Loss on Disposal $68,763 of Capital Assets $1,965

Instruction Refunds to $246,756 Grantors Research $120 $157,485 Facilities & Administrative Remittances to the State - $317

~ 25 ~ UNAUDITED

Position is to present to the readers of the financial statements expendable. Restricted nonexpendable net position consists a fiscal snapshot of Clemson University. The Statement of Net solely of the University’s permanent endowment funds and is Position presents end-of-year data concerning Assets (property only available for investment purposes. Expendable restricted that we own and what we are owed by others), Deferred net position is available for expenditure by the institution but Outflows of Resources (consumption of net position by the must be spent for purposes as determined by donors and/or University that is applicable to a future reporting period), external entities that have placed time or purpose restrictions Liabilities (what we owe to others and have collected from on the use of the assets. The final category is unrestricted net others before we have provided the service), Deferred Inflows position. Unrestricted net position is available to the institution of Resources (acquisition of net position by the University that for any lawful purpose of the institution. Although unrestricted is applicable to a future reporting period), and Net Position net position is not subject to externally imposed stipulations, (Assets and Deferred Outflows of Resources, minus Liabilities substantially all of the University’s unrestricted net position has and Deferred Inflows of Resources). It is prepared under the been designated for various academic and research programs accrual basis of accounting, where revenues and assets are and initiatives. recognized when the service is provided and expenses and liabilities are recognized when others provide the service to Assets and Deferred Outflows of Resources– us, regardless of when cash is exchanged. increase of $161.8 million From the data presented, readers of the Statement of l Current assets decreased $64.8 million. Unrestricted Net Position are able to determine the assets available to cash balances increased $28.7 million and restricted cash continue the operations of the institution. They are also decreased $89.2 million. The unrestricted cash increase was able to determine how much the institution owes vendors, driven by an increase in student fee collections, maintenance, investors, and lending institutions. Finally, the Statement of repairs, and renovation funding, and an increase in Net Position provides a picture of the net position (assets and investment income earnings. Restricted cash decreased as deferred outflows of resources minus liabilities and deferred a result of the spend down of proceeds generated from the inflows of resources) and their availability for expenditure by issuance of prior year Revenue and Athletic Facilities Bonds the institution. for construction costs at Douthit Hills and the Football Net position is divided into three major categories. The Operations facility. Interest income receivable increased first category, net investment in capital assets, provides the $11,000. Accounts receivable decreased $2.9 million as institution’s equity in property, plant, and equipment owned the result of the receipt of prior year receivables for state by the institution. The next category is restricted net position, capital appropriations for construction of a College of which is divided into two categories, nonexpendable and Business building and projects at the Clemson University

Condensed Summary of Net Position (thousands of dollars)

Increase/ Percent Description 2017 2016 (Decrease) Change Assets Current assets $ 518,647 $ 583,485 $ (64,838) (11.11)% Capital assets, net 1,270,387 1,106,591 163,796 14.80% Other noncurrent assets 228,355 208,028 20,327 9.77% Total assets 2,017,389 1,898,104 119,285 6.28%

Deferred outflows of resources 93,319 50,789 42,530 83.74%

Total assets and deferred outflows of resources 2,110,708 1,948,893 161,815 8.30%

Liabilities Current liabilities 138,221 162,388 (24,167) (14.88)% Noncurrent liabilities 1,187,621 1,089,645 97,976 8.99% Total liabilities 1,325,842 1,252,033 73,809 5.90%

Deferred inflows of resources 1,751 929 822 0.00%

Total liabilities and deferred inflows of resources 1,327,593 1,252,962 74,631 5.96%

Net Position Net investment in capital assets 770,325 759,323 11,002 1.45% Restricted - nonexpendable 58,867 58,698 169 0.29% Restricted - expendable 144,460 99,062 45,398 45.83% Unrestricted (190,538) (221,152) 30,614 (13.84)% Total net position $ 783,114 $ 695,931 $ 87,183 12.53%

~ 26 ~ UNAUDITED

Restoration Institute. Grants and contracts receivable due to amortization. Deferred outflows related to the increased $964,000 due to receivables for grants and University’s proportionate share of the state’s net pension contracts on sponsored projects. Contributions receivable liability increased $43 million. decreased $274,000. An increase in pledges of $631,000 was offset by the payment of existing pledges. Prepaid Liabilities and Deferred Inflows of Resources – items decreased $2.6 million primarily due to the timing increase of $74.6 million of liability insurance premium payments. Premiums were l Current liabilities decreased $24.2 million. The decrease in paid before June 30 in the prior year, but after June 30 in accounts payable of $31.9 million was largely attributable the current year. Inventories increased $32,000. Increases to amounts due at the end of the prior fiscal year for capital in telecommunication supplies and blue cheese inventory projects including Douthit Hills, Core Campus, the Football were offset by decreases in computer store inventory. Other Operations facility, and Littlejohn Coliseum. Accrued current assets increased $453,000 as a result of an under- payroll and related liabilities increased $887,000 as the result recovery of pooled fringes for the fiscal year ending June of increased salaries and retirement contributions applied to 30, 2016 that will be absorbed through the approved pooled the final payroll of the fiscal year. The increase in unearned fringe rate established for the fiscal year ending June 30, revenues of $7.2 million was attributable to ticket sales for 2018. the upcoming football season, deferred student payments for l Net capital assets increased $163.8 million. Non-depreciable the summer semester, and unapplied admissions deposits for assets decreased $68.5 million. Construction in Progress the fall semester. Current deposits increased by $791,000. decreased by $68 million as construction was finalized on Amounts include advanced football ticket sales due to other several major building projects across campus including schools for away games. The increases in the current portion the Core Campus development, Littlejohn Coliseum, and of long-term debt totaling $2.3 million and increased interest the Football Operations facility. Land decreased $457,000. expense payable totaling $31,000 resulted from the issuance Approximately 518 acres of land in Laurens County was sold of State Institution bonds this year. Total compensated to the Department of Natural Resources. Depreciable capital absences decreased $3.4 million as a result of the removal assets increased $232.3 million. An increase of $236.1 of the retirement contribution componenet of the calculation. million in buildings was driven by the capitalization of Core The allocation of current and noncurrent liabilities resulted Campus, Littlejohn Coliseum, and the Football Operations in a decrease of $3.5 million in the current amount. The facility. The new West Campus Energy Plant, upgrades at current portion of funds held for others increased $7,000. the Waste Water Treatment Plant, security enhancements, l Noncurrent liabilities increased by $98 million. The and stormwater enhancement projects resulted in an University’s proportionate share of the net pension liability increase of $593,000 in utilities and other non-structural increased by $63.4 million to $573.2 million at the end of improvements. The decrease in software of $2.8 million the current fiscal year. Net investment income and plan was driven by depreciation of current software assets. contributions were not substantial enough to offset the plan’s Equipment decreased $4.1 million. Additions totaling $16.4 benefit payments and administrative costs, resulting in an million were offset by disposals and depreciation expense. increase to the plan’s overall net pension liability. Long- Vehicles increased $2.6 million. Vehicle additions totaling term debt increased $34.5 million driven by the issuance $3.7 million included the purchase of a ladder truck, a new of State Institution bonds this fiscal year. The long-term bus, and a mobile health clinic. Additions were offset by liability for compensated absences and related liabilities depreciation expense and disposals or trade-ins of previously increased $118,000. The noncurrent portion of funds held owned departmental vehicles. for others related to Perkins loans decreased $37,000. l Other noncurrent assets increased $20.3 million. The l Deferred inflows of resources related to the University’s net balance on loan to the Clemson University Foundation pension liability increased by $822,000. Deferred inflows of (CUF) increased $20.9 million as the result of appreciation, resources include the calculated difference between actual income, and realized gains. Noncurrent contributions and projected investment earnings on the state’s pension receivable decreased $144,000 as the result of the payment plans. of existing pledges. Investments increased $165,000 due to gains on endowment assets held by Wells Fargo. Restricted Net Position – increase of $87.2 million noncurrent cash balances decreased $112,000. A decrease in l Net investment of capital assets increased $11 million. This Perkins loan funds was offset by an increase in endowment increase resulted from an increase in capital assets of $163.8 cash balances. Student loans receivable decreased $89,000 million, less an increase in capital debt of $36.8 million, a due to collections of Perkins Federal student loans. Other decrease in unspent bond proceeds of $115.5 million, and assets decreased $597,000 due to the under-recovery of a $498,000 decrease in deferred outflows of resources as pooled fringe benefit costs that will be absorbed/adjusted discussed above. through the approved pooled fringe rate established for the l Restricted – nonexpendable net position for scholarships and fiscal year ending June 30, 2019. fellowships increased $169,000 as the result of investment l Deferred outflows of resources increased $42.5 million. earnings on endowment balances held by Wells Fargo. Deferred losses on bond refundings decreased $499,000

~ 27 ~ UNAUDITED l Restricted for expendable net position increased $45.4 million, based on the following:  Restricted – expendable net position for scholarships and fellowships decreased $333,000 due to scholarship spending for endowed chair programs and federal and state scholarship funding.  Restricted – expendable net position for research decreased $332,000 resulting primarily from Sponsored Program research projects.  Restricted – expendable net position for instructional/departmental use decreased $2.1 million due to the funding for a mobile medical unit, a decrease in contributions, and the transfer of previously recognized gift amounts to sponsored projects.  Restricted – expendable net position for student loans decreased $25,000 as the result of a slight decrease in Clemson student loans.  Restricted – expendable net position for capital projects increased $47.4 million resulting, in large part, from bond proceeds for Douthit Hills projects, an increase in funding for Foundation commitments, and an increase in maintenance and stewardship funds.  Restricted – expendable net position for debt service increased $758,000 as the result of debt service reserve fund requirements for new Revenue and State Institution bond debt. l Unrestricted net position increased $30.6 million, based on the following:  The University’s proportionate share of the state’s net pension liability and accompanying deferred inflows and outflows of resources resulted in a $21.2 million reduction of unrestricted net position.  Unrestricted - educational and general increased $32.7 million as the result of increased student fee revenues.  Unrestricted – unexpended plant increased $6.2 million. Transfers of auxiliary operating funds for project costs related to the Douthit Hills construction, proceeds from the Laurens County land sale, and increased repair and renovation balances contributed to the increase.  Unrestricted – board designated endowments increased $10.8 million as the result of an increase in earnings on endowment balances held by the Clemson University Foundation and Wells Fargo.  Unrestricted – public services net position increased $17,000.  Unrestricted – auxiliaries net position increased $2.1 million. Increased balances in housing were offset by athletic costs associated with post-season play.

Statement of Cash Flows The final statement presented is the Statement of Cash Flows. The Statement of Cash Flows presents detailed information about the cash activity of the institution during the year. The statement is divided into five parts. The first part deals with operating cash flows and shows the net cash used by the operating activities of the institution. The second section reflects cash flows from noncapital financing activities. This section reflects the cash received and spent for nonoperating, noninvesting, and noncapital financing purposes. The third section deals with cash flows from capital and related financing activities. This section deals with the cash used for the acquisition and construction of capital and related items. The fourth section reflects the cash flows from investing activities and shows the purchases, proceeds, and interest received from investing activities. The fifth section reconciles the net cash used to the operating income or loss reflected on the Statement of Revenues, Expenses and Changes in Net Position.

Capital Assets Capital assets, net of accumulated depreciation, at June 30, 2017 and June 30, 2016 were as follows:

Capital Assets (net of accumulated depreciation) Increase/ Percent Description 2017 2016 Decrease Change Capital Assets: Land and improvements $ 34,293,526 $ 34,750,526 $ (457,000) (1.32)% Construction in progress 193,607,016 261,664,562 (68,057,546) (26.01)% Utilities systems and other non-structural improvements 38,035,150 37,442,058 593,092 1.58% Buildings and improvements 871,708,010 635,656,862 236,051,148 37.13% Computer software 2,920,549 5,746,303 (2,825,754) (49.18)% Equipment 124,099,068 128,166,890 (4,067,822) (3.17)% Vehicles 5,724,105 3,163,380 2,560,725 80.95% Total Capital Assets $ 1,270,387,424 $ 1,106,590,581 $ 163,796,843 14.80%

~ 28 ~ UNAUDITED

The $68.5 million decrease in non-depreciable capital (CULSF), its component unit, for space in the Greenville assets was attributable to a decrease in land and a decrease in One Building in downtown Greenville, SC. The outstanding Construction in Progress. During the fiscal year, the University liability on this lease as of June 30, 2017 was $11,851,378. sold approximately 518 acres of land located in Laurens County Also included is a capital lease with an unrelated corporate to the Department of Natural Resources. The land sale resulted leasing entity to finance the purchase of an electron microscope in a decrease in capital assets of $457,000. Construction in for the Advanced Materials Research Laboratories. The Progress decreased approximately $68 million as construction outstanding liability on this lease as of June 30, 2017, was was completed on several major building projects including the $138,339. Core Campus project, Littlejohn Coliseum, and the Football For additional information on this new notes payable, Operations facility. and Debt Administration, see Notes 6 and 7 in the notes to the Utilities Systems and Other Non-Structural Improvements financial statements. increased approximately $593,000. The construction of the West Campus Energy Plant, the Waste Water Treatment Plant, Economic Outlook and enhancements to the University’s security and stormwater As a state supported higher education institution, the programs were offset by depreciation expense on new and University’s economic position is closely tied to the State existing assets. of South Carolina. The State ended fiscal year 2017 with a Buildings increased $236.1 million due to the capitalization $60 million budgetary surplus. In his end-of-the-year press of several major projects including the Core Campus project, release, State Comptroller General Richard Eckstrom noted Littlejohn Coliseum, and the Football Operations facility. that the state experienced revenue growth of 4.3 percent. While Capitalized Computer Software decreased $2.8 million positive, revenue growth has been slowing over the past two as a result of depreciation on existing software. fiscal years. The General Fund surplus fell short of projections Equipment decreased $4.1 million. Net additions totaling and as a result, supplemental appropriations totaling $11.8 approximately $16.4 million were offset by depreciation and million will not be disbursed in the next fiscal year. Eckstrom disposals totaling $20.4 million. addressed the issues surrounding the state’s mounting pension Vehicles increased $2.6 million. Vehicle additions totaling liabilities while remaining optimistic that the state’s survival $3.7 million including a new mobile medical unit, ladder truck, of the past economic downturn has demonstrated that the state and bus, were offset by depreciation expense and disposals or has been able to operate during tight economic times. trade-ins of previously owned departmental vehicles. State appropriations to fund University operations For more detailed information on capital asset activity, increased $10.5 million for fiscal year 2017, an increase of 9.7 please refer to Note 4 – Capital Assets in the Notes to the percent from the previous year. Appropriations for Education Financial Statements. and General activities increased $7 million while Public Service activities increased $3.5 million. Debt Administration State scholarship programs funded with lottery proceeds The University’s financial statements indicate increased by approximately $3.3 million, to $57.6 million, $606,256,958 in bonds payable and $11,989,717 in capital for 2017. In addition, the University received $1.75 million leases payable at June 30, 2017. from the State Commission on Higher Education to fund The University’s bonded indebtedness consisted of: the Science, Technology, Engineering, and Math (STEM) General Obligation Bonds of $160,163,402, Athletic Facilities program. State capital appropriations decreased $10.6 million Revenue Bond issues totaling $136,769,056, and Revenue as a result of prior year State Capital Reserve Funds for a new Bonds of $309,324,500. General Obligation Bonds are College of Business building and Research Infrastructure bond obligations of the State of South Carolina and are secured as proceeds for the Clemson University Restoration Institute and to principal and interest by a pledge of the full faith, credit, the Greenwood Genetic Center. Current year appropriations and taxing power of the State and are paid with tuition and included $2.4 million in funding for outdoor lab renovations, matriculation fees. Athletic Facilities Revenue Bonds are $1.4 million for agriculture and natural resource renovations, payable solely from the net revenues of the University’s and $1 million for Garrison Arena construction. Athletic Department and gross receipts from the imposition of The University’s Board of Trustees adopted a budget any admissions fee and any special student fee. Revenue bonds for 2018 that included a 2.75 percent tuition increase for in- are payable solely from and secured by a pledge of revenues of state undergraduate students, the lowest percentage increase the University’s housing facilities, bookstore, dining services, in twenty years, and a 4.25 percent increase for out-of-state parking, vending and from additional funds from the academic undergraduate students. An average increase of 4.8 percent “University fee” imposed by the Board of Trustees. In October in student housing and dining plans will be used to improve 2016, the University issued General Obligation bonds totaling dining, housing, and student life facilities. $52,395,000 for the construction of the main campus electrical distribution system and to construct a water tower and utility infrastructure at Douthit Hills. Capital leases totaling $11,989,717 include a capital lease with the Clemson University Land Stewardship Foundation

~ 29 ~ CLEMSON UNIVERSITY STATEMENT OF NET POSITION June 30, 2017 Clemson Clemson University Description University Research Foundation ASSETS Current Assets: Cash and cash equivalents...... $ 202,409,684 $ 6,673,403 Restricted Assets - Current: Cash and cash equivalents...... 255,950,728 1,979,498 Accounts receivable (net of provision for doubtful accounts of $580,980)...... 21,779,643 387,407 Grants and contracts receivable...... 22,959,761 — Contributions receivable, net...... 833,988 — Interest and income receivable...... 1,455,192 — Student loans receivable...... 12,918 — Inventories...... 3,230,435 — Note receivable...... — 137,500 Prepaid items...... 9,012,246 140,547 Other current assets...... 1,002,744 — Total current assets...... 518,647,339 9,318,355 Noncurrent Assets: Notes receivable...... 198,902,686 206,250 Contributions receivable, net...... 980,232 — Investments...... 2,542,152 — Restricted Assets - Noncurrent: Cash and cash equivalents...... 18,059,168 — Student loans receivable...... 7,463,904 — Other assets...... 406,168 953,866 Capital assets, not being depreciated...... 227,900,542 530,972 Capital assets, net of accumulated depreciation...... 1,042,486,882 179,864 Total noncurrent assets...... 1,498,741,734 1,870,952 Total assets...... 2,017,389,073 11,189,307 Deferred Outflows of Resources: Deferred losses on bond refunding...... 1,154,715 — ...... 92,164,098 — ...... 93,318,813 — Deferred outflows on net pension liability Total assets and deferred outflows of resources...... $ 2,110,707,886 $ 11,189,307 Total deferred outflows of resources LIABILITIES Current Liabilities: Accounts and retainages payable...... $ 26,756,948 $ 303,441 Accrued payroll and related liabilities...... 20,310,087 — Accrued compensated absences and related liabilities...... 14,967,394 — Accrued interest payable...... 4,309,690 — Unearned revenues...... 46,744,821 83,048 Bonds payable...... 21,402,558 — Capital leases payable...... 708,862 — Deposits...... 2,208,020 — Funds held for others...... 812,926 — Total current liabilities...... 138,221,306 386,489 Noncurrent Liabilities: Accrued compensated absences and related liabilities...... 10,603,606 — Funds held for others...... 7,714,012 — Net pension liability...... 573,168,554 — Bonds payable...... 584,854,400 — Capital leases payable...... 11,280,855 — Total noncurrent liabilities...... 1,187,621,427 — Total liabilities...... 1,325,842,733 Deferred Inflows of Resources: ...... 1,750,844 — ...... 1,750,844 — Deferred inflows on net pension liability Total liabilities and deferred inflows of resources...... $ 1,327,593,577 $ 386,489 Total deferred inflows of resources NET POSITION Net investment in capital assets...... $ 770,324,745 $ 1,638,206 Restricted for nonexpendable purposes: Scholarships and fellowships...... 58,866,602 — Restricted for expendable purposes: Scholarships and fellowships...... 16,587,632 — Research...... 1,041,782 1,986,721 Instructional/departmental use...... 14,372,124 — Loans ...... 2,109,820 — Capital projects...... 101,566,077 — Debt service...... 8,783,959 — Unrestricted...... (190,538,432) 7,177,891 Total net position...... $ 783,114,309 $ 10,802,818

See accompanying notes to basic financial statements.

~ 30 ~ CLEMSON UNIVERSITY STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION For the year ended June 30, 2017

Clemson Clemson University Description University Research Foundation REVENUES Operating Revenues:: Student tuition and fees (net of scholarship allowances of $99,415,007)...... $ 364,125,796 $ — Federal grants and contracts...... 81,923,483 1,104,265 State grants and contracts...... 62,055,230 — Local grants and contracts...... 1,771,818 — Nongovernmental grants and contracts...... 11,616,470 32,189 Sales and services of educational and other activities...... 21,303,080 — Sales and services of auxiliary enterprises - pledged for revenue bonds (net of scholarship allowances of $15,538,475)...... 124,492,211 — Sales and services of auxiliary enterprises - not pledged...... 45,035,160 — Other operating revenues...... 34,036,616 1,508,477 Total operating revenues...... 746,359,864 2,644,931

EXPENSES: Operating Expenses: ...... 556,537,090 — Services and supplies...... 265,758,294 2,552,981 UtilitiesCompensation...... and employee benefits 19,730,055 — Depreciation...... 51,759,019 142,396 Scholarships and fellowships...... 27,269,239 — Total operating expenses...... 921,053,697 2,695,377 Operating (loss)...... (174,693,833) (50,446)

NONOPERATING REVENUES (EXPENSES) State appropriations...... 119,308,662 — Federal appropriations...... 12,239,506 — Gifts and grants...... 67,551,660 — Interest income...... 3,699,622 61,651 Endowment income...... 19,955,244 — Interest on capital asset related debt...... (21,470,993) — Other nonoperating revenues...... 329,517 — Gain/loss on disposal of capital assets...... (566,539) — Refunds to grantors...... (119,773) — Facilities and administrative remittances to the State...... (316,624) — Net nonoperating revenues...... 200,610,282 61,651

Income before other revenues, expenses, gains or losses...... 25,916,449 11,205

State capital appropriations...... 5,240,195 — Capital grants and gifts...... 56,006,584 — Additions to permanent endowments...... 20,510 — Increase in net position...... 87,183,738 11,205

NET POSITION Net position, beginning of year...... 695,930,571 10,791,613 Net position, end of year...... $ 783,114,309 $ 10,802,818

See accompanying notes to basic financial statements.

~ 31 ~ CLEMSON UNIVERSITY STATEMENT OF CASH FLOWS For the year ended June 30, 2017

DESCRIPTION AMOUNT CASH FLOWS FROM OPERATING ACTIVIES Payments from customers...... $ 554,531,414 Grants and contracts...... 148,633,067 Payments to suppliers...... (285,314,018) Payments to employees...... (422,708,184) ...... (120,162,395) Payments to students...... (45,785,560) Payments for benefits ...... 68,064,906 ...... (7,261,706) LoansInflows to from students Stafford...... loans (43,205) CollectionOutflows from of loans Stafford...... loans 1,681,360 Net cash used by operating activities...... (108,364,321)

CASH FLOW FROM NONCAPITAL FINANCING ACTIVITIES State appropriations...... 119,308,662 Federal appropriations...... 12,123,301 Gifts and grants...... 70,454,323 ...... 201,886,286

CASH FLOWNet cashFROM flow CAPITAL provided AND by RELATEDnoncapital FINANCING financing activities ACTIVITIES Proceeds from capital debt...... 56,800,478 State capital appropriations...... 4,324,600 Capital grants and gifts received...... 54,318,214 Proceeds from sale of property...... 1,398,481 Purchases of capital assets...... (234,576,026) Principal payments and redemption premiums on long term debt...... (17,697,454) Interest and fees...... (23,259,929) Net cash used by capital activities...... (158,691,636)

CASH FLOWS FROM INVESTING ACTIVITIES Interest on investments...... 4,636,675 Transfer to Clemson University Foundation...... 91,073 Proceeds from stock sales...... (165,061) ...... 4,562,687

Net changeNet cash in cash flows...... provided by investing activities (60,606,984) Cash beginning of year...... 537,026,564 Cash end of year...... $ 476,419,580

RECONCILIATION OF NET OPERATING INCOME (LOSS) TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES: Operating income (loss)...... $ (174,693,833) Adjustments to reconcile operating income (loss) to net cash provided (used) by operating activities: Depreciation expense...... 51,759,019 Amortization of net pension liability...... 21,209,339 Change in asset and liabiliites: Receivables, net...... (592,807) Grants and contracts receivable...... (854,770) Student loans receivable...... (67,487) Prepaid items...... 2,276,983 Inventories...... (24,814) Pooled fringe adjustment...... 146,957 Accounts and retainages payable...... (12,375,342) Accrued payroll and related liabilities...... 897,879 Accrued compensated absences and related liabilities...... (3,385,000) Unearned revenue...... 6,707,792 Deposits held for others...... 631,763 Net cash used by operating activities...... $ (108,364,321)

NON-CASH TRANSACTIONS Increase in fair value of investments...... $ (21,364,316) Assets acquired through gifts...... 1,688,370 State capital appropriations receivable ...... 4,774,653 Collection of capital gift receivable...... (6,334,894)

RECONCILIATION OF CASH AND CASH EQUIVALENT BALANCES Current assets: Cash and cash equivalents...... $ 202,409,684 Restricted cash and cash equivalents...... 255,950,728 Noncurrent assets...... 18,059,168 Total cash and cash equivalent balances $ 476,419,580 See accompanying notes to basic financial statements.

~ 32 ~ CLEMSON UNIVERSITY FOUNDATION NON-GOVERNMENTAL DISCRETELY PRESENTED COMPONENT UNIT STATEMENT OF FINANCIAL POSITION June 30, 2017

DESCRIPTION AMOUNT ASSETS Cash and cash equivalents...... $ 60,342,269 Contributions receivable, net...... 25,004,479 Due from related organizations...... 1,540,670 Investments...... 471,266,812 Investments held for Clemson University...... 198,902,686 Cash surrender value of life insurance...... 2,005,682 Land held for resale...... 11,900 Land, buildings and equipment, net...... 9,347,585

Non-pooled assets, net...... 5,565,769 FundsPooled held investments in trust for...... affiliates: 23,879,997 Contributions receivable, net...... 26,528,753 Other assets...... 639,098 Total assets...... $ 825,035,700

LIABILITIES AND NET ASSETS Liabilities: Accounts payable and accrued liabilities...... $ 705,498 Due to related organizations...... 419,697 Accrued liability to Clemson University due to net investment appreciation...... 95,983,370 Note payable to Clemson University...... 102,919,316 Actuarial liability of annuities payable...... 4,713,212 ...... 55,974,519 Total liabilities...... 260,715,612 Funds administered for affiliates Net Assets: Unrestricted...... 30,543,950 Temporarily restricted...... 228,988,403 Permanently restricted...... 304,787,735 Total net assets...... 564,320,088 Total liabilities and net assets...... $ 825,035,700

See accompanying notes to basic financial statements.

~ 33 ~ CLEMSON UNIVERSITY FOUNDATION NON-GOVERNMENTAL DISCRETELY PRESENTED COMPONENT UNIT STATEMENT OF ACTIVITIES For the year ended June 30, 2017

TEMPORARILY PERMANENTLY DESCRIPTION UNRESTRICTED RESTRICTED RESTRICTED TOTAL REVENUES, GAINS AND OTHER SUPPORT: Gifts and bequests...... $ 1,550,245 $ 18,725,962 $ 8,785,646 $ 29,061,853 Income on investments...... 5,026,792 424,379 — 5,451,171 Net realized and unrealized gains on investments...... 2,687,998 45,800,305 139,947 48,628,250 Program income...... 1,946,331 589,414 — 2,535,745 Other income...... 3,020,947 12,103 43,606 3,076,656 Change in value of split-interest agreements...... 25,665 71,083 735,034 831,782 ...... 766,481 (970,340) 203,859 — Total...... 15,024,459 64,652,906 9,908,092 89,585,457 NetReclassification assets released of donor from restrictionsintent ...... 24,309,148 (24,280,650) (28,498) — Total revenues, gains and other support...... 39,333,607 40,372,256 9,879,594 89,585,457

EXPENSES: Program expenses: Grants to Clemson University...... 1,515,903 — — 1,515,903 Alumni operations...... 2,148,840 — — 2,148,840 Endowments...... 5,839,351 — — 5,839,351 Operations...... 15,051,438 — — 15,051,438 Capital projects...... 3,865,102 — — 3,865,102 Total program expenses...... 28,420,634 — — 28,420,634 General and administrative...... 3,044,749 — — 3,044,749 Fundraising...... 4,160,310 — — 4,160,310 Total expenses...... 35,625,693 — — 35,625,693 Change in net assets before other changes...... 3,707,914 40,372,256 9,879,594 53,959,764

OTHER CHANGES: Contributions to a related entity...... (122,767) — — (122,767) Transfer to temporarily restricted funds due to underwater endowments...... 59,337 (59,337) — — Total other changes...... (63,430) (59,337) — (122,767)

Change in net assets...... 3,644,484 40,312,919 9,879,594 53,836,997 Net assets at beginning of year...... 26,899,466 188,675,484 294,908,141 510,483,091 Net assets at end of year...... $ 30,543,950 $ 228,988,403 $ 304,787,735 $ 564,320,088

See accompanying notes to basic financial statements.

~ 34 ~ CLEMSON UNIVERSITY LAND STEWARDSHIP FOUNDATION NON-GOVERNMENTAL DISCRETELY PRESENTED COMPONENT UNIT STATEMENT OF FINANCIAL POSITION June 30, 2017

DESCRIPTION AMOUNT ASSETS Cash and cash equivalents...... $ 3,180,632 Receivables...... 8,008 Real estate investments...... 45,657,439 Real estate and equipment, net...... 11,205,769 ...... 11,892,715 ...... 900,000 DevelopmentDirect financing costs lease...... 1,335,452 PrepaidInvestments expense held...... in trust by affiliate 1,416 Total assets...... $ 74,181,431

LIABILITIES AND NET ASSETS Liabilities: Accounts payable...... $ 225,527 Accrued interest payable...... 28,639 Deposits held for others...... 28,495 Unearned revenue...... 131,877 Deferred rent revenue...... 2,800,097 Due to Clemson University Foundation...... 20,932,472 Notes payable...... 22,887,894 Total liabilities...... 47,035,001

Unrestricted net assets ...... 27,146,430 Total net assets...... 27,146,430 Total liabilities and net assets...... $ 74,181,431

See accompanying notes to basic financial statements.

~ 35 ~ CLEMSON UNIVERSITY LAND STEWARDSHIP FOUNDATION NON-GOVERNMENTAL DISCRETELY PRESENTED COMPONENT UNIT STATEMENT OF ACTIVITIES For the year ended June 30, 2017

DESCRIPTION AMOUNT REVENUES, GAINS AND OTHER SUPPORT: Gifts and contributions at fair value...... $ 915,859 Rental revenues...... 3,353,751 ...... 4,064 ...... 278,543 Common Direct financing area fees...... 364,113 Loss Federal on grantsale of real estate and equipment...... (4,294) ...... 4,912,036

Total revenues and gains EXPENSES:

Administrative and other...... 315,358 ProgramGreenville expenses: One...... 307,888 CU-ICAR campus...... 1,477,182 ...... 2,100,428 ...... 604,933 Total program expenses ...... 2,705,361 Interest expense Total expenses ...... 2,206,675 ...... 24,939,755 Change Unrestricted in net assets net assets, end of year...... $ 27,146,430 Unrestricted net assets, beginning of year

See accompanying notes to basic financial statements.

~ 36 ~ IPTAY NON-GOVERNMENTAL DISCRETELY PRESENTED COMPONENT UNIT STATEMENT OF FINANCIAL POSITION For the year ended June 30, 2017

DESCRIPTION AMOUNT ASSETS Cash and cash equivalents...... $ 29,444,903 Due from related organizations...... 94,953 Annual fund receivable, net...... 564,818

Non-pooled assets...... 4,308,378 FundsPooled held investments in trust by .an...... affiliate: 21,471,401 Contributions receivable, net...... 26,219,617 Total assets...... $ 82,104,070

LIABILITIES AND NET ASSETS Liabilities: Accounts payable and accrued expenses...... $ 105,488 Due to related organizations...... 1,526,767 Total liabilities...... 1,632,255

Net assets Unrestricted...... 52,884,442 Temporarily restricted...... 27,182,450 Permanently restricted...... 404,923 Total net assets...... 80,471,815 Total liabilities and net assets...... $ 82,104,070

See accompanying notes to basic financial statements.

~ 37 ~ IPTAY NON-GOVERNMENTAL DISCRETELY PRESENTED COMPONENT UNIT STATEMENT OF ACTIVITIES For the year ended June 30, 2017

TEMPORARILY PERMANENTLY DESCRIPTION UNRESTRICTED RESTRICTED RESTRICTED TOTAL REVENUES, GAINS AND OTHER SUPPORT: Contributions from the public...... $ 46,314,501 $ 9,456,558 $ 404,923 $ 56,175,982 Net realized and unrealized gains on investments.... 2,363,850 — — 2,363,850 Investment income, net...... 186,708 — — 186,708 Interest income...... 96,339 — — 96,339 48,961,398 9,456,558 404,923 58,822,879 Net assets released from restrictions - Satisfaction of purpose restrictions...... 7,998,950 (7,998,950) — — Total revenues, gains and other support...... 56,960,348 1,457,608 404,923 58,822,879

EXPENSES: Program services: Support of Clemson University: Athletic operations...... 22,519,522 — — 22,519,522 Football operations building...... 33,731,905 — — 33,731,905 Debt service...... 5,091,889 — — 5,091,889 Other construction costs...... 10,478,315 — — 10,478,315 Other ...... 3,935,570 — — 3,935,570 Management and general...... 644,137 — — 644,137 Total expenses...... 76,401,338 0 0 76,401,338

...... (19,440,990) 1,457,608 404,923 (17,578,459)

Contributions Excess (deficit) of net of assets revenues from over a related expenses party (Note 7) ...... 77,553 — — 77,553

Change in net assets...... (19,363,437) 1,457,608 404,923 (17,500,906) Net assets, beginning of year...... 72,247,879 25,724,842 — 97,972,721 Net assets, end of year...... $ 52,884,442 $ 27,182,450 $ 404,923 $ 80,471,815

See accompanying notes to basic financial statements.

