Colorado Educational and Cultural Facilities Authority

This Preliminary Official Statement and the information contained herein are subject to completion or amendment. These securities may not be sold nor may offers to buy be accepted prior to the time the Official Statement is delivered in final form. Under no circumstances shall this Preliminary Official Statement constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. assessments intheStateofColorado.See“TAXMATTERS”herein. pursuant totheTax Code. The Bonds,the transfer thereof, and the income therefromareexempt from all taxation and income ofcorporations.InterestontheSeries2017BBondsisincludedingrossforfederaltaxpurposes current earnings”adjustmentapplicabletocorporationsforpurposesofcomputingthealternativeminimumtaxable oftheTaxCodeexceptthatsuchinterestisrequiredtobeincludedincalculating“adjusted in Section 55(b)(2) “Tax Code”),andinterestontheSeries2017ABondsisexcludedfromalternativeminimumtaxableincomeasdefined oftheInternalRevenueCode1986,asamendedtodatedeliverySeries2017ABonds(the Section 103 herein, interestontheSeries2017ABondsisexcludedfromgrossincomeunderfederaltaxlawspursuantto delivery throughthefacilities ofDTConoraboutJune27,2017. to theAuthority.KutakRock LLPisactingascounseltotheUnderwriter.Itexpected thattheBondswillbeavailablefor as municipal advisorto the Universityand PFM Financial AdvisorsLLC, Denver, Colorado isacting as the financial advisor by itscounsel,Hoffman,Crews, Nies,Waggener&FosterLLP.NorthSlopeCapital Advisors,Denver,Coloradoisacting by Sherman&HowardL.L.C, generalcounseltotheAuthority.Certainlegalmatterswill bepasseduponfortheUniversity in connectionwiththepreparationofthisOfficialStatement. CertainlegalmatterswillbepasseduponfortheAuthority of Sherman & HowardL.L.C.,asbondcounsel. Sherman&HowardL.L.C.alsohasactedasspecialcounseltotheUniversity investment decision,givingparticularattentionto the sectionentitled“INVESTMENTCONSIDERATIONS.” Investors mustreadtheentireOfficialStatementto obtaininformationessentialtothemakingofaninformed or taxingpowersoftheAuthorityState.The Authorityisnotauthorizedtolevytaxesorassessments. of theStateandshallnotconstituteorgiveriseto apecuniaryliability,orchargeagainstthegeneralcredit “State”) or any political subdivision thereof within the meaning of any provision ofthe Constitution and laws shall never constitute the general obligation debt or indebtedness of the Authority, the State of Colorado (the and theUniversity.TheBondsarenotgeneralobligationsofAuthority.interest thereon revenues andotheramountsderivedbytheAuthoritypursuanttoaLoanAgreementbetween in thisOfficialStatement.See“THEBONDS–RedemptionProvisions.” associated withtheissuanceofBonds.See“SOURCESANDUSESOFFUNDS.” commons, andothercampusimprovements;(ii)paycertaincapitalizedinterestontheBonds;(iii) costs campus careercenter,asubstantialdemolition,renovationandexpansionofthestudentcentertobecomecommunity improvement, renovation,andequippingofcertaincampusimprovementsincludingafreshmanresidentialdormitory, the University ofDenver(the“University”).TheproceedstheBondswillbeusedto:(i)financeaportionconstruction, surrender thereofatUMBBank,n.a.,Denver,Colorado(the“Trustee”),oritssuccessorastrustee.See“THEBONDS.” registered owner of the Bonds. The principal and premium, if any, of the Bonds shall be payable uponpresentation and Co.asthe March 1andSeptemberofeachyear,commencingon1,2017,bycheckordraftmailedtoCede & Only System.”TheBondswillbearinterestattheratessetforthoninsidefrontcoverhereof,payablesemiannually on will notreceivecertificatesrepresentingtheirbeneficialownershipinterestintheBonds.See“THEBONDS--Book-Entry (“DTC”), securitiesdepositoryfortheBonds.PurchasesofBondsaretobemadeinbook-entryformonly.Purchasers initially willberegisteredinthenameofCede & Co.,asnomineeofTheDepositoryTrustCompany,NewYork,York Dated: DateofDelivery FULL BOOKENTRY NEW ISSUE * Preliminary; subjectto change. In theopinionofSherman&Howard,L.L.C.,assumingcontinuouscompliancewithcertaincovenantsdescribed The Bondsareofferedwhen,as,andifissuedbytheAuthority andacceptedbytheUnderwritersubjecttoapproval This cover page contains certain information for quickreference only. It is notasummaryof the issue. The Bondsconstitutespecial,limitedobligationsoftheAuthority,andarepayablesolelyfrompayments, The Bondsaresubjecttooptional,extraordinaryandmandatorysinkingfundredemptionpriormaturityasset forth The proceedsfromthesaleofBondswillbeloanedtoColoradoSeminary,morecommonlyknownas the The Bondsareissuedasfullyregisteredbondsindenominationsof$5,000,oranyintegralmultiplethereof. COLORADO EDUCATIONAL AND CULTURAL FACILITIES AUTHORITY

RBC Capital Markets

PRELIMINARY OFFICIAL STATEMENT DATED MAY 11, 2017 TAX-EXEMPT SERIES2017A

REVENUE BONDS $123,835,000* (UNIVERSITY OFDENVERPROJECT) Official Statement datedMay__,2017.

TAXABLE SERIES2017B REVENUE BONDS $24,295,000* Wells Fargo Securities Due: March1,asshownherein RATINGS: Moody’s:“A1” See “RATINGS” Fitch: “AA-” MATURITY SCHEDULES*

SERIES 2017A TAX-EXEMPT BONDS

Maturity Maturity Date Principal Interest Date Principal Interest (March 1) Amount Rate Yield CUSIP1© (March 1) Amount Rate Yield CUSIP1© 2031 $4,815,000 % % 2035 $5,850,000 % % 2032 5,055,000 2036 6,145,000 2033 5,310,000 2037 6,450,000 2034 5,575,000 $21,360,000* ___% Term Bond due March 1, 2040 Price: _____% CUSIP: [______] 1© $24,725,000* ___% Term Bond due March 1, 2043 Price: _____% CUSIP: [______] 1© $38,550,000* ___% Term Bond due March 1, 2047 Price: _____% CUSIP: [______] 1©

SERIES 2017B TAXABLE BONDS

Maturity Maturity Date Principal Interest Date Principal Interest (March 1) Amount Rate Yield CUSIP1© (March 1) Amount Rate Yield CUSIP1© 2021 $3,685,000 % % 2026 $2,120,000 % % 2022 1,625,000 2027 2,285,000 2023 1,755,000 2028 2,910,000 2024 1,815,000 2029 3,015,000 2025 1,960,000 2030 3,125,000

* Preliminary; subject to change. © 2017, CUSIP Global Services. CUSIP® is a registered trademark of the American Bankers Association. The CUSIP data herein is provided by CUSIP Global Services which is managed on behalf of the American Bankers Association by S&P Capital IQ. The CUSIP numbers are not intended to create a database and do not serve in any way as a substitute for the CUSIP Service. 1 The Authority and University take no responsibility for the accuracy of the CUSIP numbers, which are included solely for the convenience of owners of the Bonds.

USE OF INFORMATION IN THIS OFFICIAL STATEMENT

This Official Statement, which includes the cover page, the inside cover page and the appendices, does not constitute an offer to sell or the solicitation of an offer to buy any of the Bonds in any jurisdiction in which it is unlawful to make such offer, solicitation, or sale. No dealer, salesperson, or other person has been authorized to give any information or to make any representations other than those contained in this Official Statement in connection with the offering of the Bonds, and if given or made, such information or representations must not be relied upon as having been authorized by the Authority or the University. The University and the Authority each maintain an internet website; however, the information presented there is not a part of this Official Statement and should not be relied upon in making an investment decision with respect to the Bonds.

The information set forth in this Official Statement has been obtained from the University and from the sources referenced throughout this Official Statement, which the University believes to be reliable. No representation is made by the University, however, as to the accuracy or completeness of information provided from sources other than the University. This Official Statement contains, in part, estimates and matters of opinion which are not intended as statements of fact, and no representation or warranty is made as to the correctness of such estimates and opinions, or that they will be realized.

The Underwriter has provided the following sentence for inclusion in this Official Statement. The Underwriter has reviewed the information in this Official Statement in accordance with, and as part of, its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information.

The information, estimates, and expressions of opinion contained in this Official Statement are subject to change without notice, and neither the delivery of this Official Statement nor any sale of the Bonds shall, under any circumstances, create any implication that there has been no change in the affairs of the University, or in the information, estimates, or opinions set forth herein, since the date of this Official Statement.

This Official Statement has been prepared only in connection with the original offering of the Bonds and may not be reproduced or used in whole or in part for any other purpose.

The Bonds have not been registered with the Securities and Exchange Commission due to certain exemptions contained in the Securities Act of 1933, as amended. The Bonds have not been recommended by any federal or state securities commission or regulatory authority, and the foregoing authorities have neither reviewed nor confirmed the accuracy of this document.

THE PRICES AT WHICH THE BONDS ARE OFFERED TO THE PUBLIC BY THE UNDERWRITER (AND THE YIELDS RESULTING THEREFROM) MAY VARY FROM THE INITIAL PUBLIC OFFERING PRICES OR YIELDS APPEARING ON THE INSIDE COVER PAGE HEREOF. IN ADDITION, THE UNDERWRITER MAY ALLOW CONCESSIONS OR DISCOUNTS FROM SUCH INITIAL PUBLIC OFFERING PRICES TO DEALERS AND OTHERS. IN ORDER TO FACILITATE DISTRIBUTION OF THE BONDS, THE UNDERWRITER MAY ENGAGE IN TRANSACTIONS INTENDED TO STABILIZE THE PRICE OF THE BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.

The Authority has not prepared or assisted in the preparation of this Official Statement except for statements relating to the Authority under the sections captioned - “INTRODUCTION--The Authority,” “THE AUTHORITY” and “LEGAL MATTERS--Absence of Litigation - The Authority” and, except for those sections, the Authority is not responsible for any statements made in this Official Statement. Except for the execution and delivery of documents required to effect the issuance of the Bonds, the Authority has not otherwise assisted in the public offer, sale or distribution of the Bonds. Accordingly, except as specified above, the Authority disclaims responsibility for the disclosures set forth in this Official Statement or otherwise made in connection with the offer, sale and distribution of the Bonds.

UNIVERSITY OF DENVER OFFICIALS

Chancellor: Rebecca S. Chopp Provost: Gregg Kvistad Vice Chancellor for Business and Financial Affairs and Treasurer: Craig Woody Vice Chancellor for University Advancement: Armin Afsahi Vice Chancellor for University Communications and Marketing: Renell Wynn Vice Chancellor for University Technology: Don Harris Vice Chancellor for Enrollment: Thomas Willoughby Vice Chancellor for Athletics and Recreation: Peg Bradley-Doppes Associate Vice Chancellor for Finance, Controller, and Assistant Treasurer: Andrew Cullen Vice Chancellor for Legal Affairs and General Counsel: Paul Chan Vice Chancellor for Institutional Partnerships: David Greenberg Vice Chancellor for Human Resources: Laura Maresca Vice Chancellor for Campus Life and Inclusive Excellence: Liliana Rodriguez Senior Advisor to the Chancellor and Provost on Diversity and Inclusion: Frank Tuitt

BOARD OF TRUSTEES

Chairman: Douglas G. Scrivner Vice Chairman: John W. Low Vice Chairman: James R. Griesemer Vice Chairman: Catherine C. Shopneck Secretary: Margot Gilbert Frank

Edward T. Anderson John A. Miller

Katherine Archuleta Trygve E. Myhren

Joy S. Burns Denise O'Leary Rebecca S. Chopp* Scott J. Reiman

Mary Sue Coleman Mary K. Rhinehart Navin Dimond Joseph W. Saunders Kevin C. Gallagher Otto Tschudi Peter A. Gilbertson Clara Villarosa Craig Harrison Frederick T. Waldeck Brandon Johnson

*Ex-officio member of the Board

Underwriters RBC Capital Markets, LLC Denver, Colorado

Wells Fargo Securities Denver, Colorado

Trustee and Paying Agent UMB Bank, n.a. Denver, Colorado

Bond Counsel Sherman & Howard L.L.C. Denver, Colorado

TABLE OF CONTENTS

Page INTRODUCTION ...... 1 General ...... 1 The Authority ...... 1 The University ...... 2 Purpose of the Issue ...... 2 Authority for Issuance ...... 2 The Bonds; Redemption Provisions ...... 2 Security for the Bonds ...... 3 Prior Parity Bond Additional Indebtedness Limitations ...... 4 Professionals ...... 4 Tax Status of Interest on the Bonds ...... 4 Continuing Disclosure Undertaking ...... 5 Additional Information ...... 6 INVESTMENT CONSIDERATIONS ...... 7 No Mortgage or Lien Interests Secure the Bonds ...... 7 No Debt Service Reserve Fund Secures the Bonds ...... 7 Risks Related to University Operations ...... 7 Contributions ...... 8 Dependence Upon Tax-Exempt Status ...... 8 Limitations on Enforcement of Remedies; Bankruptcy Proceedings ...... 9 Potential Environmental Risks ...... 9 Construction of Improvements ...... 10 Forward-Looking Statements ...... 10 Secondary Market ...... 10 SOURCES AND USES OF FUNDS ...... 11 Sources and Uses of Funds ...... 11 The Financed Facilities ...... 11 THE BONDS ...... 13 Payment of Principal and Interest; Record Date ...... 13 Redemption Provisions ...... 14 Extraordinary Prior Redemption...... 16 Book-Entry Only System ...... 17 DEBT SERVICE REQUIREMENTS...... 18 SECURITY FOR THE BONDS ...... 19 Existing Liens on Gross Revenues ...... 19 Historical Net Income Available for Debt Service; Pro-Forma Debt Service Coverage Ratio ...... 19 The Loan Agreement ...... 20 The Indenture ...... 21 THE AUTHORITY ...... 22 THE UNIVERSITY ...... 23 Organization ...... 23 -i-

Page Accreditation ...... 23 Board of Trustees ...... 23 Administration ...... 26 Strategic Planning Overseen by the Chancellor and Provost ...... 30 Academic Programs ...... 30 Enrollment ...... 32 Admission ...... 36 Financial Aid ...... 38 Institutional Profile - Tuition ...... 39 Faculty ...... 40 Employees ...... 41 Retirement Plans and Other Post-retirement Benefits ...... 42 Facilities ...... 42 Capital Planning and Maintenance Planning ...... 45 Risk Management Activities ...... 46 University Contracts and Agreements ...... 47 Zoning ...... 47 UNIVERSITY FINANCIAL INFORMATION ...... 49 Introduction ...... 49 Sources of Revenues ...... 49 Financial Statements ...... 52 Summary of Certain Historical Financial Information ...... 52 Management Discussion of Financial Results ...... 54 Budget Process ...... 57 The Fiscal Year 2017 Budget ...... 58 LEGAL MATTERS ...... 61 Absence of Litigation - The Authority ...... 61 Absence of Litigation - The University ...... 61 Approval of Legal Proceedings ...... 61 TAX MATTERS ...... 62 Series 2017A Bonds ...... 62 Series 2017B Bonds ...... 64 INDEPENDENT AUDITORS...... 64 RATINGS ...... 64 UNDERWRITING ...... 65 MUNICIPAL ADVISOR...... 66 CERTIFICATION OF OFFICIAL STATEMENT ...... 67

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Page APPENDIX A - Audited Financial Statements of the University of Denver (Colorado Seminary) for the Fiscal Years Ended June 30, 2016 and 2015 ...... A-1

APPENDIX B - Certain Definitions and Summaries of Certain Provisions of the Indenture and the Loan Agreement ...... B-1

APPENDIX C - Book-Entry Only System ...... C-1

APPENDIX D - Form of Continuing Disclosure Agreement ...... D-1

APPENDIX E - Form of Opinion of Bond Counsel ...... E-1

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INDEX OF TABLES

NOTE: Tables marked with an (*) indicate Annual Financial Information to be updated pursuant to SEC Rule 15c2-12, as amended. See Appendix D - Form of Continuing Disclosure Agreement. Page

Sources and Uses of Funds ...... 11 Debt Service Requirements ...... 18 *Net Income Available for Debt Service and Pro-Forma Debt Service Coverage ...... 20 *Historical Fall-Term Enrollment by Home Unit ...... 34 *Traditional Undergraduate New Enrollment ...... 35 *Historical Admission Activity Data ...... 36 *Historical College Entrance Exam Scores ...... 37 Preliminary Admission Activity Data, Fall 2017 ...... 38 Preliminary Fall 2017 College Entrance Exam Scores ...... 38 Comparison of General Tuition and Fee Rates - Colorado Institutions ...... 40 Comparison of Tuition and Fee Rates - Peer Institutions ...... 40 *Full-Time Faculty and Tenure Trends ...... 41 *Historical Student/Faculty Ratios ...... 41 *Total Development Activity ...... 50 *Endowment Fund Summary ...... 51 *Statement of Activities ...... 53 *Current Funds Unrestricted ...... 57

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OFFICIAL STATEMENT

COLORADO EDUCATIONAL AND CULTURAL FACILITIES AUTHORITY (UNIVERSITY OF DENVER PROJECT)

$123,835,000* $24,295,000* REVENUE BONDS REVENUE BONDS TAX-EXEMPT SERIES 2017A TAXABLE SERIES 2017B

INTRODUCTION

General

This Official Statement, including the cover page, the inside cover page and the appendices, provides certain information concerning the issuance and sale by the Colorado Educational and Cultural Facilities Authority (the “Authority”) of its $123,835,000* in aggregate principal amount of Colorado Educational and Cultural Facilities Authority Revenue Bonds (University of Denver Project) Tax-Exempt Series 2017A (the “Series 2017A Bonds”) and its $24,295,000* in aggregate principal amount of Colorado Educational and Cultural Facilities Authority Revenue Bonds (University of Denver Project) Taxable Series 2017B” (the “Series 2017B Taxable Bonds,” also referred to as the “Series 2017B Bonds,” and together with the Series 2017A Bonds, the “Bonds”). The Bonds will be issued pursuant to an Indenture of Trust dated as of June 1, 2017 (the “Indenture”) between the Authority and UMB Bank, n.a., Denver, Colorado, as trustee (the “Trustee”). Unless otherwise defined, capitalized terms used herein are defined in Appendix B.