~ 38 ~ NOTES TO FINANCIAL STATEMENTS

NOTE 1. The Clemson University Foundation (CUF) is a separately SUMMARY OF SIGNIFICANT chartered corporation organized exclusively to promote ACCOUNTING POLICIES the development and welfare of Clemson University in its educational and scientific purposes. CUF’s activities are Nature of Organization governed by its Board of Directors. CUF is considered a Clemson University is a State-supported, coeducational component unit, and is discretely presented in the financial institution of higher education. The University is granted an statements, because the nature and significance of its annual appropriation for operating purposes as authorized by relationship with the University is such that exclusion from the South Carolina General Assembly. The appropriation as the reporting entity would render the financial statements enacted becomes the legal operating budget for the institution. incomplete. CUF is considered a nongovernmental component The Appropriation Act authorizes expenditures from funds unit since it does not meet the definition of a governmental appropriated from the General Fund of the State and authorizes entity. None of the following characteristics of a governmental expenditures of total operating funds. The laws of the State entity apply to CUF: a) Organization is a public corporation; b) and the policies and procedures specified by the State for State Organization is a body corporate and politic; c) A controlling agencies and institutions are applicable to the activities of the majority of the members of the organization are elected or University. The University was established as an institution of appointed by governmental officials; d) There is potential higher education by Section 59-119-20 of the Code of Laws of for unilateral dissolution by a government with the net assets South Carolina in accordance with the will of Thomas Green reverting to the government; and e) The organization has Clemson and the Act of Acceptance of the General Assembly the power to enact and enforce a tax levy. Because CUF is of South Carolina. The University is a component unit of the deemed not to be a governmental entity and uses a different State of South Carolina and its financial statements are included reporting model, its balances and transactions are reported on in the Comprehensive Annual Financial Report of the State separate financial statements. Copies of the separately issued of South Carolina. The University is governed by a board of financial statements of the Clemson University Foundation thirteen members, including six elected by the State Legislature can be obtained by sending a request to the following address: and seven self-perpetuating life members. Accordingly, as Clemson University Foundation, 110 Daniel Drive, Clemson, such it administers, has jurisdiction over, and is responsible SC, 29634. for the management of the University. The Clemson University Land Stewardship Foundation (CULSF) is a separately chartered corporation, established to Reporting Entity serve the needs of Clemson University in the management, The financial reporting entity, as defined by Governmental development, and investment of real property and related Accounting Standards Board (GASB) Codification Section assets. CULSF’s activities are governed by its Board of 2100, Defining the Financial Reporting Entity, consists of Directors. CULSF is considered a component unit, and is the primary government, organizations for which the primary discretely presented in the financial statements, because the government is financially accountable and other organizations nature and significance of its relationship with the University for which the nature and significance of their relationship with is such that exclusion from the reporting entity would render the primary government are such that exclusion could cause the the financial statements incomplete. CULSF is considered financial statements to be misleading or incomplete. GASB a nongovernmental component unit since it does not meet Codification Section 2600, Reporting Entity and Component the definition of a governmental entity (as described above). Unit Presentation and Disclosure, provides criteria for Copies of the separately issued financial statements of the determining whether certain organizations should be reported Clemson University Land Stewardship Foundation can be as component units based on the nature and significance of their obtained by sending a request to the following address: relationship with a primary government and classifies reporting Clemson University Land Stewardship Foundation, P.O. requirements for those organizations. Based on these criteria, Box 1889, Clemson, SC 29633. the financial statements include the University and its blended The Clemson University Research Foundation (CURF) component unit as the primary government, and other related is a separately chartered corporation established to solicit entities as discretely presented component units. research grants and contracts, then contract the University to The Clemson Research Facilities Corporation (CRFC) is perform the research. CURF’s activities are governed by its a separately chartered not-for-profit corporation established Board of Directors. CURF is considered a component unit, and to construct certain facilities for the University. CRFC is a is discretely presented in the financial statements, because the fully blended component unit of the University. Although nature and significance of its relationship with the University legally separate from the University, CRFC’s activities are so is such that exclusion from the reporting entity would render intertwined with the University’s that they are, in substance, the the financial statements incomplete. Copies of the separately same as the primary entity. CRFC’s activities are governed by issued financial statements of the Clemson University Research its Board of Directors which is wholly comprised of University Foundation can be obtained by sending a request to the representatives. Its balances and transactions are blended with following address: Clemson University Research Foundation, those of the University and reported as if they were balances 155 Old Greenville Highway, Suite 105,, Clemson, SC 29633. and transactions of the University.

~ 39 ~ NOTES TO FINANCIAL STATEMENTS

IPTAY is a separately chartered corporation established Not-for-Profit Entities. As such, certain revenue recognition exclusively to support University athletics. IPTAY’s criteria and presentation features are different from GASB activities are governed by its Board of Directors. IPTAY is revenue recognition criteria and presentation features. No considered a component unit, and is discretely presented in modifications have been made to CUF, CULSF, or IPTAY’s the financial statements, because the nature and significance financial information in the University’s financial reporting of its relationship with the University is such that exclusion entity for these differences. from the reporting entity would render the financial statements incomplete. IPTAY is considered a nongovernmental Cash and Cash Equivalents component unit since it does not meet the definition of a The amounts shown in the financial statements in governmental entity (as described above). Copies of the University funds as “cash and cash equivalents” represent petty separately issued financial statements of IPTAY can be cash, cash on deposit in banks, cash on deposit with the State obtained by sending a request to the following address: IPTAY, Treasurer, cash invested in various instruments by the State P.O. Box 1529, Clemson, SC 29633. Treasurer as part of the State’s internal cash management pool, The University’s discretely presented component units cash invested in various short-term instruments by the State are discussed in Note 20. Treasurer and held in separate agency accounts, and certain funds invested with Wells Fargo. Financial Statement Presentation Most State agencies, including the University, participate The financial statement presentation for the University in the State’s internal cash management pool. Because meets the requirements of GASB Codification Sections 2100- the cash management pool operates as a demand deposit 2900, Financial Reporting Entity, and Co5, Colleges and account, amounts invested in the pool are classified as cash Universities. The financial statement presentation provides a and cash equivalents. The State Treasurer administers the comprehensive, entity-wide perspective of the University’s cash management pool. The pool includes some long-term assets, liabilities, net position, revenues, expenses, changes investments such as obligations of the United States and certain in net position, and cash flows. agencies of the United States, obligations of the State of South Carolina and certain of its political subdivisions, certificates Use of Estimates of deposit, collateralized repurchase agreements, and certain The preparation of financial statements in conformity corporate bonds. For credit risk information pertaining to the with generally accepted accounting principles requires cash management pool, see the deposits disclosures in Note 2. management to make estimates and assumptions that affect The State’s internal cash management pool consists of a the reported amounts of assets, liabilities, deferred inflows, general deposit account and several special deposit accounts. deferred outflows, revenues and expenses, and affect disclosure The State records each fund’s equity interest in the general of contingent assets and liabilities at the date of the financial deposit account; however, all earnings on that account are statements. Significant estimates include separation of accrued credited to the General Fund of the State. The University compensated absences between current and non-current and records and reports its deposits in the general deposit account depreciation expense. Actual results could differ from those at cost. It records and reports its special deposit account at fair estimates. value. Investments held by the pool are recorded at fair value. Interest earned by the University’s special deposit accounts is Basis of Accounting For financial reporting purposes, the University, along posted to its account at the end of each month and is retained. with Clemson Research Facilities Corporation, its fully Interest earnings are allocated based on the percentage of blended component unit, and the Clemson University the University’s accumulated daily income receivable to the Research Foundation, its discretely presented component total income receivable of the pool. Reported interest income unit, is considered a special-purpose government engaged includes interest earnings at the stated rate, realized gains/ only in business-type activities. Accordingly, the University’s losses, and unrealized gains/losses arising from changes in the financial statements are presented using the economic resources fair value of investments held by the pool. Realized gains and measurement focus and the accrual basis of accounting. Under losses are allocated daily and are included in the accumulated the accrual basis, revenues are recognized when earned, and income receivable. Unrealized gains and losses are allocated expenses are recorded when an obligation has been incurred. at year end based on the percentage of ownership in the pool. Student tuition and auxiliary enterprise fees are presented net Some State Treasurer accounts are not included in the of scholarships and fellowships applied to student accounts, State’s internal cash management pool because of restrictions while payments made directly are presented as scholarship and on the use of the funds. For those accounts, cash equivalents fellowship expenses. All significant intra-agency transactions include investments in short-term, highly liquid securities have been eliminated. having an internal maturity of three months or less at the The Clemson University Foundation (CUF), the Clemson time of acquisition. For purposes of the statements of cash University Land Stewardship Foundation (CULSF), and flows, the University considers all highly liquid investments IPTAY are private nonprofit organizations that report under with an original maturity of three months or less to be cash Financial Accounting Standards Board (FASB) standards, equivalents. Funds invested through the State Treasurer’s Cash including Accounting Standards Codification Topic 958, Management Program are considered to be cash equivalents.

~ 40 ~ NOTES TO FINANCIAL STATEMENTS

Receivables Investments Accounts receivable consists of tuition and fee charges to The University accounts for its investments at fair value students and auxiliary enterprise services provided to students, in accordance with GASB Statement No. 31, Accounting and faculty and staff, the majority of each residing in the State Financial Reporting for Certain Investments and for External of South Carolina. Accounts receivable are recorded net of Investment Pools. Changes in unrealized gain (loss) on the estimated uncollectible amounts. carrying value of investments are reported as a component of Grants and contracts receivable include amounts due investment income in the statement of revenues, expenses, and from the Federal government, state and local governments, or changes in net position. private sources, in connection with reimbursement of allowable expenditures made pursuant to the University’s grant and Noncurrent Cash and Investments contracts. Also included are amounts due for Federal loan Noncurrent cash and investments primarily consist of and scholarships programs and reimbursements for Federal permanently endowed funds and federal student loan funds. land-grant expenditures. These funds are externally restricted and are classified as Contributions receivable are accounted for at their noncurrent assets in the statement of net position. estimated net realizable value. The estimated net realizable value comprehends the present value of long-term pledges Other Assets and reductions for any allowance for uncollectible pledges. The University submits a pooled fringe benefit rate Pledges vary from one to ten years and are used to support proposal to its cognizant agency, the U.S. Department of Health specifically identified University programs and initiatives. & Human Services two years in advance of actual charges. Amounts due from the Clemson University Foundation Under-recoveries of actual costs are recognized as an Other are pursuant to a Memorandum of Understanding between the Asset. These under-recoveries will be considered in the rate University and that entity prompted by a 1999 change in the proposal for the next review period. South Carolina Code of Laws that allowed state-supported universities to lend endowment balances to separately chartered Capital Assets not-for-profit entities whose existence is primarily providing Capital assets are recorded at cost at the date of acquisition financial assistance and other support to the institution and its or fair market value at the date of donation in the case of gifts. educational programs. For additional information regarding The University follows capitalization guidelines established by this loan, see Note 3. the State of South Carolina. All land is capitalized, regardless Student loans receivable consists of amounts due from of cost. Qualifying improvements that rest in or on the land the Federal Perkins Loan Program, and from other loans itself are recorded as depreciable land improvements. Major administered by the University. additions and renovations and other improvements that add to Interest and income receivable consists of amounts due the usable space, prepare existing buildings for new uses, or from the State Treasurer relating to holdings in the State’s extend the useful life of an existing building are capitalized. internal cash management pool and cash invested in various The University capitalizes movable personal property with a short-term investments by that agency. unit value in excess of $5,000 and a useful life in excess of one year and depreciable land improvements, buildings and Inventories improvements, and intangible assets, including internally Inventories for internal use are valued at cost. Inventories developed software, costing in excess of $100,000. Routine for resale are carried at the lower of cost or market. Items repairs and maintenance and library materials, except accounted for as University inventories using the moving individual items costing in excess of $5,000, are charged weighted average method include: maintenance supplies, to operating expenses in the year in which the expense was housing supplies, janitorial and auto supplies, printing incurred. and graphic supplies, office supplies, computer parts and Depreciation is computed using the straight-line method accessories, telecommunications supplies, medical supplies, over the estimated useful lives of the assets, generally 15 to 40 and Clemson blue cheese production. years for buildings and improvements and land improvements and 6 to 20 years for machinery, equipment, and vehicles. Prepaid Items Internally developed software is depreciated using the straight- Expenditures for insurance and similar services paid for in line method over a three year period. Depreciation expense the current or prior fiscal years and benefiting more than one is charged monthly, with a mid-month convention utilized for accounting period are allocated among accounting periods. For the initial month that the asset is placed in service. the University, amounts reported in this asset account consist primarily of prepaid insurance, prepaid postage, prepaid airline Unearned Revenues tickets, and advance payments for maintenance and service Unearned revenues include amounts received for tuition agreements. and fees and certain auxiliary activities prior to the end of the fiscal year but related to the subsequent accounting period. Unearned revenues also include amounts received from grant and contract sponsors that have not yet been earned.

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Deposits Net Pension Liability Deposits represent football-related guarantees and For purposes of measuring the net pension liability, conference settlement amounts, and various student-related deferred outflows of resources and deferred inflows amounts including: dormitory room deposits, security deposits of resources related to pensions, and pension expense, for possible room damage and key loss, other deposits, and information about the fiduciary net position of the South student fee refunds. Student deposits are recognized as revenue Carolina Retirement System (SCRS) and the South Carolina during the semester for which the fee is applicable and earned Police Officers Retirement System (PORS) and additions to/ when the deposit is nonrefundable to the student under the deductions from SCRS’s and PORS’ fiduciary net position forfeit terms of the agreement. have been determined on the same basis as they are reported by SCRS or PORS. For this purpose, benefit payments (including Funds Held for Others refunds of employee contributions) are recognized when due Current balances in Funds Held for Others result primarily and payable in accordance with the benefit terms. Investments from the University acting as an agent, or fiduciary, for another are reported at fair value. entity. These include amounts due to other entities and amounts due for various study abroad programs. Noncurrent balances Deferred Outflows of Resources and Deferred represent the Federal liability for the Perkins Loan Program. Inflows of Resources Deferred outflows of resources represent consumption Internal Service and Auxiliary Enterprise Activities of net position that is applicable to a future period. Deferred Both revenue and expenses relating to internal service inflows of resources represent acquisition of net position that (including information technology costs) and auxiliary is applicable to a future period. For the University, refunds enterprise activities including print shop, office equipment, related to debt defeasance are included in deferred outflows maintenance, transportation services, telecommunications, of resources. The deferred amount will be amortized over the institutional computing, bookstores, and cafeterias have been remaining life of the debt refunded. Changes in net pension eliminated. liability not included in pension expense are reported as deferred outflows of resources or deferred inflows of resources. Compensated Absences Employer contributions subsequent to the measurement date Generally all permanent full-time State employees of the net pension liability are reported as deferred outflows and certain part-time employees scheduled to work at least of resources. one-half of the agency’s workweek are entitled to accrue and carry forward at calendar year-end maximums of 180 Net Position days sick leave and 45 days annual vacation leave, except The University’s components of net position are classified that faculty members do not accrue annual leave. Upon as follows: termination of State employment, employees are entitled to be paid for accumulated unused annual vacation leave up to the Net Investment in Capital Assets: This represents the maximum, but are not entitled to any payment for unused sick University’s total investment in capital assets, net of leave. The compensated absences liability includes accrued outstanding debt obligations related to those capital assets. annual leave and compensatory overtime leave earned for To the extent debt has been incurred but not yet expended for which the employees are entitled to paid time off or payment capital assets, such amounts are not included as a component at termination. The University calculates the compensated of net investment in capital assets. absences liability based on recorded balances of unused leave for which the employer expects to compensate employees Restricted Net Position - Nonexpendable: Nonexpendable through paid time off or cash payments at termination. That restricted net position consists of endowment and similar liability is inventoried at fiscal year-end current salary costs type funds in which donors or other outside sources have and the cost of the salary-related benefit payments net change stipulated, as a condition of the gift instrument, that the in the liability is recorded in the current year in the applicable principal is to be maintained inviolate and in perpetuity, functional expenditure categories. and invested for the purpose of producing present and future income, which may either be expended or added to principal. Noncurrent Liabilities Noncurrent liabilities include (1) principal amounts of Restricted Net Position - Expendable: Restricted expendable revenue bonds payable and capital lease obligations with net position includes resources in which the University is contractual maturities greater than one year; (2) estimated legally or contractually obligated to spend resources in amounts for accrued compensated absences and other liabilities accordance with restrictions imposed by external third that will not be paid within the next fiscal year; and (3) other parties. liabilities that, although payable within one year, are to be paid from funds that are classified as noncurrent assets.

~ 42 ~ NOTES TO FINANCIAL STATEMENTS

Unrestricted Net Position: Unrestricted net position Educational Activities Revenue represents resources derived from student tuition and fees, Revenues from sales and services of educational activities state appropriations, and sales and services of educational generally consist of amounts received from instructional, departments and auxiliary enterprises. These resources laboratory, research, and public service activities that are used for transactions relating to the educational and incidentally create goods and services which may be sold to general operations of the University and may be used at the students, faculty, staff, and the general public. The University discretion of the governing board to meet current expenses receives such revenues primarily from various activities for any purpose. These resources also include auxiliary related to the University’s agricultural public service mission, enterprises, which are substantially self-supporting activities including pesticide registration and licensing fees, livestock, that provide services for students, faculty and staff. poultry and health test fees, extension service fees, forest product sales, and youth camp fees. These unrestricted When an expense is incurred that can be paid using either revenues are collectively labeled “Sales and Services of restricted or unrestricted resources, the University’s policy is Educational Departments”. to first apply the expense towards unrestricted resources and then towards restricted resources. Scholarship Discounts and Allowances Student tuition and fee revenues, and certain other revenues Income Taxes from students, are reported net of scholarship discounts and The University is a political subdivision of the State allowances in the statement of revenues, expenses and changes of South Carolina and is consequently exempt from federal in net position. Scholarship discounts and allowances are the income taxes under Section 115(1) of the Internal Revenue difference between the stated charge for goods and services Code, as amended. provided by the University, and the amount that is paid by The Internal Revenue Service has determined that the students and/or third parties making payments on the students’ Clemson University Foundation, the Clemson University behalf. Certain governmental grants, such as Pell grants, and Research Foundation, the Clemson University Land other Federal, state or nongovernmental programs are recorded Stewardship Foundation, and IPTAY qualify as exempt as either operating or nonoperating revenues in the University’s organizations under Internal Revenue Code Section 501(c)(3) financial statements. To the extent that revenues from such and as such are exempt from taxation on related income. programs are used to satisfy tuition and fees and other student charges, the University has recorded a scholarship discount Classification of Revenues and Expenses and allowance. The University has classified its revenues and expenses as either operating or nonoperating according to the following Adoption of New Accounting Standards criteria: The GASB issued Statement No. 82, Pension Issues – An Amendment of GASB Statements No. 67, No. 68 and No. Operating revenues and expenses: Operating revenues 73, in March 2016 which was effective for the year ended include activities that have the characteristics of exchange June 30, 2017. This statement addresses issues regarding transactions, such as (1) student tuition and fees, net of the presentation of payroll-related measures in required scholarship discounts and allowances, (2) sales and services supplementary information, the selection of assumptions and of auxiliary enterprises, net of scholarship discounts and the treatment of deviations from the guidance in an Actuarial allowances, (3) most Federal, state and local grants and Standard of Practice for financial reporting purposes, and contracts, and (4) interest on institutional loans. Operating the classification of payments made by employers to satisfy expenses include all expense transactions incurred other than employee contribution requirements. See Note 8 for the impact those related to investing, capital or noncapital financing of adoption. activities.

Nonoperating revenues and expenses: Nonoperating revenues include activities that have the characteristics of nonexchange transactions, such as gifts and contributions, and other revenue sources that are defined as nonoperating revenues by GASB Statement No. 9, Reporting Cash Flows of Proprietary and Nonexpendable Trust Funds and Governmental Entities That Use Proprietary Fund Accounting, and GASB Statement No. 34, such as state and federal appropriations and investment income. Nonoperating expenses include interest paid on capital asset related debt, losses on the disposal of capital assets, and refunds to grantors.

~ 43 ~ NOTES TO FINANCIAL STATEMENTS

NOTE 2. CASH AND CASH EQUIVALENTS, DEPOSITS AND INVESTMENTS All deposits and investments of the University are under the control of the State Treasurer who, by law, has sole authority for investing State funds. Certain monies are deposited or invested with or managed by financial institutions and brokers. The following schedule reconciles deposits and investments within the footnotes to the balance sheet amounts:

Reconciliation of Deposits and Investments

Statement of Net Position Amount Footnotes Amount Cash and cash equivalents: Cash on hand $ 230,411 Current - unrestricted $ 202,409,684 Deposits held by State Treasurer 476,065,835 Current - restricted 255,950,728 Other deposits 123,334 Noncurrent - restricted 18,059,168 Investments held by State Treasurer 154,439 Investments 2,542,152 Other investments 2,387,713 Total $ 478,961,732 Total $ 478,961,732

Deposits Held by State Treasurer State law requires full collateralization of all State Treasurer bank balances. The State Treasurer must correct any deficiencies in collateral within seven days. With respect to investments in the State's internal cash management pool, all of the State Treasurer's investments are insured or registered or are investments for which the securities are held by the State or its agent in the State's name. Information pertaining to the reported amounts, fair values, and credit risk of the State Treasurer's investments is disclosed in the Comprehensive Annual Financial Report of the State of South Carolina. For the fiscal year ending June 30, 2017, $1,277,176 of the $476,065,835 identified above as “Deposits held by State Treasurer” is attributable to unrealized appreciation.

Other Deposits The University's other deposits at year-end were entirely covered by federal depository insurance or collateral held by custodial banks.

Investments Held by State Treasurer Investments held by State Treasurer comprise investments held for the University and the State of South Carolina which are legally restricted, and earnings thereon become revenue of the specific fund from which the investment was made. These investments are specific, identifiable investment securities. Investments consist of Agricultural College stock with a carrying amount of $95,900 and Perpetual stock with a carrying amount of $58,539 held by the State Treasurer as Trustee in Perpetuity on which they are required to pay the University six percent per year. Since there is no readily determinable fair value for these investments, they have been assigned a fair value equal to their historical cost value.

Other Investments The University also has investments in mutual funds as authorized by a single donor. The mutual funds with a fair value of $2,387,713 are held and invested by Wells Fargo, as trustee in accordance with the endowment agreement specified by the donor. The University has adopted applicable accounting standards for its financial assets and liabilities which clarify that fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The University utilizes market data or assumptions that market participants would use in pricing the asset or liability. The standards establish a three tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs about which little or no market data exists, therefore requiring an entity to develop its own assumptions. The University's investments consist entirely of mutual funds and other investments with readily determinable fair values in an active market. These investments have been categorized as Level 1. The University does not have a formal investment policy that limits investment maturities as a means of managing its exposure to fair value losses arising from increasing interest rates.

~ 44 ~ NOTES TO FINANCIAL STATEMENTS

"Other Investments" are stated at fair value and include unrealized appreciation of $1,506,881. Purchases and sales are accounted for on the trade date. Both unrealized and realized gains and losses on investments have been recorded. Earnings are recorded on an accrual basis. Other investments as of June 30, 2017 were as follows:

Other Investments

Effective Maturity Credit Description Fair Value (Years) Rating Domestic bond fund $ 379,153 7.3 N/A International bond fund 146,951 11.8 N/A Equity funds 1,861,609 N/A N/A Total other investments $ 2,387,713

NOTE 3. RECEIVABLES University receivables reported in the Statement of Net Position as of June 30, 2017, were as follows:

University Receivables

Description Current Noncurrent Total Accounts receivable $ 21,779,643 $ — $ 21,779,643 Grants and contracts receivable 22,959,761 — 22,959,761 Notes receivable — 198,902,686 198,902,686 Contributions receivable, net 833,988 980,232 1,814,220 Interest and income receivable 1,455,192 — 1,455,192 Student loans receivable 12,918 7,463,904 7,476,822 Total university receivables $ 47,041,502 $ 207,346,822 $ 254,388,324

Accounts receivable are reported net of allowances for doubtful accounts of $580,980 based on credit losses experienced in prior years and evaluation of current portfolios. Student payment allowances of $320,000, parking services allowances of $228,190, emergency medical service allowances of $24,366, Sullivan Center allowances of $2,979, telecommunications allowances of $5,000, and other student services allowances of $445 comprise this amount. Contributions receivable are reported net of allowances for current uncollectible pledges of $346,837 and allowances for noncurrent uncollectible pledges of $172,983. Accounts receivable for the year ended June 30, 2017, were comprised of the following balances:

Accounts Receivable

Description Amount State capital appropriations $ 4,780,067 Students/scholarships 5,607,106 Auxiliaries 7,722,138 Computer services 303,138 Professional development 108,784 Educational programs 1,226,543 Camps 11,077 Fees 819,040 Other 1,201,750 Total accounts receivable $ 21,779,643

~ 45 ~ NOTES TO FINANCIAL STATEMENTS

Grants and contracts receivable are comprised of amounts due for sponsored research projects, federal land-grant appropriations, and federal scholarship programs. Grants and contracts receivable for the year ended June 30, 2017, were comprised of the following balances:

Grants and Contracts Receivable

Description Federal State Local Nongovernmental Total Sponsored research $ 17,684,613 $ 347,075 $ 67,660 $ 2,298,026 $ 20,397,374 Land-grant appropriations 1,428,591 — — — 1,428,591 Scholarship programs 1,133,796 — — — 1,133,796 Total grants and contracts receivable $ 20,247,000 $ 347,075 $ 67,660 $ 2,298,026 $ 22,959,761

Contributions receivable are comprised of pledges for gifts to support specifically identified University programs and to provide athletic scholarships. Contributions receivable are accounted for at their estimated net realizable value, or the present value of long-term pledges and reductions for allowances for uncollectible pledges. Pledges vary from one to ten years.

Contributions Receivable

Description Current Noncurrent Total University programs $ 833,988 $ 980,232 $ 1,814,220 Total contributions receivable $ 833,988 $ 980,232 $ 1,814,220

Part II, Section 9 of the 1998-99 State Appropriations Act University Foundation is for a ten year period. It is reviewed amended the South Carolina Code of Laws by adding Section annually by both parties and may be extended automatically for 59-101-410. This amendment allowed the governing boards an additional twelve month period unless either party provides of state-supported universities to lend their endowment and written notice of objection to the extension, in which case, auxiliary enterprise funds on deposit with the State Treasurer’s the Memorandum of Understanding will not automatically Office to separately chartered not-for-profit legal entities whose extend for an additional twelve month period. The above not existence is primarily providing financial assistance and other withstanding, either party may terminate the Memorandum of support to the institution and its educational program. Understanding at any time without cause upon one hundred Accordingly, as of June 30, 2017, the University had eighty days written notice to the other party. notes receivable from the Clemson University Foundation, a With minor exceptions, losses for loans to students are related party, totaling $198,902,686. This amount includes not estimated or recorded in allowances for uncollectible the original loan of $35,358,188, additional amounts totaling accounts. At the time a loan is considered uncollectible it is $67,561,127 loaned since the fiscal year 1999 original charged to principal. Any accounts receivable written off is loan, plus related income and appreciation. Funds loaned recognized in the period in which the receivable is considered to the Clemson University Foundation will be paid back to uncollectible. Based on past experience, potential losses are the University with interest at a rate equal to that which is not deemed material. necessary to produce a sum which is equal to the total return Interest and income receivable consists of amounts due (consisting of appreciation and income), provided, however, from the State Treasurer relating to holdings in the State’s such rate will not be less than zero. The Memorandum of internal cash management pool and cash invested in various Understanding between Clemson University and the Clemson short-term investments by that agency.

~ 46 ~ NOTES TO FINANCIAL STATEMENTS

NOTE 4. CAPITAL ASSETS Capital asset activity for the year ended June 30, 2017, is summarized as follows:

Capital Assets

Beginning Ending Balance Balance Description June 30, 2016 Increases Decreases Transfers June 30, 2017 Capital assets not being depreciated: Land and improvements $ 34,750,526 $ — $ 457,000 $ — $ 34,293,526 Construction in progress* 261,664,562 114,609,944 62,767 (182,604,723) 193,607,016 Total capital assets not being depreciated 296,415,088 114,609,944 519,767 (182,604,723) 227,900,542

Depreciable capital assets: Utilities systems and other non-structural improvements 68,255,882 3,274,348 — 384,348 71,914,578 Buildings and improvements** 1,013,908,835 79,537,618 650,000 182,210,941 1,275,007,394 Computer software 24,247,269 26,606 — 9,434 24,283,309 Equipment 316,608,332 16,378,240 14,214,593 — 318,771,979 Vehicles 15,155,510 3,709,612 765,120 — 18,100,002 Total depreciable capital assets at historical cost 1,438,175,828 102,926,424 15,629,713 182,604,723 1,708,077,262

Less accumulated depreciation for: Utilities systems and other non-structural improvements 30,813,824 3,065,604 — — 33,879,428 Buildings and improvements 378,251,973 25,176,970 129,559 — 403,299,384 Computer software 18,500,966 2,861,794 — — 21,362,760 Equipment 188,441,442 19,507,665 13,276,196 — 194,672,911 Vehicles 11,992,130 1,146,986 763,219 — 12,375,897 Total accumulated depreciation 628,000,335 51,759,019 14,168,974 0 665,590,380

Depreciable capital assets, net 810,175,493 51,167,405 1,460,739 182,604,723 1,042,486,882

Capital assets, net $ 1,106,590,581 $ 165,777,349 $ 1,980,506 $ 0 $ 1,270,387,424

*Includes current fiscal year capitalized interest of $6,305,384 ** Includes current fiscal year capitalized interest of $6,965,327. NOTE: The University received $1,398,481 in proceeds from the sale of capital assets

NOTE 5. UNEARNED REVENUES, DEPOSITS AND FUNDS HELD FOR OTHERS Unearned revenues consist primarily of athletic ticket sales A summary listing of unearned revenue follows: and related fees and unearned student revenues for summer session and fall semester. These monies were collected in Unearned Revenues advance and were not earned at June 30, 2017. Athletic sales and related event receipts include: advance Description Amount Athletic event receipts $ 22,804,938 sales of football tickets and program advertising fees. Sponsored research programs 6,594,254 Unearned student revenues consist mainly of student tuition Academic and other fees 16,021,722 Educational programs 867,650 and fees, room and board, and other fees related to the long Public service programs 98,584 summer session and fall semester. Also included are amounts Other 357,673 received in advance for sponsored research programs. Total unearned revenues $ 46,744,821 Fees collected in advance for municipal services, contract credit courses, and various departmental accounts comprise the remaining balance of unearned revenues.

~ 47 ~ NOTES TO FINANCIAL STATEMENTS

Current deposits are comprised of football game guarantees and amounts due to the Atlantic Coast Conference, student campus card balances, funds held on deposit for concert promoters, and miscellaneous departmental amounts.

Deposits

Description Current Amount Football guarantees/conference settlement $ 1,818,206 Student campus card balances 257,989 Miscellaneous departmental 131,825 Total deposits $ 2,208,020

Funds held for others consist of both current and noncurrent components. The balance of current funds held for others is comprised of agency funds held in trust for others. The federal Perkins loan liability balance represents the noncurrent funds held for others

Funds Held for Others

Current Noncurrent Description Amount Amount Federal Perkins Loans $ — $ 7,714,012 Amounts held in trust 812,926 — Total funds held for others $ 812,926 $ 7,714,012

NOTE 6. BONDS PAYABLE At June 30, 2017, bonds payable consisted of the following:

BONDS PAYABLE

Original Interest Rate Maturity June 30, 2017 Debt Retired in Description Debt (outstanding) Dates Balance Fiscal Year 2017 General Obligation Bonds Bonds dated 4/01/07 (Series 2007B) $ 14,000,000 2.50-4.00% 6/1/2021 $ 4,615,000 $ 1,020,000 Bonds dated 3/01/11 (Series 2011B) 62,370,000 3.00-5.00% 3/1/2031 61,170,000 200,000 Bonds dated 5/1/12 (Series 2012C) 21,135,000 5.00% 4/1/2018 2,635,000 4,130,000 Bonds dated 6/1/14 (Series 2014B) 33,030,000 3.00-5.00% 4/1/2034 29,535,000 1,130,000 Bonds dated 10/01/16 (Series 2016F) 52,395,000 2.00-5.00% 6/1/2036 52,395,000 — 150,350,000 Revenue Bonds Bonds dated 12/1/05 (Series 2005) 22,130,000 4.00-4.25% 5/1/2020 1,860,000 455,000 Bonds dated 2/1/12 (Series 2012) 21,200,000 2.00% 5/1/2018 6,060,000 5,940,000 Bonds dated 5/1/15 (Series 2015) 90,285,000 4.00-5.00% 5/1/2045 90,285,000 — Bonds dated 12/1/15 (Series 2015B) 191,000,000 2.75-5.00% 5/1/2046 191,000,000 — 289,205,000 Athletic Facilities Revenue Bonds Bonds dated 2/1/12 (Series 2012) 12,335,000 2.00-3.00% 5/1/2023 5,590,000 820,000 Bonds dated 12/1/14 (Series 2014A) 30,695,000 3.00-5.00% 5/1/2045 30,695,000 — Bonds dated 12/1/14 (Series 2014B) 9,240,000 2.40-4.00% 5/1/2027 7,670,000 795,000 Bonds dated 12/1/14 (Series 2014C) 10,545,000 2.00-5.00% 5/1/2025 9,635,000 780,000 Bonds dated 5/1/15 (Series 2015) 60,695,000 4.00-5.00% 5/1/2045 58,570,000 1,020,000 Bonds dated 12/1/15 (Series 2015B) 18,875,000 3.00-5.00% 5/1/2046 18,445,000 430,000 130,605,000 Subtotal bonds payable $ 570,160,000 $ 16,720,000 Plus unamortized bond premium 36,096,958 2,292,558 Total Bonds Payable $ 606,256,958 $ 19,012,558

~ 48 ~ NOTES TO FINANCIAL STATEMENTS

Bonds issued by the University include certain restrictive The Series 2012 Refunding Revenue Bonds mature as covenants. General Obligation Bonds of the State are backed serial bonds on May 1 of each of the years 2012 through 2018 by the full faith, credit and taxing power of the State. Tuition and are not subject to redemption prior to maturity. and matriculation fees paid to the University are pledged The Series 2012 Athletic Facilities Refunding Revenue for the payment of principal and interest on these bonds. Bonds mature as serial bonds on May 1 of each of the years Auxiliary Revenue Bonds are payable solely from and secured 2012 through 2023 and are not subject to redemption prior to by a pledge of revenues of the University’s housing facilities, maturity. bookstores, dining services, parking and vending, and from The Series 2012C General Obligation State Institution additional funds from the academic “University” fee imposed Bonds mature on April 1 in each of the years 2013 through by the Board of Trustees. Athletic Facilities Revenue Bonds 2018 and are not subject to redemption prior to maturity. are payable solely from the net revenues of the University’s The Series 2014B General Obligation State Institution Athletic Department and the gross receipts from the imposition Bonds mature on April 1 in each of the years 2015 through of any admissions fee and any special student fee. 2034 and are not subject to redemption prior to maturity. The University purchased a bond insurance policy payable The Series 2014A Athletic Facilities Revenue Bonds to the bond trustee for the Revenue Bonds Series 2005; and the mature on May 1 in each of the years 2015 through 2045 and Athletic Facilities Revenue Bonds Series 2005. In addition, a are subject to redemption prior to maturity. surety bond was purchased for the Athletic Facilities Revenue The Series 2014B Taxable Athletic Facilities Revenue Bonds, Series 2005. The insurance guarantees payment of Bonds mature on May 1 in each of the years 2015 through principal and interest until all debt has been retired. 2027 and are subject to redemption prior to maturity. Tuition fees for the fiscal year ended June 30, 2016 were The Series 2014C Athletic Facilities Revenue Refunding $29,578,944 which results in a legal annual debt service limit Bonds mature on May 1 in each of the years 2015 through at June 30, 2017 of $26,621,050. This amount is equal to 90% 2025 and are subject to redemption prior to maturity. of tuition fees collected for the prior fiscal year. The Series 2015B Athletic Facilities Revenue Bonds The Series 2005 Improvement and Refunding Revenue maturing prior to May 1, 2017 shall not be subject to Bonds maturing prior to May 1, 2017, shall not be subject to redemption; however, they shall be subject to redemption redemption prior to their stated maturities. The Series 2005 prior to maturity on or after May 1, 2017 at the option of the Bonds maturing on or after May 1, 2017, shall be subject to University, on or after May 1, 2016, in whole or in part for redemption at the option of the Board of Trustees on or after the principal amount thereof and the interest accrued on such May 1, 2016, in whole or part, at any time, and if in part in principal amount to the date fixed for redemption. those maturities designated by the University and by lot within The Series 2015B Higher Education Revenue Bonds a maturity (but only in integral multiples of $5,000) upon 30 maturing prior to May 1, 2017 shall not be subject to day notice at the par amount of the principal to be redeemed, redemption; however, they shall be subject to redemption plus accrued interest thereon. prior to maturity on or after May 1, 2017 at the option of the The Series 2005 Athletic Facilities Revenue Bonds University, on or after May 1, 2016, in whole or in part for maturing prior to May 1, 2017 shall not be subject to the principal amount thereof and the interest accrued on such redemption; however, they shall be subject to redemption principal amount to the date fixed for redemption. prior to maturity on or after May 1, 2017 at the option of the During the fiscal year ending June 30, 2017, the State of University, on or after May 1, 2016, in whole or in part for South Carolina issued on behalf of the University, General the principal amount thereof and the interest accrued on such Obligation State Institution Bonds, Series 2016F, in the amount principal amount to the date fixed for redemption. of $52,395,000. The Series 2016F General Obligation State The Series 2007B General Obligation Bonds maturing on Institution Bonds were issued to (i) defray the costs of energy and after June 1, 2018, are subject to redemption, in whole or distribution and utility infrastructure on campus and (ii) to pay in part, at any time in any order of maturity to be determined the costs of issuance of the bonds. The Series 2016F Bonds by the State, on and after June 1, 2017, at par plus accrued are not subject to redemption prior to maturity. The Series interest to the date fixed for redemption. 2016F General Obligation Bonds are secured by a pledge The Series 2011B General Obligation State Institution of the full faith, credit, and taxing power of the State and Bonds maturing on and after March 1, 2022, are subject to are additionally secured by a pledge of the revenues derived redemption, in whole or in part, at any time in any order of from the tuition fees of the University. The $4,405,478 bond maturity to be determined by the State, on and after March premium associated with this issuance is being amortized over 1, 2021 at par plus accrued interest to the date fixed for the twenty year life of the bonds using the straight line method. redemption.

~ 49 ~ NOTES TO FINANCIAL STATEMENTS

All of the bonds are payable in semiannual installments plus interest. Amounts including interest required to complete payment of the Revenue, Athletic Facilities Revenue, and General Obligation Bonds as of June 30, 2017, are as follows:

Revenue Bonds

Description Principal Interest Total Year Ending June 30 2018 $ 8,155,000 $ 11,777,264 $ 19,932,264 2019 6,580,000 11,556,064 18,136,064 2020 6,900,000 11,232,164 18,132,164 2021 6,505,000 10,892,451 17,397,451 2022 6,825,000 10,567,201 17,392,201 2023 through 2027 39,605,000 47,361,506 86,966,506 2028 through 2032 44,115,000 37,836,166 81,951,166 2033 through 2037 52,555,000 29,383,975 81,938,975 2038 through 2042 63,220,000 18,733,800 81,953,800 2043 through 2046 54,745,000 5,259,800 60,004,800 Total Revenue Bonds $ 289,205,000 $ 194,600,391 $ 483,805,391

Athletic Facilities Revenue Bonds

Description Principal Interest Total Year Ending June 30 2018 $ 4,005,000 $ 5,194,460 $ 9,199,460 2019 4,170,000 5,028,110 9,198,110 2020 4,345,000 4,854,610 9,199,610 2021 4,535,000 4,664,460 9,199,460 2022 4,715,000 4,480,890 9,195,890 2023through 2027 21,580,000 19,557,535 41,137,535 2028 through 2032 18,475,000 15,383,838 33,858,838 2033 through 2037 22,300,000 11,565,688 33,865,688 2038 through 2042 26,825,000 7,035,418 33,860,418 2043 through 2046 19,655,000 1,621,350 21,276,350 Total Athletic Facilities Revenue Bonds $ 130,605,000 $ 79,386,359 $ 209,991,359

General Obligation Bonds

Description Principal Interest Total Year Ending June 30 2018 $ 6,950,000 $ 6,261,412 $ 13,211,412 2019 6,750,000 5,928,613 12,678,613 2020 9,535,000 5,602,363 15,137,363 2021 9,765,000 5,137,412 14,902,412 2022 7,995,000 4,680,163 12,675,163 2023 through 2027 45,700,000 17,058,612 62,758,612 2028 through 2032 45,440,000 7,310,794 52,750,794 2033 through 2036 18,215,000 1,237,344 19,452,344 Total General Obligation Bonds $ 150,350,000 $ 53,216,713 $ 203,566,713

~ 50 ~ NOTES TO FINANCIAL STATEMENTS

The University reported net principal retirements and interest expenditures related to the bonds as follows for the year ended June 30, 2017:

Principal Retirements and Interest Expenses

Bond Type Net Principal Interest General obligation bonds $ 6,480,000 $ 5,057,622 Revenue bonds 6,395,000 10,970,056 Athletic facilities revenue bonds 3,845,000 4,945,732 Total Net Principal Retirements and Interest Expenses $ 16,720,000 $ 20,973,410

NOTE 7. LEASE OBLIGATIONS The University is obligated under various operating leases for the use of real property (land, buildings, office space) and equipment and also is obligated under capital leases and installment purchase agreements for the acquisition of real property. All capital and operating leases are with parties outside state government. Future commitments for capital leases (which here and on the Statement of Net Position include other installment purchase agreements) and for non-cancellable operating leases having remaining terms in excess of one year as of June 30, 2017, were as follows:

Capital and Operating Lease Commitments

Capital Operating Description Leases Leases Year Ending June 30: 2018 $ 714,369 $ 3,051,597 2019 574,408 2,770,752 2020 574,408 1,865,185 2021 574,408 1,562,538 2022 574,408 385,961 2023 through 2027 2,872,040 346,870 2028 through 2032 2,872,040 — 2033 through 2037 2,872,040 — 2038 404,556 — Total minimum lease payments 12,032,677 $ 9,982,903 Less: Interest 42,960 Principal outstanding - Clemson University $ 11,989,717

Capital Leases The Capital Leases are payable in monthly installments and will expire in 2038. Expenditures for fiscal year 2017 were $1,001,658 of which $977,454 was principal and $24,204 was interest. The following is a summary of the carrying values of the assets held under capital leases at June 30, 2017:

Assets Held Under Capital Lease

Value at Lease Accumulated Description Inception Depreciation Net Buildings $ 14,300,000 $ 2,311,834 $ 11,988,166 Equipment 1,908,694 1,103,463 805,231 Total assets held under capital lease $ 16,208,694 $ 3,415,297 $ 12,793,397

~ 51 ~ NOTES TO FINANCIAL STATEMENTS

Certain capital leases provide for renewal and/or purchase In September 2011, the University entered into an options. Generally purchase options at bargain prices of one agreement with CULSF, a component unit, for space in the dollar are exercisable at the expiration of the lease terms. building located at 3 Research Drive, Greenville, SC, at the In October 2012, the University entered into a capital CU-ICAR Campus. This agreement is on a month-to-month lease of $14,300,000 at less than .1 percent interest whereby basis and extends indefinitely. Under this lease, the University the University leases space in the Greenville One Building paid $12,000 in the current fiscal year. for a twenty-five year period which began in March 2013 In November 2013, the University entered into an and extends to March 2038. The Greenville One Building is agreement with CULSF for space in the building located at located in downtown Greenville, SC and the space consists of 3 Research Drive, Greenville, SC at the CU-ICAR Campus. four floors and space on the ground floor and exclusive use of This agreement is on a month to month basis and extends an exterior green roof. indefinitely. Under this lease, the University paid $1,250 in The University entered into this lease with Clemson the current fiscal year. This lease ended July 31, 2016. University Land Stewardship Foundation, Inc. (CULSF), a In January 2014, the University entered into an component unit. The outstanding liability on this lease as of agreement with CULSF for space in the building located at June 30, 2017 is $11,851,378. 3 Research Drive, Greenville, SC at the CU-ICAR Campus. In October 2012 the University entered into a Capital This agreement is on a month to month basis and extends Lease of $1,908,694 at 5.703 percent interest with First indefinitely. Under this lease, the University paid $3,000 this Financial Corporate Leasing, LLC, an unrelated party, fiscal year. This lease ended July 31, 2016. (whereby the University leases) a Hitachi NB5000 Duabeam In June 2014, the University entered into a real property FIB Microscope for use in the Advanced Materials Research operating lease with CULSF for space in the building located Laboratories. Lease payments are for five years with bargain at 110 Daniel Drive, Clemson, SC. This lease extends through purchase options after the first twelve months. Lease payments June 2024. Under this lease, the University paid CULSF are $39,042 for thirty-two months, $36,832 for sixteen months, $97,665 this fiscal year. and $34,990 for the final twelve months. The outstanding In June 2014, the University entered into a real property liability on this lease as of June 30, 2017 is $138,339. operating lease with CULSF for space in the building located at 114 Daniel Drive, Clemson, SC. This lease extends through Operating Leases June 2024. Under this lease, the University paid CULSF The University's non-cancelable operating leases having $42,500 this fiscal year. remaining terms of more than one year expire in various In December 2015, the University entered into a real fiscal years from 2018 through 2024. Certain operating property operating lease with CULSF for space in the building leases provide for renewal options for periods from one to located at 1 Research Dr., Greenville, SC. This lease extends five years at their fair rental value at the time of renewal. All through June 2019. Under this lease, the University paid agreements are cancelable if the State of South Carolina does CULSF $506,000 this current fiscal year. not provide adequate funding but that is considered a remote In March 2016, the University entered into a real property possibility. In the normal course of business, operating leases operating lease with CULSF for space in the building located are generally renewed or replaced by other leases. Operating at 1 Research Dr., Greenville, SC. This lease extends through leases are generally payable on a monthly basis. June 2019. Under this lease, the University paid CULSF In June 2011, the University’s Computer and Information $525,782 this current fiscal year. Technology division entered into a real property operating lease In the current fiscal year, Clemson University incurred with the Clemson University Land Stewardship Foundation expenses of $107,853 for office copier contingent rentals on (CULSF), a component unit, for space in the building located a cost-per-copy basis. at 3 Research Drive, Greenville, SC, at the Clemson University Center for Automotive Research (CU-ICAR) Campus. This agreement extends through September 2016. Under this agreement, the University paid CULSF $24,797 in the current fiscal year. This lease ended September 30, 2016. In January 2012, Clemson University originally entered into a real property operating lease with CULSF, a component unit, for space locate in the building at 3 Research Drive, Greenville, SC, at the CU-ICAR Campus. This agreement to establish a component testing laboratory has been extended through April 2022. Under this lease, the University paid CULSF $173,550 in the current fiscal year.

~ 52 ~ NOTES TO FINANCIAL STATEMENTS

NOTE 8. of Laws for the purpose of providing retirement allowances PENSION PLANS and other benefits for police officers and firemen of the state The South Carolina Public Employee Benefit Authority and its political subdivisions. (PEBA), which was created July 1, 2012, administers the various retirement systems and retirement programs managed Membership by its Retirement Division. PEBA has an 11-member Board of Membership requirements are prescribed in Title 9 of Directors, appointed by the Governor and General Assembly the South Carolina Code of Laws. A brief summary of the leadership, which serves as co-trustee and co-fiduciary of requirements under each system is presented below. the systems and the trust funds. By law, the State Fiscal SCRS – Generally, all employees of covered employers Accountability Authority (SFAA), which consists of five are required to participate in and contribute to the system as a elected officials, also reviews certain PEBA Board decisions condition of employment. This plan covers general employees regarding the funding of the South Carolina Retirement and teachers and individuals newly elected to the South Systems (Systems) and serves as a co-trustee of the Systems Carolina General Assembly beginning with the November in conducting that review. 2012 general election. An employee member of the system For purposes of measuring the net pension liability, with an effective date of membership prior to July 1, 2012 is a deferred outflows and inflows of resources related to pensions, Class Two member. An employee member of the system with and pension expense, information about the fiduciary net an effective date of membership on or after July 1, 2012 is a position of the Systems and additions to/deductions from the Class Three member. Systems fiduciary net position have been determined on the State ORP – As an alternative to membership in the accrual basis of accounting as they are reported by the Systems SCRS, newly hired state, public school, and higher education in accordance with generally accepted accounting principles employees and individuals newly elected to the South (GAAP). For this purpose, revenues are recognized when Carolina General Assembly beginning with the November earned and expenses are recognized when incurred. Benefit 2012 general election have the option to participate in the and refund expenses are recognized when due and payable in State Optional Retirement Program (State ORP), which is a accordance with the terms of the plan. Investments are reported defined contribution plan. State ORP participants direct the at fair value. investment of their funds into a plan administered by one of PEBA issues a Comprehensive Annual Financial four investment providers. PEBA assumes no liability for Report (CAFR) containing financial statements and required the State ORP benefits. Rather, the benefits are the liability supplementary information for the South Carolina Retirement of the investment providers. For this reason, State ORP Systems’ Pension Trust Funds. The CAFR is publicly available programs are not considered part of the retirement systems through the Retirement Benefits’ link on PEBA’s website at for financial statement purposes. Employee and Employer www.peba.sc.gov, or a copy may be obtained by submitting a contributions to the State ORP are at the same rates as SCRS. request to PEBA, 202 Arbor Lake Drive, Columbia, SC 29223. A direct remittance is required from the employers to the PEBA is considered a division of the primary government of member’s account with investment providers for the employee the state of South Carolina and therefore, retirement trust fund contribution and a portion of the employer contribution (5 financial information is also included in the comprehensive percent). A direct remittance is also required to SCRS for annual financial report of the state. the remaining portion of the employer contribution and an incidental death benefit contribution, if applicable, which is Plan Description retained by SCRS. The South Carolina Retirement System (SCRS), a cost- PORS – To be eligible for PORS membership, an sharing multiple-employer defined benefit pension plan, was employee must be required by the terms of his employment, established effective July 1, 1945, pursuant to the provisions by election or appointment, to preserve public order, protect of Section 9-1-20 of the South Carolina Code of Laws for the life and property, and detect crimes in the state; to prevent purpose of providing retirement allowances and other benefits and control property destruction by fire; or to serve as a for employees of the state, its public school districts, and peace officer employed by the Department of Corrections, the political subdivisions. Department of Juvenile Justice, or the Department of Mental The State Optional Retirement Program (ORP) is a Health. Probate judges and coroners may elect membership defined contribution plan that is offered as an alternative to in PORS. Magistrates are required to participate in PORS for certain newly hired state, public school, and higher education service as a magistrate. PORS members, other than magistrates employees. State ORP participants direct the investment of and probate judges, must also earn at least $2,000 per year their funds into a plan administered by one of four investment and devote at least 1,600 hours per year to this work, unless providers. exempted by statute. An employee member of the system The South Carolina Police Officers Retirement System with an effective date of membership prior to July 1, 2012, (PORS), a cost-sharing multiple-employer defined benefit is a Class Two member. An employee member of the system pension plan, was established effective July 1, 1962, pursuant with an effective date of membership on or after July 1, 2012 to the provisions of Section 9-11-20 of the South Carolina Code is a Class Three member.

~ 53 ~ NOTES TO FINANCIAL STATEMENTS

Benefits Benefit terms are prescribed in Title 9 of the South Carolina Code of Laws. PEBA does not have the authority to establish or amend benefit terms without a legislative change in the code of laws. Key elements of the benefit calculation include the benefit multiplier, years of service, and average final compensation. A brief summary of benefit terms for each system is presented below.

SCRS – A Class Two member who has separated from service with at least five or more years of earned service is eligible for a monthly pension at age 65 or with 28 years credited service regardless of age. A member may elect early retirement with reduced pension benefits payable at age 55 with 25 years of service credit. A Class Three member who has separated from service with at least eight or more years of earned service is eligible for a monthly pension upon satisfying the Rule of 90 requirement that the total of the member’s age and the member’s creditable service equals at least 90 years. Both Class Two and Class Three members are eligible to receive a reduced deferred annuity at age 60 if they satisfy the five- or eight-year earned service requirement, respectively. An incidental death benefit is also available to beneficiaries of active and retired members of employers who participate in the death benefit program. The annual retirement allowance of eligible retirees or their surviving annuitants is increased by the lesser of one percent or five hundred dollars every July 1. Only those annuitants in receipt of a benefit on July 1 of the preceding year are eligible to receive the increase. Members who retire under the early retirement provisions at age 55 with 25 years of service are not eligible for the benefit adjustment until the second July 1 after reaching age 60 or the second July 1 after the date they would have had 28 years of service credit had they not retired.

PORS – A Class Two member who has separated from service with at least five or more years of earned service is eligible for a monthly pension at age 55 or with 25 years of service regardless of age. A Class Three member who has separated from service with at least eight or more years of earned service is eligible for a monthly pension at age 55 or with 27 years of service regardless of age. Both Class Two and Class Three members are eligible to receive a deferred annuity at age 55 with five or eight years of earned service, respectively. An incidental death benefit is also available to beneficiaries of active and retired members of employers who participate in the death benefit program. Accidental death benefits are also provided upon the death of an active member working for a covered employer whose death was a natural and proximate result of an injury incurred while in the performance of duty. The retirement allowance of eligible retirees or their surviving annuitants is increased by the lesser of one percent of five hundred dollars every July 1. Only those annuitants in receipt of a benefit on July 1 of the preceding year are eligible to receive the increase.

Teacher and Employee Retention Incentive Effective January 1, 2001, Section 9-1-2210 of the South Carolina Code of Laws allows employees eligible for service retirement to participate in the Teacher and Employee Retention Incentive (TERI) Program. TERI participants may retire and begin accumulating retirement benefits on a deferred basis without terminating employment for up to five years. Upon termination of employment or at the end of the TERI period, whichever is earlier, participants will begin receiving monthly service retirement benefits which will include any benefit adjustments granted during the TERI period. Because participants are considered retired during the TERI period, they do not earn service credit and are ineligible for disability retirement benefits. The TERI program will end effective June 30, 2018 and a member’s participation may not continue after this date.

Contributions Contributions are prescribed in Title 9 of the South Carolina Code of Laws. Upon recommendation by the actuary in the annual actuarial valuation, the PEBA Board may adopt and present to the SFAA for approval an increase in the SCRS and PORS employer and employee contribution rates, but any such increase may not result in a differential between the employee and total employer contribution rate that exceeds 2.9 percent of earnable compensation for SCRS and 5 percent for PORS. An increase in the contribution rates adopted by the Board may not provide for an increase of more than one-half of one percent in any one year. If the scheduled employee and employer contributions provided in statute or the rates last adopted by the Board are insufficient to maintain a thirty year amortization schedule of the unfunded liabilities of the plans, the Board shall increase the contribution rates in equal percentage amounts for the employer and employee as necessary to maintain the thirty-year amortization period; and, this increase is not limited to one-half of one percent per year.

~ 54 ~ NOTES TO FINANCIAL STATEMENTS

Required employee contribution rates (1) are as follows:

Contribution Plan Fiscal Year 2017 Fiscal Year 2016 SCRS Employee Class Two 8.66% 8.16% Employee Class Three 8.66% 8.16% State PORS Employee 8.66% 8.16% PORS Employee Class Two 9.24% 8.74% Employee Class Three 9.24% 8.74%

Required employer contribution rates (1) are as follows:

Contribution Plan Fiscal Year 2017 Fiscal Year 2016 SCRS Employer Class Two 11.41% 10.91% Employer Class Three 11.41% 10.91% Employer Incidental Death Benefit 0.15% 0.15% State PORS Employer Contribution (2) 11.41% 10.91% Employer Incidental Death Benefit 0.15% 0.15% PORS Employer Class Two 13.84% 13.34% Employer Class Three 13.84% 13.34% Employer Incidental Death Benefit 0.20% 0.20% Employer Accidental Death Program 0.20% 0.20%

(1) Calculated on earnable compensation as defined in Title 9 of the South Carolina Code of Laws. (2) Of this employer contribution, 5% of earnable compensation must be remitted by the employer directly to the ORP vendor to be allocated to the member’s account with the remainder of the employer contribution remitted to the SCRS.

For the year ended June 30, 2017, the University's SCRS contributions totaled $20,992,216. The University's PORS contributions totaled $564,457. Total contributions directly to the ORPs were approximately $8,064,833 (excluding the surcharge) from Clemson University as employer and approximately $13,968,291 from its employees as plan members. The remaining employer contribution amounts sent to SCRS (excluding the surcharge) were $10,574,426.

~ 55 ~ NOTES TO FINANCIAL STATEMENTS

Net Pension Liability At June 30, 2017, the University reported liabilities of $565,925,016 and $7,243,538 for its proportionate shares of the SCRS and PORS net pension liabilities, respectively. The net pension liabilities were measured as of June 30, 2016, and the total pension liabilities used to calculate the net pension liabilities were determined by an actuarial valuation as of July 1, 2015 projected forward to June 30, 2016. The University’s proportionate shares of the net pension liabilities were based on a projection of the University’s long-term share of contributions to the pension plans relative to the projected contributions of all participating employers, actuarially determined. The University’s proportionate share of the SCRS plan decreased by 0.007714% over the prior year. The University’s proportionate share of the PORS plan increased by 0.01982% over the prior year. At June 30, 2017, the University’s proportionate shares of the SCRS and PORS plans were 2.649480% and 0.28558% respectively. For the year ended June 30, 2017, the University recognized pension expense of $52,475,711 and $864,726 for SCRS and PORS, respectively.

The net pension liability (NPL) is calculated separately for each system and represents that particular system’s total pension liability determined in accordance with GASB No. 67 less that System’s fiduciary net position. NPL totals, as of June 30, 2016, for SCRS and PORS are presented below.

Total Plan Employers’ Plan Fiduciary Pension Fiduciary Net Net Pension Net Position as a Percentage System Liability Position Liability (Asset) of the Total Pension Liability SCRS $ 45,356,214,752 $ 23,996,362,354 $ 21,359,852,398 52.9% PORS 6,412,510,458 3,876,035,732 2,536,474,726 60.4%

The total pension liability is calculated by the Systems’ actuary, and each plan’s fiduciary net position is reported in the Systems’ financial statements. The net position liability is disclosed in accordance with the requirements of GASB 67 in the Systems’ notes to the financial statements and required supplementary information. Liability calculations performed by the Systems’ actuary for the purpose of satisfying the requirements of GASB Nos. 67 and 68 are not applicable for other purposes, such as determining the plans’ funding requirements.

Deferred Outflows of Resources and Deferred Inflows of Resources related to Pensions At June 30, 2017, the University reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:

South Carolina Retirement System

Deferred Outflows Deferred Inflows Description of Resources of Resources University contributions subsequent to the measurement date $ 31,566,642 $ — Differences between expected and actual experience 5,866,478 614,596 Net difference between projected and actual earnings on pension plan investments 47,612,478 — Differences due to changes in proportionate share of contributions 5,296,464 1,115,455 Total outflows and inflows of resources $ 90,342,062 $ 1,730,051

Police Officers Retirement System

Deferred Outflows Deferred Inflows Description of Resources of Resources University contributions subsequent to the measurement date $ 564,457 $ — Differences between expected and actual experience 107,480 — Net difference between projected and actual earnings on pension plan investments 821,354 — Difference due to changes in proportionate share of contributions 328,745 20,793 Total outflows and inflows of resources $ 1,822,036 $ 20,793

The $31,566,642 and $564,457 reported as deferred outflows of resources related to pensions resulting from University contributions paid subsequent to the measurement date for the SCRS and PORS plans, respectively, during the year ended June 30, 2017 will be recognized as a reduction of the net pension liabilities in the year ending June 30, 2018.

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Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows for the SCRS and PORS plans, respectively:

Year ended June 30: SCRS PORS 2018 $ 15,213,098 $ 291,393 2019 12,146,653 285,945 2020 19,020,667 412,399 2021 10,664,951 247,049

Actuarial Assumptions and Methods Actuarial valuations involve estimates of the reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and future salary increases. Actuarial assumptions and methods used during the annual valuation process are subject to periodic revision, typically with an experience study, as actual results over an extended period of time are compared with past expectations and new estimates are made about the future. South Carolina state statute requires that an actuarial experience study be completed at last once in each five-year period. An experience report on the Systems was most recently issued as of July 1, 2015. The June 30, 2016, total pension liability, net pension liability, and sensitivity information were determined by the Systems consulting actuary, Gabriel, Roeder, Smith and Company (GRS) and are based on the July 1, 2015, actuarial valuations, as adopted by the PEBA Board and SFAA which utilized membership data as of July 1, 2015. The total pension liability was rolled-forward from the valuation date to the Systems’ fiscal year ended June 30, 2016, using generally accepted actuarial principles. Information included in the following schedules is based on the certification provided by GRS. The following table provides a summary of the actuarial assumptions and methods used in the July 1, 2015 valuations for SCRS and PORS.

Actuarial cost method SCRS Entry age PORS Entry age Actuarial assumptions: Actuarial cost method Entry age normal Entry age normal Investment rate of return (1) 7.5% 7.5% Projected salary increases 3.5% to 12.5% (varies by service) 4.0% to 10.0% (varies by service) Benefit adjustments lesser of 1% or $500 annually lesser of 1% or $500 annually (1) Includes inflation at 2.75%

The post-retiree mortality assumption is dependent upon the member’s job category and gender. This assumption includes base rates which are automatically adjusted for future improvement in mortality using published Scale AA projected from the year 2000. Assumptions used in the July 1, 2015, valuations for SCRS and PORS are as follows:

Former Job Class Males Females RP-2000 Males (with White Collar RP-2000 Females (with White Collar Educators adjustment) multiplied by 110% adjustment) multiplied by 95% General Employees and Members of the RP-2000 Males multiplied by 100% RP-2000 Females multiplied by 90% General Assembly RP-2000 Males (with Blue Collar RP-2000 Females (with Blue Collar Public Safety, Firefighters adjustment) multiplied by 115% adjustment) multiplied by 115%

Long Term Expected Rate of Return The long-term expected rate of return on pension plan investments, as used in the July 1, 2015, actuarial valuations, was based upon the 30 year capital markets outlook at the end of the third quarter 2015. The long-term expected rate of returns represent assumptions developed using an arithmetic building block approach primarily based on consensus expectations and market based inputs. Expected returns are net of investment fees. The expected returns, along with the expected inflation rate, form the basis for the revised target asset allocation adopted beginning January 1, 2016. The long-term expected rate of return is produced by weighting the expected future real rates of return by the target allocation percentage and adding expected inflation and is summarized in the table below. For actuarial purposes, the 7.50 percent assumed annual investment rate of return set in statute and used in the calculation of the total pension liability includes a 4.75 percent real rate of return and a 2.75 percent inflation component.

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Long Term Expected Expected Target Asset Arithmetic Real Portfolio Real Asset Class Allocation Rate of Return Rate of Return Global Equity 43.0% Global Public Equity 34.0% 6.52% 2.22% Private Equity 9.0% 9.30% 0.84% Real Assets 8.0% Real Estate 5.0% 4.32% 0.22% Commodities 3.0% 4.53% 0.13% Opportunistic 20.0% GTAA/Risk Parity 10.0% 3.90% 0.39% Hedge Funds (Low Beta) 10.0% 3.87% 0.39% Diversified Credit 17.0% Mixed Credit 5.0% 3.52% 0.17% Emerging Markets Debt 5.0% 4.91% .25% Private Debt 7.0% 4.47% 0.31% Conservative Fixed Income 12.0% Core Fixed Income 10.0% 1.72% 0.17% Cash and Short Duration (Net) 2.0% 0.71% 0.01% Total Expected Real Return 100.0% 5.10% Inflation for Actuarial Purposes 2.75% Total Expected Nominal Return 7.85%

Discount Rate The discount rate used to measure the total pension liability was 7.50 percent. The projection of cash flows used to determine the discount rate assumed that the funding policy specified in the South Carolina State Code of Laws will remain unchanged in future years. Based on those assumptions, each System’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability.

Sensitivity Analysis The following presents the University’s proportionate share of the net pension liability calculated using the discount rate of 7.50 percent, as well as what the University’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1 percentage point lower (6.50 percent) or 1 percentage point higher (8.50 percent) than the current rate:

Sensitivity of the Net Pension Liability to Changes in the Discount Rate

System 1.00% Decrease (6.50%) Current Discount Rate (7.50%) 1.00% Increase (8.50%) SCRS $ 705,975,963 $ 565,925,016 $ 449,337,882 PORS 9,493,277 7,243,538 5,221,725

Additional Financial and Actuarial Information Detailed information regarding the fiduciary net position of the plans administered by PEBA is available in the Systems’ audited financial statements for the fiscal year ended June 30, 2016 (including the unmodified audit opinion on the financial statements). Additional actuarial information is available in the accounting and financial reporting actuarial valuation as of June 30, 2016.

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NOTE 9. employer contributions expenses applicable to these insurance POST-EMPLOYMENT BENEFITS OTHER benefits for active employees in the amount of approximately THAN PENSIONS $167,768 and $164,606 for the years ended June 30, 2017 and 2016, respectively. Effective May 1, 2008 the State established two trust funds Plan Description In accordance with the South Carolina Code of Laws through Act 195 for the purpose of funding and accounting and the annual Appropriations Act, the State provides post- for the employer costs of retiree health and dental insurance employment health and dental and long-term disability benefits benefits and long-term disability insurance benefits. The to retired State and school district employees and their covered SCRHITF is primarily funded through the payroll surcharge. dependents. Clemson University contributes to the South Other sources of funding include additional State appropriated Carolina Retiree Health Insurance Trust Fund (SCRHITF) and dollars, accumulated IB reserves, and income generated from the South Carolina Long-Term Disability Insurance Trust Fund investments. The SCLTDITF is primarily funded through (SCLTDITF), cost-sharing multiple employer defined benefit investment income and employer contributions. post-employment healthcare and long-term disability plans A copy of the separately issued financial statements for the administered by the Insurance Benefits Division (IB) of the benefit plans and the trust funds may be obtained by writing South Carolina Public Employee Benefit Authority (PEBA). to the South Carolina Public Employee Benefit Authority – Generally, retirees are eligible for the health and dental Insurance Benefits Division, P.O. Box 11960, Columbia, South benefits if they have established at least ten years of retirement Carolina 29211-1960. service credit. For new hires beginning employment May 2, 2008 and after, retirees are eligible for benefits if they have established 25 years of service for 100% employer NOTE 10. funding and 15 through 24 years of service for 50% employer DEFERRED COMPENSATION PLANS funding. Several optional deferred compensation plans are Benefits become effective when the former employee available to State employees and employers of its political retires under a State retirement system. Basic Long-Term subdivisions. All Clemson University employees may Disability (BLTD) benefits are provided to active state, public participate in the deferred compensation plans, except those school district, and participating local government employees in student employment positions. Certain employees of the approved for disability. University have elected to participate. The multiple-employer plans, created under Internal Revenue Code Sections 457, Funding Policies 401(k), and 403(b), are administered by third parties and are Section 1-11-710 of the South Carolina Code of Laws of not included in the Comprehensive Annual Financial Report 1976, as amended, requires these post-employment and long- of the State of South Carolina. Compensation deferred under term disability benefits be funded through annual appropriations the Section 401(k), 457 and 403(b) plans is placed in trust for by the General Assembly for active employees to the IB and the contributing employee. The State has no liability for losses participating retirees to the PEBA, except for the portion under the plans. Employees may withdraw the current value funded through the pension surcharge and provided from the of their contributions when they terminate State employment other applicable sources of the IB, for its active employees if permitted by the plan. Eligibility rules and penalties may who are not funded by State General Fund appropriations. apply. Employees may also withdraw contributions prior Employers participating in the RMP are mandated by State to termination if they meet requirements specified by the statute to contribute at a rate assessed each year by the Office of applicable plan. In accordance with IRS regulations effective the State Budget, 5.33% of annual covered payroll for 2017 and January 1, 2009, Clemson University adopted a 403b plan 2016. The IB sets the employer contribution rate based on a document. Under the plan, loans and financial hardship pay-as-you-go basis. Clemson University paid approximately distributions are permitted. Fifteen years of service catch-up $18,487,843 and $16,371,391 applicable to the surcharge contributions are not permitted. included with the employer contribution for retirement benefits for the fiscal years ended June 30, 2017 and 2016, respectively. BLTD benefits are funded through a person’s premium charged to State agencies, public school districts, and other participating local governments. The monthly premium per active employee paid to IB was $3.22 for the fiscal years ended June 30, 2017 and 2016. Clemson University recorded

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NOTE 11. LONG-TERM LIABILITIES Long-term liability activity for the year ended June 30, 2017 was as follows:

Long-Term Liabilities

Due Within Description July 1, 2016 Additions Reductions June 30, 2017 One Year Bonds payable and capital lease obligations: General obligation bonds $ 104,435,000 $ 52,395,000 $ 6,480,000 $ 150,350,000 $ 6,950,000 Revenue bonds 295,600,000 — 6,395,000 289,205,000 8,155,000 Athletic facilities revenue bonds 134,450,000 — 3,845,000 130,605,000 4,005,000 Subtotal bonds payable 534,485,000 52,395,000 16,720,000 570,160,000 19,110,000 Unamortized revenue bond premium 33,984,038 4,405,478 2,292,558 36,096,958 2,292,558 Total bonds payable 568,469,038 56,800,478 19,012,558 606,256,958 21,402,558 Capital leases payable 12,967,171 — 977,454 11,989,717 708,862 Total bonds and capital leases payable 581,436,209 56,800,478 19,990,012 618,246,675 22,111,420

Other liabilities: Accrued compensated absences 28,956,000 10,647,585 14,032,585 25,571,000 14,967,394 Funds held for others 7,751,177 — 37,165 7,714,012 — Net pension liability 509,741,860 117,199,052 53,772,358 573,168,554 — Total other liabilities 546,449,037 127,846,637 67,842,108 606,453,566 14,967,394 Total long-term liabilities $ 1,127,885,246 $ 184,647,115 $ 87,832,120 $ 1,224,700,241 $ 37,078,814

Additional information regarding Bonds and Notes Payable is included in Note 6. Additional information regarding Capital Lease Obligations is included in Note 7. The balance in the long-term liability account “Funds held for others” represents the Federal liability for the Perkins Loan program and longevity incentives for athletic coaches.