The offering of the Bonds is made only by way of this Official Statement, which supersedes any other information or materials used in connection with the offer or sale of the Bonds. The following introductory material is only a brief description of and is qualified by the more complete information contained throughout this Official Statement. A full review should be made of the entire Official Statement and the documents summarized or described herein, particularly the section entitled “INVESTMENT CONSIDERATIONS.” Detachment or other use of this “INTRODUCTION” without the entire Official Statement, including the cover page, the inside cover page and the appendices, is unauthorized.

The Authority

The Authority is an independent public body politic and corporate constituting a public instrumentality and political subdivision of the State of Colorado (the “State”). The Authority was created in 1981 pursuant to Title 23, Article 15, Colorado Revised Statutes, as amended (the “Act”). The Authority is not an agency of the State government and is not subject to administrative direction by any department, commission, board or agency of the State. The Authority is authorized by the Act to provide financing for educational institutions and cultural institutions and to acquire, construct, reconstruct, repair, alter, improve, extend, own, lease and dispose of properties to the end that the Authority may be able to promote the welfare of the people of the State. See “THE AUTHORITY.”

* Preliminary, subject to change.

The University

The Colorado Seminary, known as the University of Denver (the “University”), located on its University Park Campus in Denver, Colorado (the “City”), is one of the largest and oldest independent institutions of higher education in the Rocky Mountain region. The University currently offers 10 bachelor degree programs and 22 advanced degree programs. The University is composed of Undergraduate Studies (the locus of the undergraduate Core Curriculum), Arts and Humanities and Social Sciences, Natural Sciences and Mathematics, Engineering and Computer Science, the Daniels College of Business, the Sturm College of Law, the Morgridge College of Education, the Graduate School of Professional Psychology, the Korbel School of International Studies, the Graduate School of Social Work and the University College. See “THE UNIVERSITY.”

The University’s student body is comprised of students from all 50 states and 78 foreign countries. For Fiscal Year 2017 (represented by enrollment in the fall quarter 2016), the University enrolled 12,217 (headcount) students, of whom 5,754 were undergraduates. Included in the total headcount were 601 students enrolled in non-collegiate programs (including the Fisher Early Learning Center, Ricks Center for Gifted Children, and the English Language Center). For a discussion of fall 2012-2016 enrollment trends, see “THE UNIVERSITY-- Enrollment” and “UNIVERSITY FINANCIAL INFORMATION--Sources of Revenue.”

Purpose of the Issue

The proceeds from the sale of the Bonds will be loaned to the University pursuant to the terms of a Loan Agreement dated as of June 1, 2017 (the “Loan Agreement”), between the Authority and the University. The proceeds of the Bonds will be used to: (i) finance a portion of the construction, improvement, renovation, and equipping of certain campus improvements including a freshman residential dormitory, the campus career center, a substantial demolition, renovation and expansion of the student center to become a community commons, and other campus improvements (the “Improvements”); (ii) pay certain capitalized interest on the Bonds; and (iii) pay certain costs associated with the issuance of the Bonds. See “SOURCES AND USES OF FUNDS.”

Authority for Issuance

The Bonds are issued pursuant to the Act, the Indenture and a Resolution adopted by the Authority on April 26, 2017.

The Bonds; Redemption Provisions

General. The Bonds are issued solely as fully registered certificates in the denomination of $5,000, or any integral multiple thereof. The Bonds initially will be registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York (“DTC”), the securities depository for the Bonds. Purchases of the Bonds are to be made in book-entry form only. Purchasers will not receive certificates representing their beneficial ownership interest in the Bonds. See “THE BONDS--Book-Entry Only System.” The Bonds are dated as of the date of their delivery and mature and bear interest (calculated based on a 360-day year consisting of twelve 30-day months) as set forth on the inside cover page of this Official

Statement. The payment of principal and interest on the Bonds is described in “THE BONDS-- Payment of Principal and Interest; Record Date.”

Prior Redemption. The Bonds are subject to optional, extraordinary and mandatory sinking fund redemption. The terms and provisions regarding such prior redemption are set forth in “THE BONDS--Redemption Provisions.”

Security for the Bonds

Special, Limited Obligations of the Authority. The Bonds are special, limited obligations of the Authority and, except to the extent payable from Bond proceeds, are payable solely from payments, revenues and other amounts derived by the Authority pursuant to the Loan Agreement. The Bonds do not constitute the general obligation debt or indebtedness of the Authority within the meaning of any provision or limitation of the constitution or statutes of the State, and shall never constitute or give rise to a pecuniary liability of the Authority or the State, or a charge against the general credit or taxing power of the Authority or the State. The Authority is not authorized to levy taxes or assessments.

Gross Revenues of the University. Under the Loan Agreement, the University is unconditionally obligated to pay amounts sufficient to provide for the payment of the principal of and interest on the Bonds. The obligation of the University to make such payments under the Loan Agreement is secured only by a security interest in the Gross Revenues of the University (defined herein) and all of the University’s right, title and interest, if any, in the funds and accounts referred to in the Loan Agreement or the Indenture (other than the Rebate Fund), all of which security is assigned to the Trustee for the benefit of the owners of the Bonds.

The Loan Agreement defines “Gross Revenues” to mean all revenues of the University (except as described below) including, but not limited to:

• Income from tuition, fees, charges (whether such tuition, fees and charges are paid by or on behalf of students or by any other party) and quasi- endowments;

• Gifts, donations, pledges, grants, legacies, bequests, devises and contributions heretofore or hereafter made, and the income derived therefrom (collectively, “Donated Property”), but only to the extent that the Donated Property is not specifically restricted by the donor or grantor to a particular purpose inconsistent with its use for payment of Loan Payments;

• Income from the operations of the Facilities (as defined in the Loan Agreement (see Appendix B));

• Rental income;

• Investment income (excluding income from Irrevocable Deposits, as defined in the Loan Agreement);

• Net proceeds of business interruption insurance, if any; and

• All other accounts receivable, revenues, profits and receipts derived by or on behalf of the University from any source.

Notwithstanding the foregoing, the definition of “Gross Revenues” does not include rental income, income from operations, insurance proceeds, accounts receivable, revenues, profits and receipts relating to, or derived from, Property not included within the Facilities. As indicated by the above definition, the University’s endowment funds and investments thereon do not constitute Gross Revenues. See “SECURITY FOR THE BONDS--The Loan Agreement.”

Prior Parity Bond Additional Indebtedness Limitations

The University has entered into separate loan agreements with the Authority in connection with several series of Prior Parity Bonds (as defined herein). All of the Prior Loan Agreements (as defined herein) contain tests limiting the issuance of Additional Parity Indebtedness. The Loan Agreement does not contain any limitation on the issuance of any additional Indebtedness, including Additional Parity Indebtedness. See “SECURITY FOR THE BONDS - Additional Indebtedness Limitations and Expendable Resources Test.”

Professionals

Sherman & Howard L.L.C., Denver, Colorado, has acted as Bond Counsel and also has acted as special counsel to the University in connection with the preparation of this Official Statement. Sherman & Howard L.L.C. also serves as General Counsel to the Authority. The fees of Sherman & Howard L.L.C. will be paid only upon delivery of the Bonds. Certain legal matters will be passed upon for the University by its counsel, Hoffman, Crews, Nies, Waggener & Foster LLP. North Slope Capital Advisors, Denver, Colorado is acting as municipal advisor to the University and PFM Financial Advisors LLC, Denver, Colorado is acting as the financial advisor to the Authority. Kutak Rock LLP is acting as counsel to the Underwriter. UMB Bank, n.a., Denver, Colorado, will serve as the Trustee. RBC Capital Markets, LLC and Wells Fargo Securities will serve as the Underwriters of the Bonds. See “UNDERWRITING.” Certain legal matters will be passed on for the Underwriter by its counsel, Kutak Rock LLP, Denver, Colorado. The University’s financial statements in Appendix A of this Official Statement include the report of CliftonLarsonAllen LLP, certified public accountants, Greenwood Village, Colorado. See “INDEPENDENT AUDITORS.” Several of the professionals involved in this transaction are associated with the University. See “THE UNIVERSITY--Board of Trustees - Conflicts of Interest.”

Tax Status of Interest on the Bonds

In the opinion of Bond Counsel, assuming continuous compliance with certain covenants described herein, interest on the Series 2017A Bonds is excluded from gross income under federal income tax laws pursuant to Section 103 of the Internal Revenue Code of 1986, as amended to the date of delivery of the Series 2017A Bonds (the “Tax Code”), and interest on the Series 2017A Bonds is excluded from alternative minimum taxable income as defined in Section 55(b)(2) of the Tax Code except that such interest is required to be included in calculating the “adjusted current earnings” adjustment applicable to corporations for purposes of computing the alternative minimum taxable income of corporations. The Bonds, the transfer thereof, and the income therefrom are exempt from all taxation and assessments in the State of

Colorado. Interest on the Series 2017B Taxable Bonds is included in gross income for federal income tax purposes pursuant to the Tax Code. See “TAX MATTERS”.

Continuing Disclosure Undertaking

The University will execute a continuing disclosure agreement (the “Disclosure Agreement”) at the time of the closing for the Bonds. The Disclosure Agreement will be executed for the benefit of the beneficial owners (the “Beneficial Owners”) of the Bonds and the University will covenant in the Loan Agreement to comply with its terms. The Disclosure Agreement will provide that so long as the Bonds remain outstanding, the University will provide the following information to the Municipal Securities Rulemaking Board, acting through its Electronic Municipal Market Access (“EMMA”) system: (i) annually, certain financial information and operating data; and (ii) notice of the occurrence of certain material events; all as specified in the Disclosure Agreement. The form of the Disclosure Agreement is attached hereto as Appendix D. The University did not timely file certain of its previous continuing disclosure undertakings under Rule 15c2-12 promulgated under the Securities Exchange Act of 1934, as amended (the “Rule”) during the past five years. The University failed to file its 2012 annual financial statement and operating data, reportable on December 7, 2012, until July 11, 2014. The University self-reported this issue to the Securities Exchange Commission (the “SEC”) in December 2014 pursuant to the Municipalities Continuing Disclosure Cooperation initiative (“MCDC”). On March 3, 2017, the SEC notified the University that based on information it had received as of that date, it did not intend to recommend enforcement action. The University has taken remedial action to bring the University into compliance with its continuing disclosure obligations. The University’s management believes that it has appropriate staffing levels and adequate policies and associated procedures to assure post issuance compliance with future continuing disclosure filings under the Rule.

No financial or operating data concerning the Authority is material (as interpreted pursuant to the Securities and Exchange Act of 1934, as amended) to an evaluation of the Bonds or any decision to purchase, hold or sell the Bonds, and the Authority will not provide any such information. The University will undertake all responsibilities for any continuing disclosure to the Beneficial Owners as described in the Continuing Disclosure Agreement, and the Authority will have no liability to such Registered Owners of the Bonds or any other person with respect to such disclosures.

The continuing disclosure undertaking described above and in the Continuing Disclosure Agreement has been entered into for the benefit of the Registered Owners of the Bonds. The undertaking provides that such Registered Owners may enforce specific performance thereof by any judicial proceeding available, and that such action to compel specific performance is the sole remedy in the event of failure by the University to comply with the undertaking. No other party has any power or duty to enforce the undertaking. Failure to comply with the undertaking does not constitute a default or event of default under the Loan Agreement or the Indenture. Failure of the University to provide such information may materially and adversely affect any secondary market trading in the Bonds, but such failure will not cause a default under the Indenture or the Loan Agreement.

Additional Information

This introduction is only a brief summary of the provisions of the Bonds, the Indenture, and the Loan Agreement. A full review of the entire Official Statement should be made by potential investors. Brief descriptions of the Authority, the University, the Bonds, the Loan Agreement and the Indenture are included in this Official Statement and the appendices hereto. The descriptions herein of the Bonds, the Loan Agreement and the Indenture are qualified in their entirety by reference to each such document and the information contained therein. All such descriptions are further qualified in their entirety by reference to bankruptcy laws and principles of equity relating to or affecting generally the enforcement of creditors’ rights. This Official Statement speaks only as of its date; the information contained herein is subject to change.

Copies of the above-referenced documents are available for inspection and additional information is available during the initial offering period from the Underwriters:

RBC Capital Markets, LLC Attention: Nate Eckloff 1801 California Street, Suite 3840 Denver, CO 80202 Telephone: (303) 778-5555

Copies of the above-reference documents and additional information also may be obtained at the University’s Business and Financial Affairs Office:

University of Denver The Mary Reed Building, Room 103 2199 S. University Blvd. Denver, Colorado 80208 Telephone: (303) 871-3588

INVESTMENT CONSIDERATIONS

No Mortgage or Lien Interests Secure the Bonds

The Bonds are not secured by a mortgage, lien or security interest on or in any of the funds or other assets of the University other than the Gross Revenues of the University and the Funds (other than the Rebate Fund) established under the Indenture. For a discussion of existing liens on Gross Revenues, see “SECURITY FOR THE BONDS--Existing Liens on Gross Revenues.” Under the Loan Agreement, the University is permitted to have and incur debt other than Additional Parity Indebtedness (as defined in Appendix B). To the extent that any other debt of the University is secured by a pledge, mortgage, lien or security interest, the owners thereof would have priority as to payment from the property subject thereto over owners of the Bonds. Furthermore, the assets comprising the Facilities, and many of the other assets of the University included in its educational plant, are specialized facilities which may not be suitable for alternative uses. No assurance can be given that any other educational or similar institution would be able or willing at any particular time to acquire or otherwise use such facilities even for the purposes for which they are intended to be used.

No Debt Service Reserve Fund Secures the Bonds

The Bonds are not secured by a debt service reserve fund and debt service reserve funds established for Prior Parity Bonds will not secure the Bonds.

Risks Related to University Operations

The ability of the University to meet its payment obligations under the Loan Agreement will depend upon the continued availability to the University of revenue from a variety of sources sufficient to meet such obligations, the University’s operating expenses, debt service on other debt, extraordinary costs or expenses which may occur and other costs and expenses. Revenues and expenses of the University will be affected by future events and conditions relating generally to, among other things: the ability of the University to provide educational programs to attract and retain sufficient numbers of students during the time that the Bonds remain outstanding; demographic changes that may affect the number of students, particularly traditional undergraduate students, who will be attracted to and enroll at the University; the abilities of the University’s Board of Trustees to direct and the University’s administration to manage and operate the University; the University’s ability to control expenses, including (but not limited to) operation and maintenance of its physical plant; the University’s ability to maintain or increase rates for tuition and other fees without adversely affecting enrollment; the ability of the University to attract and retain quality faculty members for its educational programs; the investment of the University’s endowment and other funds; the ability of the University to solicit and obtain future gifts and bequests; the availability of governmental assistance for student financial aid; changes to laws or regulations related to federal student loan programs; and grants and contracts from governmental bodies, agencies and others. No assurances can be given that these or other sources of revenues will be adequate to meet the expenses of the University in the future.

The University operates in a competitive market for students with other educational institutions. As tuition costs increase, so does the demand for financial aid. The University expects that potential students will require more financial aid than past student 7

populations. The University staff expects that it will continue to have to balance its rate of increase in tuition and financial aid needs in the future in order to attract sufficient numbers of qualified students. See “THE UNIVERSITY--Admission,” “Financial Aid” and “Institutional Profile - Tuition.”

The University has experienced steady enrollment numbers over the last several years, maintaining enrollment changes within a 1-2% range of each prior fiscal year. Enrollment for fall 2016 (Fiscal Year 2017) is down slightly. See “THE UNIVERSITY--Enrollment” and “UNIVERSITY FINANCIAL INFORMATION--The Fiscal Year 2017 Budget” for more information. The University's long-term goal is to achieve overall stable enrollment through effective marketing and strategic use of financial aid and strategic growth in certain graduate units with capacity. There is no guarantee as to whether overall enrollment numbers will grow or decrease in the future.

Future revenues and expenses of the University will be subject to conditions which may differ from current conditions to an extent that cannot be determined at this time. Descriptions of the University’s operations and other factors that will affect the University’s ability to meet its payment obligations under the Loan Agreement are contained in “THE UNIVERSITY.”

Contributions

The University relies upon income sources other than undergraduate and graduate tuition and fees, including: contributions by private individuals and entities (including alumni); federal and state grants and loans for student financial assistance; endowment income; sales of auxiliary services; and interest and income from other sources. See “UNIVERSITY FINANCIAL INFORMATION.” The University relies on contributions to fund many activities. There can be no assurance that contributions or revenues from any of these sources of funding will continue at levels sufficient to meet the financial requirements of the University.

Various factors could affect individuals’ continued contributions. Federal legislation is adopted from time to time that changes or limits the tax value of deductions. For example, a change in marginal income tax rates or estate tax laws could reduce the tax advantages of charitable contributions for many taxpayers. Donations of stock and other appreciated property may result in tax liability under the Tax Code’s alternative minimum tax provisions, thereby discouraging contributions of such property. In addition, taxpayers who do not itemize deductions are not able to deduct charitable contributions. Such factors could adversely affect contributions to organizations such as the University.

Dependence Upon Tax-Exempt Status

The University generally is not subject to income and property tax in Colorado. This treatment affects the revenues available to the University to meet financial obligations, including the payment of principal of and interest on the Bonds. While the University has covenanted in the Loan Agreement to maintain its tax-exempt status for federal tax purposes and the tax-exempt status of the Series 2017A Bonds, there can be no assurance that such tax-exempt status will be maintained.