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NOTE 12. CONSTRUCTION COSTS AND COMMITMENTS Capitalized The University has obtained or has plans to obtain the necessary funding for the acquisition, construction, renovation, and equipping of certain facilities which will be capitalized in the applicable capital asset categories upon completion. Management estimates that the University has sufficient resources available and/or future resources identified to satisfactorily complete the construction of such projects which are expected to be completed in varying phases over the next 2 or 3 years at an estimated cost of $874,227,034. The $874,227,034 includes estimated costs of $412,451,848 for capital projects currently in progress plus $461,775,186 estimated costs for other capital projects already in service. Of the total estimated cost, $236,276,611 was unexpended at June 30, 2017. Of the total expended through June 30, 2017, the University has capitalized substantially complete and in use projects in the amount of $411,462,783. Of the unexpended balance the University has remaining commitment balances of $58,110,635 with certain property owners, engineering firms, construction contractors, and vendors related to these projects. Retainages payable on these capitalized projects as of June 30, 2017 was $6,796,473 Capital projects at June 30, 2017 which constitute construction in progress that are to be capitalized when completed are listed below.

Construction Costs and Commitments

Approximate Amount Project Cost Expended College of Business School Construction $ 87,500,000 $ 1,960,952 Douthit Hills development 227,892,375 182,411,161 125,000 28,571 Electrical distribution upgrade 75,290,932 3,827,434 DukeElectrical Innovation infrastructure Building maintenance upfit and improvements 1,118,674 1,118,674 Fike Natatorium sauna and steam 615,800 164,030 Football Operations facility construction 492,900 144,064 Garrison Arena construction 1,000,000 84,405 IPTAY Center expansion & renovation 10,000,000 150,426 Jervey Championship Plaza 746,600 132,654 Outdoor Fitness Wellness construction 312,500 400 Parking lot expansion, R06 978,200 929,318 Parking lot expension, R-1 461,500 143,028 Ravenel gravity sewer line 588,300 119,338 Ravenel Hugo McGregor parking lot 917,500 67,636 Recycle operations 500,000 73,994 Sanitary sewer infrastructure 998,000 860,107 Tennis facility 312,500 203,596 Transformer and switch gear replacement 353,400 292,027 999,900 895,199 Total construction costs and commitments $ 411,204,081 $ 193,607,014 Watt Family Innovation Center/fourth floor

The amount expended includes only capitalized project expenses and capitalized interest on construction debt for projects less than substantially complete and not in service at June 30, 2017. No noncapitalized expenditures are included in these totals.

Non-Capitalized At June 30, 2017 the University had in progress other capital projects which will not be capitalized when complete. These projects are for replacements, repairs, and/or renovations to existing facilities. Estimated costs on these non-capitalized projects total $83,556,153. This amount includes costs incurred to date of $47,607,298 and estimated costs to complete of $35,948,855. The University has remaining commitment balances with certain parties related to these projects of $8,480,866. Retainages payable on the non-capitalized projects as of June 30, 2017, was $165,997. The University anticipates funding these projects out of current resources, current and future bond issues, state capital improvement bond proceeds, private gifts and student fees.

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NOTE 13. Clemson University Continuing Education and RELATED PARTIES Conference Complex Corporation Certain separately chartered legal entities whose activities The Clemson University Continuing Education and are related to those of the University exist primarily to provide Conference Complex Corporation (Finance Corporation), is financial assistance and other support to the University and its a separately chartered corporation established in September, educational program. 1993, to construct, operate and manage the golf course and hotel The activities of these entities are not included in the components of the Clemson University Continuing Education University’s financial statements. However, the University’s and Conference Complex. The Finance Corporation’s actions statements include transactions between the University and its are governed by its Board of Directors. The University billed related parties. the Finance Corporation $179,949 for salaries for time devoted In accordance with Governmental Accounting Standards by University employees to the Finance Corporation. Board (GASB) Codification Sections 2100, Defining the Financial Reporting Entity, and Section 2600, Reporting Entity Clemson Advancement Foundation for Design and and Component Unit Presentation and Disclosure, management Building annually reviews its relationships with the related parties The Clemson Advancement Foundation for Design and described in this note. The University excluded these related Building (CAFDB) is a separately chartered eleemosynary parties from the reporting entity because it is not financially corporation established to support and enrich the professional accountable for them. programs in the College of Architecture, Arts and Humanities. Following is a more detailed discussion of each of these CAFDB’s actions are governed by its Board of Trustees. entities and a summary of significant transactions (if any) The University’s financial statements reflect $573,195 in between these entities and Clemson University. expenses primarily to reimburse CAFDB for administrative, educational, and facilities expenses incurred at the Charles Clemson University Real Estate Foundation E. Daniel Center for Building Research and Urban Studies in The Clemson University Real Estate Foundation, Inc., Genoa, Italy, which is owned by CAFDB, and at the Barcelona is a separately chartered entity organized to hold, and invest facility, which is operated for the University by CAFDB. acquired real estate property. The Real Estate Foundation’s actions are governed by its Board of Directors. This entity had no transactions with the University and did not significantly require the time or service of any University employees.

NOTE 14. TRANSACTIONS WITH STATE ENTITIES The University is granted an annual appropriation for operating purposes as authorized by the General Assembly of the State of South Carolina. State appropriations are recognized as revenue when received and available. Amounts that are not expended by fiscal year-end lapse and are required to be returned to the General Fund of the State unless the University receives authorization from the General Assembly to carry the funds over to the next year. The original appropriation is the University's base budget amount presented in the General Funds column of Sections 14 and 45 of Part IA of the 2016-17 Appropriation Act. The following is a reconciliation of the original appropriation as enacted by the General Assembly to state appropriations revenue reported in the financial statements for the fiscal year ended June 30, 2017:

State Appropriations

Educational Public Description and General Service Total Original appropriation $ 77,291,817 $ 36,511,692 $ 113,803,509 Allocation for health and dental plan contributions 365,054 144,890 509,944 Allocation for 0.5% SCRS and POS retirement contributions 269,532 124,790 394,322 Allocation for cost of living adjustment - salary and fringe 2,104,724 974,466 3,079,190 One-time operations funding — 500,000 500,000 Appropriation allocations from the State Commission on Higher Education: For Academic Endowment Match 31,939 — 31,939 For Clemson Agriculture Education Teachers - teacher recruitment — 989,758 989,758 Total state appropriations $ 80,063,066 $ 39,245,596 $ 119,308,662

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The University received substantial funding from the Commission on Higher Education (“CHE”) for scholarships on behalf of students that are accounted for as operating state grants and contracts. Additional amounts received from CHE are accounted for as both operating and nonoperating revenues, depending upon the requirement of deliverables with a current or potential future economic value. The University also receives State funds from various other State agencies for sponsored research and public service projects. Following is a summary of amounts received from State agencies for scholarships, sponsored research, capital and public service projects for the fiscal year ended June 30, 2017:

Other Amounts Recognized from State Agencies

Capital and Operating Nonoperating Endowment Description Revenues Revenues Proceeds Total Received from the Commission on Higher Education (CHE): LIFE Scholarships $ 29,087,010 $ — $ — $ 29,087,010 Palmetto Scholarships 26,128,556 — — 26,128,556 Need-Based Grants 2,303,105 — — 2,303,105 HOPE Scholarships 86,800 — — 86,800 Received from the Department of Education - STEM 1,750,000 — — 1,750,000 Received from the Department of Education - Other 750,624 — — 750,624 Received from various other state agencies 1,557,308 — — 1,557,308 Received from agencies outside South Carolina 391,827 — — 391,827 Proviso 118.16 Agricultural and Natural Resources Facilities — — 4,100,000 4,100,000 Research infrastructure bond proceeds — — 140,195 140,195 Capital reserve fund proceeds — — 1,000,000 1,000,000 Total other amounts recognized from state agencies $ 62,055,230 $ — $ 5,240,195 $ 67,295,425

The University provided no significant services free of employees to the Employment Security Commission and charge to any State agency during the fiscal year; however, State Accident Fund. The amounts of 2017 expenditures the University did provide computer services and information applicable to related transactions with state entities are not systems development for a fee to other State agencies during readily available the fiscal year. Total fees received were $39,642,262, comprised of $594,129 in fees for computer services classified as other operating revenues, and $39,048,133 in information NOTE 15. and systems development fees classified as sales and services of auxiliary enterprises. RISK MANAGEMENT The University is exposed to various risks of loss and Also, the University collected and remitted $8,416 in maintains State or commercial insurance coverage for each of pesticide penalties and other fees to the State General Fund. those risks. Management believes such coverage is sufficient to Services received at no cost from State agencies include preclude any significant uninsured losses for the covered risks. maintenance of certain accounting records by the Comptroller There were no significant reductions in insurance coverage General; banking, bond trustee and investment services from from coverage in the prior year. The costs of settled claims the State Treasurer; legal services from the Attorney General; have not exceeded this coverage in any of the past three years. and grants services from the Governor's Office. The University pays insurance premiums to certain other State Other services received at no cost from the various agencies and commercial insurers to cover risks that may occur offices of the State Budget and Control Board include pension in normal operations. The insurers promise to pay to or on plan administration, insurance plans administration, audit behalf of the insured for covered economic losses sustained services, personnel management, assistance in the preparation during the policy period in accord with insurance policy and of the State Budget, review and approval of certain budget benefit program limits. amendments, procurement services, and other centralized State management believes it is more economical to functions. manage certain risks internally and set aside assets for claim The University had financial transactions with various settlement. Several State funds accumulate assets and the State State agencies during the fiscal year. Significant payments itself assumes substantially all risks for the following: were made to divisions of the State Budget and Control Board for pension and insurance plans employee and (1) Claims of State employees for unemployment employer contributions, insurance coverage, office supplies, compensation benefits (Employment Security and interagency mail. Significant payments were also made Commission); for unemployment and workers' compensation coverage for

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(2) Claims of covered employees for workers’ In addition, the Vice President for Finance and Operations compensation benefits for job-related illnesses or is covered for $250,000 under a specific public official injuries (State Accident Fund); bond. Manager Cash & Treasury Services, Controller, VP (3) Claims of covered public employees for health for Finance and Operations, President and CEO for Clemson and dental insurance benefits (Office of Insurance University Foundation, Chief Financial Officer and Treasurer Services); and for Clemson University Foundation, Senior Financial Analyst (4) Claims of covered public employees for long-term and Project Manager for Clemson University Foundation, disability and group-life insurance benefits (Office Director of Student Financial Services are each covered under of Insurance Services). a $2,000,000 bond. The University has recorded insurance premium expenses Employees elect health coverage through either a health and expenses for deductibles in applicable functional expense maintenance organization or through the State’s self-insured categories. plan. All of the other coverages listed above are through The University has not transferred the portion of the risk the applicable State self-insured plan except dependent and of loss related to insurance policy deductibles, and policy optional life premiums are remitted to commercial carriers. limits for all coverage to a State or commercial insurer. The University and other entities pay premiums to the The University has not reported an estimated claims loss State’s Insurance Reserve Fund (IRF) which issues policies, expenditure, and the related liability at June 30, 2017, based accumulates assets to cover the risks of loss, and pays claims on the requirements of GASB Statement’s No. 10 and No. 30, incurred for covered losses related to the following University which state that a liability for claims must be reported only assets, activities, and/or events: if information prior to issuance of the financial statements indicates that it is probable that an asset has been impaired or (1) Theft of, damage to, or destruction of assets; a liability has been incurred on or before June 30, 2017, and (2) Real property, its contents, and other equipment; the amount of the loss is reasonably estimable. (3) Motor vehicles, aircraft, and watercraft (inland In management’s opinion, claims losses in excess of marine); insurance coverage are unlikely and, if incurred, would (4) Torts; be insignificant to the University’s financial position. (5) Business interruptions; Furthermore, there is no evidence of asset impairment or other (6) Natural disasters; and information to indicate that a loss expenditure and liability (7) Medical malpractice claims against covered infirmaries should be recorded at year-end. Therefore no loss accrual has and employees. been recorded.

The IRF is a self-insurer and purchases reinsurance to Enterprise Risk Management Initiative obtain certain services and specialized coverage and to limit Clemson University engages in an Enterprise Risk losses in the areas of property, boiler and machinery, automobile Management (ERM) program defined by The Committee of liability, and medical professional liability insurance. Also, Sponsoring Organizations (COSO) as a “process, effected by the IRF purchases reinsurance for catastrophic property and an entity’s board of directors, management and other personnel, medical professional liability insurance. Reinsurance permits applied in strategy-setting and across the enterprise, designed partial recovery of losses from reinsurers, but the IRF remains to identify potential events that may affect the entity, and primarily liable. The IRF purchases insurance for aircraft manage risk to be within its risk appetite, to provide reasonable and ocean marine coverage. The IRF’s rates are determined assurance regarding the achievement of entity objectives”. actuarially. The Board of Trustees ensures appropriate ERM framework State agencies and other entities are the primary is in place and functional to appropriately manage risks at participants in the State’s Health and Disability Insurance Fund an enterprise level. The President and Executive Leadership and in the IRF. Team establishes and manages the framework for a sustainable The University obtains coverage through commercial enterprise risk management process. The University’s ERM insurers for employee fidelity bond insurance. All employees process incorporates the fundamentals of risk identification, are covered for $1,000,000 for Commercial Crime. This risk assessment, risk treatment, risk monitoring and risk review. coverage includes the following:

(1) Blanket employee dishonesty; (2) Forgery/alterations; (3) Theft, disappearance of money and security; (4) Computer fraud; and (5) Faithful Performance of duty

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NOTE 16. CONTINGENCIES AND LITIGATION The University is involved in a number of legal proceedings and claims with various parties which arose in the normal course of business and cover a wide range of matters. Because, in the opinion of management and counsel, the risk of material loss in excess of insurance coverage for these items is remote, the outcome of the legal proceedings and claims is not expected to have a material effect on the financial position of the University. Therefore, an estimated liability has not been recorded. The various federal programs administered by the University for fiscal year 2017 and prior years are subject to examination by the federal grantor agencies. At the present time, amounts, if any, which may be due federal grantors have not been determined but the University believes that any such amounts in the aggregate would not have a material adverse effect on the financial position of the University. Therefore, an estimated loss has not been recorded. The University settled a legal (condemnation) action with a division of the SC Commerce Department concerning land at the site of the Clemson University Restoration Institute (CURI) in North Charleston. The University has no further contingencies or liability related to this action.

NOTE 17. OPERATING EXPENSES BY FUNCTION Operating expenses by functional classification for the year ended June 30, 2017 are summarized as follows:

Operating Expenses by Function

Compensation Services Scholarships and Employee and and Description Benefits Supplies Utilities Depreciation Fellowships Total Instruction $ 215,595,109 $ 29,367,287 $ 1,330,972 $ — $ 462,788 $ 246,756,156 Research 106,528,598 47,731,362 1,834,145 — 1,390,815 157,484,920 Public Service 48,228,804 18,829,190 1,705,223 — — 68,763,217 Academic Support 52,010,828 837,239 849,996 — 25,000 53,723,063 Student Services 26,008,691 14,273,999 357,227 — 38,749 40,678,666 Institutional Support 33,284,873 7,776,344 319,721 — — 41,380,938 Operation and Maintenance 17,837,406 45,242,222 5,362,230 — — 68,441,858 of Plant Scholarships and Fellowships 12,793 104,179 — — 25,350,287 25,467,259 Auxiliary Enterprises 57,029,988 101,596,472 7,970,541 — 1,600 166,598,601 Depreciation — — — 51,759,019 — 51,759,019 Total Operating Expenses by Function $ 556,537,090 $ 265,758,294 $ 19,730,055 $ 51,759,019 $ 27,269,239 $ 921,053,697

NOTE 18. DONOR-RESTRICTED ENDOWMENTS If a donor has not provided specific instructions, state law permits the Board of Trustees to authorize for expense the net appreciation (realized and unrealized) of the investments of endowment funds. Any net appreciation that is spent is required to be spent for the purposes for which the endowment was established. In accordance with the spending policy adopted by the Clemson University Board of Trustees in 1998, endowment-derived program expenses are based on the endowment carrying value from the previous year at a percentage set by the Board. For fiscal year 2017, this rate was 4.0%. At June 30, 2017, net appreciation gains of $16,739,546 were recorded, and were reported in the Statement of Net Position as unrestricted.

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NOTE 19. DETAILS OF RESTRICTED ASSETS The purposes and amounts of Restricted Assets are as follows:

Details of Restricted Assets

Description Amount Current: Cash and cash equivalents: $ 18,088,047 University administered loans 312,705 PaymentAs specified of maturing by sponsors/donors debt 12,944,303 Unspent bond proceeds 117,029,281 Amounts restricted for capital projects 106,910,247 Funds held for others 666,145 Total of current restricted assets $ 255,950,728

Noncurrent: Cash and cash equivalents: Endowments $ 16,038,583 Federal Perkins Loan Program 2,020,585 Total of noncurrent restricted cash and cash equivalents $ 18,059,168

Student Loans Receivable: Total Federal Perkins Loan Program $ 7,463,904

NOTE 20. approximately $1,724,401 for University building projects. COMPONENT UNITS As referenced in Note 3, a 1999 amendment to the South Carolina Code of Laws allowed state-supported universities to Clemson University Foundation lend endowment balances on deposit with the State Treasurer The Clemson University Foundation (CUF) is a separately to entities (like CUF) whose existence is primarily providing chartered corporation organized exclusively to promote financial assistance and other support to the institution and its the development and welfare of Clemson University in its educational program. At fiscal year end, the amount loaned, educational and scientific purposes. including income and appreciation, totaled $198,902,686. As discussed in Note 1, CUF has been included in the CUF charges an annual fee of 1.25 percent for managing reporting entity as a component unit. Because CUF is deemed the University’s endowments. For the fiscal year ending June not to be a governmental entity and uses a different reporting 30, 2017, the management fee was $1,944,452, net of current model, its balances and transactions are reported on separate year income, gains and appreciation $22,868,624. At fiscal financial statements. year-end, $487,837 in accounts payable was due to CUF. CUF transfers funds earmarked from private contributions CUF investment securities and donated negotiable assets to the University to support University scholarship, fellowship, are stated at fair value as determined by quoted market prices. professorship, and research programs and to reimburse the Real estate investments are stated primarily at the current University for any purchases made by CUF. These transfers appraised value. for fiscal year 2017 were recorded by the University as CUF investment income, net of external and internal nonoperating gift revenues totaling $18,370,103. CUF also management expenses and fees, and gains and losses arising reimbursed the University $946,903 for salaries for time from the sale or other disposition of investments and other devoted by University employees to CUF and to fund other noncash assets is distributed to the various endowments using University initiatives. a pooled income approach. This approach distributes income CUF has two operating leases with the University and paid following the market value unit method, which is based on the a total of $140,165 for office space during fiscal year 2017. number of units each fund owns in the managed investment Equipment donated by CUF to the University totaled $142,239 pool. and was recorded as capital grants and gifts in the Statement CUF Endowment and board-designated funds are invested of Revenues, Expenses and Changes in Net Position. Also on the basis of a total return policy to provide income and to recorded as capital grants and gifts upon receipt were CUF realize appreciation in investment values. Under this policy, donations totaling $4,095,890 for University building projects. earnings, not to exceed a specified percentage, could be used As of June 30, 2017, CUF had remaining commitments of to support the intended purposes. Any such earnings used to

~ 66 ~ NOTES TO FINANCIAL STATEMENTS support the intended purposes are allocated only from those deemed not to be a governmental entity and uses a different funds which have a market value in excess of historical value. reporting model, its balances and transactions are reported on A summary of investments at fair value at June 30, 2017 separate financial statements. follows: The University leases and utilizes several facilities owned and operated by CULSF at the Greenville, CU-ICAR campus. In addition, the University entered into a capital Investments lease with CULSF for space in the Greenville One Building

Description Amount in downtown Greenville. For the fiscal year ending June 30, Money market funds $ 28,526,012 2017, $304,393 was paid by the University to CULSF for Treasury/agency 50,176,074 common area maintenance costs and $1,270,717 for operating Mortgage backed securities 9,091,621 leases at the CU-ICAR campus. An additional $524,293 was Corporate bonds 10,724,913 International bonds 858,329 paid in building upfit costs for space that will be leased by U.S. Equities 309,746,771 the University. Capital lease-related principal, interest, and Global equities 108,774,643 operating expense payments totaling $897,513 were paid to Commodities 5,530,518 Hedge funds 91,640,237 CULSF for the Greenville One building. Private equity 45,996,847 CULSF reimbursed the University $180,967 for salaries Private real assets 10,166,496 for time devoted by University employees to CULSF. Public real assets 807,680 Other 2,009,354 Subtotal - marketable investments 674,049,495 IPTAY Subordinated note receivable from Clemson IPTAY is a separately chartered corporation established University Real Estate Foundation, Inc. 20,000,000 exclusively to support University athletics. IPTAY’s activities Total Investments $ 694,049,495 are governed by its Board of Directors. As discussed in Note 1, IPTAY has been included in the reporting entity as a component unit. Because IPTAY is Clemson University Research Foundation deemed not to be a governmental entity and uses a different The Clemson University Research Foundation (CURF) reporting model, its balances and transactions are reported on is a separately chartered corporation established to solicit separate financial statements. research grants and contracts, then contract the University to In the fiscal year beginning July 1, 2014, IPTAY began perform the research. CURF’s activities are governed by its operating as an independent entity. Previously, although Board of Directors. recognized as a tax-exempt organization by the Internal As discussed in Note 1, CURF has been included in the Revenue Service, all IPTAY receipts were deposited through reporting entity as a component unit and is discretely presented the University into State Treasurer bank accounts and related in the financial statements. disbursements were also made from these accounts. During The University performs research and development under the fiscal year ended June 30, 2017, IPTAY contributed performance agreements for CURF, and receives payment for $75,757,202 to the University for qualifying athletic all direct and indirect costs which are incurred in accordance scholarships, operating expenses, capital project funding, and with the terms of the performance agreements. Revenues debt service obligations. An additional $40,000 of IPTAY totaling $786,358 from CURF were recorded by the University funds remains in a CUF held endowment for future use by the in the Statement of Revenues, Expenditures and Changes University. At June 30, 2017, the Statement of Net Position in Net Position as operating nongovernmental grants and includes accounts receivable from IPTAY of $1,374,549 in contracts. Grants and contracts receivable in the Statement deferred ticket sales and $152,218 in expense reimbursements. of Net Position include $147,800 due from CURF at June 30, At June 30, 2017, $2,400 in accounts payable was due to 2017. IPTAY. The University remitted $315,000 to CURF per the operating agreement between the two entities. CURF reimbursed the University $98,105 for salaries for time devoted by University employees to CURF.

Clemson University Land Stewardship Foundation The Clemson University Land Stewardship Foundation (CULSF) is a separately chartered corporation established to serve the needs of Clemson University in the management, development, and investment of real property and related assets. CULSF’s activities are governed by its Board of Directors. As discussed in Note 1, CULSF has been included in the reporting entity as a component unit. Because CULSF is

~ 67 ~ NOTE 21. SUBSEQUENT EVENTS On August 24, 2017, the State Treasurer’s Office finalized the issuance of General Obligation State Institution Bonds on behalf of Clemson University to defray the costs of constructing and equipping an academic facility to house the University’s College of Business and to refund the outstanding principal amount of Series 2011B General Obligation State Institution bonds. The Clemson University Board of Trustees adopted a series resolution authorizing issuance of bonds for the proposed refunding of Series 2011B bonds on July 15, 2016. The series resolution authorizing issuance of bonds for the proposed College of Business academic building was adopted on February 3, 2017. The $120,885,000 bond issue includes $75,005,000 for the College of Business project and $45,880,000 to refund the Series 2011B bonds.

~ 68 ~ REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF THE UNIVERSITY'S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY

South Carolina Retirement System (SCRS) University’s Plan Fiduciary Net University’s University’s Covered Employee University’s Proportionate Position as a Proportionate Proportionate Payroll During the Share of the Net Pension Percentage of the For the Share of the Net Share of the Net Measurement Liabillity as a Percentage Total Pension Year Pension Liabillity Pension Liability Period of its Covered Payroll Liability 2017 2.649480% $ 565,925,016 $ 336,425,269 168.22% 52.90% 2016 2.657194% 503,949,653 326,390,137 154.40% 56.99% 2015 2.601067% 447,817,506 308,864,854 144.99% 59.92% 2014 2.601067% 441,495,608 292,367,473 151.01% 56.39%

Police Officers Retirement System (PORS) University’s Plan Fiduciary Net University’s University’s Covered Employee University’s Proportionate Position as a Proportionate Proportionate Payroll During the Share of the Net Pension Percentage of the For the Share of the Net Share of the Net Measurement Liabillity as a Percentage Total Pension Year Pension Liabillity Pension Liability Period of its Covered Payroll Liability 2017 0.28558% $ 7,243,538 $ 3,716,102 194.92% 60.40% 2016 0.26576% 5,792,207 3,358,977 172.44% 64.57% 2015 0.26743% 5,119,734 3,238,913 158.07% 67.55% 2014 0.26743% 5,127,588 2,973,675 172.43% 62.98%

~ 69 ~ REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF UNIVERSITY CONTRIBUTIONS

South Carolina Retirement System (SCRS) Contributions Contributions as a Statutorily Required Recognized by the Contribution University’s Covered Percentage of Covered For the Year Contribution Plan Deficiency (excess) Payroll Payroll 2017 $ 31,566,642 $ 31,566,642 $ — $ 359,507,113 8.78% 2016 28,386,836 28,376,288 10,548 336,425,269 8.44% 2015 27,147,096 27,156,699 (9,603) 326,390,137 8.32% 2014 25,031,158 25,031,158 — 308,864,854 8.10% 2013 24,089,283 24,089,283 — 292,367,473 8.24% 2012 19,221,300 19,221,300 — 263,508,916 7.29% 2011 18,869,713 18,869,713 — 258,961,093 7.29% 2010 19,245,843 19,245,843 — 263,089,467 7.32% 2009 19,549,484 19,549,484 — 264,118,753 7.40% 2008 19,163,400 19,163,400 — 262,969,373 7.29%

Police Officers Retirement System (PORS) Contributions Contributions as a Statutorily Required Recognized by the Contribution University’s Covered Percentage of Covered For the Year Contribution Plan Deficiency (excess) Payroll Payroll 2017 $ 564,457 $ 564,457 $ — $ 3,991,757 14.14% 2016 500,233 500,233 — 3,716,102 13.46% 2015 441,480 441,508 (28) 3,358,977 13.14% 2014 412,997 412,997 — 3,238,913 12.75% 2013 364,346 364,346 — 2,973,675 12.25% 2012 275,212 275,212 — 2,343,277 11.74% 2011 247,568 247,568 — 2,143,665 11.55% 2010 242,692 242,692 — 2,193,276 11.07% 2009 253,222 253,222 — 2,292,453 11.05% 2008 251,269 251,269 — 2,338,698 10.74%

~ 70 ~ Statistical Section (unaudited) [THIS PAGE INTENTIONALLY LEFT BLANK] Statistical Section This section of the Comprehensive Annual Financial Report provides additional information as a context for understanding what the information in the financial statements and note disclosures says about the University’s and the State of South Carolina’s overall financial health.

Contents Page

Financial Trends 74 These schedules contain trend information to help the reader understand how the University’s financial performance and well-being have changed over time. Debt Capacity 79 These schedules present information to help the reader assess the affordability of the University’s current levels of outstanding debt and the University’s ability to issue additional debt in the future. Operating Information 82 These schedules contain service and capital asset data to help the reader understand how the information in the University’s financial report relates to the services the University provides and the activities it performs. Demographic and Economic Information 88 These schedules offer demographic and economic indicators to help the reader understand the environment within which the University’s and the State’s financial activities take place.

~ 73 ~ 0 799 1,389 8,462 (7,046) 79,159 56,165 43,414 11,177 16,268 14,186 25,013 44,466 167,224 228,681 420,525 2007-08 $ 188,530 $ 649,206 872 715 1,944 10,029 86,282 59,205 47,248 11,700 16,543 12,317 21,671 46,872 (20,283) 128,279 179,873 449,009 2008-09 $ 205,488 $ 628,882 57 959 3,192 8,727 10,085 12,408 89,129 63,792 48,683 15,917 11,269 28,851 59,473 114,120 210,604 479,094 2009-10 $ 223,036 $ 689,698 757 502 137 6,913 7,752 22,236 91,917 95,096 65,045 50,679 15,843 11,744 27,396 68,797 203,085 514,653 2010-11 $ 252,924 $ 717,738 690 636 1,271 8,226 6,948 (1,114) 88,780 63,962 46,868 15,845 11,507 27,771 59,126 167,154 106,181 539,214 2011-12 $ 269,671 $ 706,368 796 458 310 9,446 1,073 92,784 64,467 51,377 17,203 10,948 31,372 56,403 14,744 176,720 114,618 578,057 2012-13 $ 288,778 $ 754,777 For the Year Ended June 30, Ended Year For the (amounts expressed in thousands) (amounts expressed 376 648 1,640 3,077 99,591 62,079 53,189 11,174 18,778 10,566 34,840 62,951 23,664 200,873 121,927 604,338 2013-14 $ 300,711 $ 805,211 882 188 340 670 4,086 63,540 57,352 11,223 20,104 11,338 38,322 33,586 156,553 129,119 106,345 637,435 2014-15 $ 316,893 $ 793,988 78 912 252 4,071 (2,979) 71,500 58,828 12,844 20,441 11,632 31,638 48,189 170,055 163,635 108,812 700,875 2015-16 $ 341,077 $ 870,930 330 1,772 1,397 3,700 81,924 62,055 11,616 21,303 12,240 34,037 67,552 19,955 224,483 169,527 119,309 746,360 2016-17 $ 364,126 $ 970,843 (net of scholarship allowances) (net of scholarship allowances)

Federal grants and contracts grants Federal Student tuition and fees Student tuition and fees Federal appropriations Federal State grants and contracts grants State and contracts grants Nongovernmental Other nonoperating revenues Other nonoperating assets the sale of capital from Proceeds Other operating revenues Other operating appropriations State Gifts and grants Local grants and contracts Local grants Interest income Interest income (loss) Endowment Sales and services of educational and Sales and services of educational enterprises Sales and services of auxiliary

Revenues: Total nonoperating revenues nonoperating Total

activities other

Total operating revenues operating Total Total revenues Total SCHEDULE OF REVENUES BY SOURCE BY OF REVENUES SCHEDULE

~ 74 ~ 8.7% 6.7% 0.1% 1.7% 2.5% 3.9% 2.2% 6.8% 1.3% 0.2% 0.0% (1.1)% 29.0% 12.2% 64.8% 25.8% 35.2% 2007-08 100.0% 9.4% 7.5% 0.1% 1.9% 2.6% 3.4% 2.0% 7.5% 1.6% 0.3% 0.1% (3.2)% 32.7% 13.7% 71.3% 20.4% 28.7% 100.0% 2008-09 9.2% 7.1% 0.1% 1.3% 2.3% 4.2% 1.6% 8.6% 1.8% 1.5% 0.5% 0.1% 32.3% 12.9% 69.4% 16.5% 30.6% 100.0% 2009-10 9.1% 7.1% 0.1% 1.0% 2.2% 3.8% 1.6% 9.6% 1.1% 3.1% 0.1% 0.0% 35.2% 13.2% 71.7% 12.8% 28.3% 2010-11 100.0% 0.1% 1.2% 2.2% 3.9% 1.6% 8.4% 1.0% 0.2% 0.1% 9.1% 6.6% (0.2)% 38.2% 15.0% 76.3% 12.6% 23.7% 100.0% 2011-12 0.1% 1.3% 2.3% 4.2% 1.5% 7.4% 0.1% 0.0% 0.1% 8.5% 6.8% 2.0% 38.2% 15.2% 76.6% 12.3% 23.4% 2012-13 100.0% (percent of total revenues) For the Year Ended June 30, Year For the 0.2% 1.4% 2.3% 4.3% 1.3% 7.8% 0.4% 0.1% 0.0% 7.7% 6.6% 2.9% 37.4% 15.1% 75.0% 12.5% 25.0% 100.0% 2013-14 0.1% 1.4% 2.5% 4.8% 1.4% 4.2% 0.1% 0.0% 0.0% 8.0% 7.2% 0.5% 40.0% 16.3% 80.3% 13.5% 19.7% 2014-15 100.0% 0.1% 1.5% 2.3% 3.6% 1.3% 5.5% 0.4% 0.0% 0.0% 8.2% 6.8% (0.3)% 39.3% 18.8% 80.6% 12.5% 19.4% 100.0% 2015-16 0.2% 1.2% 2.2% 3.5% 1.3% 7.0% 0.4% 2.1% 0.0% 0.1% 8.4% 6.4% 17.5% 76.8% 12.3% 23.2% 37.4% 100.0% 2016-17 (net of scholarship allowances) of scholarship (net enterprises Endowment income (loss) Endowment revenues Other nonoperating capital assets the sale from Proceeds revenues Total Sales and services of auxiliary revenues Other operating appropriations State appropriations Federal Gifts and grants income Interest Student tuition and fees Student tuition and fees and contracts grants Federal and contracts grants State and contracts Local grants and contracts grants Nongovernmental and Sales and services of educational revenues nonoperating Total allowances) revenues operating Total activities other Revenues: Clemson University Comprehensive Annual Financial Reports. Source: Clemson University Comprehensive

~ 75 ~ 443 386 710 8,735 7,196 0.1% 2.8% 5.0% 1.6% 1.1% 0.1% 0.1% 1.4% 17,951 32,697 10,845 62.2% 27.0% 98.6% 174,642 638,736 2007-08 100.0% 2007-08 $ 402,601 $ 647,471 802 213 608 8,260 6,637 19,376 33,364 13,382 0.1% 3.1% 5.3% 2.1% 1.1% 0.0% 0.1% 1.3% 158,556 619,386 62.9% 25.3% 98.7% 2008-09 2008-09 100.0% $ 394,708 $ 627,646 95 464 185 6,543 9,175 5,799 17,733 35,164 0.1% 2.8% 5.6% 1.5% 0.9% 0.0% 0.0% 1.0% 174,958 622,549 61.3% 27.8% 99.0% 2009-10 2009-10 100.0% $ 385,519 $ 629,092 791 296 450 7,571 6,034 0.1% 2.6% 5.4% 3.6% 0.9% 0.0% 0.1% 1.1% 17,013 35,009 23,402 59.2% 28.1% 98.9% 182,049 640,262 2010-11 2010-11 100.0% $ 382,789 $ 647,833 381 386 8,821 5,799 2,255 0.3% 2.5% 5.6% 3.1% 0.9% 0.1% 0.1% 1.4% 16,946 37,162 20,942 57.6% 29.8% 98.6% 198,747 658,500 2011-12 2011-12 100.0% $ 384,703 $ 667,321 254 515 339 6,983 5,875 0.0% 2.5% 4.5% 3.7% 0.8% 0.1% 0.0% 0.9% 17,961 32,715 26,380 58.0% 30.4% 99.1% 219,962 716,683 2012-13 100.0% 2012-13 $ 419,665 $ 723,666 (percent of total expenses) For the Year ended June 30, ended Year For the For the Year Ended June 30, Year For the (amounts expressed in thousands) (amounts expressed 178 413 4,903 5,512 (1,200) 20,344 42,974 23,846 2.6% 5.5% 3.1% 0.7% 0.0% 0.1% 0.6% (0.2)% 243,893 775,970 57.0% 31.2% 99.4% 2013-14 2013-14 100.0% $ 444,913 $ 780,873 137 375 7,341 4,343 5.8% 3.0% 0.9% 0.5% 0.0% 0.0% 1.4% 2.3% 12,196 19,783 49,316 25,411 56.5% 31.0% 98.6% 262,955 836,456 2014-15 2014-15 100.0% $ 478,991 $ 848,652 71 340 450 5.6% 3.1% 1.9% 0.0% 0.0% 0.1% 2.0% 2.1% 17,952 18,910 49,872 27,726 17,091 57.3% 29.9% 98.0% 267,423 877,332 2015-16 100.0% 2015-16 $ 513,401 $ 895,284 317 120 1,965 5.5% 2.9% 2.3% 0.2% 0.0% 0.0% 2.5% 2.1% 23,873 19,730 51,759 27,269 21,471 97.5% 58.9% 28.1% 265,758 921,053 2016-17 100.0% 2016-17 $ 944,926 $ 556,537 remittances to the State to remittances remittances to the State to remittances Refunds to grantors to Refunds administrative and Facilities Services and supplies Scholarships and fellowships debt on capital asset related Interest capital of assets on disposal loss (Gain) Interest on capital asset related debt on capital asset related Interest capital assets (Gain) loss on disposal of grantors to Refunds and administrative Facilities Services and supplies Scholarships and fellowships Total expenses Total Expenses: Total expenses Total expenses nonoperating Total benefits Compensation and employee Utilities Depreciation expenses operating Total Total operating expenses operating Total expenses nonoperating Total benefits Compensation and employee Utilities Depreciation Expenses: : Clemson University Comprehensive Annual Financial Reports. Source: Clemson University Comprehensive SCHEDULE OF EXPENSES BY USE BY OF EXPENSES SCHEDULE

~ 76 ~ 443 386 710 7,196 6.0% 4.2% 4.9% 7.5% 1.6% 5.0% 1.1% 0.1% 0.1% 0.1% 73,218 72,649 38,647 27,150 31,951 48,826 10,006 32,697 11.3% 27.2% 19.7% 11.2% 127,427 2007-08 100.0% 2007-08 $ 176,165 $ 647,471 802 213 608 6,637 5.7% 4.0% 4.4% 5.7% 2.0% 5.3% 1.1% 0.1% 0.0% 0.1% 81,304 68,508 35,775 25,189 27,843 35,869 12,488 33,364 13.0% 27.7% 20.0% 10.9% 125,623 2008-09 100.0% 2008-09 $ 173,423 $ 627,646 95 464 185 8,124 5,799 9.9% 5.9% 4.0% 4.2% 6.0% 1.3% 5.6% 0.9% 0.1% 0.0% 0.0% 88,329 62,390 37,181 25,316 26,389 37,435 35,164 14.0% 27.9% 20.2% 126,972 100.0% 2009-10 $ 175,249 2009-10 $ 629,092 791 296 450 6,034 9.1% 5.5% 4.2% 3.9% 6.6% 3.4% 5.4% 0.9% 0.1% 0.0% 0.1% 89,548 59,083 35,321 27,282 25,490 42,905 22,143 35,009 13.8% 27.7% 19.3% 124,837 2010-11 100.0% 2010-11 $ 178,644 $ 647,833 381 386 5,799 2,255 8.7% 5.5% 3.7% 4.3% 7.1% 2.9% 5.6% 0.9% 0.3% 0.1% 0.1% 57,890 36,715 24,685 28,925 47,505 19,503 37,162 15.2% 27.1% 18.5% 123,594 101,375 2011-12 100.0% 2011-12 $ 181,146 $ 667,321 254 515 339 5,875 8.3% 5.4% 3.7% 4.8% 8.7% 3.5% 4.5% 0.8% 0.0% 0.1% 0.0% 59,837 38,926 26,694 34,640 62,754 25,179 32,715 14.3% 27.8% 18.1% 130,787 103,420 100.0% 2012-13 2012-13 $ 201,731 $ 723,666 (percent of total expenses) For the Year Ended June 30, Ended Year For the For the Year Ended June 30, Year For the (amounts expressed in thousands) (amounts expressed 178 413 5,512 (1,200) 8.1% 5.4% 4.6% 4.9% 8.2% 2.8% 5.5% 0.7% 0.0% 0.1% 63,542 42,231 35,578 38,019 64,116 22,115 42,974 (0.2)% 15.0% 27.8% 17.1% 133,562 116,856 2013-14 100.0% 2013-14 $ 216,977 $ 780,873 137 375 7,341 4,343 7.8% 5.6% 4.4% 5.0% 9.1% 2.8% 5.8% 0.9% 0.5% 0.0% 0.0% 65,814 47,633 37,345 42,388 77,156 23,773 49,316 14.9% 26.8% 16.4% 139,399 126,150 2014-15 100.0% 2014-15 $ 227,482 $ 848,652 71 340 450 7.3% 5.1% 4.1% 4.4% 7.9% 2.9% 5.6% 1.9% 0.0% 0.0% 0.1% 17,091 65,362 46,018 36,540 39,267 70,664 26,006 49,872 18.3% 26.0% 16.4% 146,516 163,498 2015-16 100.0% 2015-16 $ 233,589 $ 895,284 120 317 1,965 5.7% 4.3% 4.4% 7.2% 2.7% 5.5% 2.3% 0.2% 0.0% 0.0% 7.3% 21,471 68,763 53,723 40,678 41,381 68,442 25,467 51,759 17.6% 26.1% 16.7% 157,485 166,599 2016-17 100.0% 2016-17 $ 944,926 $ 246,756 remittances to the State to remittances remittances to State to remittances Institutional support of plant and maintenance Operation Scholarships and fellowships enterprises Auxiliary on capital debt Interest capital assets (Gain) loss on disposal of grantors to Refunds administrative and Facilities Public service support Academic Student services Scholarships and fellowships enterprises Auxiliary on capital debt Interest capital of assets on disposal loss (Gain) grantors to Refunds administrative and Facilities Public service support Academic Student services Institutional support of plant and maintenance Operation

Depreciation Instruction Research Total expenses Total Expenses: Total Expenses Total Depreciation Instruction Research Expenses: : Clemson University Comprehensive Annual Financial Reports. Source: Clemson University Comprehensive SCHEDULE OF EXPENSES BY FUNCTION BY OF EXPENSES SCHEDULE

~ 77 ~ 5,898 3,998 1,735 19,501 31,132 33,916 689,938 153,420 104,065 2007-08 (647,471) $ 649,206 $ 429,669 $ 721,070 $ 721,070 2,491 6,986 1,236 13,059 23,772 35,785 721,070 125,265 127,686 2008-09 (627,646) $ 628,882 $ 456,106 $ 744,842 $ 744,842 3,736 11,846 31,148 60,606 47,853 744,842 107,336 172,687 147,714 2009-10 (629,092) $ 689,698 $ 483,924 $ 852,178 $ 852,178 2,765 6,643 38,376 69,905 50,959 852,178 117,689 234,454 221,593 2010-11 (647,833) $ 717,738 $ 462,861 $ 969,867 $ 969,867 4,259 9,468 28,350 39,047 81,124 55,045 969,867 259,181 201,484 (667,321) 2011-12 $ 1,050,991 $ 1,050,991 $ 706,368 $ 535,281 2,710 9,612 21,945 31,111 65,378 57,880 For the Fiscal Year For the Fiscal 260,870 192,765 (723,666) 2012-13 1,050,991 $ 754,777 $ 1,116,369 $ 1,116,369 $ 604,854 (amounts expressed in thousands) (amounts expressed 123 6,198 9,397 58,241 184,828 (422,285) (406,567) (172,503) 2013-14 1,116,369 (1,227,496) $ 709,802 $ 709,802 $ 805,211 $ 639,236 209 6,448 4,457 58,323 (54,664) (43,550) 709,802 126,834 (848,652) (199,236) 2014-15 $ 680,331 $ 666,252 $ 666,252 $ 793,988 567 37,580 15,886 29,679 58,698 99,062 (24,354) 666,252 2015-16 (895,284) (221,152) $ 759,323 $ 695,931 $ 695,931 $ 870,930 20 5,240 56,006 25,917 87,183 58,867 695,931 144,460 2016-17 (944,926) (190,538) $ 783,114 $ 783,114 $ 970,843 $ 770,325 Total changes in net position Total Income (loss) before other Income (loss) before or losses gains expenses, revenues, of revenues by source) by of revenues and function) use by of expenses Additions to permanent endowments to Additions Capital grants and gifts Capital grants State capital appropriations State Net position, beginning Net investment in capital assets Net investment Total ending position, Net

Total revenues (from schedule (from revenues Total Total expenses (from schedule (from expenses Total Unrestricted Restricted - expendable Restricted Restricted - nonexpendable Restricted Clemson University Comprehensive Annual Financial Reports. Source: Clemson University Comprehensive SCHEDULE OF NET POSITION AND CHANGES IN NET POSITION CHANGES IN AND OF NET POSITION SCHEDULE

~ 78 ~ 2,360 1,876 1,285 1,583 34,975 55,875 16,250 142,870 144,453 2007-08 $ 9,084 $ 147,614 $ 49,660 873 1,610 1,394 1,442 33,410 51,490 17,367 132,195 133,637 2008-09 $ 7,825 $ 135,904 $ 45,685 820 430 1,256 1,301 31,770 46,900 18,237 121,040 122,341 2009-10 $ 6,801 $ 124,027 $ 41,550 964 4,954 30,045 42,090 18,417 171,745 176,699 2010-11 $ 9,647 $ 177,663 $ 99,610 — — page 82). 475 8,078 25,600 37,620 18,980 156,295 164,373 2011-12 $ 8,685 $ 164,848 $ 93,075 — — 150 7,145 24,150 32,350 19,800 15,911 For the Fiscal Year For the Fiscal 144,920 152,065 2012-13 $ 88,420 $ 8,491 $ 168,126 — 9,387 22,680 26,585 20,202 14,963 166,035 175,422 2013-14 $ 9,424 $ 116,770 $ 190,385 — — (amounts expressed in thousands except for outstanding debt per student) in thousands except for outstanding debt (amounts expressed 20,823 13,993 20,425 118,875 110,860 340,350 360,775 2014-15 $ 17,998 $ 110,615 $ 374,768 — — 21,654 12,967 33,984 134,450 295,600 534,485 568,469 2015-16 $ 104,435 $ 581,436 $ 26,851 — — 22,307 11,990 36,097 130,605 289,205 570,160 606,257 2016-17 $ 618,247 $ 27,715 $ 150,350 — — Subtotal bonds payable Subtotal bonds payable Total outstanding debt Total Athletic Facilities Revenue Bonds Revenue Facilities Athletic Full-time equivalent students equivalent Full-time Outstanding debt per student

Revenue Bonds Revenue Capital Lease Obligations General Obligation Bonds Obligation General Unamortized bond premiums Payable Notes Plant Improvement Bonds Plant Improvement Clemson University Comprehensive Annual Financial Reports, Clemson University Office of Institutional Research Annual Financial Reports, Clemson University Source: Clemson University Comprehensive Outstanding debt per student calculated using fall semester full-time equivalent student enrollment data for the last ten academic years ( Note: Outstanding debt per student calculated using fall semester full-time equivalent student enrollment SCHEDULE OF RATIOS OF OUTSTANDING DEBT OUTSTANDING OF OF RATIOS SCHEDULE

~ 79 ~ 2.76 2.98 3.28 3.25 2.76 3.37 3.10 3.43 2.91 2.60 1.46 1.64 2.90 3.17 3.16 2.58 2.59 2.55 2.02 2.24 Coverage Ratio Coverage Ratio 6,456 6,900 6,407 7,288 6,685 6,883 7,201 8,128 7,056 5,981 8,164 5,980 8,478 5,973 7,201 Total Total 14,177 10,397 10,699 $ 17,365 $ 11,538 691 890 3,438 2,746 2,006 4,217 4,544 3,484 1,845 3,823 2,158 7,917 1,137 1,968 1,875 2,293 2,816 3,016 $ 5,058 Interest Interest $ 10,970 Debt Service Requirements Debt Service Requirements 4,690 4,310 3,975 6,180 6,155 4,680 4,655 3,815 5,765 6,260 6,010 5,270 5,320 4,810 4,385 4,185 4,135 4,590 $ 6,480 $ 6,395 Principal Principal 23,214 19,986 20,219 18,830 17,306 17,557 14,569 16,130 20 439 22,440 21,028 19,607 33,740 29,579 27,487 20,493 24,703 15,534 $ 25,330 $ 35,823 Available for Available Available for Available Debt Service Net Revenue Debt Service Total Revenue Total 39,103 38,667 36,310 35,233 31,636 32,057 32,386 30,226 26,913 Fees 22,440 21,028 19,607 15,534 33,740 29,579 27,487 $ 42,855 20,493 24,703 Expenses Operating $ 35,823 Tuition and Tuition Matriculation 62,317 58,653 56,749 55,452 50,466 49,363 44,795 43,043 49,943 $ 68,185 Revenues 2012 2011 2010 2009 2008 2017 2016 2015 2014 2013 Fiscal Year Ended June 30

2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 Fiscal Year Ended June 30 Revenue Bonds General Obligation Bonds General Obligation SCHEDULE OF BOND COVERAGE OF BOND SCHEDULE Fiscal Years Last Ten thousands) (amounts in

~ 80 ~ 2.84 1.16 2.07 1.31 4.03 4.40 5.22 2.05 2.81 3.40 Coverage Ratio 3,075 3,100 3,117 2,029 2,272 2,403 8,052 2,996 3,089 Total $ 8,791 802 953 1,585 1,460 1,392 1,054 4,752 1,616 1,524 $ 4,946 Interest Debt Service Requirements 975 1,490 1,640 1,725 1,450 1,470 3,300 1,380 1,565 $ 3,845 Principal 6,392 8,747 3,584 4,090 8,178 9,992 12,542 22,649 10,179 $ 18,042 Available for Available Debt Service Total Revenue Total 667 Fee 2,062 1,883 1,980 2,031 2,015 1,927 2,046 1,915 $ 2,214 Admissions 6,685 1,701 2,110 6,163 8,133 9,325 4,477 10,511 20,722 $ 15,828 Revenues Net Athletic 48,455 51,474 54,441 65,588 66,988 92,274 77,052 72,762 52,751 Athletic Expenses Operating $ 101,322 55,140 53,175 56,551 76,099 73,151 85,185 82,087 57,228 112,996 Athletic Revenues $ 117,150 2009 2008 2010 2011 2013 2012 2017 2016 2015 2014 Fiscal Year Ended June 30 Athletic Facilities Revenue Bonds Athletic Facilities Revenue The revenue bonds are secured by revenues from five sources: dining services, vending operations, the university bookstore, student housing and parking. Note: The revenue bonds are secured by revenues from five sources: dining services, vending operations, Annual Financial Reports Source: Clemson University Comprehensive

~ 81 ~ 2007-08 2007-08

16,250 17,585 54.0% 46.0% 6.9% 78.4% 14.7%

50.2% 38.6% 1,221 595 626 984

2,762

7,154 14,254 2007-08 2008-09 2008-09

17,367 18,317 53.9% 46.1% 6.8% 77.2% 16.0%

53.8% 35.0% 1,227 597 630 985 2,923

8,355 15,542 2008-09 2009-10 2009-10

18,237 19,111 54.2% 45.8% 6.7% 78.0% 15.3%

62.8% 33.1% 1,225 597 628 982

3,383

10,224 Enrolled 16,282 2010-11 2009-10 2010-11

18,417 19,453 54.3% 45.7% 6.1% 78.3% 15.6%

57.7% 31.0% 1,231 599 632 979

3,016

9,724 16,865 2011-12 2010-11 2011-12

54.3% 45.7% 6.1% 78.2% 15.7% 18,980 19,914

1,229 599 630 972 60.0% 28.7%

2,933

10,215 17,016 2012-13 2011-12 2012-13

53.9% 46.1% 6.1% 78.1% 15.8% 19,800 20,768

1,246 610 636 969 57.9% 32.3%

3,463

Accepted 10,706 18,500 2013-14

2013-14 2012-13

54.3% 45.7% 6.0% 76.6% 17.4% 20,202 21,303 1,246 609 637 971 57.2% 30.9%

3,289 10,645

21,857

2014-15 2014-15

18,604 53.5% 46.5% 6.2% 77.2% 16.6% 20,823 1,252 611 641 978 51.5% 32.5%

2013-14

3,475 10,692 2015-16 2015-16

1,251 613 638 978 51.3% 30.0% 52.9% 47.1% 6.3% 77.6% 16.1% 21,654 22,698 20,757

2014-15

3,448 2016-17 11,483 2016-17

Applications 1,242 611 631 987 52.3% 36.2%

52.1% 47.9% 6.6% 77.8% 15.7% 22,307 23,406 22,396

2015-16

4,804

13,273 25,358 2016-17 0 5,000 30,000 25,000 20,000 15,000 10,000 Enrolled Applied, Freshman Accepted and Admissions — Accepted as a percentage of applications as a percentage Accepted of accepted as a percentage Enrolled scores-total SAT score-total SAT average South Carolina Percentage of other Percentage Undergraduate and graduate FTE graduate and Undergraduate headcount graduate and Undergraduate of men Percentage of women Percentage of black Percentage of white Percentage Admissions-Freshman Verbal Math Last Ten Academic Years Last Ten Enrollment

ADMISSIONS, ENROLLMENT AND DEGREE STATISTICS AND ENROLLMENT ADMISSIONS,

~ 82 ~ 2,591 2,591 799 139

9,497

8,088 2007 2,953

139 13,787 13,787

799 1,207 1,207 2007-08 2,953 2007 Women

850 151 2,928 2,928

3,072 2008

8,453

9,864 14,148 14,148 151

1,241 1,241 850

2008-09 3,072 2008

794 173

10,368 2,924 2009 3,255 8,743

14,910 14,910

173 1,277 1,277

Men

Doctorate 794

2009-10 3,255 2009

176 3,028 3,028 2010 3,416 1,002

8,890

10,563 15,239 15,239

176

1,186 1,186

2010-11 1,002 3,416

983 203 2010 3,137 3,137 2011

3,314

9,106 10,808

15,562 15,562

Other 1,215 203

2011-12 983

208 3,314 3,278 3,278 2012 3,449 1,131 2011

9,563

11,205 Masters 16,218 16,218

1,272 1,272 208

2012-13 1,131

211

2013 3,449 3,709 3,709 3,755 1,189

2012

11,574 9,729 16,324 16,324

White

1,270 1,270

2013-14 211 217 1,189

2014 3,747 1,282 3,634 3,755

10,160 2013

16,876 11,697 1,347

2014-15 217

242

2015 1,282 3,754 1,264

3,653

10,682 3,747

12,016

17,626 2014 Black 1,419

2015-16

Baccalaureate 230 242

2016 4,003 1,423

1,264 3,667

11,200

12,206 3,754 18,204

2015 1,535

2016-17

230

0 1,423 4,003 2016 8,000 6,000 4,000 2,000 20,000 18,000 16,000 14,000 12,000 10,000 0 500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 4,500 Clemson University Office of Institutional Research (www.clemson.edu/oirweb1/fb/factbook/CUfactbook.cgi)

* Includes May and August of the current year and December graduation from the previous year. August of * Includes May and degrees. ** Masters awards include specialist Degrees Earned* Degrees Headcount and Graduate Enrollment — Enrollment Undergraduate Baccalaureate Masters** Doctorate Source:

~ 83 ~ 5,642 9,640 8,925 7,397 6,161 4,929 5,117 7,416 7,335 9,937

$ 5,834 2007-08

$12,852 $12,852 Virginia Tech Virginia 6,040 9,497 8,198 6,360 5,151 5,274 7,750 7,844

10,214

10,379

$ 6,500 $14,047 2008-09

University of California Davis - California of University 7,506 8,605 $10,030 6,651 5,151 5,474 8,638 8,177

10,405 11,078 10,880

$ 6,972 Campus 2009-10

Main Main - University M & A Texas 8,716 9,459 $10,002 6,997 5,461 6,529 9,070 8,387

11,153 13,080

11,908

2010-11 University Purdue $ 7,900

$8,880 $8,880 9,652 University 7,486 5,805 7,018 9,478 8,421

12,203 15,123 10,509 12,404

2011-12 $ 8,698 North Carolina State State Carolina North

$7,780 $7,780 For the Fiscal Year For the Fiscal University 7,726 6,264 7,788 9,900 8,506

10,098 12,623 15,257 10,923

12,774

$ 9,446 State Mississippi 2012-13

$14,063 $14,063 7,726 6,772 8,206 9,992 8,506 University State Michigan 10,650 12,863 13,896 11,455

13,054

2013-14 $ 9,852

$8,219 $8,219 Iowa State University State Iowa 13,446 2014-15 $ 10,200

11,394 7,731 13,200 7,140 8,296 10,002 9,179 13,896 12,017

$12,212 $12,212 Undergraduate Tuition and Fees - Resident — FY 2016-17 and Fees - Resident — FY Undergraduate Tuition Technology of Institute Georgia 9,428 7,736 7,502 8,581 10,002 13,952 12,485 12,204 13,560

13,882

2015-16 $ 10,424

$14,318 $14,318 Clemson University Clemson 7,780 8,880 8,219 10,002 10,030 14,047 12,852 12,212 14,063

14,318

2016-17 $ 10,696

$10,696 $10,696 Auburn University Auburn $0 $2,000 $8,000 $6,000 $4,000 $14,000 $12,000 $10,000 $16,000 Texas A & M University - Main Campus M University A & Texas - Davis of California University Tech Virginia Georgia Institute of Technology Institute Georgia University State Iowa University State Michigan University Mississippi State University State North Carolina University Purdue Auburn University Auburn Clemson University

Institution - Resident

UNDERGRADUATE AVERAGE ANNUAL ANNUAL AND TUITION FEES AVERAGE UNDERGRADUATE Peer Land-Grant Institutions Ten in Comparison to Clemson University years Last ten fiscal

~ 84 ~ 16,919 23,500 11,420 17,315 22,224 15,675 28,545 19,775 23,366

21,867

2007-08 $ 16,334

$29,975 $29,975 Virginia Tech Virginia

17,350 23,500 12,503 17,572 23,224 22,184 30,105 20,825 25,182

23,401

2008-09 $ 18,260 $40,729

Davis - California of University 17,871 27,343 13,021 17,959 25,118 22,607 33,074 21,878 $30,208 25,716

25,388

2009-10 $ 19,452

Main Campus Main - University M & A Texas $28,804 $28,804

18,563 29,108 13,801 19,064 26,622 22,817 35,959 23,217 26,926

27,420

2010-11 University Purdue $ 21,916 $26,399 $26,399

19,358 31,148 14,670 19,853 27,646 23,811 38,001 24,480 27,862

28,562 University State Carolina North

2011-12 $ 23,290 $20,900 $20,900

For the Fiscal Year For the Fiscal 19,838 32,580 15,828 20,953 28,702 25,036 38,135 25,915 University State Mississippi 29,402

29,700

$ 22,977 2012-13

$37,890 $37,890 Michigan State University State Michigan 20,278 33,750 16,960 21,661 28,794 25,126 36,774 27,211 29,954

30,488

2013-14 $ 26,364

$21,583 $21,583 Iowa State University State Iowa 31,462 2014-15

$ 27,384

20,617 34,965 18,478 23,551 28,804 26,356 36,774 28,048 30,698

$32,404 $32,404 Georgia Institute of Technology of Institute Georgia

32,396 20,856 36,360 20,142 24,932 28,804 28,021 38,660 29,129 32,800 Undergraduate Tuition and Fees - Non Resident — FY 2016-17 and Fees - Non Resident — FY Undergraduate Tuition

2015-16 $ 28,040

$34,200 $34,200 Clemson University Clemson

40,729 29,975 32,404 21,583 37,890 20,900 26,399 28,804 30,208 34,200

2016-17 $ 28,840

$28,840 $28,840 Auburn University Auburn $0 $5,000 $15,000 $10,000 $30,000 $25,000 $20,000 $45,000 $40,000 $35,000 North Carolina State Univeristy State North Carolina University Purdue - Main Campus A & M University Texas - Davis of California University Tech Virginia Auburn University Auburn Clemson University of Technology Institute Georgia University State Iowa University State Michigan University Mississippi State

Institution - Non Resident Institution These figures are for undergraduate first-time, full-time students with an academic year of 24 semester hours or 30 quarter hours. These figures are for undergraduate (oia.uwyo.edu/charges) Wyoming Source: University of

~ 85 ~ 2007-08 $ 76,639

269 1,205 39.5% 506 2,834 775 4,039 14.6 6.2 2008-09 $ 77,330

284 1,205 40.1% 581 2,839 865 4,044 15.2 6.5 2009-10 $ 78,038

238 1,153 42.7% 687 2,657 925 3,810 16.8 5.0 2010-11 $ 78,257

248 1,150 42.3% 668 2,486 916 3,636 16.9 7.8 2011-12 $ 80,200 215 1,110 43.8% 682 2,388 897 3,498 17.9 8.3 For the Fiscal Year For the Fiscal 2012-13 $ 89,474 196 1,111 46.7% 783 2,475 979 3,586 18.7 8.4 2013-14 $ 89,788 172 1,157 46.7% 856 2,542 1,028 3,699 18.4 8.4 2014-15 $ 91,984 217 1,171 45.3% 921 2,591 1,138 3,762 18.7 8.4 Numbers are Based on the October 1st Freeze Date from the Clemson University Business System the Clemson University 1st Freeze Date from Based on the October Numbers are 2015-16 $ 92,110 244 1,187 43.4% 982 2,650 1,226 3,837 19.1 8.6 2016-17 $ 94,510 2,651 1,372 3,850 19.5 8.8 287 1,199 43.5% 1,085

*Full-time, permanent, instructional in Academic departments (AAUP definition) Academic departments (AAUP *Full-time, permanent, instructional in Students per full-time annual faculty salary* Average Staff and administrators with faculty rank employees Total Faculty Staff Part-time Full-time Part-time Full-time Faculty Part-time Full-time tenured Percentage Full time includes all regular full time employees, and part time includes all part-time and all temporary employees. Note: Full time includes all regular full time employees, and part time includes all part-time and all temporary Source: Clemson University Office of Institutional Research (www.clemson.edu/oirweb1/fb/factbook/CUfactbook.cgi) FACULTY AND STAFF STATISTICS STAFF AND FACULTY Fiscal Years Last Ten

~ 86 ~ 23 16 2007-08 15,024 12,839 15,358 3,898 1,169,179 667,120 715,677 1,782,291 3 4 6,198 5,923 95.6% 23 16 2008-09 14,851 12,993 12,555 4,678 1,310,706 630,397 725,166 1,637,796 3 4 6,145 5,974 97.2% 23 17 2009-10 15,651 12,679 13,292 4,730 1,675,560 731,487 986,055 1,674,427 3 4 6,145 6,303 102.6% 23 17 2010-11 16,277 11,939 15,379 4,983 1,286,350 615,539 598,763 1,527,397 3 4 6,074 5,845 96.2% 23 17 2011-12 1,292,391 529,590 644,171 1,618,671 3 4 6,080 5,724 94.1% 17,200 12,533 16,294 4,814 23 17 For the Fiscal Year For the Fiscal 2012-13 1,391,955 570,867 604,045 1,726,207 3 4 6,162 6,303 102.3% 17,667 12,159 15,547 4,973 23 17 2013-14 1,427,870 533,047 674,059 1,719,202 3 4 6,248 6,113 97.8% 17,746 12,303 16,007 5,069 23 17 2014-15 1,370,476 534,617 597,540 1,644,622 3 4 6,275 6,140 97.8% 18,020 12,457 17,188 5,093 23 17 2015-16 1,326,740 579,205 597,556 1,644,622 3 4 6,236 6,122 98.2% 18,316 12,125 15,625 5,001 20 19 2016-17 5 4 6,469 6,469 100.0% 18,701 12,784 15,812 5,106 1,347,951 589,243 604,448 1,692,580 Clemson University Office of Institutional Research Clemson University Housing Clemson University Business Services Clemson University Parking Services Parking permits issued to faculty/staff permits issued to Parking Units in use occupancy Percent customers daily Average spaces available Parking students permits issued to Parking Net assignable square feet (in thousands) feet Net assignable square (in thousands) feet Net assignable square halls Residence Units available Net assignable square feet (in thousands) feet Net assignable square (in thousands) feet Net assignable square Building square footage Student housing Dining facilities Parking facilities

Dining facilities: Locations facilities: Parking buildings: operations and independent Auxiliary Student housing: Suites Apartments and support buildings: Administrative Laboratories: Academic buildings: Academic Sources: SCHEDULE OF CAPITAL ASSET INFORMATION ASSET OF CAPITAL SCHEDULE Fiscal Years Last Ten

~ 87 ~ 6.0% 7.6% 9.1% 6.9% 5.9% 6.6% 4.8% 10.3% 11.2% 11.7% Rate (d) Unemployment Average Annual Average

Per 38,041 35,453 34,266 33,673 33,163 31,799 31,884 31,013 Capita 36,934 $ 39,852 Income (c) at 4,869,991 4,832,482 4,774,839 4,723,723 4,679,230 4,596,958 4,561,242 4,479,800 4,407,709 4,987,575 July 1 (b) Population as of June 30 (a) 186,285,746,000 178,485,001,000 169,282,713,000 161,863,730,000 156,230,797,000 149,283,181,000 144,342,563,000 149,324,705,000 142,166,788,000 Personal Income $ 198,762,651,000 U.S. Board of Economic Advisors (a) Source: U.S. Board of Economic Advisors (b) Source: U.S. Board of Economic Advisors (c) Source: U.S Board of Economic (d) Source: U.S. Department of Labor Year 2009 2008 2007 2015 2014 2013 2012 2011 2010 2016

Source: South Carolina Comptroller General's Office DEMOGRAPHIC STATISTICS DEMOGRAPHIC Carolina State of South

~ 88 ~ Bi-Lo, Inc. Shield of South Carolina Blue Blue Cross Department of Defense Inc. Michelin North America Health Palmetto Savannah River Company County School District of Greenville Carolina of South University Service US Postal Inc. Associates, Wal-Mart

2006 Michelin North America, Inc Michelin North America, Health Palmetto Inc. Publix Super Markets County School District of Greenville Carolina of South University Service US Postal Wal-Mart Associates, Inc. Bi-Lo, Inc. Department of Defense Health System Greenville

2016 Due to confidentiality issues, the number of employees for each company is not available, and the employers are listed alphabetically rather than in order of size. Note: Due to confidentiality issues, the number of employees for each company is not available, and the employers Workforce Source: South Carolina Department of Employment and TEN LARGEST EMPLOYERS TEN LARGEST Carolina State of South Prior Years Ten and Year Calendar Latest Completed Alphabetically) (Listed

~ 89 ~ [THIS PAGE INTENTIONALLY LEFT BLANK] Supplementary Information to the Financial Statements (unaudited) 237,551 166,201 944,874 300,608 300,000 143,747 967,482 450,002 276,177 248,274 143,493 237,002 171,533 316,944 Total 8,134,238 4,646,164 6,923,787 2,232,083 1,664,788 2,872,824 1,288,853 1,183,175 1,057,052 2,521,235 68,184,532 37,176,873 15,832,304 42,854,787 $ 20,602,055 $ 25,329,745

34,602 49,017 70,442 135,812 106,539 667,837 559,042 910,955 300,608 607,713 112,855 207,222 263,058 6,533,320 3,378,459 3,852,558 1,966,496 37,361,702 37,176,873 19,571,706 Housing $ — $ 17,789,996 — — — — — — — — 658 6,644 5,607 14,999 77,594 25,051 14,863 69,725 35,409 15,430 839,867 967,482 450,002 114,615 112,585 406,447 1,191,760 5,677,361 2,872,824 1,288,853 1,112,180 3,945,234 Parking Services $ — $ 1,732,127 — — — — — — 663 175 3,940 98,004 72,766 26,442 16,599 217,926 1,219,737 1,219,074 $ — Bookstore $ 1,001,811 — — — — — — — — — — — — — — — — — — 2015B) 40 75 346 349 and 4,953 2,231 62,763 65,804 765,576 199,257 300,000 138,140 123,226 Vending Vending $ 699,772 $ — Operations — — — — — — — — — — — — — — — , 2012, 2015 , 2012, 2015 5,587 53,018 81,124 14,877 65,432 38,110 244,894 336,392 121,850 332,465 276,379 157,605 239,344 2,232,083 1,181,381 2,070,595 Dining Services 19,054,117 23,160,156 14,161,082 $ 20,602,055 $ 4,106,039 — — — — — — — — — (SERIES 2005 (SERIES University debit card fees debit card University expenses Other operating Heat, light, and power and garbage sewer Water, Supplies and materials Student meal plans service commissions Food machines Campus vending Net revenues Insurance television Cable outlay Capital expenses Total Travel services Contractual Repairs Telecommunications Rents Parking citations Parking revenue Meter income Investment revenues Total Expenses: Salaries benefits Fringe Other halls Residence rental ATM revenue Contract permits Parking fees Transit Description Revenues: For the year ended June 30, 2017 For the year CLEMSON UNIVERSITY CLEMSON NET REVENUES OF PLEDGED SCHEDULE BONDS REVENUE AUXILIARY

~ 92 ~ 2,000 42,238 64,428 169,878 342,912 926,032 240,147 212,317 492,827 Total 5,134,925 1,776,484 1,985,838 5,539,676 1,134,577 1,082,133 7,227,197 2,897,575 5,065,252 1,912,305 3,181,153 4,374,614 6,385,699 7,284,339 5,218,560 5,472,888 19,288,892 19,089,916 38,533,696 16,682,991 19,235,419 11,514,471 101,322,114 117,149,537 $ 15,827,423 $ 25,960,272 55,737 34,452 40,979 42,783 166,186 584,912 228,516 207,006 342,912 180,022 173,632 1,263,572 3,517,126 4,333,581 2,600,000 4,591,456 13,542,309 28,241,089 41,128,781 27,033,968 10,430,721 Specific $ 12,887,692 $ — Non Program — — — — — — — — — — — — 2,000 47,605 60,125 50,122 14,607 358,194 138,673 141,190 500,598 647,858 575,107 705,853 133,750 169,878 155,518 120,639 206,930 Other 4,657,555 3,287,768 5,173,630 8,461,398 2,584,424 1,097,991 Sports 20,304,155 10,058,387 $ 1,071,129 $ (10,245,768) — — — — — — — — 2015B) and 4,082 61,231 22,504 724,394 839,190 361,726 607,612 142,180 503,879 420,194 326,101 605,900 514,642 112,705 200,000 209,659 4,158,855 3,500,686 1,361,678 2,653,828 1,731,622 1,025,166 10,178,056 11,767,874 Basketball $ 1,858,096 $ 1,589,818 — — — — — — — — — 4,760 7,786 45,227 89,761 848,789 750,000 926,032 261,927 2,173,181 4,549,199 1,883,179 7,227,197 1,534,725 4,964,420 2,106,565 1,044,023 5,134,925 5,226,399 1,225,000 1,065,046 1,930,086 1,528,545 2,913,850 1,134,577 1,778,824 Football 42,598,814 12,476,564 54,194,495 10,931,675 $ 23,031,047 $ 11,595,681 — — — — , 2014B, 2014C, 2015 A, 2014B, 2012, 2014 (SERIES (SERIES related entities related Fund raising, marketing and promotion marketing raising, Fund Sports camp expenses expenses Spirit group and rental maintenance facilities, Direct expenses Medical and insurance Dues and membership expenses meals (non-travel) Student-Athlete expenses Other operating expenses Bowl entities the institution and related Coaching salaries, benefits and bonuses paid by the institution and salaries, benefits and bonuses paid by Support staff/administrative pay Severance travel Team and supplies Equipment, uniforms Game expenses Royalties, advertisements and sponsorships advertisements Royalties, Sports camp revenues income and investment Endowment Other revenue revenues Bowl student aid Athletic Ticket sales Ticket support institutional Direct sales game and away Guarantees In kind car leases and internet radio - broadcast, television, Media rights revenues all tournament NCAA distributions including revenues including all tournament distributions Conference sales and parking novelty sales, concessions, Program Revenues: Total operating expenditures operating Total