The University also generally is not subject to sales taxes imposed by the State or the City and County of Denver. This treatment also affects the revenues available to the University to meet financial obligations. There is no assurance that current sales tax laws, or the interpretation thereof, will not change in the future. Should that occur, the University may be required to pay sales taxes on some items that currently are exempt. It is not possible to predict what the financial impact to the University would be if any change in current sales tax laws or administrative interpretations thereof should occur in the future.

Limitations on Enforcement of Remedies; Bankruptcy Proceedings

General. The remedies available to the Trustee or the Owners of the Bonds upon an Event of Default under the Indenture or the Loan Agreement are in many respects dependent upon judicial actions which are often subject to discretion and delay. Under existing constitutional and statutory law and judicial decisions, the remedies provided in the Indenture and the Loan Agreement may not be readily available or may be limited.

Bankruptcy proceedings or the exercise of powers by the federal or State government, if initiated, could subject the owners of the Bonds to judicial discretion and interpretation of their rights in bankruptcy or otherwise, and consequently may entail risks of delay, limitation or modification of their rights. The various legal opinions to be delivered concurrently with the delivery of the Bonds will be qualified as to the enforceability of the various legal instruments by limitations imposed by the valid exercise of the sovereign powers of the State, and the constitutional powers of the United States of America, bankruptcy, reorganization, insolvency or other similar laws affecting the rights of creditors generally.

Bankruptcy Matters. In the event the University were to become a debtor under the Federal Bankruptcy Code, payments of Gross Revenues (or portions thereof) to the Trustee to pay debt service on the Bonds may be stayed or, under certain circumstances, subject to avoidance. Further, the Trustee’s lien on the Gross Revenues (or portions thereof) may not extend to or be enforceable against Gross Revenues after the commencement of such a bankruptcy case.

Other Potential Limitations on Rights of Bond Owners. The Bonds are secured by a security interest in the Gross Revenues on a parity with the lien thereon of the Prior Parity Bonds and any future Additional Parity Indebtedness. See “SECURITY FOR THE BONDS-- Existing Liens on Gross Revenues.” That security interest is intended to be prior to any security interest in, lien on or pledge of the Gross Revenues. However, in addition to the limitations discussed above, that security interest may be subject to or limited by other factors, including without limitation statutory liens, rights arising in favor of the United States of America or any agency thereof (including federal tax liens or other federal liens existing in the future), and rights of third parties in any Gross Revenues, including any Gross Revenues converted to cash and not in the possession of the Trustee.

Potential Environmental Risks

There are potential risks relating to environmental liability associated with the ownership of any property. If hazardous substances are found on property, owners and operators of such property may be held liable for costs of cleanup and other liabilities relating to such hazardous substances. In addition, liens arising as a result of liabilities relating to hazardous 9

substances may take priority over all other liens. The University has not undertaken any current environmental review of the sites upon which the projects are located or to be located.

Construction of Improvements

The University is financing the construction of the Improvements with a portion of the proceeds of the Bonds. No assurances can be given that the cost of the construction of the Improvements will be for an amount equal to or less than the amount available from bond proceeds. See “SOURCES AND USES OF FUNDS--The Financed Facilities”.

Forward-Looking Statements

This Official Statement (particularly, but not limited to, the information contained under the captions “INVESTMENT CONSIDERATIONS,” “UNIVERSITY FINANCIAL INFORMATION--Management Discussion of Financial Results” and “UNIVERSITY FINANCIAL INFORMATION--The Fiscal Year 2017 Budget”) contains statements relating to future results that are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. When used in this Official Statement, the words “estimate,” “intend,” “expect” and similar expressions identify forward-looking statements. Any forward-looking statement is subject to uncertainty and risks that could cause actual results to differ, possibly materially, from those contemplated in such forward-looking statements. Inevitably, some assumptions used to develop forward-looking statements will not be realized or unanticipated events and circumstances may occur. Therefore, investors should be aware that there are likely to be differences between forward-looking statements and actual results; those differences could be material.

Secondary Market

There is no guarantee that a secondary trading market will develop for the Bonds. Consequently, prospective purchasers should be prepared to hold their Bonds to maturity.

SOURCES AND USES OF FUNDS

Sources and Uses of Funds

The estimated sources and uses of the bond proceeds and other funds are shown in the following table.

Sources and Uses of Funds

Sources of Funds Par Amount of Bonds ...... $ Net Original Issue Discount/Premium on Bonds ...... $ Total ...... $

Uses of Funds Deposit to Bond Interest Fund ...... $ Deposit to Issuance Expense Fund (1) ...... $ Deposit to Project Fund Accounts ...... $ Total ...... $

(1) Includes Underwriter’s discount, legal fees, rating agency fees and other costs.

Source: The Underwriter.

The Financed Facilities

The total cost of the Improvements is expected to be approximately $143,000,000, which will be financed with the proceeds of the Bonds. The proceeds of the Bonds will be used to finance the projects described below, and such other campus improvements as the University may determine.

First time/First year Residence Hall – A portion of the proceeds will be used to acquire, construct and equip a new 500-bed residence hall facility for first year/first time University students. The facility will be in the vicinity of the existing on-campus residence hall facilities and in close proximity to the Driscoll Student Center. The program places an emphasis on community building, with dedicated common space for groups of 20 students. The facility will be designed without a dedicated dining hall in anticipation that the Driscoll Student Center renovation and expansion project (as described below) will offer centralized dining for all on- campus residents. Construction is expected to begin December 2018 and be completed May 2020, in time for the start of the 2020-21 school year.

Community Commons – A portion of the proceeds will be used for the demolition, renovation and expansion of the Driscoll Student Center to become a community commons. The Driscoll Student Center was last renovated (including a newly-constructed portion of the Driscoll Student Center) in the early 1980’s. Since the last renovation, total enrollments have increased significantly, resulting in a need to update and expand the facility for student organizations, retail operations and student services professional staff offices. Additionally, a significant component of the project will be the construction of a centralized dining facility containing a variety of food

choices. It is the belief of the University that construction of this type of dining facility will benefit campus life by encouraging faculty, staff, students and neighboring communities to share meals together. The Community Commons is also planned to improve and provide: (i) navigation of student services and support; (ii) information regarding culturally relevant spaces and programs; and (iii) support networks for social engagement outside the classroom. Phase I construction is expected to begin in April 2018 and be completed by June 2019 and Phase II construction is expected to begin in December 2018 and be completed by July 2020.

Career Achievement Center – The University intends to use a portion of the bond proceeds to expand its Career Advancement & Global Alumni Services center (the “Career Achievement Center”). The Career Achievement Center will serve as the University’s global network hub, providing a central destination for students, families, alumni and the prospective employers of University students. The University’s Career Achievement Center plans to provide students with opportunities to be mentored in professional and career exploration, in addition to information and support regarding internships, research positions, and study abroad opportunities. Construction is expected to begin August 2018 and be completed in November 2019.

Construction Management – The University anticipates using a construction manager/general contractor (“CM/GC”) method to deliver the projects within the construction budgets contemplated. This method allows the University to be an active participant with the architect of record during the design phase of the Improvements and the construction manager to act as consultant during the design process to offer constructability and pricing feedback on design options. This method also allows the construction manager to lock down subcontractor trades and pricing before a project goes under contract. A design-bid-build method of delivery will be considered as an alternative to general and subcontractor pricing subject to supply- demand competition in the commercial marketplace. Under either method of delivery, the University will use a guaranteed maximum price construction agreement to ensure that each project is likely to be delivered on budget.

THE BONDS

The description and summaries of various documents set forth below do not purport to be comprehensive or definitive, and reference is made to each document for the complete details of all terms and conditions. Copies of the Indenture are available for inspection from the sources listed in “INTRODUCTION--Additional Information.” See also “THE LOAN AGREEMENT” in Appendix B hereto.

Payment of Principal and Interest; Record Date

The Bonds will be dated as of their date of delivery and will mature and bear interest as set forth on the inside cover of this Official Statement. The Bonds will be issuable in fully registered form and will initially be registered in the name of “Cede & Co.,” as nominee for DTC, as securities depository for the Bonds. Purchases by Beneficial Owners of the Bonds are to be made in book-entry only form in the denominations of $5,000 and integral multiples thereof. Interest on the Bonds is payable semiannually on March 1 and September 1 of each year (collectively, the “Interest Payment Dates”), commencing September 1, 2017. Interest on the Bonds will be computed on the basis of a year of 360 days of 12 months of 30 days each until payment of principal has been made or provided for, payable on each Interest Payment Date, except that the Bonds which are reissued upon transfer, exchange or other replacement will bear interest from the most recent Interest Payment Date to which interest has been paid or duly provided for, or if no interest has been paid, from the date of the Bonds.

The principal or redemption price of the Bonds will be payable in lawful money of the United States of America upon surrender thereof at the principal corporate trust office of the Trustee or at the principal office of its successor in trust. Interest will be payable in lawful money of the United States of America to the registered owners of the Bonds (initially Cede & Co.) as shown on the registration books kept by the Trustee as of the close of business on the applicable record dates described below. Payments to Beneficial Owners are to be made as described below in “Book-Entry Only Form.” Except in the case of overdue interest, the record date for interest due will be the fifteenth day of the month preceding each Interest Payment Date. Interest which is due and payable on any Interest Payment Date, but cannot be paid on such date from available sources, ceases to be payable to the registered owners otherwise entitled thereto as of such date. At such time as sufficient funds are available for the payment of such overdue interest, the Trustee is required to establish a special payment date and a Special Record Date in respect thereof. The Trustee is required to mail a notice specifying each date so established to each registered owner of the Bonds, such notice to be mailed at least 10 days prior to the Special Record Date.

Notwithstanding the foregoing, payments of the principal of and interest on the Bonds will be made directly to DTC or its nominee, Cede & Co., by the Trustee, so long as DTC or Cede & Co. is the registered owner of the Bonds. Disbursement of such payments to DTC’s Participants is the responsibility of DTC, and disbursements of such payments to the Beneficial Owners is the responsibility of DTC’s Participants and the Indirect Participants, as more fully described herein. See “Book-Entry Only System” below.

Redemption Provisions

Optional Prior Redemption. The Series 2017A Bonds maturing on and before March 1, 2027*, are not subject to optional redemption prior to maturity. The Series 2017A Bonds maturing on or after March 1, 2028*, are subject to optional redemption prior to maturity by the Authority upon the direction of the University on and after March 1, 2027*, as a whole or in part at any time, at a price equal to the principal amount of each Series 2017A Bond redeemed and accrued interest to the redemption date.

The Series 2017B Taxable Bonds maturing on and before March 1, 2027*, are not subject to optional redemption prior to maturity. The Series 2017B Taxable Bonds maturing on or after March 1, 2028*, are subject to optional redemption prior to maturity by the Authority upon the direction of the University on and after March 1, 2027*, as a whole or in part at any time, at a price equal to the principal amount of each Series 2017B Taxable Bond redeemed and accrued interest to the redemption date.

Sinking Fund Redemption. The Series 2017A Bonds maturing on March 1, 2040*, March 1, 2043* and on March 1, 2047*, are subject to mandatory sinking fund redemption at a redemption price equal to 100% of the principal amount thereof and accrued interest to the redemption date.

As and for a sinking fund for the redemption of Series 2017A Bonds maturing on March 1, 2040,* there shall be deposited into the Bond Principal Fund and Bond Interest Fund on March 1, 2038 and on March 1, 2039, a sum which is sufficient to redeem (after credit as provided in the Indenture) the following principal amount of the Series 2017A Bonds maturing on March 1, 2040, and accrued interest to the redemption date:

March 1 Principal Amount of the Year* to be Redeemed* 2038 $6,775,000 2039 7,115,000 2040 (maturity) 7,470,000

* Preliminary, subject to change. 14

As and for a sinking fund for the redemption of Series 2017A Bonds maturing on March 1, 2043*, there shall be deposited into the Bond Principal Fund and Bond Interest Fund on March 1, 2041 and on March 1, 2042, a sum which is sufficient to redeem (after credit as provided in the Indenture) the following principal amount of the Series 2017A Bonds maturing on March 1, 2043, and accrued interest to the redemption date:

March 1 Principal Amount of the Year* to be Redeemed* 2041 $7,845,000 2042 8,235,000 2043 (maturity) 8,645,000

As and for a sinking fund for the redemption of Series 2017A Bonds maturing on March 1, 2047,* there shall be deposited into the Bond Principal Fund and Bond Interest Fund on March 1, 2044, and on each March 1 thereafter, to and including March 1, 2046, a sum which is sufficient to redeem (after credit as provided in the Indenture) the following principal amount of the Series 2017A Bonds maturing on March 1, 2047, and accrued interest to the redemption date:

March 1 Principal Amount of the Year* to be Redeemed* 2044 $9,080,000 2045 9,440,000 2046 9,820,000 2047 (maturity) 10,210,000

Not more than forty-five days nor less than thirty days prior to the sinking fund redemption date for the Bonds then subject to redemption, the Trustee will proceed to select for redemption (by lot in such manner as the Trustee may determine) from all Outstanding Bonds then subject to redemption a principal amount of Bonds then subject to redemption equal to the aggregate principal amount of Bonds then subject to redemption which are redeemable with the required sinking fund payment, and will call such Bond for redemption from the sinking fund on the next March 1, and give notice of such call.

At the option of the University to be exercised by delivery of a written certificate to the Trustee and the Authority not less than forty-five days next preceding any sinking fund redemption date for the Bonds then subject to redemption, it may (i) deliver to the Trustee for cancellation Bonds then subject to redemption in an aggregate principal amount desired by the University or (ii) specify a principal amount of Bonds of such then subject to redemption which prior to said date have been redeemed (otherwise than through the operation of the sinking fund) and cancelled by the Trustee and not previously applied as a credit against any sinking fund redemption obligation. Each Bond so delivered or previously redeemed will be credited by the Trustee at 100% of the principal amount thereof against the obligation of the Authority on such sinking fund redemption date and any excess shall be so credited against future sinking fund

* Preliminary, subject to change. 15

redemption obligations with respect to Bonds then subject to redemption as specified by the University. In the event the University chooses to avail itself of the provisions of clause (i) of the first sentence of this paragraph, the certificate required by the first sentence of this paragraph will be accompanied by the Bonds then subject to redemption to be cancelled.

Extraordinary Prior Redemption. The Bonds are redeemable upon the direction of the University in whole on any date from and to the extent of funds on deposit under the Indenture and available for this purpose at a redemption price equal to the principal amount of each Bond redeemed and accrued interest to the redemption date upon the occurrence of any of the following events:

(a) The Facilities shall have been damaged or destroyed in whole or in part to such extent that, as expressed in a Consulting Architect’s Certificate filed with the Trustee, (i) the Facilities cannot reasonably be restored within a period of six consecutive months to the condition thereof immediately preceding such damage or destruction, or (ii) the University is thereby prevented from carrying on its normal operations for a period of six consecutive months, or (iii) the cost of restoration thereof would exceed the Net Proceeds of insurance carried thereon pursuant to the requirements of Section 6.3 of the Loan Agreement.

(b) Title to, or the temporary use of, all or any substantial part of the Facilities shall have been taken under the exercise of the power of eminent domain by any governmental authority, or person, firm, or corporation acting under governmental authority.

(c) As a result of any changes in the Constitution of the State of Colorado or the Constitution of the United States of America or of legislative or administrative action (whether state or federal or by final decree, judgment or order of any court or administrative body whether state or federal entered after the contest thereof by the University in good faith), the Loan Agreement shall have become void or unenforceable or impossible of performance in accordance with the intent and purposes of the parties as expressed in the Loan Agreement, or unreasonable burdens or excessive liabilities shall have been imposed on the University in respect to the Facilities, including, without limitation, federal, state or other ad valorem, property, income, or other taxes not being imposed on the date of the Loan Agreement.

(d) Following the sale or the transfer of the use or management of the Facilities financed with the proceeds of the Series 2017A Bonds or a portion thereof to a Person who is not an Exempt Person if the University shall have received an opinion of nationally recognized bond counsel to the effect that the failure to redeem the Series 2017A Bonds could result in the interest on the Series 2017A Bonds becoming includible in the gross income of the holders thereof for federal income tax purposes.

The Bonds are also redeemable in part by the Authority upon the direction of the University on any date at a redemption price equal to the principal amount of each Bond redeemed and accrued interest to the redemption date in the manner and upon compliance with the provisions the Loan Agreement or if an event in subsection (d) above has occurred. Only Net Proceeds of insurance or a condemnation award shall be used for a partial redemption of Bonds pursuant to subsections (a) or (b) above. 16

Redemption Procedures. In the case of every redemption, the Trustee will cause notice of such redemption to be given at least 30 days prior to the redemption date, by first-class mail, to the Authority and the owners of the Bonds designated for redemption in whole or in part, at their addresses as they last appear upon the registration records. However, failure to give such notice, or any defect therein, will not affect the validity of any proceedings for the redemption of such Bonds. On the redemption date, the principal amount of each Bond to be redeemed, together with the accrued interest thereon to such date shall become due and payable; and from and after such date, notice having been given and deposit having been made in accordance with the provisions of the Indenture, no further interest shall accrue on any of such Bonds.

Each notice of redemption shall specify the date fixed for redemption, the series, the redemption price, the place or places of payment, that payment will be made upon presentation and surrender of the Bonds to be redeemed, that interest accrued to the date fixed for redemption will be paid as specified in said notice, and that on and after said date interest thereon will cease to accrue. If less than all the Outstanding Bonds are to be redeemed, the notice of redemption shall specify the numbers of the Bonds or portions thereof to be redeemed.

Notwithstanding the provisions described above, any notice of redemption may contain a statement that the redemption is conditioned upon the receipt by the Trustee of funds on or before the date fixed for redemption sufficient to pay the redemption price of the Bonds so called for redemption, and that if such funds are not available, such redemption shall be cancelled by written notice to the owners of the Bonds called for redemption in the same manner as the original redemption notice was mailed.