Guarantees Recruiting revenues Total Contributions Description Net Revenues Operating Expenditures: Operating For the year ended June 30, 2017 For the year CLEMSON UNIVERSITY CLEMSON NET REVENUES OF PLEDGED SCHEDULE BONDS REVENUE FACILITIES ATHLETIC

~ 93 ~ 34,427 549,337 137,500 2,111,947 7,374,908 3,827,804 1,653,330 1,444,015 3,198,586 1,123,759 Total FY16 21,467,477 18,171,383 11,488,274 49,135,897 50,789,227 54,879,346 11,607,442 24,574,316 757,008,220 810,790,081 178,317,702 305,946,869 347,290,822 463,425,060 1,802,577,787 2,559,586,007 $ 291,824,952 $ 2,610,375,234 — 12,918 980,232 137,500 2,005,682 7,463,904 4,234,584 1,154,715 1,455,192 3,230,435 9,154,209 1,002,744 Total FY17 22,811,961 18,059,168 11,217,669 92,164,098 93,318,813 52,622,902 20,861,205 257,930,226 671,270,183 199,108,936 237,402,563 525,246,172 1,043,043,282 2,048,762,192 2,720,032,375 $ 302,050,891 $ 2,813,351,188 — (147,800) (3,097,276) (2,949,476) (11,892,715) (75,974,529) (198,902,686) (286,769,930) (289,867,206) Eliminations $ — $ (289,867,206) — — — — — — — — — — — — — — — — — — — 12,918 980,232 137,500 1,154,715 1,455,192 3,230,435 9,154,209 1,002,744 2,005,682 7,463,904 4,234,584 23,810,681 52,622,902 92,164,098 93,318,813 22,959,761 11,892,715 18,059,168 11,217,669 674,367,459 257,930,226 398,011,622 237,402,563 601,220,701 Subtotal 1,043,043,282 2,335,532,122 3,009,899,581 $ 302,050,891 $ 3,103,218,394 94,953 IPTAY 56,324,291 26,784,435 25,779,779 25,779,779 82,104,070 $ 29,444,903 $ 82,104,070 — — — — — — — — — — — — — — — — — — — — — 1,416 8,008 Land 2,235,452 3,190,056 70,991,375 11,892,715 45,657,439 74,181,431 11,205,769 Clemson University $ 74,181,431 $ 3,180,632 Foundation Stewardship — — — — — — — — — — — — — — — — — — 11,900 639,098 376,536 2,005,682 8,971,049 1,540,670 86,887,418 25,004,479 738,148,282 198,902,686 527,241,331 825,035,700 Clemson University Foundation $ 825,035,700 $ 60,342,269 — — — — — — — — — — — — — — — 953,866 179,864 206,250 530,972 137,500 387,407 140,547 1,870,952 1,979,498 9,318,355 11,189,307 Clemson Research University $ 11,189,307 $ 6,673,403 Foundation — — — — — — — — — — — — — — — — — — — — 12,918 406,168 833,988 980,232 7,463,904 1,154,715 1,455,192 3,230,435 9,012,246 1,002,744 2,542,152 92,164,098 18,059,168 21,779,643 93,318,813 22,959,761 227,900,542 518,647,339 198,902,686 255,950,728 Clemson University 1,498,741,734 1,042,486,882 2,017,389,073 $ 202,409,684 $ 2,110,707,886

resources Total assets Total of outflows deferred Total

depreciation Cash and cash equivalents Cash and cash equivalents Restricted Assets - Noncurrent Restricted Restricted Assets - Current: Restricted receivable and contracts Grants Contributions receivable, net Contributions receivable, resale held for estate Real Capital assets, not being depreciated Capital assets, net of accumulated Cash and cash equivalents net Contributions receivable, and income receivable Interest Student loans receivable assets Other current receivable Lease obligation Cash surrender value of life insurance of life value Cash surrender resources Deferred losses on bond refunding Deferred Noncurrent Assets: Noncurrent Current Assets: Current Total assets and deferred outflows of of outflows assets and deferred Total Total noncurrent assets noncurrent Total on net pension liability outflows Deferred Investments receivable loans Student assets Other Notes receivable Notes Inventories items Prepaid assets current Total receivable Notes receivable Accounts Description Assets:: Deferred outflows of resources: outflows Deferred CLEMSON UNIVERSITY REPORTING ENTITY REPORTING UNIVERSITY CLEMSON POSITION OF NET/FINANCIAL STATEMENT COMBINED ended June 30, 2017 For the year

~ 94 ~ 97,002 929,451 929,451 403,046 805,540 7,751,177 4,618,507 3,452,013 2,134,737 8,026,253 4,304,796 1,445,065 Total FY16 54,424,817 16,458,838 19,422,755 18,470,397 41,995,527 18,792,284 10,485,603 20,996,162 (74,101,051) 353,605,729 205,596,045 509,741,860 549,676,754 165,960,967 1,269,328,032 1,103,367,065 $ 770,520,370 $ 1,270,257,483 $ 1,340,117,751 $ 60,321,557 — (37,452) 134,454 812,926 7,714,012 4,713,212 1,750,844 1,750,844 3,028,503 2,109,820 8,783,959 4,338,329 2,236,515 Total FY17 14,372,124 20,310,087 14,967,394 49,759,843 21,402,558 10,603,606 22,887,894 (58,645,381) 363,654,337 245,576,035 105,665,526 573,168,554 584,854,400 141,840,667 1,345,744,893 1,203,904,226 $ 781,310,537 $ 27,878,561 $ 1,347,495,737 $ 1,465,855,460 — (574,408) (2,739,212) (76,907,001) (11,318,307) (289,867,206) (287,127,994) (198,902,686) Eliminations $ — $ — $ (289,867,206) $ (2,164,804) — — — — — — — — — — — — — — — — — — — — — — 708,862 812,926 2,109,820 8,783,959 4,338,329 2,236,515 4,713,212 1,750,844 1,750,844 3,028,503 14,372,124 14,967,394 49,759,843 21,402,558 10,603,606 84,621,013 11,280,855 22,887,894 20,310,087 (58,645,381) 363,654,337 105,665,526 198,902,686 573,168,554 584,854,400 245,576,035 144,579,879 Subtotal 1,635,612,099 1,491,032,220 $ 30,043,365 $ 781,310,537 $ 1,637,362,943 $ 1,465,855,460 404,923 IPTAY 1,632,255 1,632,255 80,066,892 $ — $ 80,471,815 $ 1,632,255 $ 1,632,255 — — — — — — — — — — — — — — — — — — — — — — — — — — 28,639 28,495 Land 3,214,635 2,931,974 27,146,430 20,932,472 47,035,001 22,887,894 43,820,366 $ 225,527 Clemson University $ 27,146,430 $ 47,035,001 $ — Foundation Stewardship — — — — — — — — — — — — — — — — — — — — 4,713,212 1,125,195 21,196,365 55,974,519 260,715,612 198,902,686 259,590,417 304,787,735 228,988,403 Clemson University Foundation $ 564,320,088 $ 260,715,612 $ 9,347,585 $ 1,125,195 — — — — — — — — — — — — — — — — — — — — 83,048 386,489 386,489 1,986,721 7,177,891 Clemson $ 386,489 Research University $ 303,441 $ 10,802,818 $ 1,638,206 Foundation — — — — — — — — — — — — — — — — — — — — — — — — — — 708,862 812,926 1,041,782 2,109,820 8,783,959 7,714,012 1,750,844 4,309,690 2,208,020 1,750,844 20,310,087 21,402,558 58,866,602 16,587,632 14,372,124 11,280,855 46,744,821 10,603,606 14,967,394 584,854,400 101,566,077 573,168,554 138,221,306 Clemson (190,538,432) University 1,187,621,427 1,325,842,733 $ 26,756,948 $ 770,324,745 $ 1,327,593,577 $ 783,114,309

resources of inflows deferred Total related liabilities related related liabilities related Accrued compensated absences and compensated Accrued Accrued compensated absences and compensated Accrued Accrued payroll and related liabilities and related payroll Accrued Bonds payable Scholarships and fellowships Scholarships and fellowships Capital leases payable others held for Funds the University Due to others held for Funds Net pension liability Capital leases payable Accounts and retainages payable and retainages Accounts payable interest Accrued Bonds payable resources Net investment in capital assets Net investment Restricted for non expendable purposes: for non expendable Restricted purposes: for expendable Restricted Noncurrent Liabilities: Noncurrent Current Liabilities Current

Deferred inflows of resources: inflows Deferred Total liabilities and deferred inflows of inflows liabilities and deferred Total Net Position Unrestricted Research use Instructional/departmental Loans projects Capital service Debt on net pension liability inflows Deferred payable Notes payable liabilities Annuities noncurrent Total liabilities Total Deposits liabilties current Total Liabilities: revenues Unearned Description Total net position Total

~ 95 ~ 911,966 Total FY16 73,299,089 56,403,485 18,967,401 50,133,148 27,726,340 58,828,423 12,876,820 20,441,468 42,113,490 284,407,194 895,857,701 713,181,910 514,623,618 107,230,229 (182,675,791) $ 341,076,940 1,771,818 Total FY17 82,519,933 45,035,160 19,730,055 52,005,888 27,269,239 62,055,230 11,648,659 21,303,080 42,324,854 279,401,926 936,170,173 755,276,741 557,763,065 124,492,211 (180,893,432) $ 364,125,796 (786,358) 1,225,975 (3,340,926) (2,554,568) 98,365,434 (102,932,335) (101,706,360) Eliminations $ — — — — — — — — — — 1,771,818 83,306,291 62,055,230 11,648,659 21,303,080 45,035,160 44,879,422 19,730,055 52,005,888 27,269,239 382,334,261 124,492,211 758,617,667 556,537,090 Subtotal (279,258,866) 1,037,876,533 $ 364,125,796 IPTAY 76,401,338 76,401,338 (76,401,338) $ — — — — — — — — — — — — — — 278,543 Land 1,900,043 2,100,428 2,100,428 4,000,471 3,721,928 Clemson University $ — Foundation Stewardship — — — — — — — — — — 5,612,401 5,612,401 35,625,693 35,625,693 (30,013,292) Clemson University Foundation $ — — — — — — — — — — — — 32,189 (50,446) 142,396 2,552,981 2,695,377 2,644,931 1,104,265 1,508,477 Clemson Research University $ — Foundation — — — — — — — — 1,771,818 51,759,019 19,730,055 27,269,239 81,923,483 62,055,230 11,616,470 34,036,616 21,303,080 45,035,160 556,537,090 265,758,294 921,053,697 746,359,864 124,492,211 Clemson (174,693,833) University $ 364,125,796 other activities revenue - pledged for enterprises bonds (net of scholarship of $15,538,475) allowances - not pledged enterprises scholarship allowances of scholarship allowances $99,415,007) Sales and services of educational and Sales and services of auxiliary Sales and services of auxiliary Student tuition and fees (net of Student tuition and fees Nongovernmental grants and contracts grants Nongovernmental revenues Other operating Services and supplies Scholarships and fellowships Federal grants and contracts grants Federal contracts and grants State and contracts Local grants Depreciation Operating Expenses: Operating Operating Revenues: Operating

Expenses: Total operating liabilities operating Total income/(loss) Operating Total operating revenues operating Total benefits Compensation and employee Utilities

Description Revenues: CLEMSON UNIVERSITY REPORTING ENTITY REPORTING UNIVERSITY CLEMSON POSITION IN NET AND CHANGES ACTIVITIES EXPENSES, OF REVENUES, STATEMENT COMBINED ended June 30, 2017 For the year

~ 96 ~ 10,541 77,798 (87,192) (70,675) 567,036 (450,045) Total FY16 23,698,647 59,337,232 19,175,093 11,631,669 10,195,769 15,885,915 (17,568,741) (12,869,133) 108,812,383 206,374,438 106,702,605 1,280,780,519 $ 1,340,117,751

77,553 20,510 329,517 (566,539) (119,773) (316,624) 9,491,198 5,240,195 Total FY17 18,036,550 12,239,506 71,779,127 93,187,187 (22,075,926) 102,362,903 125,737,711 119,308,662 283,256,335 1,340,117,749 $ 1,465,855,460 122,767 37,847,267 (37,970,034) (60,518,167) (60,518,167) $ — Eliminations — — — — — — — — — — — — — 20,510 (45,214) 329,517 (566,539) (119,773) (316,624) 9,491,198 5,240,195 12,239,506 64,515,636 56,006,584 71,779,127 (22,075,926) 343,774,502 119,308,662 125,737,711 153,705,354 Subtotal 1,340,117,749 $ 1,465,855,460

77,553 283,047 IPTAY 2,363,850 58,822,879 56,175,982 97,972,721 (17,578,459) (17,500,906) $ 80,471,815 — — — — — — — — — — (4,294) 306,632 915,859 (604,933) Land 2,206,675 2,206,675 24,939,755 Clemson University $ 27,146,430 Foundation Stewardship — — — — — — — — — — — (122,767) 5,451,172 83,973,058 53,959,766 29,061,853 49,460,033 53,836,999 Clemson 510,483,089 University Foundation $ 564,320,088 — — — — — — — — — — 61,651 61,651 11,205 11,205 10,791,613 Clemson Research $ 10,802,818 University Foundation — — — — — — — — — — — — — 20,510 329,517 (119,773) (566,539) (316,624) 3,699,622 5,240,195 12,239,506 25,916,449 56,006,584 87,183,738 67,551,660 19,955,244 (21,470,993) 200,610,282 695,930,571 119,308,662 Clemson University $ 783,114,309

other revenues, other revenues, expenses, gains or losses gains expenses, to the State to Net position, beginning of year State capital appropriations State and gifts Capital grants contributions Intra-entity endowments permanent to Additions Endowment income Endowment debt related on capital asset Interest revenues Other nonoperating assets Gain/loss on disposal of capital grantorss to Refunds remittances and administrative Facilities State appropriations State appropriations Federal Gifts and grants income Interest Net Position: Net position, end of year Income before Income position net in Increase revenues nonoperating Net Description (Expenses): Revenues Nonoperating

~ 97 ~ This Comprehensive Annual Financial Report is also available on the Clemson University Comptroller Office website located at http://www.clemson.edu/finance/controller/cafr

Prepared by: Controller’s Office Administrative Services Building P.O. Box 345321 Clemson, SC 29634-5321 Tel: (864) 656-0586 FAX: (864) 656-5600 Steve Crump, Controller

APPENDIX B

SUMMARY OF CERTAIN PROVISIONS OF THE BOND RESOLUTION AND THE 2017 SERIES RESOLUTION

[THIS PAGE INTENTIONALLY LEFT BLANK] APPENDIX B

SUMMARY OF CERTAIN PROVISIONS OF THE BOND RESOLUTION AND THE 2017 SERIES RESOLUTION

The Bond Resolution and the 2017 Series Resolution contain various covenants and security provisions, some of which are summarized below. Wherever particular provisions of the Bond Resolution or the 2017 Series Resolution are referred to, such provisions should be considered incorporated by reference as part of the statements made, and the statements made are qualified in their entirety by such provisions. Reference is made to the Bond Resolution and the 2017 Series Resolution for a full and complete statement of their respective provisions. Capitalized terms used in this summary which are not defined below or elsewhere herein shall have the same meanings as in the Bond Resolution or the 2017 Series Resolution.

The Bond Resolution

Definitions

“Accreted Value” shall mean the amounts set forth in and the amounts computed pursuant to a formula set forth in a Series Resolution authorizing the issuance of Bonds in the form of Capital Appreciation Bonds, the Accreted Value of which is being determined.

“Accountants” shall mean an independent firm of certified public accountants of suitable standing, or the Office of Auditor of the State of South Carolina, which audits the books and accounts of the University relating to the Facilities.

“Admissions Fee” shall mean any specially designated admissions fee or charge which may, in addition to other charges, be imposed by the Board of Trustees in its discretion upon persons admitted to any event held at any of the Athletic Facilities, for the purpose of providing funds to assist in the repayment of the Bonds.

“Annual Budget” shall mean the budget or amended budget adopted annually by the Board of Trustees for the ensuing Fiscal Year of the University.

“Annual Principal and Interest Requirement” shall mean, with respect to the annual period in question and to a Series of Bonds, an amount (other than amounts paid from proceeds of Bonds) equal to the sum of (1) all interest payable on such Series of Bonds during such period, less any such interest which has been capitalized in accordance with the terms of this Bond Resolution, plus (2) any Principal Installments of such Series of Bonds during such period; provided, however, with respect to any Principal Installment (whether maturing in such particular Fiscal Year or in a subsequent Fiscal Year) of a Series of Partially Amortizing Bonds, equaling 25% or more of the principal of such Series of Partially Amortizing Bonds, the amount of the principal which would be payable during such Fiscal Year shall be computed as if such principal were amortized from the date of issuance thereof over a period of twenty (20) years or the actual maturity of such Partially Amortizing Bonds, whichever is greater, on a level debt service basis at an interest rate equal to the rate borne by such Partially Amortizing Bonds on the date calculated, except that if the date of calculation is within twelve (12) months of the actual maturity of such Partially Amortizing Bonds, the full amount of the Principal Installment payable at maturity (less any sinking fund established therefor and deposited with the Trustee for such Bonds) shall be included in such calculation. For purposes of computing “Annual Principal and Interest Requirement,” the rate of interest used to determine (1) above shall be a rate per annum equal to (a) with respect to any Series of Bonds which bear interest at a fixed rate or rates, the rate or rates of interest borne or to be borne by such Bonds, and (b) with respect to any Series of Variable Rate Bonds, the following methods shall determine the interest rate to be used:

(i) in the case of determining the Annual Principal and Interest Requirement or the Combined Principal and Interest Requirement, as the case may be, for purposes of Sections 4.02(A)(7) of the Bond Resolution (Additional Bonds Test), the interest rate shall be equal to the 30-year Revenue Bond

B-1 Index published by the Bond Buyer no more than two (2) weeks prior to, but in no event after the sale of the proposed Series of Bonds to be issued; and

(ii) in the case of determining the Combined Annual Principal and Interest Requirement for purposes of applying the covenants contained in Sections 5.01(8), 5.01(C) and 6.01 of the Bond Resolution (Rate Covenants), the interest rate shall be equal to the maximum interest rate prevailing on such Variable Rate Bonds for the preceding twelve-month period; provided, however, that if the 30-year Revenue Bond Index referred to in (i) above is no longer published, any reasonably equivalent nationally recognized index published for the periods in question may be selected by the Chief Financial Officer for use in its stead.

“Authorized Investments” shall mean those investments authorized for investment of State funds under Section 11-9-660, Code of Laws of South Carolina, 1976, as now or hereafter amended from time to time.

“Athletic Department” shall mean the Athletic Department of the University.

“Athletic Facilities” shall mean all of the facilities of the University designated from time to time by the Board of Trustees as intercollegiate athletic facilities, including any facilities providing support for facilities where intercollegiate events are held, including without limitation any related infrastructure and any administration, maintenance, practice, training, physical therapy and related facilities of the Athletic Department, whether now owned or are hereafter acquired by the University.

“Board of Trustees” shall mean the Board of Trustees of Clemson University, or any successor body.

“Bond Counsel” shall mean any firm of attorneys which is nationally recognized as bond counsel in the field of public finance.

“Bond Insurance Policy” shall mean any municipal bond insurance policy insuring the payment, when due, of the principal of and interest on a Series of Bonds.

“Bond Insurer” shall mean, with respect to a Series of Bonds, an insurance company that has issued its Bond Insurance Policy with respect to such Series of Bonds.

“Bond Payment Date” shall mean the dates on which interest on any of the Bonds shall be payable or on which both principal and interest shall be payable on any of the Bonds, all as set forth in the Series Resolutions authorizing the issuance of the respective Series of Bonds.

“Bondholder” or “Holder”, or any similar term, when used with reference to the Bonds, shall mean any person who shall be the registered owner of any Outstanding Bond or in the case of Bonds issued in bearer form in accordance with the Bond Resolution, the holder of any such Bond.

“Bonds” shall mean any indebtedness of the University issued in accordance with the provisions of the Enabling Act, the Bond Resolution and a Series Resolution, but not including Junior Lien Bonds.

“Business Day” shall mean, except as set forth in a Series Resolution with respect to the Series of Bonds issued thereunder, any day other than Saturday, a Sunday or a day on which banking institutions in the State or in the State of New York are required or authorized by law (including executive orders) to close.

“Capital Appreciation Bonds” shall mean Bonds that bear interest payable only at maturity or payable prior to maturity only on the redemption dates set forth in the Series Resolution authorizing the issuance of such Bonds and in the amounts determined by reference to the Accreted Value of such Capital Appreciation Bonds in accordance with the provisions of the Series Resolution authorizing the issuance of such Capital Appreciation Bonds.

B-2 “Chairman” shall mean the Chairman of the Board of Trustees. The term shall include the Vice Chairman or Acting Chairman, whenever by reason of absence, illness or other reason, the person who is the Chairman is unable to act.

“Chief Financial Officer” shall mean the individual to whom the Board of Trustees has delegated the responsibility of supervising and maintaining records and accounts relating to the collection and disbursement of the Revenues.

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to time. References to the Code and sections of the Code include relevant applicable regulations, temporary regulations and proposed regulations thereunder and under the Internal Revenue Code of 1954, as amended, and any successor provisions to those sections, regulations, temporary regulations or proposed regulations.

“Combined Annual Principal and Interest Requirement” shall mean, with respect to any particular Fiscal Year, the sum of the Annual Principal and Interest Requirements on all Bonds Outstanding.

“Counsel” shall mean an attorney duly admitted to practice law before the highest court of the State, who is not a full-time employee of the University or the State but may include the Office of the Attorney General of South Carolina.

“Date of Issue” shall mean that date established in any Series Resolution from which interest shall accrue on the Bonds of the applicable Series.

“Debt Service Fund” shall mean the fund so designated pursuant to a Series Resolution and designed to provide for the payment of the principal of and interest on a particular Series of Bonds issued pursuant to the Bond Resolution, as the same full due, and as established pursuant to the provisions of the Bond Resolution.

“Debt Service Reserve Fund” shall mean the fund, if any, so designated pursuant to a Series Resolution and designed (l) to insure the timely payment of the principal of and interest on a particular Series of Bonds Outstanding and issued pursuant to the Bond Resolution, and (2) to provide for the redemption of such Series of Outstanding Bonds prior to their stated maturity, as established by the provisions of the Bond Resolution.

“Enabling Act” shall mean Article 9 of Chapter 119, Title 59, Code of Laws of South Carolina 1976, as amended.

“Fiscal Year” shall mean the period of twelve calendar months, beginning on July 1 of each year and ending with June 30th of the succeeding year, unless the same shall have been changed by the Board of Trustees pursuant to the authorization of the Bond Resolution.

“Government Obligations” shall mean and include direct noncallable general obligations of the United States of America or noncallable obligations, the payment of principal of or interest on which is fully and unconditionally guaranteed by the United States of America.

“Improvement Fund” shall mean the fund established pursuant to Section 7.05 hereof.

“Junior Lien Bonds” shall mean any revenue bonds or other obligations issued by the University which are secured by pledges of or liens on the Revenues, the Admissions Fee or the Special Student Fee which are junior and subordinate in all respects to the pledges and liens made to secure Bonds.

“Moody’s” shall mean Moody’s Investors Service, Inc., and its successors.

“Net Revenues” shall mean for the period in question, all Revenues remaining after payment of the operating and maintenance expenses of the Athletic Department and the Athletic Facilities but before provision is made for depreciation, amortization, nonmandatory transfers and interest expenses of the Athletic Department for a given fiscal year; provided that there shall be excluded from the calculation made to determine Net Revenues gains

B-3 or losses on the sale or other disposition of investments of fixed or capital assets which do not result from the ordinary course of business.

“Operation and Maintenance Fund” shall mean the fund established pursuant to the Bond Resolution in order to provide for the payment of all expenses incurred in connection with the administration and operation of the Athletic Department and the Athletic Facilities, including, without limiting the generality of the foregoing, such expenses as may be reasonably necessary to preserve the Athletic Facilities in good repair and condition and to pay the fees and charges of the Trustee, the Paying Agent, the Registrar and the custodian or trustee of any other fund created or to be created hereunder, the costs of audits required hereunder, and the premiums for all insurance policies and any fidelity bonds required by the Bond Resolution.

“Outstanding”, when used with reference to the Bonds, shall mean, as of any date, all such Bonds theretofore or then being authenticated and delivered except:

(a) Bonds paid or redeemed and cancelled at or prior to such date;

(b) Bonds in lieu of or in substitution for which other Bonds shall have been executed and delivered;

(d) for purposes of any consent or other action to be taken by the Holders of a specified percentage of Bonds, Bonds held by, or for the account of, the University, or by any person controlling, controlled by or under common control with the University.

“Partially Amortizing Bonds” shall mean a Series of Bonds twenty-five percent (25%) or more of the principal payments of which are due in a single Fiscal Year, which portion of the principal is not required by the Series Resolution, providing for their issuance, to be paid by redemption prior to such maturity date.

“Paying Agent” shall mean the State Treasurer or any bank or trust company or other entity appointed from time to time as Paying Agent or Paying Agents in accordance with the Bond Resolution to serve as Paying Agent for one or more Series of Bonds issued thereunder.

“Principal Installment” shall mean, as of any date of calculation, (i) the aggregate principal amount of Outstanding Bonds stated to mature on a certain date, reduced by the aggregate principal amount of such Bonds which will be retired by reason of any mandatory sinking fund payment payable before such date, plus (ii) any mandatory sinking fund payment due on such certain date, together with the aggregate amount of the premiums, if any, applicable to such mandatory sinking fund payments, plus (iii) with respect to any Capital Appreciation Bonds required to be paid on such certain date, the Accreted Value as of such certain date of such Capital Appreciation Bonds; and in this latter respect, any reference to “principal” of Bonds in the Bond Resolution shall mean, with respect to Capital Appreciation Bonds, the Accreted Value of such Capital Appreciation Bonds.

“Registrar” shall mean the State Treasurer or any bank or trust company appointed by the University from time to time as Registrar or Registrars in accordance with the Bond Resolution to serve as Registrar for one or more Series of Bonds issued hereunder.

“Reserve Requirement” shall mean, as of any date of calculation, the debt service reserve requirement, if any, established by a Series Resolution with respect to a particular Series of Bonds.

“Revenues” means (i) all revenues, or other income received by the Athletic Department from the operation of the Athletic Department and the Athletic Facilities, including without limitation, amounts received from the sale of tickets for and guarantees with respect to intercollegiate athletic events, from any athletic conference (collectively, the “Conference”) with respect to the University’s share of proceeds from Conference members’ television and bowl appearances, from the University’s participation in Conference and National Collegiate Athletic Association tournaments, from rentals of executive boxes at Athletic Facilities, from sales of game programs and concessions, or commissions therefrom, from the University’s sports radio and television rights, from corporate

B-4 sponsorships, and from license fees, (ii) all gifts, bequests, contributions and donations received by the Board of Trustees or the University from any persons, including from any athletic booster organization, for use in connection with the operations of the Athletic Department, (iii) any other unrestricted revenues of the Athletic Department not otherwise pledged that may be made applicable by the Board of Trustees to the payment of the principal and interest of the Bonds including such revenues which may fall into the category of non-mandatory transfers as such term is used in generally accepted accounting principles and (iv) all income from the investment of the above; but excluding:

(v) gifts, bequests, contributions and donations restricted to a particular purpose inconsistent with their use for the payment of the principal, premium or interest on the Bonds;

(vi) the proceeds of any borrowings;

(vii) State appropriations of any sort; and

(viii) investment income restricted to a purpose inconsistent with the payment of operating expenses of the Athletic Department or debt service on Bonds including (whether or not so restricted) interest earned on any construction fund or construction account created with the proceeds of borrowing by the University.

“S&P” means Standard & Poor’s Ratings Services, a Division of The McGraw-Hill Companies, Inc., and its successors.

“Secretary” shall mean the Secretary of the Board of Trustees. The term shall include the Acting Secretary or the Assistant Secretary whenever by reason of absence, illness or other reason, the person who is the Secretary is unable to act.

“Series” shall mean all of the Bonds authenticated and delivered on original issuance in a simultaneous transaction, and any Bonds thereafter authenticated and delivered in lieu of or in substitution for (but not to refund) such Bonds as provided in the Bond Resolution, regardless of variations in maturity, interest rate or other provisions.

“Series Resolution” shall mean a Resolution of the Board of Trustees authorizing the issuance of a Series of Bonds pursuant to the Bond Resolution in accordance with the terms and provisions hereof, adopted in accordance with the provisions of the Bond Resolution.

“Special Student Fee” shall mean any fee as may be established by the Board of Trustees in its discretion from time to time and imposed upon persons in attendance at any academic session of the University in order to provide funds to assist the repayment of the Bonds.

“State” shall mean the State of South Carolina.

“State Authority” shall mean the State Fiscal Accountability Authority (formerly the State Budget and Control Board).

“State Treasurer” shall mean the Office of the State Treasurer of South Carolina.

“Trustee” shall initially mean the State Treasurer or such other bank, trust company or financial institution which is authorized by the University and approved by the State Treasurer to serve in such capacity.

“University” shall mean Clemson University, South Carolina.

“Variable Rate Bonds” shall mean, for any period of time, any Bonds which during such period bear interest at a variable rate; provided that Bonds the interest rate on which has been fixed for the remainder of the term thereof shall no longer be Variable Rate Bonds.

B-5 Rate Covenants

(A) The University covenants and agrees in the Bond Resolution to maintain and collect rates and charges for attendance at events held at any Athletic Facilities which, when combined with other Revenues and the gross receipts of any Admissions Fee and any Special Student Fee, shall at all times be sufficient:

(2) To provide for the punctual payment of the principal of and interest on all Bonds and any Junior Lien Bonds that may from time to time be Outstanding;

(3) To maintain all Debt Service Funds and thus provide for the punctual payment of the principal of and interest on the Bonds;

(4) To maintain any and all Debt Service Reserve Funds in the manner herein prescribed;

(6) To pay all amounts owing under a reimbursement agreement with any provider of a surety bond, insurance policy, line of credit, letter of credit or similar instrument as contemplated under the Bond Resolution; and

(7) To discharge all obligations imposed by the Enabling Act and the Bond Resolution.

(B) The University further covenants and agrees in the Bond Resolution that it will at all times prescribe and maintain rates and thereafter collect charges in accordance with such rates and charges for attendance at events held at any Athletic Facilities or the use thereof which are reasonably expected to yield, along with all other Revenues, annual Net Revenues which when added to all gross receipts from the imposition of any Admissions Fee and any Special Student Fee, in the current Fiscal Year equal to at least 100% of the Combined Annual Principal and Interest Requirement for all Bonds Outstanding in such Fiscal Year; and, promptly upon any material change in the circumstances which were contemplated at the time such rates and charges were most recently reviewed, but not less frequently than once in each Fiscal Year, shall review the rates and charges for such use and shall promptly revise such rates and charges as necessary to comply with the foregoing requirement.

(C) For each Fiscal Year, the Board of Trustees shall adopt an Annual Budget for such Fiscal Year which shall set forth in reasonable detail the estimated revenues and operating expenses of the Athletic Department for each Fiscal Year and which shall include appropriations for the estimated operating expenses of the Athletic Department for such period and the amount, if any, to be deposited during such Fiscal Year in the Improvement Fund. The Board of Trustees may at any time adopt an amended Annual Budget for the remainder of the then current Fiscal Year, or may delegate to the Chief Financial Officer the authority to revise rates and charges as may be necessary.

(D) In connection with its covenants and agreements pursuant to this Section, the University shall only be obligated to establish, impose and collect any Admissions Fee or any Special Student Fee to the extent Net Revenues are not otherwise sufficient to enable the University to meet its obligations contained in such covenants and agreements.

(E) Notwithstanding any provision in the Bond Resolution to the contrary:

(i) The University shall not be obligated to impose any Admissions Fee or Special Student Fee, except as may be required pursuant to paragraph (D) above.

B-6 (ii) The University shall not be obligated to charge any fee for attendance at any intercollegiate athletic event held at any of the Athletic Facilities.

(iii) The University may permit events to be held at any of the Athletic Facilities which are not related to activities of the Athletic Department and in any such cases, any fees or concessions recovered by the University in connection with attendance at such events shall not be deemed to be Revenues unless the University so elects.

General Covenants

The University covenants and agrees in the Bond Resolution that:

(1) Neither the Athletic Facilities, nor any part thereof, nor any of the income or revenues derived from the Athletic Facilities, have been or will be hypothecated, mortgaged, otherwise pledged or encumbered, save and except as herein disclosed and provided for; and provided that nothing in this section of the Bond Resolution shall prevent the University from financing the acquisition of any item or items of equipment for or related to the Athletic Facilities, which financing is secured by a purchase money security interest or the equivalent thereof.

(2) So long as there are any Bonds outstanding and unpaid, it will perform all duties with reference to the Athletic Facilities required by the Constitution and statutes of the State, including without limitation the Enabling Act and the University hereby irrevocably covenants, binds and obligates itself not to pledge, mortgage or otherwise encumber the Athletic Facilities or any part thereof, or any revenues therefrom, except in the manner herein authorized and it will not sell, lease or dispose of any portion of the Athletic Facilities, necessary or useful (as determined by the University) in the operation of such facilities, until all Bonds shall be paid in full, or unless and until provision shall have been made for the payment of all Bonds and the interest thereon in full, and the University further obligates itself and covenants and agrees with the Bondholders to operate and maintain in good condition the Athletic Facilities, and to collect and charge such rates for the services provided by or the use of the Athletic Facilities so that the Net Revenues, along with the receipts from imposition of any Admissions Fee and any Special Student Fee, will be sufficient at all times to meet the requirements of the Bond Resolution.

(3) It will not discriminate, nor-permit discrimination by its employees, agents, lessees, or others operating the Athletic Facilities in the use thereof because of race, religion, creed or national origin.

(4) It will permit, so long as there are any Bonds Outstanding, any Bondholder to inspect the Athletic Facilities and all records and accounts thereof, as well as records and accounts pertaining to the imposition of any Admissions Fee and any Special Student Fee, under reasonable terms and conditions and after reasonable notice has been given.

(5) It will not make any use, and it shall not direct the Trustee and each fiduciary to make any use of the proceeds of any Series of Bonds which Bonds were intended upon the issuance thereof to be exempt from federal income taxation, which, if such use had been reasonably expected on the date of the issuance of the Bonds of such Series would have caused such Bonds or any other Bonds to be “arbitrage bonds” within the meaning of Section 148 of the Code and will observe and not violate the requirements of Section 148 of the Code.