Book-Entry Only System

The Bonds will be available only in book-entry form in the principal amount of $5,000 or any integral multiple thereof. DTC will act as the initial securities depository for the Bonds. The ownership of one fully registered Bond for each series, maturity and interest rate as set forth on the inside cover page of this Official Statement, each in the aggregate principal amount of such maturity, will be registered in the name of Cede & Co., as nominee for DTC. See Appendix C-Book-Entry Only System.

SO LONG AS CEDE & CO., AS NOMINEE OF DTC, IS THE REGISTERED OWNER OF THE BONDS, REFERENCES IN THIS OFFICIAL STATEMENT TO THE REGISTERED OWNERS OF THE BONDS WILL MEAN CEDE & CO. AND WILL NOT MEAN THE BENEFICIAL OWNERS.

None of the Authority, the University or the Trustee will have any responsibility or obligation to DTC’s Direct Participants or Indirect Participants (each as defined in Appendix C), or the persons for whom they act as nominees, with respect to the payments to or the providing of notice for the Direct Participants, the Indirect Participants or the beneficial owners of the Bonds as further described in Appendix C to this Official Statement.

DEBT SERVICE REQUIREMENTS

The following table sets forth, as of the date of this Official Statement, the debt service requirements for the Bonds in each fiscal year, the combined annual debt service on the Prior Parity Bonds and the total debt service to be paid in each fiscal year on the Bonds and the Prior Parity Bonds. See “SECURITY FOR THE BONDS – Existing Liens on Gross Revenues.”

Debt Service Requirements (1) The Bonds Fiscal Year Combined Debt Service Principal* Interest Debt Service Ending on Prior Parity Bonds June 30 2018 $11,123,209 - 2019 11,263,688 - 2020 11,258,512 - 2021 11,256,874 3,685,000 2022 11,258,509 1,625,000 2023 11,303,090 1,755,000 2024 10,128,643 1,815,000 2025 10,129,031 1,960,000 2026 10,130,343 2,120,000 2027 10,126,606 2,285,000 2028 2,978,481 2,910,000 2029 2,977,387 3,015,000 2030 2,981,537 3,125,000 2031 3,018,250 4,815,000 2032 3,020,000 5,055,000 2033 3,020,750 5,310,000 2034 3,015,250 5,575,000 2035 3,013,500 5,850,000 2036 - 6,145,000 2037 - 6,450,000 2038 - 6,775,000 2039 - 7,115,000 2040 - 7,470,000 2041 - 7,845,000 2042 - 8,235,000 2043 - 8,645,000 2044 - 9,080,000 2045 - 9,440,000 2046 - 9,820,000 2047 - 10,210,000 Total $132,003,667 $148,130,000

(1) Totals may not add due to rounding. * Preliminary, subject to change.

Source: The Underwriter.

SECURITY FOR THE BONDS

The description and summaries of various documents set forth below do not purport to be comprehensive or definitive, and reference is made to each document for the complete details of all terms and conditions. Copies of the Loan Agreement and the Indenture are available for inspection from the sources listed in “INTRODUCTION--Additional Information.” See also “THE LOAN AGREEMENT” in Appendix B hereto.

Existing Liens on Gross Revenues

The Bonds will be issued on a parity with and will be payable from the same revenues as the Prior Parity Bonds and any additional obligations of the University issued with a parity lien on Gross Revenues. The owners of the Prior Parity Bonds are equally and ratably secured by the pledge and security interest granted by the University in its Gross Revenues to the owners of the Bonds. Prior Parity Bonds include the Authority’s: (i) Refunding Revenue Bonds (University of Denver Project) Series 2007, currently outstanding in the principal amount of $39,920,000; (ii) Refunding Revenue Bonds (University of Denver Project) Series 2008, currently outstanding in the principal amount of $2,535,000; (iii) Refunding Revenue Bonds (University of Denver Project) Series 2013, currently outstanding in the principal amount of $22,270,000; (iv) Refunding Revenue Bonds (University of Denver Project) Series 2014A, currently outstanding in the principal amount of $26,185,000; and (v) Refunding Revenue Bonds (University of Denver Project) Series 2014B, currently outstanding in the principal amount of $9,265,000.

Additional Indebtedness Limitations and Expendable Resources Tests

The University has entered into separate loan agreements with the Authority in connection with each series of the Prior Parity Bonds (the “Prior Loan Agreements”). All of the Prior Loan Agreements contain tests limiting the issuance of Additional Parity Indebtedness and certain other obligations. In addition, one Prior Loan Agreement (entered into in 2007) provides that the University may not incur Additional Parity Indebtedness, unless the University can certify that the “Expendable Resources Ratio” is not less than .75x, based upon the most recent fiscal year for which audited financial statements are available. Expendable Resources are defined as all of the University’s (i) unrestricted net assets and temporarily restricted net assets, less (ii) the number derived by subtracting: (A) outstanding long term debt from (B) net property, plant and equipment, all as determined in accordance with generally accepted accounting principles. These additional debt tests will continue to govern the issuance of Additional Parity Indebtedness and certain other obligations until such time as none of the Prior Parity Bonds containing these tests remain outstanding or until the owners of 66 and two-thirds percent in aggregate principal amount of each affected series of Prior Parity Bonds agree to amend the Prior Loan Agreements. See “THE LOAN AGREEMENT” in Appendix B hereto.

Historical Net Income Available for Debt Service; Pro-Forma Debt Service Coverage Ratio

The following table shows the Net Income Available for Debt Service for each of the five Fiscal Years ending June 30, 2012 through June 30, 2016, the estimated Maximum Annual Debt Service on the Bonds, and the pro-forma Debt Service Coverage Ratio on the Bonds for that period, calculated in accordance with the Loan Agreement. Pursuant to the Loan

Agreement, “Debt Service Coverage Ratio” means the ratio for the period in question of Net Income Available for Debt Service to the estimated Maximum Annual Debt Service.

Pursuant to the Loan Agreement, “Net Income Available for Debt Service” means, as to any period of time, the excess of all operating revenues of the University (excluding income from Irrevocable Deposits) over operating expenses (inclusive of payments to pension, retirement, health and hospitalization funds), excluding from such expenses depreciation, amortization, interest expense with respect to Bonds and Long-Term Additional Parity Indebtedness and expenses relating to gifts, donations, pledges, grants, legacies, bequests, devises and contributions heretofore or hereafter made to the extent specifically restricted by the donor to a particular purpose inconsistent with their use for payment of debt service on Indebtedness or operation and maintenance expenses (“Restricted Gifts”) to the extent of the income on such Restricted Gifts, all as determined in accordance with generally accepted accounting principles (as in effect on the date of calculation or, in the case of audited financial statements, as of the date of the relevant report thereon) consistently applied, and also excluding from revenues Restricted Gifts and the income derived therefrom; provided that no determination thereof shall take into account any gain or loss resulting from either the extinguishment of Indebtedness or the sale, exchange or other disposition of capital assets not in the ordinary course of business.

Net Income Available for Debt Service and Pro-Forma Debt Service Coverage

2012 2013 2014 2015 2016 Total Revenues: $382,408,974 $382,318,576 $403,934,232 $420,579,515 $430,194,085 Less: Expenditures (1) 330,884,335 338,570,053 339,504,492 350,360,311 368,712,432 Net Income Available for Debt Service (1) $51,524,639 $43,748,523 $64,429,740 $70,219,204 $61,481,653

Maximum Annual Debt Service on the Prior Parity Bonds and the Bonds (2) $19,622,911* $19,622,911* $19,622,911* $19,622,911* $19,622,911* Pro Forma Coverage 2.62x 2.23x 3.28x 3.58x 3.13x

* Estimated, subject to change. (1) Calculated in accordance with the definition of “Net Income Available For Debt Service.” See the definition on the prior page and in Appendix B - DEFINITIONS. Generally, pursuant to that definition, expenses do not include debt service payments or expenditures from Designated Funds which represent amounts transferred by the Board of Trustees from unrestricted current funds in one year for specific future operating purposes. See “FINANCIAL INFORMATION CONCERNING THE UNIVERSITY--Financial Statements.” (2) Represents the estimated combined Maximum Annual Debt Service requirements of the Outstanding Prior Parity Bonds and the Bonds as estimated by the University’s Municipal Advisor. See “DEBT SERVICE REQUIREMENTS.”

Source: University Office of Financial Affairs.

The Loan Agreement

Under the Loan Agreement, the Authority agrees to issue the Bonds and to lend the proceeds thereof to the University to finance the cost of the Project, and the University is unconditionally obligated to repay the loan in amounts sufficient, together with available funds held under the Indenture, to provide for the timely payment of the principal of and interest on the Bonds when due (whether by maturity or acceleration) and to perform certain other obligations set forth therein. Among other things, the University will covenant (i) to maintain its status as an organization exempt from federal income taxation under Section 501(c)(3) of the Tax Code, as 20

amended and (ii) to operate that portion of the Facilities which constitute educational facilities for University purposes. For further discussion of the provisions of the Loan Agreement, see “THE LOAN AGREEMENT” in Appendix B hereto.

The Authority will assign certain of its rights and interests in the Loan Agreement, including certain of its rights to receive certain payments thereunder, and certain of its rights and interests in the Gross Revenues to the Trustee for the benefit of the owners of the Bonds under the Indenture. For further discussion of the provisions of the Loan Agreement, see “SECURITY FOR THE BONDS – Additional Indebtedness and Expendable Resources Tests.” See also “THE LOAN AGREEMENT” in Appendix B hereto.

In addition to the covenants contained in the Loan Agreement, the University is bound by covenants contained in loan agreements executed in connection with the issuance of the Prior Parity Bonds (the “Prior Loan Agreements”). One Prior Loan Agreement executed in 2007 contains a covenant that requires the expendable resource calculation to be equal at least 0.75x of outstanding principal amount of its long-term debt. See “THE LOAN AGREEMENT” in Appendix B hereto.

The Indenture

The Bonds are to be issued pursuant to the Indenture and will be equally and ratably secured thereby and by an assignment of certain of the Authority’s rights under the Loan Agreement. The Indenture provides that all Bonds issued thereunder shall be limited obligations of the Authority, payable solely from and secured solely by certain payments made by the University under the Loan Agreement, the Gross Revenues and the Funds (other than the Rebate Fund) established under the Indenture. As security for its obligations under the Indenture, the Authority will assign to the Trustee certain payments of the University received or receivable by the Authority pursuant to the Loan Agreement, certain of its rights and interests in the Gross Revenues and its rights and interests in all Funds (other than the Rebate Fund) held by the Trustee under the Indenture and all income derived from the investment of such funds. Neither the Owners of the Bonds nor the Trustee will have any mortgage lien on any of the Facilities. See “THE UNIVERSITY--Facilities” and “THE INDENTURE” in Appendix B hereto.

THE AUTHORITY

The Authority, created in 1981, is an independent public body politic and corporate constituting a public instrumentality and political subdivision of the State. The Authority is not an agency of state government and is not subject to administrative direction by any department, commission, board or agency of the State. The Authority is authorized by the Act to provide financing for educational institutions and cultural institutions and to acquire, construct, reconstruct, repair, alter, improve, extend, own, lease and dispose of properties to the end that the Authority may be able to promote the welfare of the people of the State.

The Authority has offered and plans to offer other obligations from time to time to finance other educational facilities and cultural institutions with respect to facilities located in Colorado and, subject to the satisfaction of certain requirements, other states. The Authority has financed facilities for institutions that compete with the University and may do so in the future. Such obligations have been and will be issued pursuant to and secured by instruments separate and apart from the Indenture.

The Authority has not prepared or assisted in the preparation of this Official Statement except for statements relating to the Authority under the sections captioned “INTRODUCTION--The Authority,” “THE AUTHORITY” and “LEGAL MATTERS--Absence of Litigation - The Authority” and, except for those sections, the Authority is not responsible for any statements made in this Official Statement. Except for the execution and delivery of documents required to effect the issuance of the Bonds, the Authority has not otherwise assisted in the public offer, sale or distribution of the Bonds. Accordingly, except as specified above, the Authority disclaims responsibility for the disclosures set forth in this Official Statement or otherwise made in connection with the offer, sale and distribution of the Bonds.

The Bonds are limited obligations of the Authority payable solely from the payments made by the University under the Loan Agreement and from the moneys and securities held by the Trustee under the Indenture. Neither the Authority nor its directors, officers, employees or agents are personally liable with respect to the Bonds. Accordingly, no financial information with respect to the Authority or its directors or officers has been included in this Official Statement.

THE UNIVERSITY

Organization

The University, located in Denver, Colorado, is one of the oldest and largest independent institutions of higher education in the Rocky Mountain region. Colorado Seminary is the legal entity which owns and operates the University and its properties. Colorado Seminary and the University of Denver are most commonly referred to as the “University of Denver” and are collectively referred to herein as the “University.” The Colorado Seminary was incorporated in 1864 pursuant to an act of the Council and House of Representatives of Colorado Territory for the purpose of founding, directing and maintaining an institution of learning. The founders of the Colorado Seminary were members of the Methodist Episcopal Church (now known as the United Methodist Church). While the Colorado Seminary maintains its relationship with the United Methodist Church, the legislative charter of the Colorado Seminary provides that “[n]o test of religious faith shall ever be applied as a condition of admission.”

The Colorado Seminary was reorganized in 1880, at which time the University was incorporated as the degree-granting body. The function of the University, as a corporate entity distinct from the Colorado Seminary, is limited strictly to the conferral of academic degrees. The Members of the Board of Trustees of the Colorado Seminary also serve as the Members of the Board of Trustees of the University.

Accreditation

The University has been accredited by the North Central Association of Colleges and Secondary Schools (“NCA”) since 1914. The NCA reaccreditation team last visited the campus on June 20, 2011. The NCA reaccreditation was granted for the maximum period (ten years) before the next university-wide review. Accordingly, the University’s next reaccreditation review is scheduled for 2021. The NCA accreditation team commented upon many aspects of the University. The team favorably cited the University’s attention to student learning, the excellent campus physical environment, and the prominence of the study abroad in the undergraduate curriculum. The University’s vision, values, mission, and goals receive strong support from faculty, staff and students and are central to the University’s planning and programming. It also noted the University benefits from the commitment of a highly involved Board of Trustees. In addition to the NCA accreditation, various schools and colleges within the University currently are recognized by specialized accrediting organizations.

Board of Trustees

Pursuant to the legislative charter of the University, the University’s Board of Trustees is empowered to perform such acts as may be necessary and proper for carrying into effect the objectives of the University and to adopt all proper rules and regulations for the government of the conduct of teachers and pupils and the management of all affairs pertaining to the University.

The University’s charter and Bylaws provide that the Board of Trustees shall consist of 28 members, divided into four classes of seven members each, appointed for four-year terms, with the terms of the several classes to expire in successive years. Members of the Board of Trustees (each a “trustee”) are appointed, following nomination by the Board of Trustees, by 23

the Annual Conference of the United Methodist Church. Currently, there are five vacant positions on the Board of Trustees.

The name, year of original appointment, expiration date of current term and principal business affiliation of each of the trustees, the title of the office held by certain trustees and the Executive Committee members are set forth below. Per the January 2013 Bylaw amendments, trustees are appointed to the balance of the class they joined, plus up to three four- year terms (which means, as applied prospectively, their appointments may be as long as 15 years, depending on which class the trustee joined).

Expiration of Current Year of Term Name Appointment (June) Principal Business Affiliation and Address (or Home) Founder, President & CEO, Stonebridge Companies, Englewood, Navin Dimond 2013 2017 Colorado

Margot Gilbert Frank 2001 2017 Lewis D. and John J. Gilbert Foundation, Denver, Colorado

Chairman, President & CEO, Anacostia & Pacific Company, Inc., Peter A. Gilbertson 2009 2017 Chicago, Illinois

Scott J. Reiman 1998 2017 President, Hexagon Investments, Denver, Colorado

Douglas G. Scrivner 2008 2017 Retired General Counsel – Accenture (Los Altos Hills, California)

Edward T. Anderson 2011 2018 Partner, North Bridge Venture Partners, Boston, Massachusetts

President Emerita, University of Michigan; President, Association of Mary Sue Coleman 2015 2018 American Universities, Washington D.C. President & CEO, North American Corporation of Illinois, Chicago, John A. Miller 2008 2018 Illinois Private Investor, Director, Calpine Corp., Medtronic Inc. and US Denise M. O'Leary 2013 2018 Airways Inc. (Cherry Hills Village, Colorado)

Joseph W. Saunders 2014 2018 Former Chairman and CEO Visa Inc. (San Francisco, California)

Otto Tschudi 1991 2018 Managing Director, Stifel Nicolas Weisel, San Francisco, California

Joy S. Burns 1981 2019 President, D.C. Burns Realty & Trust Co., Denver, Colorado

Craig Harrison 2015 2019 Managing Director, Arrowhead Partners LLC, Denver, Colorado

Brandon Johnson 2016 2019 Principal, Johnson Financial Group, LLC, Denver, Colorado

John W. Low 1987 2019 Attorney/Member, Sherman & Howard L.L.C., Denver, Colorado

Trygve E. Myhren 1996 2019 President, Myhren Media, Inc., Denver, Colorado

Clara Villarosa 1996 2019 Founder - Retired, Hue-man Bookstore (New York, New York)

Former Director, U.S. Office of Personnel Management (Corrales, Katherine Archuleta 2016 2020 New Mexico)

Kevin C. Gallagher 2004 2020 President and CEO, Gallagher Industries LP, Denver, Colorado

Professor, Daniels College of Business, University of Denver, James R. Griesemer 2012 2020 Denver, Colorado Chairman, President & Chief Executive Officer, Johns Manville, Mary K. Rhinehart 2016 2020 Denver, Colorado

Catherine C. Shopneck 2006 2020 Principal, South Woods Financial LLC, Denver, Colorado

Frederick T. Waldeck 1989 2020 Managing Director, Tishman Speyer, New York, New York

Conflicts of Interest. Several of the trustees from time to time have entered into transactions directly or indirectly with the University which give rise to potential conflicts of interest. Members of the Board of Trustees are required to complete a Conflicts of Interest questionnaire annually in connection with the external audit of the University’s financial statements. Conflicts, if any, are reviewed by the Chair of the Board of Trustees. John W. Low, a trustee, is a member in the firm of Sherman & Howard L.L.C., which is acting as Bond Counsel and special counsel to the University in connection with the issuance of the Bonds. Sherman & Howard L.L.C. also serves as the Authority’s General Counsel. James R. Griesemer, a trustee, is a faculty member in the Daniels College of Business. Scott Reiman, a trustee, purchased a parcel of real estate that had previously been donated to the University. The transaction was supported by fair market appraisals. Kevin Gallagher is on the Board of Directors of UMB Financial Corporation, the parent company of UMB Bank, n.a., the Trustee of the University’s outstanding bonds and the purchaser of the University’s outstanding Series 2014A and B Bonds.

In addition, other trustees or members of their families have in the past and may in the future engage in arms-length transactions with the University in the normal course of business which may give rise to potential conflicts of interest. Trustees do not participate in voting on matters related to those in which they have conflicts of interest.

Administration

The following paragraphs describe the executive level personnel who are responsible for the financial operation and general administration of the University.

Rebecca Chopp, Chancellor. The chief executive and administrative officer of the University is the Chancellor, selected and appointed by the Board of Trustees for such term and upon such conditions as the Board may authorize, and is directly responsible to the Board for the administrative functions of the University. Dr. Chopp became Chancellor in September 2014 and is leading the implementation of DU IMPACT 2025, a strategic plan focused on the 21st-century transformation of knowledge, the holistic education of students, and the University’s engagement in local and global organizations and communities. A visionary leader, Dr. Chopp emphasizes the importance of developing the University as an international and inclusive global community. Previously, Dr. Chopp was President of Swarthmore College and Colgate University. She also served as Provost and Executive Vice President for academic affairs at Emory University and as a Dean at Yale University. Dr. Chopp is a widely published author and editor, including six books and more than 50 articles. Dr. Chopp received her B.A. from Kansas Wesleyan University; her M.Div. from St Paul School of Theology; and her Ph.D. from the University of Chicago.

Among her duties, the Chancellor of the University appoints the Provost and the Vice Chancellors, who have such duties and responsibilities as may be assigned by the Chancellor. The Vice Chancellors may be removed by the Chancellor after consultation with the Chair of the Board of Trustees and the chair of the relevant committees. The Vice Chancellor for Financial Affairs, however, shall be appointed by the Chancellor after consultation with, and concurrence of, the Chair of the Board and the chair of the Finance and Budget Committee, and may be removed by the Chancellor, subject, however, to the prior approval of the Chair of the Board of Trustees.

Gregg Kvistad, Provost and Executive Vice Chancellor. The Provost and Executive Vice Chancellor is the chief academic officer and second-in-command to the Chancellor. Dr. Kvistad, formerly Dean of the Division of Arts, Humanities and Social Sciences, became the Provost in June 2006 after having served as Interim Provost since July 2005. As the officer ultimately responsible for the internal administration of the academic community, the Provost’s duties include academic planning and policy, preparation of the University’s annual budget, faculty development, and certain campus operations. Dr. Kvistad served as Interim Chancellor in August 2014. He is now responsible for implementation of DU IMPACT 2025. Dr. Kvistad joined the University’s political science faculty in 1984, chaired that department for six years and was Dean of the Division for seven years. Dr. Kvistad received his B.A. from the University of Minnesota and his M.A. and Ph.D. from the University of California, Berkeley. In April 2017, the Chancellor announced Dr. Kvistad’s decision to step down from his position as Provost and Executive Vice Chancellor at the end of the 2017-2018 academic year.

Craig Woody, Vice Chancellor for Business and Financial Affairs and Treasurer. Mr. Woody is responsible to the Chancellor for the following offices and departments: Controller’s Office, Campus Safety, Student Financial Services, Facilities Planning, Shared Services and Management and Risk Management. As Treasurer, Mr. Woody is responsible for overseeing the University’s working capital, daily cash management and endowment investments and for managing long-term debt. He came to the University as Controller in 1984 and was appointed Vice Chancellor in January 1995. Prior to joining the University, Mr. Woody worked in the audit department of the accounting firm KPMG. He earned a bachelor’s in accounting from the University of Iowa and a master’s degree in accounting from the Daniels College of Business at the University of Denver.

Armin Afsahi, Vice Chancellor for Advancement. Mr. Afsahi became Vice Chancellor in July 2015. His role is to inspire the vision and provide the leadership for the University’s philanthropy programs and global engagement. As the chief development officer, he builds strong relationships with key University leaders as well as alumni, parents and friends of the University. Mr. Afsahi has expertise spanning creative alumni engagement strategies, innovative and highly effective fundraising strategies, and leadership of comprehensive campaigns raising in excess of $1 billion. He has over 25 years of private and public sector experience in institutional advancement, business development, strategic planning, marketing and operations. For 10 years before coming to the University, he was a senior advancement executive for prestigious institutions including the University of California, San Diego and Georgetown University. Mr. Afsahi has a B.A. from UC-San Diego and a MBA in finance and strategic management from University of San Diego.

Margaret (Peg) Bradley-Doppes, Vice Chancellor for Athletics and Recreation. Ms. Doppes became the Vice Chancellor for Athletics and Recreation in July 2005. She has more than three decades of experience in NCAA Division I programs, where she has served as head coach for 11 years and as an athletics administrator for more than 25 years. She was the Director of Athletics at the University of North Carolina Wilmington from 1999 to 2004. Ms. Doppes holds an M.A. in health and physical education from Miami University, Ohio. Ms. Doppes is responsible for leading the University’s athletics and recreation programs at the NCAA I level. She oversees all varsity sports, club sports and a recreation program that serve students, alumni and families in the Denver community.

Paul Chan, Vice Chancellor for Legal Affairs and General Counsel. Mr. Chan became what was previously known as University Counsel in July 1997. He is responsible for day-to-day legal matters of the University and oversees the Office of Vice Chancellor for Legal Affairs. Prior to joining the University, Mr. Chan served as Administrative Counsel (Managing Attorney) for the Colorado Attorney General’s Office for five years and was Assistant Attorney General from 1986 to 1992. Mr. Chan earned his B.A. from the University of Denver and his J.D. from the University of California, Berkeley.

Andrew Cullen, Associate Vice Chancellor for Finance, Controller, and Assistant Treasurer. Mr. Cullen is responsible for the daily operations of accounting and budget operations for the University. As Assistant Treasurer, he works with the University Treasurer on managing the University’s working capital, endowment investments and long-term debt. Prior to joining the University, Mr. Cullen served as the Associate Vice President for the Office of Planning, Budget & Analysis at the University of New Mexico. In this role, he oversaw the prioritization, development and implementation of the University’s operating and capital budgets and the development of the University Innovate ABQ economic development initiative. With more than 20 years of experience with strategy and planning, Mr. Cullen brings to the University important skills and experience that make him an effective collaborator and partner. He earned both his bachelor’s degree in finance & accounting and a master’s degree in landscape architecture from the University of New Mexico.

David Greenberg, Vice Chancellor for Institutional Partnerships. Mr. Greenberg became Vice Chancellor in 2010 and is responsible for collaborating with academic institutions, industry, government and NGOs to create and expand programs that strengthen the strategic mission of the University of Denver. He plays a leadership role in implementing the University’s strategic plan, especially with respect to external partnerships and collaboration. Before coming to the University, Mr. Greenberg shaped efforts to create the Denver School of Science and Technology and was first board chair of DSST schools. Mr. Greenberg has a distinguished career in consulting and was managing partner for 18 years of the Denver-based firm GBSM. Greenberg holds a B.A. from Columbia University and a J.D. from Harvard Law School.

Don Harris, Vice Chancellor for University Technology Services and Chief Information Officer. Dr. Harris ensures that technology serves to bridge the University’s diverse academic community and encourage greater collaboration, which is critical to achieving the goals outlined in DU IMPACT 2025. Dr. Harris leads the IT enterprise in implementing innovative technological solutions that advance the University’s objectives for teaching and learning, research and community outreach. Dr. Harris most recently served as the founding CIO and strategic advisor for a new graduate research university in Education City, Doha, Qatar. Prior to that, Dr. Harris was CIO at the University of Oregon, as well as Emory University. He has more than 30 years of IT experience in higher education, including 10 years as a faculty member in information systems. Dr. Harris holds a master’s and a bachelor of arts degree from Biola University and a PhD from Claremont Graduate University.

Laura Maresca, Vice Chancellor for Human Resources. Prior to her appointment in December 2016 as Interim Vice Chancellor, Ms. Maresca joined the University in 2015 as Director of Equal Opportunity. She is a seasoned attorney and human resources professional who has spent her career specializing in employment law and managing, investigating and working to resolve employment conflict. Ms. Maresca has been involved in all aspects of the employment

relationship, including serving as a chief human resources officer. Ms. Maresca serves the University in this interim capacity while a national search for a new Vice Chancellor is conducted. Ms. Maresca is an alumna of the Sturm College of Law at the University of Denver.

Liliana Rodriguez, Vice Chancellor for Campus Life and Inclusive Excellence. Dr. Rodriguez was hired in July 2015 as the University’s first Vice Chancellor-level student affairs administrator. Dr. Rodriguez leads the University’s efforts to redesign the student experience in light of the needs and opportunities of the 21st century. She also oversees the work of more than 130 full-and part-time staff in 16 departments, including academic advising, disability services, housing, and career services. Prior to coming to Denver, she served as Associate Dean of Diversity, Inclusion, and Community Development at Swarthmore College, and director of the multicultural Davis Center at Williams College. Dr. Rodriguez earned a bachelor’s degree in psychology from Williams College, and a master’s degree and doctorate in psychology from University of Massachusetts, Amherst.

Frank Tuitt, Senior Advisor to the Chancellor and Provost on Diversity and Inclusion. Dr. Tuitt was appointed to this new role in 2015 and serves on the Chancellor’s senior staff. Dr. Tuitt oversees implementation of a variety of recommendations related to diversity and inclusion; oversees an external review on diversity efforts across the University; and helped create the Chancellor's Diversity and Equity Advisory Committee, which he supports. He provides counsel to the Chancellor’s entire senior staff. Dr. Tuitt previously directed the University’s Center for Multicultural Excellence. He is on the higher education faculty in the University’s Morgridge College of Education. Dr. Tuitt holds a B.A. from Connecticut College, and a M.Ed. and Ed.D. from Harvard University.

Tom Willoughby, Vice Chancellor for Enrollment. Mr. Willoughby joined the University in July 2004. He is responsible for managing a comprehensive enrollment and financial aid strategy for the University’s undergraduate and select graduate programs. The staffs of the Office of Admission and Student Financial Aid also report directly to the Vice Chancellor for Enrollment. Prior to joining the University, Mr. Willoughby served as Vice President of Admission and Financial Aid at Drake University. Mr. Willoughby earned a bachelor’s in Psychology from the University of Dubuque and a master’s in Counseling from Loras College. Mr. Willoughby will be retiring from his position at the end of the 2016-2017 academic year.

Renell Wynn, Vice Chancellor for Communications and Marketing. Ms. Wynn is responsible for setting the University’s narrative in support of the Chancellor’s vision and the University’s strategic plan. Ms. Wynn is responsible for all centralized branding, as well as communication for internal and external audiences. She coordinates communications and marketing efforts across the various academic units to ensure consistency of message and brand across the University. Before coming to the University in August 2016, Ms. Wynn served for nearly four years as Vice President for Communications and Marketing at George Mason University. She held leadership positions at The College of William and Mary, Florida State University and Mississippi Valley State University. Ms. Wynn has communications and marketing experience in the for-profit and not-for-profit arenas as well. She has a B.A. from Spelman College, and an MBA from William Woods University.

Other senior administrative officers of the University include the Deans of the various colleges and graduate schools and several associate vice chancellors. Deans report to the Provost and Executive Vice Chancellor. 29

Strategic Planning Overseen by the Chancellor and Provost

During the first year of Chancellor Rebecca Chopp’s tenure at the University, she and Provost Gregg Kvistad commenced a strategic planning exercise reflecting a two-pronged approach – one, engaging the community to address pressing needs and review various reports completed during the prior year, and two, identifying three to six strategic recommendations for the University has a whole. The result of the year-long effort involved over 2,500 people contributing ideas resulting in DU IMPACT 2025, which was approved by the Board of Trustees in January 2016. DU IMPACT 2025 is designed to position the University to lead through three Transformative Directions and through a fourth to guide its future as an intentional community that integrates research, teaching and engagement for the public good. The four Transformative Directions identified are as follows:

(i) Students Learning and Leading in a Diverse and Global 21st Century

(ii) Discovery and Design in an Age of Collaboration

(iii) Engagement and Empowerment in Denver and the Rocky Mountain West

(iv) One DU

A more thorough description of DU IMPACT 2025 can be found at http://impact.du.edu/; provided, however, such website and any links to other web pages therein are not incorporated herein by this reference and is not part of this Official Statement.

Academic Programs

The University offers a variety of bachelor, master and doctoral degree programs and is classified as a doctoral degree-granting institution according to the Carnegie classification of post - secondary institutions. All academic programs are under the aegis of the Provost. An Undergraduate Council reviews and recommends on matters pertaining to undergraduate education, and a Graduate Council performs a similar role with respect to graduate programs.

Undergraduate and graduate degrees in a range of traditional arts and sciences disciplines, as well as selected interdisciplinary programs, are offered through Arts, Humanities & Social Sciences, Natural Sciences & Mathematics, and the Ritchie School of Engineering & Computer Science. Undergraduate and master’s level degrees in an array of business majors are offered through the Daniels College of Business, including Professional and Executive MBA programs. University College offers a Bachelor of Arts Completion Program that may be completed entirely online or on campus, or a hybrid thereof, with majors in communication arts, global studies, leadership and organization studies, environmental studies, global commerce and transportation, and information technology. Separate graduate colleges and schools, coordinated through the Office of Graduate Studies under the Provost’s Office, offer a range of additional graduate programs. These units include, for example, the Sturm College of Law (offering J.D., Master of Science in Legal Administration, and Master of Science in Legal Studies degrees), the Graduate School of International Studies (offering MA and PhD programs), the Graduate School of Social Work (offering MSW and PhD programs), the Morgridge College of Education (offering teacher and school administration certification programs and MA, EdS, EdDPhD

degree programs) and the Graduate School of Professional Psychology (offering a PsyD program).

Through its Morgridge College of Education, the University also operates the Fisher Early Learning Center serving children ages 6 weeks to 4 years and the Ricks Center, an elementary and middle school.

There also are interdivisional graduate degree programs, such as the Graduate Tax Program offered through the Sturm College of Law and the Daniels College of Business, and dual degree programs, such as the MA in International Studies and MSW offered through the Korbel School of International Studies and the Graduate School of Social Work. In addition, the University offers a joint doctoral degree program in the study of religion with the Iliff School of Theology, a separate institution whose campus adjoins that of the University.

On April 21, 2017, the University entered into an agreement with 2U, Inc., a public company, to offer on-line graduate degree programs in its Master of Business Administration and Master of Social Work. 2U, Inc., will provide advisory and marketing support, as well as a technology platform for the programs. The University will retain control of admission and financial aid decisions, its faculty, and the curriculum. Students will begin on- line classes in winter of 2018. The University believes that the on-line programs will enhance brand identification to its existing on-campus degree offerings. The University also offers all of its programs in University College in both the on-line and on-campus modes. The University College on-line program is not part of the 2U, Inc., agreement.

The University currently offers the following degree programs:

UNDERGRADUATE GRADUATE Bachelor of Arts (BA) Master of Accountancy (MACC) Bachelor of Fine Arts (BFA) Master of Applied Science (MAS) Bachelor of Music (BM) Master of Arts (MA) Bachelor of Science (BS) Master of Business Administration (MBA) Bachelor of Science in Accounting (BSACC) Master of Fine Arts (MFA) Bachelor of Science in Business Administration (BSBA) Master of Laws (LLM) Bachelor of Science in Chemistry (BSCH) Master of Liberal Studies (MLS) Bachelor of Science in Computer Engineering (BSCPE) Master of Library and Information Services (MLIS) Bachelor of Science in Electrical Engineering (BSEE) Master of Music (MM) Bachelor of Science in Mechanical Engineering (BSME) Master of Professional Studies (MPS) Master of Public Policy (MPP) Master of Resources Law Studies (MRLS) Master of Science (MS) Master of Study in Law (MSL) Master of Social Work (MSW) Master of Taxation (MT) Educational Specialist (EDS) Doctor of Education (EDD) Juris Doctor (JD) Doctor of Philosophy (PhD) Doctor of Psychology (PsyD) Professional Science, Masters (PSM)

Enrollment

Total University enrollment (headcount) at the end of the fall 2016 term was 12,217, comprised of 5,638 traditional undergraduates, 55 Women's College undergraduates, 5,862 graduate students, 61 bachelor completion undergraduates in University College and 601 non-collegiate students (in the Fisher Early Learning Center, Ricks Center, and English Language Center).

There are some differing patterns within and across the various components of the overall student population. Traditional undergraduate students represent approximately 46% of the total headcount. However, because it is almost completely composed of full-time students, this group accounts for over 52% of the academic year full-time equivalent enrollment of the University. Undergraduate enrollments have grown in recent years, both from growth in numbers of new students and an improvement in persistence rates. Although individual years have fluctuated slightly, first-time freshmen enrollments have increased from 1,203 in fall 2012 to 1,400 in fall 2016.

Graduate enrollment dropped from 6,262 for fall 2012 to 5,862 for fall 2016. Within the overall graduate population there are three general categories of programs: (1) disciplinary and interdisciplinary programs in arts and sciences (7.4% of the graduate students headcount); (2) the programs of the graduate professional schools (approximately 67.4% of graduate headcount enrollment); and (3) the degree and non-degree outreach programs of the University College (approximately 25.2% of the graduate student headcount).