(6) As to any Series of Bonds which were intended at the time of their issuance to be exempt from federal income taxation, it will take all actions required of it under the Code that are necessary to preserve the tax- exempt status of such Bonds, including without limitation, actions necessary to comply with all information reporting requirements and any obligation to rebate arbitrage earnings on the proceeds of such Bonds to the United States Government.

(7) It will make all payments or deposits required under Articles VII (Establishment of Funds) and VIII (Disposition of Revenues) of the Bond Resolution in a timely manner.

(8) It will, from time to time, forward to the Trustee, in writing, the name of the Chief Financial Officer and any designee of such Chief Financial Officer, together with a specimen signature of such individual.

B-7 The University recognizes that those who may from time to time hereafter be Bondholders will, throughout the life of the Bonds, require full information with respect to the Athletic Department, the fiscal affairs of the Athletic Department and all matters incident to each. To that end the University covenants and agrees in the Band Resolution that it will install and thereafter at all times maintain proper books of records and accounts, separate and distinct from all other records and accounts, in which complete and correct entries shall be made of all transactions relating to the Athletic Department, and all revenues and receipts derived therefrom, directly or indirectly. Such books and records shall be kept in such fashion as to reveal in detail:

(1) All transactions incurred by the University with respect to the Athletic Facilities and the Athletic Department;

(2) Revenues and the source from whence derived;

(3) All expenses incurred in the operation and maintenance of the Athletic Facilities suitably identified as to purpose;

(4) Net Revenues;

(5) All expenditures made from the several funds established by the Bond Resolution, and the Series Resolutions authorizing the issuance of the Bonds;

(6) The rate schedules that may from time to time be in effect as to attendance of events at any of the Athletic Facilities; and

(7) Receipts from the imposition of any Admissions Fee and any Special Student Fee.

The University further covenants and agrees in the Bond Resolution that so long as any Bands are Outstanding, it will, as soon after the close of each Fiscal Year as possible, cause to be made and completed by the Accountants, an audit of the records, books and accounts pertaining to the Athletic Department, which may be included as separate schedules in the general audit of the University, made in accordance with generally accepted accounting practices, showing, among other things, Net Revenues and gross receipts from the imposition of any Admissions Fee and any Special Student Fee, and to furnish a copy of such audit to the Trustee. Such audit shall comment upon any violation of any provision of any resolution authorizing the issuance of any Bonds or Junior Lien Bonds and any violation of any provision of the Bond Resolution or any Series Resolution noted by the Accountants, and such other matters as to them seem pertinent. The cost of such audit shall be treated as a part of the cost of operating and maintaining the Athletic Department. Copies of such audit shall also be made available to any Bondholder who shall have requested the same in writing to the Trustee.

Additional Bonds

The University covenants and agrees in the Bond Resolution that it will not issue Bonds or other obligations payable from the Revenues or from gross receipts from the imposition of any Admissions Fee or Special Student Fee whose claim to the proceeds of such Revenues and receipts is prior to that of the Series 2018A Bonds, but reserves therein the right to issue Bonds which, if issued in accordance with the Enabling Act and the Bond Resolution, will be on a parity with the Series 2018A Bonds (and all other previously issued Series of Bonds pursuant to the Bond Resolution) in all respects.

The Bond Resolution provides that from time to time additional series of Bonds may be issued pursuant to a Series Resolution for the purposes of:

(1) Obtaining funds for the construction of new Athletic Facilities or the permanent improvement, expansion or renovation of existing Athletic Facilities, including payment of capitalized interest during such construction, improvement, expansion or renovation on any Series of Bonds issued for such purposes plus a period not exceeding six (6) months;

B-8 (2) Providing funds for the payment of any bond anticipation note or notes that may have been issued in anticipation of the issuance and sale of Bonds;

(3) Refunding, by exchange or otherwise, Bonds or other obligations issued to provide land or facilities which are or are to become a part of the Athletic Facilities or which are or were payable in whole or in part from revenues of the Athletic Department;

(4) Funding any Debt Service Reserve Fund (including the purchase of a surety bond, insurance policy, line of credit or letter of credit as provided under the Bond Resolution) or restoring the value of the cash and securities in any Debt Service Reserve Fund to an amount equal to the applicable Reserve Requirement;

(5) Purchasing or providing for credit enhancement for any Series of Bonds; and

(6) Paying costs of issuance of Bonds.

The Bond Resolution provides that additional Bonds may be issued provided the following conditions, among others, are met:

(1) Except in the case of Bonds issued for the purpose of refunding any Bonds:

Net Revenues plus gross receipts from the imposition of any Admissions Fee and any Special Student Fee during the most recent Fiscal Year for which audited financial statements of the University are completed shall be certified by the Chief Financial Officer on the basis of such audited financial statements to be not less than one hundred ten percent (110%) of the maximum Combined Annual Principal and Interest Requirement on all Bonds Outstanding immediately prior to the issuance of such proposed Series of Bonds and on such proposed Series of Bonds. For these purposes, such Net Revenues and such gross receipts may be adjusted to reflect (1) any ticket, rate or fee increases currently adopted and to be in effect prior to or coincident with the issuance of such proposed Series of Bonds and determined as though such rate increases had been in continuous effect during such recent Fiscal Year; (2) in the event proceeds of such proposed Series of Bonds will be used to pay interest on such proposed Series, one hundred percent (100%) of the interest that will accrue on such Series of Bonds during the first twelve (12) full months following the date of delivery of the proposed Series and that will be paid from such proceeds; provided, however that any such interest accruing in such twelve (12) month period that is to be paid on a date within the Fiscal Year of maximum Combined Annual Principal and Interest Requirements shall not be so added into such Net Revenues and such gross receipts; (3) any amount allowed by clause (2) of this paragraph as an adjustment with respect to a previously issued Series of Bonds if the proposed Series of Bonds is being issued prior to the end of the Fiscal Year in which capitalized interest on the previously issued Series of Bonds is exhausted; and

(2) In the case of Bonds issued for the purpose of refunding any Bonds, either:

(a) The Annual Principal and Interest Requirements of the refunding Bonds shall not exceed the Annual Principal and Interest Requirements of the refunded Bonds until a time subsequent to the last maturity of Bonds not refunded and which remain Outstanding following the issuance of the refunding Bonds; or

(b) The University shall comply with the revenue test described in paragraph (1) above.

Establishment of Funds

For so long a time as any sum remains due and payable by way of principal or interest on the Bonds, the Bond Resolution provides that the accounting system for the Athletic Department shall be so arranged as to reflect the following funds or accounts relating to the revenues of the Athletic Department and such funds or accounts shall be established and maintained, and deposits shall be made therein in the manner herein required. When any of such funds or accounts are not required to be held by the Trustee, they may, if required by State law or otherwise agreed to by the University and the State Treasurer, be held by the State Treasurer on behalf of the University. One or more

B-9 accounts or subaccounts may be established within any such funds or accounts by the University, the State Treasurer or the Trustee (if other than the State Treasurer), as the case may be, in order to enable the proper administration of such funds or accounts in the judgment of such party. (The brief descriptions of such funds or accounts being for convenience of reference only; more complete descriptions being contained in the Bond Resolution.)

Operation and Maintenance Fund.

(A) There shall be established and maintained by the University a fund or account designated as the Operation and Maintenance Fund. This account shall be so maintained as to accurately reflect Revenues and Net Revenues.

(B) The Operation and Maintenance Fund is intended to provide for the payment of all expenses incurred in connection with the administration and operation of the Athletic Department and the Athletic Facilities, including, without limiting the generality of the foregoing, such expenses as may be reasonably necessary to preserve the Athletic Facilities in good repair and condition and to pay the fees and charges of the Trustee, the Paying Agent, the Registrar and the custodian or trustee of any other fund created or to be created hereunder, the costs of audits required hereunder, and the premiums for all insurance policies and any fidelity bonds required by the Bond Resolution.

(C) Withdrawals from the Operation and Maintenance Fund shall be made by the University in accordance, as nearly as practicable, with the Annual Budget then in effect.

Debt Service Funds. The Bond Resolution provides that separate Debt Service Funds shall be established for each Series of Bonds Outstanding. Moneys in a Debt Service Fund will be available to pay only the Series of Bonds for which such account was established. The Debt Service Funds are to be maintained by the Trustee and are intended to provide for the ratable payment of the principal of, premium, if any, and interest on the respective Series of Bonds as the same shall become due. The Bond Resolution provides that on or before the fifteenth (15th) day of each month immediately preceding each Bond Payment Date, there shall be deposited in the respective Debt Service Funds an amount sufficient to discharge all interest to become due on the respective Series of Bonds on the next ensuing interest payment date; provided, however, that if provision has been made for the payment of all or part of the next installment of interest to become due on any Series of Bonds, pursuant to any other provision of the Bond Resolution or any Series Resolution, or by reason of investment earnings, then, in such event, the deposits so required may be omitted, or reduced accordingly. If, as a result of the provision in a Series Resolution that any Series of Bonds shall bear interest payable for a period less than semi-annually, and any Holder of such Bonds shall receive payments of interest for any period for which payments were not made to holders of Bonds bearing interest payable semi-annually, then there shall be set aside in the applicable Debt Service Fund in trust for the benefit of the Holders of Bonds bearing interest payable semi-annually an amount of money equal to the interest accrued on the Bonds bearing interest payable semi-annually for such period.

The Bond Resolution additionally provides that on or before the fifteenth (15th) day of each month immediately preceding each Bond Payment Date, there shall be deposited in the respective Debt Service Funds a sum equal to one-half of the aggregate amount of principal of all Bonds becoming due and payable on the next ensuing principal payment date. On or before the fifteenth day of the month immediately preceding each Bond Payment Date on which a payment of principal is due to be made, there shall be deposited in the respective Debt Service Funds a sum equal to the amount necessary, when added to the payment made pursuant to the preceding sentence, to discharge the aggregate amount of principal of all Bonds becoming due and payable on such ensuing Bond Payment Date (whether at stated maturity or by sinking fund installment). Provided, however, that if provision has been made for the payment of all of the principal to become due on the Bonds, pursuant to any other provision of the Bond Resolution, or any Series Resolution, or by reason of investment earnings, then, in such event, the deposits so required may be omitted, or reduced accordingly.

As receipts from the imposition of any Admissions Fee and any Special Student Fee are collected by the University, the same shall be promptly remitted to the Trustee, who shall deposit the same as received, pro-rata as to the Outstanding Series of Bonds, in the respective Debt Service Funds.

B-10 Withdrawals from the Debt Service Funds shall be made only by the Trustee who shall transmit to the Paying Agent, at such times as may be appropriate, the sums required to pay the principal of, premium, if any, and interest on the respective Series of Bonds.

Moneys in the Debt Service Funds shall be invested and reinvested at the discretion of the Trustee in Authorized Investments.

Debt Service Reserve Funds. A Series Resolution shall provide for the establishment of a Debt Service Reserve Fund for any Series of Bonds for which a Reserve Requirement may have been established pursuant to such Series Resolution. Each Debt Service Reserve Fund so established is to be maintained at the respective Reserve Requirement as may have been established for the particular Series of Bonds. Funds in a particular Debt Service Reserve Fund will be available to secure only the payment of the Series of Bonds for which such Debt Service Reserve Fund was established. All Debt Service Reserve Funds are maintained by the Trustee and are intended to insure the timely payment of the principal of and interest on the respective Series of Bonds, and to provide for any redemption of the respective Series of Bonds prior to their stated maturities.

Money in the Debt Service Reserve Funds shall be invested and reinvested at the discretion of the Trustee in Authorized Investments. The earnings from such investments accumulate in the particular Debt Service Reserve Fund until each required semi-annual evaluation. At the time of such valuation, if the market value of the securities and money in a Debt Service Reserve Fund exceed the applicable Reserve Requirement, such excess shall be removed from the Debt Service Reserve Fund and used to effect partial redemption of the applicable Series of Bonds or transferred into the Operations and Maintenance Fund or the Improvement Fund, as directed by the University.

In lieu of the deposit of moneys into a Debt Service Reserve Fund, the University may satisfy the applicable Reserve Requirement by causing to be credited thereto a surety bond, line of credit, letter of credit or an insurance policy payable to the Trustee for the benefit of the Holders of the applicable Series of Bonds in an amount which together with other moneys on deposit in such Debt Service Reserve Fund, if any, is equal to such Reserve Requirement.

In the event a Debt Service Reserve Fund has been funded with a surety bond, insurance policy, line of credit or letter of credit and either such instrument has been drawn upon, monies available to repay such surety bond, insurance policy, line of credit or letter of credit provider shall first be used to reinstate the surety bond, insurance policy, line of credit or letter of credit to its original amount. Any interest or fees due to the surety bond, insurance policy, line of credit or letter of credit provider, other than reinstatement, shall be subordinate to any amounts payable upon the applicable Series of Bonds.

In the event a Debt Service Reserve Fund is funded with a surety bond, insurance policy, line of credit or letter of credit, any revenues available for debt service on the Bonds shall be distributed on a pro rata basis among the outstanding Bonds of each Series without regard to the method or level of funding of the respective Debt Service Reserve Funds, if any, for each Series.

Any cash or investments on deposit in or credited to a Debt Service Reserve Fund shall be withdrawn prior to any draw on its surety bond, letter of credit or similar instrument with respect thereto. In the event the amount on deposit in or credited to a Debt Service Reserve Fund, in addition to the amount available under the surety bond, letter of credit or similar instrument in question (the “Original Funding Instrument”) includes amounts available under another surety bond, letter of credit or similar instrument (the “Additional Funding Instrument”), draws on the Original Funding Instrument and the Additional Funding Instrument shall be made on a pro rata basis to fund any insufficiency in the applicable Debt Service Fund.

The market value of the cash and securities in each Debt Service Reserve Fund, if any, shall be calculated as of each Bond Payment Date in order to determine if such Debt Service Reserve Fund contains the amount required by the applicable Series Resolution and the extent to which payments therefor or withdrawals therefrom must be made. In the event the aggregate market value of such cash and securities, together with any surety bond, insurance policy, line of credit or letter of credit permitted under the Bond Resolution, in a Debt Service Reserve

B-11 Fund is determined not to equal the applicable Reserve Requirement, then there shall be paid into such Debt Service Reserve Fund on the last Business Day of each of twelve (12) months following a determination of such deficiency, one-twelfth (1/12) of the amount necessary to reestablish in such Debt Service Reserve Fund its Reserve Requirement; provided, however, the University may fully re-establish the Reserve Requirement in a more timely manner.

Improvement Fund. The Improvement Fund is to be maintained by the University to establish a reasonable reserve for contingencies and for improvements, expansions and renovations of the Athletic Facilities. Money in the Improvement Fund may be withdrawn for the purposes described in the next succeeding sentence in the event all required deposits have been made in the respective Debt Service Funds and any Debt Service Reserve Funds. Such moneys may be withdrawn by the University from time to time and used solely:

(a) for the purpose of restoring depreciated or obsolete items of the Athletic Facilities;

(b) for improvements, expansions and renovations to the Athletic Facilities, other than for those things which are reasonably necessary to maintain the Facilities in good repair and condition;

(d) to prevent defaults of Bonds (should any Debt Service Fund or Debt Service Reserve Fund prove to be insufficient for such purposes) and Junior Lien Bonds; and

(e) for optional redemption of Bonds.

To the extent funds are available, there shall be paid from time to time from the Operation and Maintenance Fund, for deposit into the Improvement Fund amounts such that the entire amount deposited during Fiscal Year equals that sum which has been budgeted for the Improvement Fund for that Fiscal Year pursuant to the Annua1 Budget; provided, however, that if provision has been made for the payment of all or part of that Fiscal Year’s deposit to the Improvement Fund, due to accumulations of moneys therein or by reason of investment earnings, then, in such event, the deposits required by this Section may be omitted, or reduced accordingly.

Use of Surplus Amounts. At any time that there is in the Operation and Maintenance Fund an amount sufficient to make all payments required by the foregoing through the next ensuing Bond Payment Date, the University may withdraw any moneys in excess of such amount and use them (a) to make additional deposits to the Improvement Fund (whether or not in excess of the amounts budgeted therefrom) or (b) in the discretion of the Board of Trustees, for any other lawful purposes of the University.

Modification of Resolution

Provided that the security of the Bonds will not be lessened or in any manner impaired, the Board of Trustees may for any one or more of the following purposes, at any time, or from time to time, adopt a resolution which supplements the Bond Resolution for the following purposes:

(1) To provide for the issuance of a Series of Bonds in accordance with the other provisions of the Bond Resolution;

(2) To add to the covenants and agreements of the University in the Bond Resolution and to provide for other covenants and agreements thereafter to be observed relative to the operation, maintenance, construction or administration of any part of the Athletic Facilities; it being specifically provided that the Chief Financial Officer is authorized prior to the sale of any Series of Bonds to increase the required ratios involving Net Revenues or to increase the credit rating requirements for the providers of Debt Service Reserve Fund substitutes;

(3) To surrender any right, power or privilege reserved to or conferred upon the University by the Bond Resolution; or

B-12 (4) To cure, correct and remove any ambiguity or inconsistent provisions contained in the Bond Resolution.

The rights and duties of the University and the Bondholders and the terms and provisions of the Bond Resolution may be modified or altered in any respect by resolution of the Board of Trustees with the consent of the Bondholders of 66-2/3% in principal amount of all Bonds of each Series which will be affected (with the consent of any municipal bond insurance company which has insured a Series of Bonds), provided that no modification or alteration will:

(a) Extend the maturity of any payment of principal or interest due upon any Bond;

(b) Effect a reduction in the amount which the University is required to pay by way of principal of, redemption premium or interest on any Bonds;

(c) Effect a change as to the type of currency in which the University is obligated to effect payment of the principal of, redemption premium or interest on the Bonds;

(d) Permit the creation of a pledge of or lien upon the revenues of the Revenues or upon the proceeds of the imposition of any Admissions Fee or Special Student Fee prior or equal to the Bonds except as authorized by the Bond Resolution;

(e) Permit preference or priority of any Series of Bonds issued pursuant to the Bond Resolution to others;

(f) Alter or modify the provisions of Article IV (Additional Bonds), Article V (Rates and Charges), Article VII (Establishment of Funds), and Article VIII (Imposition of Revenues) of the Bond Resolution (except in the manner referred to in the immediately preceding paragraph above); or

(g) Reduce the percentage of Bonds required for the written consent of the modification or alteration of the provisions of the Bond Resolution;

without the consent of the Holders of all Bonds affected by such change or modification.

Events of Default

The occurrence and continuance of any of the following is an “Event of Default” under the Bond Resolution:

(A) Payment of the principal of any of the Bonds shall not be made when the same shall become due and payable, either at maturity or by proceeding for redemption;

(B) Payment of any installment of interest on any Bonds shall not be made when the same becomes due and payable;

(C) Payment of any installment of either interest or principal of any Junior Lien Bonds shall not be made when the same becomes due and payable or any other event of default shall exist with respect to any Junior Lien Bonds;

(D) The University shall for any reason be rendered incapable or fulfilling its obligations under the Bond Resolution;

(E) An order or decree shall be entered with the consent or acquiescence of the University appoint a receiver, or receivers, of the Athletic Facilities, the Athletic Department or of the Revenues, or any proceedings shall be instituted with the consent or acquiescence of the University for the purpose of effecting a composition between the University and its creditors whose claims relate to the Athletic Facilities or the Athletic Department, or for the

B-13 purpose of adjusting claims of such creditors, pursuant to any Federal or State statute now or hereafter enacted, or if such order or decree, having been entered without the consent or acquiescence of the University, shall not be vacated or discharged or stayed on appeal within sixty (60) days after entry thereof, or if such proceeding having been instituted without the consent or acquiescence of the University, shall not be withdrawn or any orders entered shall not be vacated, discharged, or stayed on appeal within sixty (60) days after the institution of such proceedings, or the entry of such orders;

(F) The University shall fail to operate the Athletic Facilities or the Athletic Department in an efficient and business-like fashion or shall default in the due and punctual performance of any other of the covenants, conditions, agreements or provisions contained in the Bonds or in this Bond Resolution, and such default shall continue for thirty (30) days after written notice specifying such default and requiring the same to be remedied, shall have been given to the University by any Bondholder, provided that in the case of default specified in this Paragraph (F), if the default be such that it cannot be corrected within the said thirty (30) day period, it shall not constitute an event of default if corrective action is instituted by the University within said thirty (30) day period and diligently pursued until the default is corrected; or

(G) The occurrence of an event of default on the part of the University under any reimbursement agreement between the University and a provider of a surety bond, insurance policy, line of credit or letter of credit as contemplated under the Bond Resolution.

The provisions of the preceding paragraph (F) are subject to the following limitations: If by reason of force majeure the University is unable in whole or in part to carry out its agreements contained in the Bond Resolution (other than the obligations on the part of the University contained in any of Article IV (Additional Bonds), Article V (Rates and Charges), Article VII (Establishment of Funds) and Article VIII (Disposition of Revenues) thereof), the University shall not be deemed in default during the continuance of such inability. The term “force majeure” means, without limitation, the following: acts of God; strikes; lockouts or other industrial disturbances; acts of public enemies; orders of any kind of the government of the United States or of the State or any of their departments, agencies, or officials, or any civil or military authority; insurrections; riots; epidemics; landslides; lightning; earthquake; fire; hurricanes; storms; floods; washouts; droughts; arrests; restraint of government and people; civil disturbances; explosions; breakage or accident to machinery, tunnels or canals; partial or entire failure of utilities; or any other cause or event not reasonably within the control of the University. The settlement of strikes, lockouts and other industrial disturbances shall be entirely within the discretion of the University, and the University shall not be required to make settlement of strikes, lockouts and other industrial disturbances by acceding to the demands of the opposing party or parties when such course is in the judgment of the University unfavorable to the University.

Acceleration; Annulment

(A) Except as specifically provided in the Bond Resolution, upon the happening of an Event of Default, subject to the rights of any Bond Insurer under the Resolution to control accelerations, the Trustee may, and upon the written request of the Holders of not less than 25% in aggregate principal amount of Bonds outstanding shall, by notice in writing to the University, declare all Bonds outstanding immediately due and payable. In the event of such declaration, the Bonds shall become and be immediately due and payable. Such Bonds shall become and be immediately due and payable, anything in the Bonds or in the Bond Resolution to contrary notwithstanding. In such event, there shall be due and payable on the Bonds an amount equal to the total principal amount of all such Bonds, plus all interest accrued thereon and which will accrue thereon to the date of payment.

(B) At any time after the principal of the Bonds shall have been so declared to be due and payable and before the entry of final judgment or decree in any suit, action or proceeding instituted on account of such delimit, or before the completion of the enforcement of any other remedy under the Bond Resolution, the Trustee may annul such declaration and its consequences with respect to any Bonds not then due by their terms if:

(1) Moneys shall have been deposited in the respective Debt Service Funds sufficient to pay all matured installments of interest and principal (other than principal then due only because of such declaration) of all outstanding Bonds;

B-14 (2) Moneys shall have been deposited with the Trustee sufficient to pay the charges, compensation, expenses, disbursements, advances and liabilities of the Trustee;

(3) All other amounts then payable by the University under the Bond Resolution shall have been paid or a sum sufficient to pay the same shall have been deposited with the Trustee; and

(4) Every Event of Default known to the Trustee (other than a default in the payment of the principal of such Bonds then due only because of such declaration) shall have been remedied to the satisfaction of the Trustee. No such annulment shall extend to or affect any subsequent Event of Default or impair any right consequent thereon.

Additional Remedies

(A) Upon the happening of any Event of Default, the Trustee may, and upon the written request of the Holders of not less than 25% in the aggregate principal amount of the Bonds outstanding, together with indemnification of the Trustee to its satisfaction therefor, shall proceed forthwith to protect and enforce its rights and the rights of the Bondholders under the Bond Resolution by such suits, actions or proceedings as the Trustee, being advised by counsel, shall deem expedient, including but not limited to:

(1) Requiring the University to carry out its duties and obligations under the terms of the Bond Resolution and under the Enabling Act;

(2) Suit upon all or any part of the Bonds;

(3) Civil action to require the University to account as if it were the trustee of an express trust for the Holders of Bonds;

(4) Civil action to enjoin any acts or things which may be unlawful or in violation of the rights of the Holders of Bonds; and

(5) Enforcement of any other right of the Bondholders conferred by law or by the Bond Resolution including the right to make proper application to a court of competent jurisdiction for the appointment of a receiver to administer and operate the Athletic Facilities and the Athletic Department. Such receiver shall be given full power to fix rentals and charges for the Athletic Facilities, sufficient to provide for the payment of principal of Bonds and the interest thereon, and for the payment of the expenses of operating and maintaining the Athletic Facilities, and to apply the income and revenues of the Athletic Facilities and the Athletic Department to the payment of principal of such Bonds and the interest thereon.

(B) Regardless of the happening of an Event of Default, the Trustee, if requested in writing by the Holders of not less than 25% in aggregate principal amount of the Bonds then outstanding, shall, upon being indemnified to its satisfaction therefor, institute and maintain such suits and proceedings as it may be advised by counsel shall be necessary or expedient:

(1) To prevent any impairment of the security under the Bond Resolution by any acts which may be unlawful or in violation of the Bond Resolution; or

(2) To preserve or protect the interests of the Bondholders, provided that such request is in accordance with law and the provisions of the Bond Resolution and, in the sole judgment of the Trustee, is not unduly prejudicial to the interests of the Holders of Bonds not making such request.

B-15 Defeasance

Pursuant to the Bond Resolution, defeasance of Bonds of a particular Series shall be deemed to have occurred when, among other things, the Trustee, Paying Agent, or other custodian authorized by the University, shall hold, at the stated maturities of such Bonds, in trust and irrevocably appropriated thereto, sufficient money for the payment thereof, or Government Obligations, the principal of and interest on which when due (without reinvestment thereof) will provide money which, together with the money, if any, deposited at the same time, will be sufficient to pay when due the principal, interest and redemption premiums, if any, due and to become due on and prior to the maturity or, if the University has irrevocably elected to redeem such Bonds, on and prior to the redemption date of such Bonds.

The 2017 Series Resolution

Bonds issued pursuant to the Bond Resolution have been authorized by the adoption of a Series Resolution. The 2017 Series Resolution sets forth the purposes for which the Series 2018A Bonds are being issued. The 2017 Series Resolution further determines, or delegates the power to determine, among other things, the date of the issue, the interest rates, maturity schedule, principal and interest payment dates and redemption provisions. The 2017 Series Resolution further provides for the manner in which the Series 2018A Bonds will be sold and awarded and authorizes the distribution of the Preliminary Official Statement and a final Official Statement. The 2017 Series Resolution also sets forth the form of the Series 2018A Bonds, authorizes the Continuing Disclosure Undertaking, and authorizes certain officials of the University to execute the Series 2018A Bonds.

The University covenants in the 2017 Series Resolution to comply with the provisions of Section 148(f) of the Code pertaining to the rebate of certain arbitrage earnings on the proceeds of the Series 2018A Bonds, to the extent such Series is not a Taxable Series. As discussed under the heading “TAX MATTERS” in the Official Statement, failure by the University to comply with the provisions of said Section 148(f) may result in the income taxation of interest on the Series 2018A Bonds, retroactive to the date of their issuance.

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APPENDIX C

FORM OF BOND COUNSEL OPINION

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FORM OF BOND COUNSEL OPINION

January __, 2018

Board of Trustees of Clemson University Clemson, South Carolina

Re: $______Athletic Facilities Revenue Bonds, Series 2018A, of Clemson University, South Carolina

Ladies and Gentlemen:

As Bond Counsel to Clemson University, South Carolina (the “University”), we have examined a certified copy of the Transcript of Proceedings and other proofs submitted to us, including the Constitution and statutes of the State of South Carolina, in relation to the issuance of the $______Athletic Facilities Revenue Bonds, Series 2018A, of Clemson University, South Carolina, dated January ___, 2018 (the “Series 2018A Bonds”). The Series 2018A Bonds are issued by the University pursuant to a bond resolution (the “Bond Resolution”) adopted by the Board of Trustees of Clemson University (the “Board of Trustees”) on April 16, 1999, and a series resolution (the “2017 Series Resolution”) adopted by the Board of Trustees on February 3, 2017 (the Bond Resolution and the 2017 Series Resolution are herein referred to together as the “Resolution”), and under and in full compliance with the Constitution and statutes of the State of South Carolina, including particularly Title 59, Chapter 119, Article 9 of the Code of Laws of South Carolina 1976, as amended, in order to obtain funds which will be used to: (i) defray the costs of constructing and equipping a tennis facility on the campus of the University, which constitute a portion of the athletic facilities of the University; and (ii) pay costs of issuance of the Series 2018A Bonds.

The Series 2018A Bonds will bear interest from January 1, 2018, and will be initially payable on May 1, 2018 and semiannually thereafter on each November 1 and May 1 in the respective principal amounts and at the interest rates per annum as set forth in the Official Statement with respect to the Series 2018A Bonds dated January ___, 2018 (the “Official Statement”).

The Series 2018A Bonds are issued in fully registered form, in the denomination of $5,000 or any whole multiple thereof, not exceeding the principal amount of the Series 2018A Bonds maturing in each year. The Series 2018A Bonds maturing on or prior to ___ 1, 202__ are not subject to redemption prior to their stated maturities. The Series 2018A Bonds maturing after ___ 1, 202_, are subject to redemption upon 30 days written notice, in whole or in part, at any time in any order of maturity to be determined by the University, on or after ____ 1, 202_, at par plus accrued interest to the date fixed for redemption.

The Series 2018A Bonds are numbered from R-1 upwards in such fashion as to maintain a proper record thereof.

The Series 2018A Bonds are being issued on a parity with certain other Series of Bonds currently outstanding and to be outstanding upon the issuance of the Series 2018A Bonds, as described herein. Further bonds on a parity with the Series 2018A Bonds in all respects (“Additional Bonds”) may be issued under the conditions prescribed in the Resolution.

Based on the foregoing, we are, as of the date hereof, of the opinion, under existing law, as follows:

1. The Series 2018A Bonds are valid and binding obligations of the University, and are payable, both as to principal and interest, solely from the Net Revenues (as defined in the Bond Resolution) and the gross receipts of the imposition of any Admissions Fee or any Special Student Fee (as such terms are defined in the Bond Resolution). The Series 2018A Bonds do not constitute a general indebtedness of the University or an indebtedness of any kind of the State of South Carolina.

2. The pledge made to secure the Series 2018A Bonds has priority over all pledges heretofore or hereafter made, except the pledges (on a parity with the pledges securing the Series 2018A Bonds) made to secure (i)

C-1 (a) the $12,335,000 original principal amount Athletic Facilities Refunding Revenue Bonds, Series 2012, (b) the $30,695,000 original principal amount Athletic Facilities Revenue Bonds, Series 2014A, (c) the $9,240,000 original principal amount Athletic Facilities Revenue Bonds (Taxable), Series 2014B, (d) the $10,545,000 original principal amount Athletic Facilities Refunding Revenue Bonds, Series 2014C, (e) the $60,695,000 original principal amount Athletic Facilities Revenue Bonds, Series 2015, and (f) the $18,875,000 original principal amount Athletic Facilities Revenue Bonds, Series 2015B; and (ii) any Additional Bonds, if such Additional Bonds be issued in the manner and under the conditions prescribed by the Bond Resolution.

3. The Resolution has been duly and lawfully adopted by the Board of Trustees, is of full force and effect, and constitutes a binding and enforceable obligation of the University. The Series 2018A Bonds have been duly and lawfully authorized and executed by the University and are valid and binding upon, and enforceable against, the University except as described below. The pledge of Net Revenues of the University’s Athletic Department and gross receipts from the imposition of any Admissions Fee and any Special Student Fee made pursuant to the Resolution constitutes a valid pledge thereof, subject to the application of such funds to the purposes, and pursuant to the conditions, set forth in the Resolution. Upon the execution, authentication, and delivery thereof, the Series 2018A Bonds will be duly and validly authorized and issued in accordance with the Resolution.

4. Interest on the Series 2018A Bonds (including any original issue discount properly allocable to an owner thereof) is excluded from gross income of the registered owners thereof for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals. The opinions set forth above are subject to the condition that the University comply with all requirements of the Internal Revenue Code of 1986, as amended (the “Code”), that must be satisfied subsequent to the issuance of the Series 2018A Bonds in order that interest thereon be (or continue to be) excluded from gross income for federal income tax purposes. Failure to comply with certain of such requirements may cause interest on the Series 2018A Bonds to be included in gross income for federal income tax purposes retroactive to the date of issuance of the Series 2018A Bonds. The University has covenanted to comply with such requirements. We express no opinion regarding other federal tax consequences arising with respect to the Series 2018A Bonds.

5. The Series 2018A Bonds and the interest thereon (including any original issue discount properly allocable to an owner thereof) are exempt from all state, county, school district, municipal and all other taxes or assessments of the State of South Carolina, except inheritance, estate, transfer or certain franchise taxes. Furthermore, it should be noted that Section 12-11-20 of the Code of Laws of South Carolina 1976, as amended, imposes upon every bank engaged in business in South Carolina a fee or franchise tax computed on the entire net income of such bank which includes interest paid on the Series 2018A Bonds.

We have been advised on this date that there is no litigation threatened or pending, which, in any manner, affects the validity of the Series 2018A Bonds.

It is to be understood that the rights of the holders of the Series 2018A Bonds and the enforceability of the Series 2018A Bonds and the Resolution may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’ rights heretofore or hereafter enacted and that their enforcement may also be subject to the exercise of judicial discretion in appropriate cases.

We express no opinion herein regarding the accuracy, adequacy or completeness of the Official Statement or regarding the perfection or priority of the lien on the Net Revenues of the University’s Athletic Department and gross receipts from the imposition of any Admissions Fee and any Special Student Fee created under the Bond Resolution (or any other document or instrument mentioned herein). This opinion is given as of the date hereof, and we assume no obligation to revise or supplement this opinion to reflect any facts or circumstances that may hereafter come to our attention or any changes in law that may hereafter occur.

Very truly yours,

Pope Flynn, LLC

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APPENDIX D

FORM OF DISCLOSURE DISSEMINATION AGREEMENT

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DISCLOSURE DISSEMINATION AGENT AGREEMENT

This Disclosure Dissemination Agent Agreement (the “Disclosure Agreement”), dated as of January __, 2018 is executed and delivered by Clemson University (the “Issuer”) and Digital Assurance Certification, L.L.C., as exclusive Disclosure Dissemination Agent (the “Disclosure Dissemination Agent” or “DAC”) for the benefit of the Holders (hereinafter defined) of the Bonds (hereinafter defined) and in order to provide certain continuing disclosure with respect to the Bonds in accordance with Rule 15c2-12 of the United States Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time (the “Rule”).

The services provided under this Disclosure Agreement solely relate to the execution of instructions received from the Issuer through use of the DAC system and do not constitute “advice” within the meaning of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Act”). DAC will not provide any advice or recommendation to the Issuer or anyone on the Issuer’s behalf regarding the “issuance of municipal securities” or any “municipal financial product” as defined in the Act and nothing in this Disclosure Agreement shall be interpreted to the contrary.