The Sturm College of Law in 2008 implemented an initiative to intentionally and strategically shrink enrollments, while adding faculty members in order to intensify the academic 32

experience in the school. The Daniels College of Business has implemented a secondary acceptance policy for undergraduates, in which students who are admitted to the University must be separately admitted to the business school programs. The enrollment depicted in the tables below illustrate how the size of enrollment has been shrinking in accordance with these two strategic plans.

Enrollment in programs in Graduate Studies (Arts and Humanities, Social Sciences, and Natural Sciences & Mathematics) has declined 12.8% from the fall of 2012 to the fall of 2016. The number of students enrolled in the University's graduate professional schools (Engineering and Computer Science, Business, Law, Tax, Education, Professional Psychology, Josef Korbel School of International Studies and Social Work) has decreased from 4,355 in the fall of 2012 to 3,953 for fall 2016. Engineering and Computer Science, Business, and Law saw the most dramatic decreases while Education, Professional Psychology and Social Work saw the most significant increases. The University's longer-range goal is to achieve overall stable enrollment through effective marketing and strategic use of financial aid and strategic growth in certain graduate units with capacity.

Traditional undergraduate enrollments for the fall of 2016 increased slightly (66 students) between 2015 and 2016. Overall traditional undergraduate enrollment for fall 2016 is 5,638, compared to 5,028 in fall of 2012. First-time, first-year students in the fall of 2016 numbered 1,400, compared to 1,426 in the fall of 2015. Transfer students numbered 137, a decrease from 176 a year ago.

The University has been, and will continue to be, heavily dependent on revenues from student tuition and fees for its general operating funds, and hence for its financial well- being. For example, net tuition and fee revenues account for approximately 73% of the University's Fiscal Year 2017 budgeted operating revenues.

The following table contains enrollment census data for the past five academic years appears.

Historical Fall-Term Enrollment by Home Unit (Headcount)(1)

FALL OF COLLEGIATE PROGRAMS 2012 2013 2014 2015 2016 Division of Arts & Humanities Undergraduate Programs 669 659 553 543 511 Graduate Programs 161 158 161 176 177 Total 830 817 714 719 688 Division of Social Sciences Undergraduate Programs 1,024 1,094 1,115 1,183 1,169 Graduate Programs 177 175 167 151 114 Total 1,201 1,269 1,282 1,334 1,283 Division of Natural Sciences & Mathematics Undergraduate Programs 811 904 926 936 907 Graduate Programs 156 133 149 151 140 Total 967 1,037 1,075 1,087 1,047 School of Engineering & Computer Science Undergraduate Programs 294 353 477 544 575 Graduate Programs 226 191 191 164 147 Total 520 544 668 708 722 Daniels College of Business Undergraduate Programs 1,124 1,138 1,218 1,285 1,554 Graduate Programs 1,016 968 915 786 744 Total 2,140 2,106 2,133 2,071 2,298 College of Law Juris Doctor Program 887 885 858 809 776 Master's Program 102 85 89 79 99 Total 989 970 947 888 875 Graduate Tax Program (2) Graduate Program 159 154 135 120 115 Total 159 154 135 120 115 College of Education Graduate Program 808 849 831 865 868 Total 808 849 831 865 868 Graduate School of Professional Psychology Graduate Program 255 249 256 271 302 Total 255 249 256 271 302 Graduate School of International Studies Undergraduate Programs 324 322 327 339 373 Graduate Programs 435 453 440 436 401 Total 759 775 767 775 774 Graduate School of Social Work Graduate Program 467 503 509 508 501 Total 467 503 509 508 501

Table Continued on the following page.

2012 2013 2014 2015 2016 University College Undergraduate Programs 112 100 88 69 61 Graduate Programs 1,264 1,314 1,342 1,413 1,383 Intermodal Transportation Inst. 35 32 39 37 33 Total 1,411 1,446 1,469 1,519 1,477 The Women's College (3) Undergraduate Programs 254 205 165 117 55 Total 254 205 165 117 55 Other Undergraduate Students (4) Undeclared – General 303 209 271 211 168 Undeclared - Business Interest 467 522 490 513 365 Non-degree Students 12 11 14 18 16 Total 782 742 775 742 549 Other Graduate Students (4) DU / Iliff Joint Program 93 83 64 57 50 Graduate Studies Non-degree Students 21 29 19 16 12 Total 114 112 83 73 62

Subtotal of Collegiate Programs 11,656 11,778 11,809 11,797 11,616

PRE-COLLEGIATE PROGRAMS Community Outreach Programs ---- - English Language Center 241 222 247 235 191 University Based Schools Fisher Early Learning Center 211 197 198 187 187 Ricks Center for Gifted Children (pre-school-8th) 232 229 235 223 223 Total 443 426 433 410 410 Subtotal of Non-Collegiate Programs 684 648 680 645 601 TOTAL UNIVERSITY ENROLLMENT 12,340 12,426 12,489 12,442 12,217

(1) Headcount data taken at the end of the fall quarter for 2012 through 2016. (2) This program is being moved to the College of Law. (3) The Women’s College degree granting program has been discontinued; the 55 remaining students in the Fiscal Year 2016 numbers represent the “teach out”, or remaining students graduating from the program. (4) Once students declare a major, they are counted in the division where that major resides. Undergraduate Studies students who have not yet declared a major and non-degree students enrolled in traditional undergraduate courses are counted as “Other Undergraduate Studies” students in census enrollment reports.

Sources: Profiles 2012-2016; Office of Institutional Research.

Enrollment data specific to traditional first-time freshmen and new undergraduate transfer students enrolled at the University for the past five academic years are presented below.

Traditional Undergraduate New Enrollment - Headcount

Fall of the Year 2012 2013 2014 2015 2016 First Time Freshmen (1) 1,203 1,399 1,425 1,426 1,400 New Transfers 181 182 191 176 137 Total New Enrollment 1,384 1,581 1,616 1,602 1,537

(1) Includes only first-time freshman enrollments.

Source: Profiles 2012-2016; Office of Institutional Research.

Admission

Undergraduate. The University’s admission program represents a systematic effort to attract students who will be able to benefit from the University’s academic programs and environment. The admission program includes annual research designed to determine the characteristics and opinions of high school students, and of the University’s faculty and students, to identify the perceived strengths and attractions of the University. The University has full-time recruiting offices in Illinois and New England.

The University has experienced increased competition for freshmen students, and accordingly, implemented a successful strategy of increasing applications and admitted students sufficient to increase enrollments (from 1,215 in 2012 to 1,400 in 2016) while improving academic quality of the matriculated class as evidenced by average ACT and SAT test scores as illustrated in the “Historical College Entrance Exam Scores” table below.

Admission activity data for traditional new freshmen and undergraduate transfer applicants to the University for fall 2012 through fall 2016 appear below.

Historical Admission Activity Data

Freshman Class Percent of Percent of Those Year Applications Admitted Enrolled Applicants Admitted Admitted Who Enrolled 2012 11,443 7,740 1,215 68% 16% 2013 13,735 10,539 1,399 77 13 2014 13,693 10,479 1,425 77 14 2015 15,036 10,940 1,426 73 13 2016 14,933 10,866 1,400 73 13

Transfer Student Percent of Percent of Those Year Applications Admitted Enrolled Applicants Admitted Admitted Who Enrolled 2012 746 470 195 63% 41% 2013 701 504 181 72 36 2014 654 472 194 72 41 2015 584 490 176 84 36 2016 584 447 137 77 31

Source: Profiles 2012-2016; the Office of Institutional Research.

High school rank and performance on standardized college entrance examinations are usual indicators of undergraduate student selectivity. Included in the following table is information for the five years shown on applicant test scores (University average and national average) on the Scholastic Aptitude Test (“SAT”) and the American College Test (“ACT”). Verbal scores are indicated with a “V;” math scores are indicated with an “M.”

Historical College Entrance Exam Scores

University Average National Average Year SAT ACT SAT ACT 2012 593V/612M 27 496V/514M 21 2013 595V/612M 28 496V/514M 21 2014 597V/611M 28 496V/513M 21 2015 606V/616M 28 495V/511M 21 2016 601V/605M 28 494V/508M 21

Source: Profiles 2012-2016; Office of Institutional Research.

College of Law. Applications for the Juris Doctor program of the Sturm College of Law have decreased from 2,455 in fall 2012 to 2,163 in fall 2016. In 2016, approximately 53.1% of the applicants were admitted and approximately 21.5% of the admitted applicants enrolled in the University.

Other Traditional Graduate Programs. Applications for admission into the University’s traditional graduate programs, excluding Law, have ranged over the last five years from 8,538 in fall 2012 to 7,430 in fall 2016. In 2016, approximately 63.8% of the applicants were admitted, and approximately 44.8% of the admitted applicants enrolled in the University. Graduate enrollment at the University is affected by several factors including, but not limited to, changing employment trends, government research funding and changes in financial aid policies.

Preliminary admissions information for fall 2017. While fall 2017 admissions and enrollment data have not yet been finalized as of the date of this Official Statement, preliminary admissions and enrollment information have been received by the University. Admission activity data for traditional new freshmen and undergraduate transfer applicants to the University for fall 2017, dated as of information compiled by the University on April 24, 2017 versus the same timeframe for fall 2016, appears below.

Preliminary Admission Activity Data, Fall 2017 Versus Year Ago – As of May 10, 2017

Freshman Class Expected to Percent of Percent of Those Year Applications Admitted Enroll Applicants Admitted Admitted Who Enrolled 2016 14,863 10,828 1,439 73% 13% 2017 14,211 11,543 1,582 81% 14%

Transfer Student Expected to Percent of Percent of Those Year Applications Admitted Enroll Applicants Admitted Admitted Who Enrolled 2016 390 277 64 71% 23% 2017 395 290 82 73% 28%

Source: The Office of Institutional Research.

Included in the following table is preliminary fall 2017 information on applicant test scores (University averages) on the Scholastic Aptitude Test (“SAT”) and the American College Test (“ACT”).

Preliminary Fall 2017 College Entrance Exam Scores Versus Year Ago – As of May 10, 2017

University Average Year SAT ACT 2016 1235 28 2017 1213 28

Source: Office of Institutional Research.

Additionally, preliminary data as of May 10, 2017 indicates 1,899 graduate students will enroll in fall 2017. As of May 10, 2016, preliminary data showed that 1,769 graduate students were expected to enroll in fall 2016.

Financial Aid

General. Student financial aid includes scholarships and grants-in-aid, tuition waivers, graduate assistantships and/or traineeships, loans, and/or part-time employment. During the 2015-16 academic year, approximately 42.8% of the financial aid awarded the University’s students came from federal programs (of that amount, approximately $121.4 million came from the federal Stafford lending program). Approximately 0.6% came from State programs. Approximately 47.7% was provided from the University’s current unrestricted funds and 4.2% from restricted University sources (gifts and endowed scholarships). Awards made to individual students from independent external sources of grants and loans (e.g. Boettcher scholarships) account for the final 4.7%.

Overall annual financial aid from all sources for University students increased from $271.0 million during academic year 2011-12 to $307.1 million in academic year 2015-16. Federal aid during this period decreased by 7.6% from $142.4 million to $131.5 million. University aid from current unrestricted funds and from restricted funds increased from academic 38

year 2011-12 to academic year 2015-16 by 39.2% from $114.4 million to $159.2 million. The University cannot predict whether similar patterns will occur in the future, although it is actively raising private donations to further bolster University aid.

In the fall of 2016, almost 84.7% of the University’s undergraduate students relied on some form of financial aid (including specific educational loan programs and/or financial aid employment programs), and approximately 74.8% of the students in the University’s graduate and professional degree programs received financial aid (again, including educational loan programs and/or financial aid employment programs).

There can be no assurance that the current amounts of Federal and State financial aid to students attending the University will be available in the future at the same levels and under the same terms and conditions as presently apply. The Federal Perkins Loan Program for graduate students ended as of October 1, 2016 and the Federal Perkins Loan program ends for undergraduate students as of October 1, 2017. The 2016-17 Perkins Loan disbursements are approximately $1.8 million, which is less than 0.6% of the total aid that students receive, but the University is actively looking at strategies to replace this loss of funding.

Institutional Profile - Tuition

The University’s rate (tuition and mandatory fees) for full-time students in traditional programs for the 2016-17 academic year is $46,422, an increase of 4.9% over the prior year. This figure includes $45,288 of tuition and $1,134 in mandatory activity, health center and technology fees. The Board of Trustees approved in September 2016 a tuition increase of approximately 4.9% for the 2017-18 academic year. The University’s various nontraditional academic programs have differential (usually lower) tuition rates which have increased at rates similar to those for traditional programs.

There are six doctoral degree granting institutions in the State. The University of Denver is fifth in size, and is the only one of the six operated under independent, non-public auspices. The five public doctoral granting institutions are: the University of Colorado-Boulder in Boulder (which offers the only law school program in the State other than the University’s); Colorado State University in Fort Collins; the University of Colorado at Denver and Health Sciences Center in Aurora; the University of Northern Colorado in Greeley; and the Colorado School of Mines in Golden. Colorado University-Colorado Springs also offers a doctorate degree in Electrical Engineering through a coordinated degree program with CU-Boulder. In addition, there are two traditional private institutions in Colorado, other than the University, that offer baccalaureate degrees – Colorado College in Colorado Springs, and Regis University in Denver. Regis University also offers masters degrees.

General tuition and fee rates for full-time students at the University and at the seven degree granting institutions listed above are as follows for the 2016-17 academic year:

Comparison of General Tuition and Fee Rates - Colorado Institutions

In-State Out-of-State University of Denver $46,422 $46,422 University of Colorado - Boulder 11,531 35,079 Colorado State University 11,052 28,346 University of Colorado - Denver/Health Sciences Center 9,228 24,924 University of Northern Colorado 8,888 20,474 Colorado School of Mines 17,842 36,172 The Colorado College 50,892 50,892 Regis University 34,450 34,450

The University’s full-time tuition and mandatory fee rates (as set forth below) compares to the current academic year tuition rate and mandatory fees at the universities listed below, which the University has identified as “peer” institutions.

Comparison of Tuition and Fee Rates - Peer Institutions

Peer Institution In-State Out-of-State University of Denver $46,422 $46,422 American University 44,853 44,853 Boston University 50,240 50,240 George Washington University 51,950 51,950 Gonzaga University 39,730 39,730 Santa Clara University 47,112 47,112 Southern Methodist University 50,358 50,358 Syracuse University 45,022 45,022 Texas Christian University 42,670 42,670 Tulane University of Louisiana 51,010 51,010 University of Miami 47,004 47,004 University of Puget Sound 46,552 46,552 University of San Diego 46,140 46,140 University of Southern California 52,283 52,283 University of Vermont 17,300 40,364

Faculty

Over the past four years, 70 full-time faculty have been added, for a total of 741 as of fall 2016. Faculty increases are designed to keep enrollment gains and the number of faculty in alignment with projected student enrollments across the various academic units. Future increases in faculty are probable if enrollment increases and if necessary to meet various University initiatives currently planned or underway.

Major emphasis is placed on faculty quality through the hiring process as replacements are sought for retiring and terminating faculty. Faculty quality is judged based on a variety of factors, including teaching, terminal degrees in the field and the quality and volume of scholarly work in the field. In addition to hiring criteria, the University has established a faculty 40

development program for continuing faculty. Both objective and subjective measures point to the University's success in achieving its faculty quality objectives.

Tenure for faculty members typically is granted or denied by the University after a multi-year trial period and a detailed merit review in accordance with policies pertaining thereto, although occasionally tenure is granted upon employment. Once granted tenure, a faculty member is generally assured continued employment until he or she chooses to retire, subject to termination for specified cause, conditions threatening financial exigency or discontinuance of an academic unit. While tenure imposes certain continuing financial obligations on the University, the resulting liability cannot be ascertained at this time.

The following table sets forth full-time faculty tenure trends over the last five years.

Full-Time Faculty and Tenure Trends

Fiscal Year Faculty Appointment 2011-12 2012-13 2013-14 2014-15 2015-16 Not-Tenure Track 264 270 276 277 273 Tenure Track 129 128 121 115 125 Tenured 341 353 352 349 358 Grand Total 734 751 749 741 756

Tenure Track & Tenured 64.03% 64.05% 63.15% 62.62% 63.89%

Source: Profiles 2011-2015; Office of Institutional Research. Note: In 2015, the University of Denver implemented a new rank and series structure for appointed faculty. Lecturers and instructors were moved to a new teaching and professor structure and assigned the rank of assistant professor, associate professor, or professor. These faculty are not tenure-track but continue to be reported in headcounts of appointed instructional faculty.

Full-time faculty members holding terminal degrees in their respective fields of study was 90% in Fiscal Year 2015-16.

The University calculates a student/faculty ratio based on full-time student and faculty equivalents. Adjunct faculty and graduate teaching assistants are included with appointed faculty in the calculation. As stated in the University’s Profiles 2012-2016, the student/faculty ratio for the University as of the fall quarter of each of the five years shown are as follows:

Historical Student/Faculty Ratios

2012 2013 2014 2015 2016 11:1 11:1 11:1 11:1 11:1

Employees

Excluding faculty, the University had 1,672 employees as of fall 2016. Of these employees, 1,090 were full-time salaried professionals and 582 were classified hourly employees.

At present, 229 custodial and maintenance workers employed by the University are represented by a labor union (Local 1572, State Council No. 76 of the American Federation of State, County and Municipal Employees, AFL-CIO) under a collective bargaining agreement which passed by membership vote on December 15, 2016 and is effective January 1, 2017 to December 25, 2017.

The University has never experienced any strikes, work stoppages or slowdowns by its unionized employees. The University believes that its relations with its employees are satisfactory.

Retirement Plans and Other Post-retirement Benefits

Retirement benefits are provided for full-time and part-time appointed employees by a contributory retirement plan (the “Plan”) with participants having fully vested interests in total contributions. Administrators, faculty members and staff-appointed employees are eligible after completing one year of service. At present, participants may contribute 4% of their base salary (subject to limits established by the Tax Code) and the University contributes an amount equal to twice that of the employee, up to 8% of such base salary. For the Fiscal Years ended June 30, 2015 and 2016, the University contributed approximately $11,142,000 and $11,568,000, respectively, to the Plan. The University has timely made all required contributions to the various funding vehicles selected by the participants. For more detailed information concerning the University’s retirement plan, see Note 9 to the University’s financial statements contained in Appendix A to this Official Statement.

The University also sponsors a defined benefit healthcare plan (the “Healthcare Plan”) that provides post-retirement medical benefits to full-time employees who have worked 10 years and attained age 55 while in service with the University if hired prior to January 1, 1992, or full-time employees who have worked 20 years and attained age 55 while in service with the University if hired after December 31, 1991. Participants receive $60 per month toward the cost of postretirement medical costs. At June 30, 2016, the Healthcare Plan covered 210 retirees, with an additional 2,386 active employees potentially eligible for coverage. Effective June 30, 2007, Financial Accounting Standards Board Statement No. 158 (“FASB 158”) requires balance sheet recognition of the net asset or liability for the over- or under-funded status of the postretirement benefit plans and recognition of changes in the funded status in the year in which changes occur. For more detailed information concerning the University’s Healthcare Plan and related obligations, see Note 10 to the University’s financial statements contained in Appendix A to this Official Statement.

Facilities

The University's facilities are generally discussed in this section. Investors should be aware that not all of the facilities described below constitute “Facilities” as defined in the Loan Agreement. The Loan Agreement generally defines “Facilities” to include only the buildings located on the “Land” (see Appendix B hereto for a definition of “Facilities,” “Land” and “Building”). Essentially, the Land encompasses the core part of the University Park Campus, with certain small exclusions that do not include any academic buildings.

University Park Campus. The University currently maintains substantially all of its operations on its University Park Campus in Denver, Colorado. 42

The University Park Campus is comprised of more than 125 acres located in an urban residential neighborhood eight miles southeast of downtown Denver and houses almost all of the University's academic programs and administrative offices. The campus is served by a transit station located on the Regional Transportation District's light rail line. Approximately 85 buildings are located on the University Park Campus, the oldest of which was erected in approximately 1890 and the most recent of which was completed in 2016. The foothills of the Rocky Mountains are one-half hour to the west by car.

Since 1997, the University has invested more than $645 million in buildings and structures built to Millennium specifications. Those specifications include long lasting design as well as inherent energy saving features. These buildings represent over 1.7 million of the 3.7 million square feet of campus space (excluding rental properties, parking structures and leased Greek housing). Approximately $127 million of the construction portfolio has been funded with bond proceeds. Gifts and internal sources, including proceeds from the 2003 sale of the University's former Park Hill Campus, have funded the remainder of the capital construction.

Through the University Technology Services Division (“UTS”), the University provides a comprehensive, service oriented, technology environment. Users have access to wired and wireless connectivity throughout campus including: public areas, classrooms, residence halls and many outdoor spaces. The UTS Help Center, centrally located in the Anderson Academic Commons, provides technical assistance to students, faculty and staff seven days a week. UTS also provides: computer networking operations, telecommunications support, information security, website services and academic research support. A student technology fee of $4 per credit hour, implemented in the fall of 1998, generates approximately $1.58 million annually. These funds are used to enhance existing and future technology needs.

General descriptions of certain University facilities and programs follow.

Academic and Classroom Space. Academic and Classroom space make up 51% of the campus Net Assignable Square Footage. The classrooms available in the fall of 2016 totaled 193 classrooms. On average, the total utilization of these classrooms were 31.8 hours per week. The University utilizes the guidelines set by the Colorado Department of Higher Education as a resource for comparing classroom performance with state and national standards. The University exceeded the goal of 30 hours per week for classroom utilization.

Housing. Students are encouraged to live in the University's residence halls throughout their enrollment at the University, and there is a requirement that 1st and 2nd year students to live in one of the halls (or a fraternity or sorority house) if their home residence is outside a commuting range. During Fiscal Year 2016, approximately 56% of all undergraduate students, principally freshman and sophomores, lived in on-campus residential quarters owned by the University. Currently, five conventional residence halls house students in furnished double occupancy rooms and/or suites, with meal service provided in three dining facilities. The University's six apartment halls offer on-campus apartment living for single undergraduate students who are 3rd and 4th year students. These apartments include a living room, a private bath, one or two bedrooms and a kitchen. For Fiscal Year 2016, the overall occupancy rate in the University's residential quarters was 97%. During fall 2016, the University worked with Brailsford and Dunlavey, Inc., a program management advisory firm, to complete a housing 43

study including a market study, peer analysis and a report that concluded a latent demand exists for 1,266 beds of undergraduate and graduate housing. It is the University’s belief that construction of the new 500-bed residence hall will fill a portion of this need.

Research and Special Facilities. The sponsored research activities of the University are divided into three categories - academic research, other sponsored agreements and sponsored instruction. In Fiscal Year 2016 sponsored research agreements focused primarily on child and family welfare and mental health counseling, early childhood education, biophysics and biomechanics, robotics, international forecasting and peace building. These activities are administered by the Associate Provost for Research. Direct expenditures charged to sponsored agreements has not dropped below $20 million annually for funded research since 2012. The three-year average for research expenditures has grown consistently since 2008, with Fiscal Year 2016 marking the highest year in University history, exceeding $25 million. Fiscal year 2017 is forecasted is to exceed Fiscal Year 2016’s record and is projected to approach $27 million.

A number of special facilities of the University are available to the students for educational and research-oriented programs. Special facilities include the Knoebel Institute for Healthy Aging, located on the fifth floor of the Engineering and Computer Science Building. This facility provides state-of-the-art wet Biosafety Lab Level 2 facilities for a variety of wet lab activities. The building also houses a recently completed vivarium to support the growing animal care and use program on campus. The fourth floor of the Engineering and Computer Science Building houses the human dynamics lab (moved from the Ritchie Center) and a human movement analysis facility. Other unique facilities include: the Chamberlin Observatory with its 20-inch refracting telescope; the Meyer-Womble Observatory, located at 14,148 feet above sea level on the Summit of Mt. Evans, Colorado, equipped with dual-aperture 28.5-inch optical and infrared telescopes used for high-altitude astronomy; and two research stations located in the Rocky Mountains used for biological and cosmic ray studies.

Libraries. The University Libraries system includes the Main Library in the Anderson Academic Commons, the Bonfils-Stanton Music Library in the Newman Center for the Performing Arts, the Westminster Law Library, located in the Frank H. Ricketson Jr. Law Building, and the Hampden Center, which houses off-site storage. Combined, the library’s collection is comprised of approximately 2.5 million physical volumes, and about 2 million electronic journals and books.

The Anderson Academic Commons is a Leadership in Energy and Environmental (“LEED”) Silver-certified, 154,223 square foot building that includes the University of Denver’s Main Library, a variety of academic support services, and the Front Porch Café. This facility is three floors and provides student accommodations including study carrels, fireside seating, reservable group study rooms equipped with white boards and flat screens, and designated silent study areas. The facility also includes a special events room, power-equipped seating, dedicated exhibit display walls and cabinets, and sustainable practices and programming.

The Bonfils-Stanton Music Library, located in the Lamont School of Music, provides music scores, audio and video recordings, and books and journals on music and musicology. A specially equipped room allows for listening to or viewing recordings of music and performance.

The Westminster Law Library, located in the Frank H. Ricketson Jr. Law Building, houses approximately 420,000 books and volumes. This library maintains its space and collection primarily to support the research and educational needs of the faculty and students of the Sturm College of Law.

The Hampden Center is a 53,000 square-foot off-site facility where approximately 2 million print holdings are stored, which supplements a collection of about 600,000 print items housed in the Anderson Academic Commons. Students and patrons request items from the Hampden Center using the library catalog, and the solicited materials are delivered to campus.

NCAA Division I Athletics. The University is a participant in NCAA Division I Athletics. The University's athletics facilities include the Daniel L. Ritchie Center for Sports and Wellness Center, which serves as the home for many of the University's varsity athletic teams as well as club sports, intramural sports, the Coors Fitness Center, many community recreation programs, University events, and commercial, community and charitable events. Other athletics facilities include a lacrosse stadium and a soccer stadium, each of which provide seating for 2,000 fans, a sports fields site, a tennis pavilion, a 14,000 square-foot strength and conditioning center, and the Highlands Ranch Golf Club, which serves as the official home course of the University's golf teams. Recently, the University’s Hockey and Men’s Lacrosse teams have experienced significant achievements, each winning the NCAA Division I National Championship in 2017 and 2015, respectively. The University’s ski team and women’s gymnastics team are also consistently nationally ranked.

Capital Planning and Maintenance Planning

Capital Planning. The University is undertaking a formal long-term capital planning effort as part of a Campus Master Plan process spurred by the release of DU IMPACT 2025. The University is receiving advice from a professional firm regarding the Campus Master Plan which will be developed in early 2017. A detailed draft addressing the Campus Master Plan is due in the fall of 2017 for the Board of Trustees’ review and approval. The University expects that this plan will expand upon the previous 2002 and 2007 updates of its comprehensive Land Use Plan, and that the Campus Master Plan will guide the long-term physical development of campus buildings and grounds. In general, all capital projects are considered by the Board both on a case-by-case basis, as well as within the framework of University priorities identified within the long range capital planning documents. DU IMPACT 2025 identifies four strategic recommendations, referred to as Transformative Directions, one of which incorporates the enhancement and expansion of the University’s learning environment and student experience. The University categorizes the construction and renovation of campus improvements being financed by the bond proceeds as within these Transformative Directions.

In spring 2007, the University completed the initial Integrated Facilities Plan, which resulted from a comprehensive assessment of its entire physical plant. The comprehensive assessment was undertaken to determine the nature, timing and estimated costs of deferred maintenance and desirable renewal and replacement of its existing buildings and systems. From Fiscal Years 2007 through 2016, approximately $92 million was spent on these projects. The University currently intends to fund selected projects over the next five years subject to the availability of budgeted and one-time resources. The Integrated Facilities Plan is continually updated and now extends through Fiscal Year 2021. 45

Under the Integrated Facilities Plan, the Associate Vice Chancellor of Facilities Management annually will submit a plan which includes projects for (1) core infrastructure which will be funded from the following year's operating budget and year-end funds earmarked by the University, and (2) program-related improvements to be funded by one-time unit gainsharing (described below in “UNIVERSITY FINANCIAL INFORMATION - Management Discussion of Financial Results”). The University currently expects that the combination of budgeted and one-time funds will be sufficient to meet or exceed the anticipated deferred maintenance needs given the extent of new construction completed over the last decade and the specific knowledge acquired in the comprehensive assessment.

Maintenance Planning. The University has provided for renewal and replacement of plant by dedicating a material portion of year-end surpluses to facilities and infrastructure needs.

Risk Management Activities

University Insurance Coverage. The University has in effect under its present policies to July 1, 2017: (i) property insurance coverage with a limit of $700 million, subject to a per-loss deductible of $250,000 per occurrence; (ii) comprehensive general liability coverage with a limit of $1 million per occurrence and $3 million in the aggregate, subject to a $100,000 deductible; (iii) umbrella insurance coverage with an aggregate limit of $25 million; (iv) an excess liability policy with coverage of $25 million and three additional excess liability policies with another $25 million each in coverage; (v) automobile liability insurance coverage for bodily injury and property damage with a limit of $1 million combined per occurrence with a $2,000 comprehensive deductible and a $25,000 liability deductible; (vi) educators legal liability with a per claim and aggregate limit of $15 million, subject to a deductible of $150,000 per claim; (vii) Side A directors (including Trustees) and officers (including the Chancellor and Vice Chancellors) insurance coverage (as defined herein) with an aggregate limit of $10 million; (viii) workers’ compensation coverage in the amount required by applicable State law with a $15,000 per injury retention; and (ix) various other perils with varying limits of liability, including healthcare professional liability, licensed professional liability, crime and fiduciary coverage, foreign liability, fine arts, multimedia liability, pollution liability and remediation, security/kidnap risk, travel evacuation and repatriation, and volunteer accident. The umbrella and excess liability coverages described above extend to the general liability, automobile and foreign coverages. The Side A directors and officers coverage is a separate category of policy coverage that cannot be depleted by claims under basic policy limits or by bankruptcy. The Side A coverage is dedicated only to pay four excess liability policies for trustees and officers in excess of $100 million and the educator’s legal liability policy of $15 million.

The University believes that its insurance portfolio adequately protects its property and operations. This is confirmed annually by the University’s insurance broker, Arthur J. Gallagher & Co. (“Gallagher”). Gallagher most recently reviewed the adequacy of coverage for the 2016- 2017 period, and its April 12, 2017 written report included the following conclusion: “The University of Denver’s Property and Casualty Insurance Program is comprehensive and broad in scope compared to standard insurance programs of like kind and quality. Retentions and Deductibles appear prudent based on the University’s size and loss history.”

Enterprise Risk Management. The University’s Business and Financial Affairs Division, which covers many University business operations, has a division-wide enterprise risk management (“ERM”) program, which is integrated with its balanced scorecard program. The ERM program is based on the Committee of Sponsoring Organizations (“COSO”) principles and higher education best practices. Business and Financial Affairs departments have targets established concerning key strategic and operations objectives. This information is reviewed semi-annually by the Vice Chancellor of Business and Financial Affairs in discussions with department leadership. In addition, the division is divided into two “environments” – Financial and Physical – that report annually to the University’s Chancellor and Provost on their key strategic initiatives and risks. As part of the reporting process, the Chancellor and Provost meet with the areas to hear a brief presentation and discuss key information from the reports.

Under the leadership of the Vice Chancellor of Business and Financial Affairs, the University is taking steps toward an organization-wide ERM program. This has been discussed at Audit Committee meetings and with University senior leadership. As part of this effort, the Vice Chancellor and the University’s Director of Enterprise Risk Management will serve as members of the University’s DU IMPACT 2025 Resource Group, which will allow for application of ERM principles in evaluating potential risks associated with strategic initiatives.

Finally, the University includes compliance with laws and regulations as part of its ERM program. Day-to-day responsibility for managing the compliance program rests with the University’s ERM Specialist. However, responsibility for compliance with about 300 compliance risks rests with the units. Compliance Liaisons, representing over 30 units throughout the University, are a critical component for ensuring compliance with the laws. This partnership has resulted in continuous improvement in the University’s compliance efforts.

The ERM Specialist works with Compliance Liaisons to assess risks on a four- year cycle. In evaluating risks, the University uses a scoring methodology based on a risk assessment toolkit developed by the National Association of College and University Business Officers in partnership with Crowe Horwath, LLP, one of largest public accounting and consulting firms in the United States. The control scoring evaluates the extent that compliance with a law or regulation has been documented, evaluated, corroborated, and tested.

University Contracts and Agreements

The University is a party to numerous contracts and agreements. According to the University, there are no contracts or agreements currently in effect to which the University is a party the breach or violation of which would have a material adverse effect on the financial position of the University.

Zoning

In 2010 the University of Denver’s campus was zoned as a single zone lot with a campus master planned – educational institution designation (“CMP-EI”) as part of the City’s Blue Print Denver effort. The new zoning designation supplanted agreements made in 2002 in relation to rezoning for the Chambers Center for the Advancement of Women and the subsequent Land Use Agreement with the City and County of Denver that was also executed in 2002. The 2002 Agreement required the University to construct specific traffic improvements, mitigate off- 47

campus parking impact, supply adequate on-campus parking, and follow specified procedures for managing traffic and parking for large campus events. These requirements have largely been met either due to the new zoning designation where parking inventory is concerned, or through improved operational efficiency since 2002. Additionally, the 2002 agreement required that the University not seek rezoning for 10 years and not develop property on the western perimeter of the University that was designated R-2 Multi-Unit Dwellings, Low Density zoning (“R-2”). The R-2 zoning was reclassified via Blue Print Denver to Urban Row House 2.5 stories (“R-RH- 2.5”). The University sold all of its holdings in that zone district to a private developer who is currently constructing row houses that meet the intended zoning designation. Additionally, the University imposed a restrictive covenant requiring its approval of design elevations for this and future development for the properties it sold. Finally, University has imposed a restrictive covenant on certain property (equal to approximately one-half of a City block) limiting its use of that property to outdoor recreational purposes for a period of ten years (which period has expired) and thereafter limiting its use to designated uses, primarily for single unit dwellings and university or college uses.

As a result of the many changes occurring on the University’s perimeter and the single zone lots CMP-EI rezoning, the University is currently undertaking a new master planning process which will not only update the 2002 Land Use Plan, but also cast a wider net to consider the University’s relationship with its immediate residential and commercial surroundings with the intention of making the area a local destination. While the planning effort is scheduled to complete during 2017, future development is likely to continue into the foreseeable future. The University refers to this area of future development as the “DU District.”

UNIVERSITY FINANCIAL INFORMATION

Introduction

The Bonds are payable in accordance with the terms of the Indenture from revenues consisting of payments made by the University. See “SECURITY FOR THE BONDS.”

The following financial information applies generally to the financial activity of the University and makes reference to revenues to be applied to the University’s operations and maintenance expenses, capital expenditures and debt service repayment requirements without necessarily segregating such uses.

Sources of Revenues

The University derives its revenues from a variety of sources including student tuition and fees, federal and state grants and contracts, auxiliary enterprises of the University such as the bookstores, dining halls and residence halls, private gifts and grants, income from the University’s Endowment Fund and other sources. Set forth below are descriptions of these various sources of revenues and their relative significance to the University’s overall financial activities.

Tuition and Fees. The University’s largest source of revenue is tuition and fees, including tuition charges, health services fees and other fees. For Fiscal Year 2017, net tuition and fees are budgeted to account for 73% of total unrestricted revenues. The major portion of tuition and fee revenue consists of tuition.