SECTION 1. Definitions. Capitalized terms not otherwise defined in this Disclosure Agreement shall have the meaning assigned in the Rule or, to the extent not in conflict with the Rule, in the Official Statement (hereinafter defined). The capitalized terms shall have the following meanings:

“Annual Filing Date” means the date, set in Sections 2(a) and 2(f), by which the Annual Report is to be filed with the MSRB.

“Annual Financial Information” means annual financial information as such term is used in paragraph (b)(5)(i) of the Rule and specified in Section 3(a) of this Disclosure Agreement.

“Annual Report” means an Annual Report described in and consistent with Section 3 of this Disclosure Agreement.

“Audited Financial Statements” means the financial statements (if any) of the Issuer for the prior fiscal year, certified by an independent auditor as specified in Section 3(b) of this Disclosure Agreement.

“Bonds” means the bonds as listed on the attached Exhibit A, with the 9-digit CUSIP numbers relating thereto.

“Certification” means a written certification of compliance signed by the Disclosure Representative stating that the Annual Report, Audited Financial Statements, Notice Event notice, Failure to File Event notice, Voluntary Event Disclosure or Voluntary Financial Disclosure delivered to the Disclosure Dissemination Agent is the Annual Report, Audited Financial Statements, Notice Event notice, Failure to File Event notice, Voluntary Event Disclosure or Voluntary Financial Disclosure required to be submitted to the MSRB under this Disclosure Agreement. A Certification shall accompany each such document submitted to the Disclosure Dissemination Agent by the Issuer and include the full name of the Bonds and the 9-digit CUSIP numbers for all Bonds to which the document applies.

“Disclosure Dissemination Agent” means Digital Assurance Certification, L.L.C, acting in its capacity as Disclosure Dissemination Agent hereunder, or any successor Disclosure Dissemination Agent designated in writing by the Issuer pursuant to Section 9 hereof.

“Disclosure Representative” means Sherri Rowland or Marsha Stowe, or such other person as the Issuer shall designate in writing to the Disclosure Dissemination Agent from time to time as the person responsible for providing Information to the Disclosure Dissemination Agent.

“Failure to File Event” means the Issuer’s failure to file an Annual Report on or before the Annual Filing Date.

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“Force Majeure Event” means: (i) acts of God, war, or terrorist action; (ii) failure or shut-down of the Electronic Municipal Market Access system maintained by the MSRB; or (iii) to the extent beyond the Disclosure Dissemination Agent’s reasonable control, interruptions in telecommunications or utilities services, failure, malfunction or error of any telecommunications, computer or other electrical, mechanical or technological application, service or system, computer virus, interruptions in Internet service or telephone service (including due to a virus, electrical delivery problem or similar occurrence) that affect Internet users generally, or in the local area in which the Disclosure Dissemination Agent or the MSRB is located, or acts of any government, regulatory or any other competent authority the effect of which is to prohibit the Disclosure Dissemination Agent from performance of its obligations under this Disclosure Agreement.

“Holder” means any person (a) having the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds through nominees, depositories or other intermediaries) or (b) treated as the owner of any Bonds for federal income tax purposes.

“Information” means, collectively, the Annual Reports, the Audited Financial Statements (if any), the Notice Event notices, the Failure to File Event notices, the Voluntary Event Disclosures and the Voluntary Financial Disclosures.

“MSRB” means the Municipal Securities Rulemaking Board established pursuant to Section 15B(b)(1) of the Securities Exchange Act of 1934.

“Notice Event” means any of the events enumerated in paragraph (b)(5)(i)(C) of the Rule and listed in Section 4(a) of this Disclosure Agreement.

“Obligated Person” means any person, including the Issuer, who is either generally or through an enterprise, fund, or account of such person committed by contract or other arrangement to support payment of all, or part of the obligations on the Bonds (other than providers of municipal bond insurance, letters of credit, or other liquidity facilities), as shown on Exhibit A.

“Official Statement” means that Official Statement prepared by the Issuer in connection with the Bonds, as listed on Exhibit A.

“Trustee” means the institution, if any, identified as such in the document under which the Bonds were issued.

“Voluntary Event Disclosure” means information of the category specified in any of subsections (e)(vi)(1) through (e)(vi)(11) of Section 2 of this Disclosure Agreement that is accompanied by a Certification of the Disclosure Representative containing the information prescribed by Section 7(a) of this Disclosure Agreement.

“Voluntary Financial Disclosure” means information of the category specified in any of subsections (e)(vii)(1) through (e)(vii)(9) of Section 2 of this Disclosure Agreement that is accompanied by a Certification of the Disclosure Representative containing the information prescribed by Section 7(b) of this Disclosure Agreement.

SECTION 2. Provision of Annual Reports.

(a) The Issuer shall provide, annually, an electronic copy of the Annual Report and Certification to the Disclosure Dissemination Agent, together with a copy for the Trustee, not later than the Annual Filing Date. Promptly upon receipt of an electronic copy of the Annual Report and the Certification, the Disclosure Dissemination Agent shall provide an Annual Report to the MSRB not later than February 1 of each fiscal year of the Issuer, commencing with the Annual Report for the fiscal year ending June 30, 2018. Such date and each anniversary thereof is the Annual Filing Date. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may cross-reference other information as provided in Section 3 of this Disclosure Agreement.

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(b) If on the fifteenth (15th) day prior to the Annual Filing Date, the Disclosure Dissemination Agent has not received a copy of the Annual Report and Certification, the Disclosure Dissemination Agent shall contact the Disclosure Representative by telephone and in writing (which may be by e-mail) to remind the Issuer of its undertaking to provide the Annual Report pursuant to Section 2(a). Upon such reminder, the Disclosure Representative shall either (i) provide the Disclosure Dissemination Agent with an electronic copy of the Annual Report and the Certification no later than two (2) business days prior to the Annual Filing Date, or (ii) instruct the Disclosure Dissemination Agent in writing that the Issuer will not be able to file the Annual Report within the time required under this Disclosure Agreement, state the date by which the Annual Report for such year will be provided and instruct the Disclosure Dissemination Agent that a Failure to File Event has occurred and to immediately send a notice to the MSRB in substantially the form attached as Exhibit B, accompanied by a cover sheet completed by the Disclosure Dissemination Agent in the form set forth in Exhibit C-1.

(c) If the Disclosure Dissemination Agent has not received an Annual Report and Certification by 6:00 p.m. Eastern time on Annual Filing Date (or, if such Annual Filing Date falls on a Saturday, Sunday or holiday, then the first business day thereafter) for the Annual Report, a Failure to File Event shall have occurred and the Issuer irrevocably directs the Disclosure Dissemination Agent to immediately send a notice to the MSRB in substantially the form attached as Exhibit B without reference to the anticipated filing date for the Annual Report, accompanied by a cover sheet completed by the Disclosure Dissemination Agent in the form set forth in Exhibit C- 1.

(d) If Audited Financial Statements of the Issuer are prepared but not available prior to the Annual Filing Date, the Issuer shall, when the Audited Financial Statements are available, provide in a timely manner an electronic copy to the Disclosure Dissemination Agent, accompanied by a Certification, together with a copy for the Trustee, for filing with the MSRB.

(e) The Disclosure Dissemination Agent shall:

(i) verify the filing specifications of the MSRB each year prior to the Annual Filing Date;

(ii) upon receipt, promptly file each Annual Report received under Sections 2(a) and 2(b) with the MSRB;

(iii) upon receipt, promptly file each Audited Financial Statement received under Section 2(d) with the MSRB;

(iv) upon receipt, promptly file the text of each Notice Event received under Sections 4(a) and 4(b)(ii) with the MSRB, identifying the Notice Event as instructed by the Issuer pursuant to Section 4(a) or 4(b)(ii) (being any of the categories set forth below) when filing pursuant to Section 4(c) of this Disclosure Agreement:

1. “Principal and interest payment delinquencies;”

2. “Non-Payment related defaults, if material;”

3. “Unscheduled draws on debt service reserves reflecting financial difficulties;”

4. “Unscheduled draws on credit enhancements reflecting financial difficulties;”

5. “Substitution of credit or liquidity providers, or their failure to perform;”

6. “Adverse tax opinions, IRS notices or events affecting the tax status of the security;”

7. “Modifications to rights of securities holders, if material;”

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8. “Bond calls, if material;”

9. “Defeasances;”

10. “Release, substitution, or sale of property securing repayment of the securities, if material;”

11. “Rating changes;”

12. “Tender offers;”

13. “Bankruptcy, insolvency, receivership or similar event of the obligated person;”

14. “Merger, consolidation, or acquisition of the obligated person, if material;” and

15. “Appointment of a successor or additional trustee, or the change of name of a trustee, if material;”

(v) upon receipt (or irrevocable direction pursuant to Section 2(c) of this Disclosure Agreement, as applicable), promptly file a completed copy of Exhibit B to this Disclosure Agreement with the MSRB, identifying the filing as “Failure to provide annual financial information as required” when filing pursuant to Section 2(b)(ii) or Section 2(c) of this Disclosure Agreement;

(vi) upon receipt, promptly file the text of each Voluntary Event Disclosure received under Section 7(a) with the MSRB, identifying the Voluntary Event Disclosure as instructed by the Issuer pursuant to Section 7(a) (being any of the categories set forth below) when filing pursuant to Section 7(a) of this Disclosure Agreement:

1. “amendment to continuing disclosure undertaking;”

2. “change in obligated person;”

3. “notice to investors pursuant to bond documents;”

4. “certain communications from the Internal Revenue Service;”

5. “secondary market purchases;”

6. “bid for auction rate or other securities;”

7. “capital or other financing plan;”

8. “litigation/enforcement action;”

9. “change of tender agent, remarketing agent, or other on-going party;”

10. “derivative or other similar transaction;” and

11. “other event-based disclosures;”

(vii) upon receipt, promptly file the text of each Voluntary Financial Disclosure received under Section 7(b) with the MSRB, identifying the Voluntary Financial Disclosure as instructed by the Issuer pursuant to Section 7(b) (being any of the categories set forth below) when filing pursuant to Section 7(b) of this Disclosure Agreement:

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1. “quarterly/monthly financial information;”

2. “change in fiscal year/timing of annual disclosure;”

3. “change in accounting standard;”

4. “interim/additional financial information/operating data;”

5. “budget;”

6. “investment/debt/financial policy;”

7. “information provided to rating agency, credit/liquidity provider or other third party;”

8. “consultant reports;” and

9. “other financial/operating data.”

(viii) provide the Issuer evidence of the filings of each of the above when made, which shall be by means of the DAC system, for so long as DAC is the Disclosure Dissemination Agent under this Disclosure Agreement.

(f) The Issuer may adjust the Annual Filing Date upon change of its fiscal year by providing written notice of such change and the new Annual Filing Date to the Disclosure Dissemination Agent, Trustee (if any) and the MSRB, provided that the period between the existing Annual Filing Date and new Annual Filing Date shall not exceed one year.

(g) Any Information received by the Disclosure Dissemination Agent before 6:00 p.m. Eastern time on any business day that it is required to file with the MSRB pursuant to the terms of this Disclosure Agreement and that is accompanied by a Certification and all other information required by the terms of this Disclosure Agreement will be filed by the Disclosure Dissemination Agent with the MSRB no later than 11:59 p.m. Eastern time on the same business day; provided, however, the Disclosure Dissemination Agent shall have no liability for any delay in filing with the MSRB if such delay is caused by a Force Majeure Event provided that the Disclosure Dissemination Agent uses reasonable efforts to make any such filing as soon as possible. SECTION 3. Content of Annual Reports.

(a) Each Annual Report shall contain Annual Financial Information with respect to the Issuer, including the information provided in the Official Statement under the headings:

(i) THE ATHLETIC DEPARTMENT- Football - Football Ticket Sales and Attendance; (ii) THE ATHLETIC DEPARTMENT - Basketball - Basketball Ticket Sales and Attendance; (iii) CERTAIN FINANCIAL INFORMATION OF THE UNIVERSITY AND THE ATHLETIC DEPARTMENT - Athletic Department Statement of Revenues, Expenditures and Transfers; (iv) CERTAIN FINANCIAL INFORMATION OF THE UNIVERSITY AND THE ATHLETIC DEPARTMENT - Components of Revenues, Expenses and Transfers of the Athletic Department; (v) CERTAIN FINANCIAL INFORMATION OF THE UNIVERSITY AND THE ATHLETICS DEPARTMENT – Admissions Fee Receipts; (vi) CERTAIN FINANCIAL INFORMATION OF THE UNIVERSITY AND THE ATHLETIC DEPARTMENT - Historical Net Revenues; and (vii) CERTAIN FINANCIAL INFORMATION OF THE UNIVERSITY AND THE ATHLETIC DEPARTMENT - Debt Service Coverage.

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(b) The Issuer’s complete audited financial statements for the preceding fiscal year prepared in accordance with accounting principles generally accepted within the United States of America as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board will be included in the Annual Report. If audited financial statements are not available, then, unaudited financial statements, prepared in accordance with in accordance with accounting principles generally accepted within the United States of America as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board will be included in the Annual Report. Audited Financial Statements (if any) will be provided pursuant to Section 2(d).

Any or all of the items listed above may be included by specific reference from other documents, including official statements of debt issues with respect to which the Issuer is an “obligated person” (as defined by the Rule), which have been previously filed with the Securities and Exchange Commission or available on the MSRB Internet Website. If the document incorporated by reference is a final official statement, it must be available from the MSRB. The Issuer will clearly identify each such document so incorporated by reference.

Any Annual Financial Information containing modified operating data or financial information is required to explain, in narrative form, the reasons for the modification and the impact of the change in the type of operating data or financial information being provided.

SECTION 4. Reporting of Notice Events.

(a) The occurrence of any of the following events with respect to the Bonds constitutes a Notice Event:

1. Principal and interest payment delinquencies;

2. Non-payment related defaults, if material;

3. Unscheduled draws on debt service reserves reflecting financial difficulties;

4. Unscheduled draws on credit enhancements reflecting financial difficulties;

5. Substitution of 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 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 Bond holders, if material;

8. Bond calls, if material, and tender offers;

9. Defeasances;

10. Release, substitution, or sale of property securing repayment of the Bonds, if material;

11. Rating changes;

12. Bankruptcy, insolvency, receivership or similar event of the Obligated Person;

Note to subsection (a)(12) of this Section 4: For the purposes of the event described in subsection (a)(12) of this Section 4, the event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent or similar officer for an Obligated Person in a proceeding under the U.S. Bankruptcy Code or in any other

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proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the Obligated Person, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the Obligated Person.

13. The consummation of a merger, consolidation, or acquisition involving an Obligated Person or the sale of all or substantially all of the assets of the Obligated Person, 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

14. Appointment of a successor or additional trustee or the change of name of a trustee, if material.

The Issuer shall, in a timely manner not in excess of ten business days after its occurrence, notify the Disclosure Dissemination Agent in writing of the occurrence of a Notice Event. Such notice shall instruct the Disclosure Dissemination Agent to report the occurrence pursuant to subsection (c) and shall be accompanied by a Certification. Such notice or Certification shall identify the Notice Event that has occurred (which shall be any of the categories set forth in Section 2(e)(iv) of this Disclosure Agreement), include the text of the disclosure that the Issuer desires to make, contain the written authorization of the Issuer for the Disclosure Dissemination Agent to disseminate such information, and identify the date the Issuer desires for the Disclosure Dissemination Agent to disseminate the information (provided that such date is not later than the tenth business day after the occurrence of the Notice Event).

(b) The Disclosure Dissemination Agent is under no obligation to notify the Issuer or the Disclosure Representative of an event that may constitute a Notice Event. In the event the Disclosure Dissemination Agent so notifies the Disclosure Representative, the Disclosure Representative will within two business days of receipt of such notice (but in any event not later than the tenth business day after the occurrence of the Notice Event, if the Issuer determines that a Notice Event has occurred), instruct the Disclosure Dissemination Agent that (i) a Notice Event has not occurred and no filing is to be made or (ii) a Notice Event has occurred and the Disclosure Dissemination Agent is to report the occurrence pursuant to subsection (c) of this Section 4, together with a Certification. Such Certification shall identify the Notice Event that has occurred (which shall be any of the categories set forth in Section 2(e)(iv) of this Disclosure Agreement), include the text of the disclosure that the Issuer desires to make, contain the written authorization of the Issuer for the Disclosure Dissemination Agent to disseminate such information, and identify the date the Issuer desires for the Disclosure Dissemination Agent to disseminate the information (provided that such date is not later than the tenth business day after the occurrence of the Notice Event).

(c) If the Disclosure Dissemination Agent has been instructed by the Issuer as prescribed in subsection (a) or (b)(ii) of this Section 4 to report the occurrence of a Notice Event, the Disclosure Dissemination Agent shall promptly file a notice of such occurrence with MSRB in accordance with Section 2 (e)(iv) hereof. This notice will be filed with a cover sheet completed by the Disclosure Dissemination Agent in the form set forth in Exhibit C-1.

SECTION 5. CUSIP Numbers. Whenever providing information to the Disclosure Dissemination Agent, including but not limited to Annual Reports, documents incorporated by reference to the Annual Reports, Audited Financial Statements, Notice Event notices, Failure to File Event notices, Voluntary Event Disclosures and Voluntary Financial Disclosures, the Issuer shall indicate the full name of the Bonds and the 9-digit CUSIP numbers for the Bonds as to which the provided information relates.

SECTION 6. Additional Disclosure Obligations. The Issuer acknowledges and understands that other state and federal laws, including but not limited to the Securities Act of 1933 and Rule 10b-5 promulgated under the

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Securities Exchange Act of 1934, may apply to the Issuer, and that the duties and responsibilities of the Disclosure Dissemination Agent under this Disclosure Agreement do not extend to providing legal advice regarding such laws. The Issuer acknowledges and understands that the duties of the Disclosure Dissemination Agent relate exclusively to execution of the mechanical tasks of disseminating information as described in this Disclosure Agreement.

SECTION 7. Voluntary Filing.

(a) The Issuer may instruct the Disclosure Dissemination Agent to file a Voluntary Event Disclosure with the MSRB from time to time pursuant to a Certification of the Disclosure Representative. Such Certification shall identify the Voluntary Event Disclosure (which shall be any of the categories set forth in Section 2(e)(vi) of this Disclosure Agreement), include the text of the disclosure that the Issuer desires to make, contain the written authorization of the Issuer for the Disclosure Dissemination Agent to disseminate such information, and identify the date the Issuer desires for the Disclosure Dissemination Agent to disseminate the information. If the Disclosure Dissemination Agent has been instructed by the Issuer as prescribed in this Section 7(a) to file a Voluntary Event Disclosure, the Disclosure Dissemination Agent shall promptly file such Voluntary Event Disclosure with the MSRB in accordance with Section 2(e)(vi) hereof. This notice will be filed with a cover sheet completed by the Disclosure Dissemination Agent in the form set forth in Exhibit C-2.

(b) The Issuer may instruct the Disclosure Dissemination Agent to file a Voluntary Financial Disclosure with the MSRB from time to time pursuant to a Certification of the Disclosure Representative. Such Certification shall identify the Voluntary Financial Disclosure (which shall be any of the categories set forth in Section 2(e)(vii) of this Disclosure Agreement), include the text of the disclosure that the Issuer desires to make, contain the written authorization of the Issuer for the Disclosure Dissemination Agent to disseminate such information, and identify the date the Issuer desires for the Disclosure Dissemination Agent to disseminate the information. If the Disclosure Dissemination Agent has been instructed by the Issuer as prescribed in this Section 7(b) to file a Voluntary Financial Disclosure, the Disclosure Dissemination Agent shall promptly file such Voluntary Financial Disclosure with the MSRB in accordance with Section 2(e)(vii) hereof. This notice will be filed with a cover sheet completed by the Disclosure Dissemination Agent in the form set forth in Exhibit C-3.

(c) The parties hereto acknowledge that the Issuer is not obligated pursuant to the terms of this Disclosure Agreement to file any Voluntary Event Disclosure pursuant to Section 7(a) hereof or any Voluntary Financial Disclosure pursuant to Section 7(b) hereof.

(d) Nothing in this Disclosure Agreement shall be deemed to prevent the Issuer from disseminating any other information through the Disclosure Dissemination Agent using the means of dissemination set forth in this Disclosure Agreement or including any other information in any Annual Report, Audited Financial Statements, Notice Event notice, Failure to File Event notice, Voluntary Event Disclosure or Voluntary Financial Disclosure, in addition to that required by this Disclosure Agreement. If the Issuer chooses to include any information in any Annual Report, Audited Financial Statements, Notice Event notice, Failure to File Event notice, Voluntary Event Disclosure or Voluntary Financial Disclosure in addition to that which is specifically required by this Disclosure Agreement, the Issuer shall have no obligation under this Disclosure Agreement to update such information or include it in any future Annual Report, Audited Financial Statements, Notice Event notice, Failure to File Event notice, Voluntary Event Disclosure or Voluntary Financial Disclosure.

SECTION 8. Termination of Reporting Obligation. The obligations of the Issuer and the Disclosure Dissemination Agent under this Disclosure Agreement shall terminate with respect to the Bonds upon the legal defeasance, prior redemption or payment in full of all of the Bonds, when the Issuer is no longer an obligated person with respect to the Bonds, or upon delivery by the Disclosure Representative to the Disclosure Dissemination Agent of an opinion of counsel expert in federal securities laws to the effect that continuing disclosure is no longer required.

SECTION 9. Disclosure Dissemination Agent. The Issuer has appointed Digital Assurance Certification, L.L.C. as exclusive Disclosure Dissemination Agent under this Disclosure Agreement. The Issuer may, upon thirty days written notice to the Disclosure Dissemination Agent and the Trustee, replace or appoint a successor Disclosure Dissemination Agent. Upon termination of DAC’s services as Disclosure Dissemination Agent, whether by notice of the Issuer or DAC, the Issuer agrees to appoint a successor Disclosure Dissemination

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Agent or, alternately, agrees to assume all responsibilities of Disclosure Dissemination Agent under this Disclosure Agreement for the benefit of the Holders of the Bonds. Notwithstanding any replacement or appointment of a successor, the Issuer shall remain liable until payment in full for any and all sums owed and payable to the Disclosure Dissemination Agent. The Disclosure Dissemination Agent may resign at any time by providing thirty days’ prior written notice to the Issuer.

SECTION 10. Remedies in Event of Default. In the event of a failure of the Issuer or the Disclosure Dissemination Agent to comply with any provision of this Disclosure Agreement, the Holders’ rights to enforce the provisions of this Agreement shall be limited solely to a right, by action in mandamus or for specific performance, to compel performance of the parties' obligation under this Disclosure Agreement; provided, however, that any such action may be initiated only in the federal or State courts located in Columbia, South Carolina. Any failure by a party to perform in accordance with this Disclosure Agreement shall not constitute a default on the Bonds or under any other document relating to the Bonds, and all rights and remedies shall be limited to those expressly stated herein.

SECTION 11. Duties, Immunities and Liabilities of Disclosure Dissemination Agent.

(a) The Disclosure Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Agreement. The Disclosure Dissemination Agent’s obligation to deliver the information at the times and with the contents described herein shall be limited to the extent the Issuer has provided such information to the Disclosure Dissemination Agent as required by this Disclosure Agreement. The Disclosure Dissemination Agent shall have no duty with respect to the content of any disclosures or notice made pursuant to the terms hereof. The Disclosure Dissemination Agent shall have no duty or obligation to review or verify any Information or any other information, disclosures or notices provided to it by the Issuer and shall not be deemed to be acting in any fiduciary capacity for the Issuer, the Holders of the Bonds or any other party. The Disclosure Dissemination Agent shall have no responsibility for the Issuer’s failure to report to the Disclosure Dissemination Agent a Notice Event or a duty to determine the materiality thereof. The Disclosure Dissemination Agent shall have no duty to determine, or liability for failing to determine, whether the Issuer has complied with this Disclosure Agreement. The Disclosure Dissemination Agent may conclusively rely upon Certifications of the Issuer at all times.

The obligations of the Issuer under this Section shall survive resignation or removal of the Disclosure Dissemination Agent and defeasance, redemption or payment of the Bonds.

(b) The Disclosure Dissemination Agent may, from time to time, consult with legal counsel (either in- house or external) of its own choosing in the event of any disagreement or controversy, or question or doubt as to the construction of any of the provisions hereof or its respective duties hereunder, and shall not incur any liability and shall be fully protected in acting in good faith upon the advice of such legal counsel. The reasonable fees and expenses of such counsel shall be payable by the Issuer.

(c) All documents, reports, notices, statements, information and other materials provided to the MSRB under this Disclosure Agreement shall be provided in an electronic format and accompanied by identifying information as prescribed by the MSRB.

SECTION 12. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Agreement, the Issuer and the Disclosure Dissemination Agent may amend this Disclosure Agreement and any provision of this Disclosure Agreement may be waived, if such amendment or waiver is supported by an opinion of counsel expert in federal securities laws acceptable to both the Issuer and the Disclosure Dissemination Agent to the effect that such amendment or waiver does not materially impair the interests of Holders of the Bonds and would not, in and of itself, cause the undertakings herein to violate the Rule if such amendment or waiver had been effective on the date hereof but taking into account any subsequent change in or official interpretation of the Rule; provided neither the Issuer or the Disclosure Dissemination Agent shall be obligated to agree to any amendment modifying their respective duties or obligations without their consent thereto.

Notwithstanding the preceding paragraph, the Disclosure Dissemination Agent shall have the right to adopt amendments to this Disclosure Agreement necessary to comply with modifications to and interpretations of the provisions of the Rule as announced by the United States Securities and Exchange Commission from time to time by

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giving not less than 20 days written notice of the intent to do so together with a copy of the proposed amendment to the Issuer. No such amendment shall become effective if the Issuer shall, within 10 days following the giving of such notice, send a notice to the Disclosure Dissemination Agent in writing that it objects to such amendment.

SECTION 13. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the Issuer, the Trustee, the Disclosure Dissemination Agent, the underwriter, and the Holders from time to time of the Bonds, and shall create no rights in any other person or entity.

SECTION 14. Governing Law. This Disclosure Agreement shall be governed by the laws of the State of South Carolina (other than with respect to conflicts of laws).

SECTION 15. Counterparts. This Disclosure Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.

[Remainder of page intentionally left blank.]

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The Disclosure Dissemination Agent and the Issuer have caused this Disclosure Dissemination Agent Agreement to be executed, on the date first written above, by their respective officers duly authorized.

DIGITAL ASSURANCE CERTIFICATION, L.L.C., as Disclosure Dissemination Agent

By:______Name:______Title:______

CLEMSON UNIVERSITY, as Issuer

By:______Name:______Title:______

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EXHIBIT A

NAME AND CUSIP NUMBERS OF BONDS

Name of Issuer Clemson University Obligated Person(s) Clemson University Name of Bond Issue: Athletic Facilities Revenue Bonds, Series 2018A Date of Issuance: January __, 2018 Date of Official Statement January __, 2018

CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number: CUSIP Number:

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EXHIBIT B

NOTICE TO MSRB OF FAILURE TO FILE ANNUAL REPORT

Issuer: Clemson University

Obligated Person: Clemson University

Name(s) of Bond Issue(s): Athletic Facilities Revenue Bonds, Series 2018A

Date(s) of Issuance: January __, 2018

Date(s) of Disclosure January __, 2018 Agreement:

CUSIP Number:

NOTICE IS HEREBY GIVEN that the Issuer has not provided an Annual Report with respect to the above-named Bonds as required by the Disclosure Dissemination Agent Agreement between the Issuer and Digital Assurance Certification, L.L.C., as Disclosure Dissemination Agent. [The Issuer has notified the Disclosure Dissemination Agent that it anticipates that the Annual Report will be filed by ______].

Dated: ______

Digital Assurance Certification, L.L.C., as Disclosure Dissemination Agent, on behalf of the Issuer

______cc:

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EXHIBIT C-1 EVENT NOTICE COVER SHEET

This cover sheet and accompanying “event notice” will be sent to the MSRB, pursuant to Securities and Exchange Commission Rule 15c2-12(b)(5)(i)(C) and (D).

Issuer’s and/or Other Obligated Person’s Name: Clemson University Issuer’s Six-Digit CUSIP Number: ______or Nine-Digit CUSIP Number(s) of the bonds to which this event notice relates: ______Number of pages attached: ______Description of Notice Events (Check One):

1. “Principal and interest payment delinquencies;” 2. “Non-Payment related defaults, if material;” 3. “Unscheduled draws on debt service reserves reflecting financial difficulties;” 4. “Unscheduled draws on credit enhancements reflecting financial difficulties;” 5. “Substitution of credit or liquidity providers, or their failure to perform;” 6. “Adverse tax opinions, IRS notices or events affecting the tax status of the security;” 7. “Modifications to rights of securities holders, if material;” 8. “Bond calls, if material;” 9. “Defeasances;” 10. “Release, substitution, or sale of property securing repayment of the securities, if material;” 11. “Rating changes;” 12. “Tender offers;” 13. “Bankruptcy, insolvency, receivership or similar event of the obligated person;” 14. “Merger, consolidation, or acquisition of the obligated person, if material;” and 15. “Appointment of a successor or additional trustee, or the change of name of a trustee, if material.”

____ Failure to provide annual financial information as required.

I hereby represent that I am authorized by the issuer or its agent to distribute this information publicly: Signature: ______Name: ______Title: ______Digital Assurance Certification, L.L.C. 315 East Robinson Street Suite 300 Orlando, FL 32801 407-515-1100

Date:

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EXHIBIT C-2 VOLUNTARY EVENT DISCLOSURE COVER SHEET

This cover sheet and accompanying “voluntary event disclosure” will be sent to the MSRB, pursuant to the Disclosure Dissemination Agent Agreement dated as of January __, 2018 between the Issuer and DAC.

Issuer’s and/or Other Obligated Person’s Name: Clemson University Issuer’s Six-Digit CUSIP Number: ______or Nine-Digit CUSIP Number(s) of the bonds to which this notice relates: ______Number of pages attached: ______Description of Voluntary Event Disclosure (Check One):

1. “amendment to continuing disclosure undertaking;” 2. “change in obligated person;” 3. “notice to investors pursuant to bond documents;” 4. “certain communications from the Internal Revenue Service;” 5. “secondary market purchases;” 6. “bid for auction rate or other securities;” 7. “capital or other financing plan;” 8. “litigation/enforcement action;” 9. “change of tender agent, remarketing agent, or other on-going party;” 10. “derivative or other similar transaction;” and 11. “other event-based disclosures.”

Date:

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EXHIBIT C-3 VOLUNTARY FINANCIAL DISCLOSURE COVER SHEET

This cover sheet and accompanying “voluntary financial disclosure” will be sent to the MSRB, pursuant to the Disclosure Dissemination Agent Agreement dated as of January __, 2018 between the Issuer and DAC.

____ Description of Voluntary Financial Disclosure (Check One): 1. “quarterly/monthly financial information;” 2. “change in fiscal year/timing of annual disclosure;” 3. “change in accounting standard;” 4. “interim/additional financial information/operating data;” 5. “budget;” 6. “investment/debt/financial policy;” 7. “information provided to rating agency, credit/liquidity provider or other third party;” 8. “consultant reports;” and 9. “other financial/operating data.”

Date:

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APPENDIX E

DTC AND BOOK-ENTRY-ONLY SYSTEM

[THIS PAGE INTENTIONALLY LEFT BLANK] APPENDIX E

THE FOLLOWING INFORMATION CONCERNING THE DEPOSITORY TRUST COMPANY (“DTC”) AND DTC’S BOOK-ENTRY ONLY SYSTEM HAS BEEN OBTAINED FROM SOURCES THAT CLEMSON UNIVERSITY (THE “UNIVERSITY”) BELIEVES TO BE RELIABLE, BUT THE UNIVERSITY TAKES NO RESPONSIBILITY FOR THE ACCURACY THEREOF.

The Depository Trust Company (“DTC”), New York, New York, will act as securities depository for the Athletic Facilities Revenue Bonds, Series 2018A (the “Series 2018A Bonds”) of the University. The Series 2018A Bonds will be issued as fully-registered bonds registered in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered bond will be issued for each maturity of the Series 2018A Bonds, each in the aggregate principal amount of such maturity, and will be deposited with DTC.

DTC, the world’s largest securities depository, is a limited-purpose trust company organised 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. 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 computerised 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 organisations. 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 the Series 2018A Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the Series 2018A Bonds on DTC’s records. The ownership interest of each actual purchaser of each Series 2018A 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 purchase. 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 Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Series 2018A 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 the Series 2018ABonds, except in the event that use of the book-entry system for the Series 2018A Bonds is discontinued.

To facilitate subsequent transfers, all Series 2018A Bonds deposited by Direct 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 authorised representative of DTC. The deposit of Series 2018A Bonds with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Series 2018A Bonds; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Series 2018A 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 Series 2018A Bonds may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Series 2018A Bonds, such as redemptions, tenders, defaults, and

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proposed amendments to any of the resolutions under which any Series 2018A Bonds is issued. For example, the Beneficial Owners of Series 2018A Bonds may wish to ascertain that the nominee holding the Series 2018A 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 Registrar and request that copies of notices be provided directly to them.

Redemption notices shall be sent to DTC. If less than all of the Series 2018A Bonds of a maturity are being redeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to the Series 2018A Bonds unless authorised by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the University as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts Series 2018A Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).

Redemption payments and principal and interest payments on the Series 2018A Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorised representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the University or the Paying Agent on the 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 Participant and not of DTC, the Paying Agent, or the University, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption payments and principal and interest payments to Cede & Co. (or such other nominee as may be requested by an authorised representative of DTC) is the responsibility of the University or the Paying Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

DTC may discontinue providing its services as depository with respect to any Series 2018A Bonds at any time by giving reasonable notice to the University and the Paying Agent. Under such circumstances, in the event that a successor depository is not obtained, bond certificates are required to be printed and delivered.

The University may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, bond certificates will be printed and delivered to DTC.

NEITHER THE UNIVERSITY NOR THE PAYING AGENT IS RESPONSIBLE OR LIABLE FOR THE FAILURE OF ANY DIRECT PARTICIPANTS OR ANY INDIRECT PARTICIPANTS TO MAKE ANY PAYMENT OR GIVE ANY NOTICE TO A BENEFICIAL OWNER WITH RESPECT TO THE SERIES 2018A BONDS OR ANY ERROR OR DELAY RELATING THERETO.

Neither the University nor the Paying Agent gives any assurances that DTC, DTC Participants, or Indirect Participants will distribute to the Beneficial Owners of the Series 2018A Bonds (i) payments of principal, premium, if any, and interest, with respect to the Series 2018A Bonds, (ii) confirmation of beneficial ownership interests in the Series 2018A Bonds, or (iii) redemption or other notices sent to DTC or Cede & Co., its nominee, as registered owner of the Series 2018A Bonds, or that they will do so on a timely basis, or that DTC, DTC Participants, or Indirect Participants will serve or act in the manner described in this Official Statement.

All capitalized terms not otherwise defined in this Appendix shall have the meaning ascribed to such term in this Official Statement.

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CLEMSON UNIVERSITY, SOUTH CAROLINA • ATHLETIC FACILITIES REVENUE BONDS, SERIES 2018A