The University uses separate methods of assessing tuition at the College of Law and its nontraditional graduate and undergraduate programs. Classes at the College of Law are conducted on the semester system, and all other courses are on the quarter system. Tuition per credit hour for the College of Law is $1,547 per credit hour for Fiscal Year 2016-17. Tuition rates for the University’s nontraditional programs vary, but generally range from $590 to $1,290 per credit hour for Fiscal Year 2016-17. See “THE UNIVERSITY – Institutional Profile – Tuition.”

The University also assesses a student fee, a health fee and a technology fee in its traditional programs. In addition, students living in the University’s residence halls pay room charges and board charges which ranged from $5,772 (triple occupancy) to $7,854 (suite, double occupancy) for the 2016-2017 school year.

The University reserves the right to revise its tuition and fees from time to time, as determined by the Board of Trustees. Although the University has been able to raise its tuition and fees without adversely affecting its enrollment, there can be no assurance that it will be able to do so in the future. Future economic and other conditions may affect the University’s ability to increase or maintain its tuition and fees.

Gifts, Grants and Bequests. The University actively solicits gifts and bequests from alumni, parents, friends, corporations, and private foundations for both current operating purposes and capital needs. Comprehensive development programs, including efforts to raise capital funds, have been in existence for a number of years and have been successfully expanded 49

in recent years. The University also conducts fundraising campaigns from time to time; the most recent being the “Ascend” campaign that began in 2007 (public phase in 2010) and ran until the University’s sesquicentennial in 2014.

The University has intentionally been de-emphasizing the dependence on unrestricted giving in the budget development process over the past five years. Greater emphasis has been added to the “capital” giving effort, which prioritizes larger-scale donations. Academic departments, athletics and the library have also become more involved with the fundraising efforts. Individual fundraisers have been added to the staffs of these areas.

The following table sets forth information for the past five fiscal years regarding the amount and general purpose of gifts, private foundation grants and bequests, including pledges, received by the University through its annual fundraising efforts:

Total Development Activity (Restricted and Unrestricted)

Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year 2012 2013 2014(1) 2015 2016 Unrestricted $ 1,659,368 $ 2,124,412 $ 2,141,559 $ 8,440,884 $ 2,112,444 Donor Designated 48,487,458 53,225,291 58,723,088 28,363,381 29,796,537 TOTAL $50,146,826 $55,349,703 $60,864,647 $36,804,265 $31,908,981

Source: University Office of Financial Affairs.

(1) The Ascend Campaign ended in Fiscal Year 2014, which represented a high achieving mark for the Campaign and the 5-year trend.

There can be no assurance that the amount of gifts, grants and bequests received by the University will remain stable or increase in the future. Future economic conditions and actions by the federal government, including changes in the Federal income tax and estate tax laws affecting the treatment of such contributions, may affect the level of giving in the future.

Endowment Income. The schedule below summarizes changes in Endowment Fund balances, estimated unrealized appreciation, annualized earnings and earnings rates (based on assets at June 30) for each of the fiscal years of the University as indicated. The following summary should be read in conjunction with the financial statements and related notes thereto appearing in Appendix A hereto. The following table is for informational purposes only; the University’s true endowment corpus is not pledged to the payment of the Bonds. Quasi- endowment, however is pledged to the payment of the Bonds.

Endowment Fund Summary (in thousands)(1)

2012 2013 2014 2015 2016 Market Value, Beginning of Year $345,213 $373,396 $403,467 $467,253 $632,761 Gifts 23,617 13,850 11,710 14,109 11,356 Gain (Loss) on investments 4,063 21,881 48,109 19,454 (21,767)(2) Transfer to (from) Quasi-Endowment (8,935) (9,177) (12,183) (14,419) (16,379) Other 9,437 3,516 16,151 146,364(3) 1,397 Market Value, End of Year $373,395 $403,467 $467,253 $632,761 $607,368 Total Return 2.6% 7.5% 13.2% 5.3% -2.3%

(1) Based on assets at June 30, for the fiscal years shown. (2) There was a market-wide loss in Fiscal Year 2016; the National Association of College and University Business Officers reported an approximate 2.1% loss for all endowments participating in the annual survey. (3) Other 2015 additions to endowment include a $99.4 million transfer from operating fund and a $25.6 million transfer from plant fund to create a quasi-endowment for financial aid.

Source: University Office of Financial Affairs.

The market value of the University’s endowment was $628.5 million at June 30, 2016. Over the past five years, $74.6 million of new gifts have been added to the endowment. The University currently distributes 4.5% of a 12 quarter trailing average of the Endowment’s market value. For Fiscal Year 2015-16 (approximately $189.6 million was considered institutional or unrestricted funds available as part of the University’s overall spendable revenues, and $24.6 million was distributed to certain University departments for use in accordance with the original donor restrictions.

Effective August 29, 2016 the University selected Investure LLC (“Investure”) to provide investment management services for the Endowment. Investure’s responsibilities include developing investment objectives and guidelines, determining an appropriate allocation of assets, monitoring money managers, managing fixed income assets and cash, monitoring and reporting investment performance and assisting with the selection of custodians.

As of February 28, 2017 the Investure managed pool of Endowment funds was approximately $588 million, allocated in proportion to the following asset classes:

Global Equity 53% Alternative Equity 30% Private Equity 8% Fixed Income 6% Cash & Miscellaneous 3%

As other legacy investments become eligible to liquidate, these funds will be transferred to Investure for investment under the terms of their agreement with the University.

Auxiliary Revenues. Another major category of unrestricted current fund revenues is revenues of the University’s auxiliary enterprises. Auxiliary enterprises include the

University’s housing system, food service, bookstore, health services and student center activities. Revenues from the University’s housing system, food service and bookstore are generally sufficient to cover the cost of these operations; revenues from health services, athletics and student center activities are, as at most universities, insufficient to cover the cost of these operations and other operating revenues are needed to pay the balance of the costs. Effective March 1, 2012, the University outsourced bookstore operations to a private operator.

Grant and Contract Revenues. Unrestricted grant and contract revenues represent payments by sponsors to cover the indirect costs of specific projects. Restricted grant and contract revenues represent payments made by sponsors to cover the direct costs of specific projects.

Other Revenues. Other revenue sources include interest income, certain rental revenues, traffic fines and other sources.

Financial Statements

The University’s financial accounts are maintained in accordance with generally accepted accounting principles (“GAAP”) and traditional concepts employed among institutions of higher education.

The University’s external financial statement format allows for depreciation, capitalization of bond principal payments, and gains and losses on long term investments to be accounted for outside of the basic operating activities. The University defines amounts transferred at the election of the Board of Trustees from unrestricted operating funds for future operating purposes defined by the deans and division heads as “designated funds.” The Board of Trustees may elect to return any balance of designated funds to unrestricted operating funds.

The University’s audited financial statements for the years ending June 30, 2016 and 2015 are attached to this Official Statement as Appendix A. The Audit Committee of the Board of Trustees and the Executive Committee have accepted these financial statements.

Summary of Certain Historical Financial Information

The table below sets forth a five-year history of the Statement of Activities for the University’s Operating Fund (including changes in unrestricted net assets, net changes in temporarily restricted net assets and changes in net assets from the beginning of the year to the end of the year) presented in accordance with GAAP. This information in the table has been excerpted from the University’s audited financial report for the years ended June 30, 2012 through 2016. The financial information in the table should be read in conjunction with the audited financial statements and related notes appearing in Appendix A hereto.

Statement of Activities - Changes in Net Assets for Operating Fund Only (In Thousands)(1)

Fiscal Year Ended June 30, Revenues and Gains 2012 2013 2014 2015 2016 Tuition and Fees $372,175 $387,595 $409,692 $433,464 $444,343 Less discount (institutional scholarships) 95,100 108,467 114,933 127,480 136,883 277,075 279,128 294,759 305,984 307,460 Less allowance (non-institutional scholarships) 10,018 10,469 11,897 12,751 14,865 Net tuition and fees 267,057 268,659 282,862 293,233 292,595 Private Gifts 1,659 870 774 979 588 Grants and Contracts 23,255 26,225 25,358 25,713 29,364 Endowment income 266 317 846 156 2,410 Other investment income 4,183 1,112 1,056 920 1,140 Net appreciation on endowment 366 357 451 557 3,557 Net appreciation (depreciation) on other investments (271) 934 1,456 (232) (1,130) Sales and services of educational activities 11,869 12,689 12,883 14,505 14,983 Sales and services of auxiliary enterprise 30,449 26,193 26,943 34,111 35,506 Other sources 19,863 19,917 20,476 20,781 21,000 Total unrestricted revenues and gains 358,695 357,272 373,105 390,723 400,013 Net Assets Released From Restriction (2) 24,146 25,666 29,834 30,378 30,993 Total unrestricted revenues, gains and other support 382,841 382,938 402,939 421,101 431,006

Expenses Education and general Instruction 135,640 141,103 147,102 148,338 152,857 Research 12,640 14,694 14,554 13,070 13,851 Public service 5,881 7,193 4,232 5,840 8,230 Academic support 62,215 64,003 63,203 63,637 68,014 Student services 44,191 45,385 44,394 47,047 49,733 Institutional support 44,415 45,428 44,941 50,493 52,229 Total educational and general expenses 304,982 317,806 318,426 328,425 344,914 Auxiliary Enterprises 28,846 23,791 24,645 25,864 27,547 Total Expenses 333,827 341,596 343,071 354,289 372,460 Transfers among unrestricted net assets 43,809 40,585 53,010 130,722 35,436 Total expenses and transfers 377,636 382,181 396,081 485,011 407,896

Increase/(decrease) in unrestricted net assets (4) 5,204 757 6,857 (63,910) 23,110 Increase/(decrease) in temporarily restricted net assets (1,149) 2,815 7,427 (23,208) (811) (3)(4) Increase/(decrease) in net assets 4,055 (2,058) 14,285 (87,118) 22,299

Net Assets at beginning of year (1) 136,517 140,572 138,514 152,798 65,680 Net assets at end of year (1) $140,572 $138,514 $152,798 $65,680 $87,979

(1) Reflects the change in net assets as stated in the University’s Operating Fund (including unrestricted net assets and temporarily restricted net assets). Reflects implementation of Accounting Standards Codification Topic 958 Not-for-Profit Entities, Subtopics 605 Revenue Recognition & 205 Presentation of Financial Statements. (2) Represents amounts originally recorded in Temporarily Restricted Net Assets whose restrictions have been met. (3) Includes private gifts, endowment appreciation and income, and investment appreciation and income whose purposes are temporarily restricted. Also includes assets released from restrictions and reclassification of temporarily restricted assets. (4) Fiscal Year 2015 includes transfer of $99.4 million of net assets from operation to board-designated endowment.

Source: Derived from the University’s Audited Financial Statements for the years ended June 30, 2012-2016.

Management Discussion of Financial Results

In its ongoing effort to ensure the incorporation of best practices, the University has contracted with the Huron Consulting Group Inc. (“Huron”), a management consulting company offering services to the higher education industry, to: (i) evaluate academic budget and finance functions; and (ii) provide a review of the University’s approach to resource management, allocation and planning. The University believes that opportunities exist to more fully integrate the budget development process with the financial management process. Specifically, it plans to emphasize the creation of a more discernable connection between the accountability of operating and capital resources and the DU IMPACT 2025 strategic plan.

Huron will also evaluate the University’s modified Responsibility Center Management (“RCM”) model and recommend enhancements that better incentivize institutional collaboration on the development of new initiatives to generate positive net margins in support of institutional strategies. Finally, Huron will gain a better understanding of current technologies used by the University’s financial analysts, budget officers and leadership, and will share options for more efficient technologies in support of these work functions. The University believes that in light of the current higher education environment, this reevaluation of the budget processes, which ultimately drive financial performance, is critical. The University remains committed to increasing undergraduate and graduate student enrollments through the use of incremental increases in tuition revenues and endowment earnings, the latter being used for student aid. By supplementing student aid in this regard, the University is aggressively addressing college affordability, especially for underrepresented populations that might otherwise not be able to attend the University.

The University continues to increase its Advancement Staff full-time employees in anticipation of a major fundraising campaign. As competition for high-performing students increases, it is important that the University be able to offer student aid packages that compare favorably to its peers. Student scholarships and awards will continue to be a prominent area of focus for the University over the next several years. Additionally, communication strategies which highlight the University’s prominent faculties and programs will be given priority in funding decisions. Investments in technology will also receive priority funding as the University continues to streamline business processes and reporting functionality.

In recent years, the University has placed a focus on expanding its research portfolio. To that end, the University viewed Fiscal Year 2016 as highly successful with respect to research and scholarship. Research and Sponsored Program expenditures reached $25.5 million, the highest in fifteen years. The number of unique faculty with external support rose from 138 to 152. More than $800,000 was distributed through internal grant programs, and the associate provost invested over $300,000 to divisions for research infrastructure needs. The University closed Fiscal Year 2016 with its 26th consecutive operating surplus.

The trend of operating surpluses reflects the University’s intent to apply sound business practices to distinctive academic programs. In fiscal year 1990-91, the University implemented a decentralized form of responsibility with regard to budgeting and accounting. Under this model, deans and division directors are actively involved in the development of their budgets and are held accountable for the results. The principal incentive within the system involves “gainsharing” favorable variations from budget with the various units of the University. Under the gainsharing policy, units are allowed to carry forward all of their expenditure savings 54

and one-half of favorable revenue variations. Accumulated balances may be used by individual units for discrete, non-recurring, mission-related expenditures, generally at no greater than one- third of the total amount accumulated by the unit in any given year. Through Fiscal Year 2016, approximately $217.6 million has been transferred to the designated gainsharing accounts from the annual operating surpluses. As of June 30, 2016, accumulated gainsharing and other designated net assets exceeded $53.4 million, representing an important source of liquidity to the University to invest in strategic initiative and/or to cushion enrollment fluctuations.

The forecast of Fiscal Year 2016-17 financial results through March 31, 2017 are comparable to Fiscal Year 2015-16 results year-over-year, with a total year-end forecasted operating margin of approximately $33 million and $36 million, respectively. Overall tuition for Fiscal Year 2017 is below budget by approximately $1.55 million, or one-third of one-percent, but ahead of Fiscal Year 2016 by $6.4 million. Scattered amongst several schools and colleges, forecast revenue shortfalls are being fully absorbed by expenditure reductions and/or through the use of gain-share reserves. Tuition discount, budgeted at 37%, is forecast to come in under budget, with the most recent forecast being 36.94%. Positive variations from labor costs, and specifically vacancy savings, are trending consistent to prior years and major non-compensation expenditure drivers such as healthcare and utilities costs are projected to end the fiscal year under budget.

Executive Management meets monthly to review financial activity (specifically tuition forecasts by school and college) and expenditure savings and adjusts budget expectations for the upcoming fiscal year accordingly. The development of the Fiscal Year 2018 budget (subject to the Board of Trustees’ approval, which occurs annually in June) reflects these discussions, with investments made to bolster operations in Engineering and Computer Science, the Graduate School of Social Work, the Graduate School of Professional Psychology and Education. Conversely, in the spirit of the University’s modified Responsibility Center Management, revenue reductions because of enrollment declines will negatively affect the School of International Studies, the College of Business and the College of Law.

As a basis of developing its budget, the University also projects annual enrollments at levels with a high probability of achievement. Generally, actual enrollment levels exceed projected levels, creating favorable variations to the budget which are then gainshared, as described above. The University also limits the growth of expenditure budgets to less than the rate of growth in predictable revenue sources, principally tuition. This has been made possible due to up-front participation from deans and directors, combined with high levels of accountability and effective incentives for actual results.

Given the importance of the projects to be funded with the Bonds, the University has invested considerable time to develop programs for each facility. In the case of the First time/First year Residence Hall, the University contracted with Brailsford & Dunlavey to perform a market study, which revealed a shortage of approximately 1,200 beds over the existing inventory of 2,563. Additionally, a financial pro-forma confirmed the ability to pay debt service with rates in line with current bed rates. In the case of the Community Commons and Career Achievement Center, University personnel visited peer institutions who have built similar facilities, with space programs modified to accommodate the University’s student population. These exercises have provided comfort that the facilities will serve the program needs of occupants and the University’s community for years to come.

Finally, operating surpluses have also been used to fund major renovations and capital improvement projects, as well as the bolstering of plant reserves. From fiscal year 1990- 91 through Fiscal Year 2015-2016, approximately $182.1 million has been transferred to Plant Fund reserves for such projects. In Fiscal Year 2016, over $9.6 million was transferred to plant fund reserves and facility infrastructure deferred maintenance projects. Another $12.2 million was transferred to fund gainshare commitment (as described above) and to fund several designated reserves for 2018 initiatives. This practice has continued in an effort to properly maintain facilities and avoid costly emergency repairs.

During Fiscal Year 2018, the University anticipates expending $16.4 million of expendable resources for a new administrative office building on land it owns and operates on the University Park campus (but outside the “Land” as described in the Loan Agreement). See “THE UNIVERSITY--Facilities”. The University also anticipates expending $9.9 million of expendable resources to fund certain one-time projects related to the implementation of DU IMPACT 2025. As of June 30, 2016, expendable resources included $87.9 million of net assets within “Operations” and $189.6 million in board-designated endowments included among “Long-term Investments.” Given that a $33 million Operating Margin Surplus is forecast for Fiscal Year 2017 and that year to date performance in the Consolidated Endowment Fund is positive, the University anticipates that year end balances as of June 30, 2017 will not be materially affected by this transaction.

A variety of factors may affect the University’s financial condition in the future and the University’s historic financial results may not be consistent with its future financial results. Such factors include, but are not limited to: the University’s ability to recruit and retain students; the University’s oversight of its finances; the University’s ability to control expenditures; the University’s ability to maintain or increase rates for tuition and other fees without affecting enrollments; the investment of the University’s endowment and other funds; the ability of the University to solicit and obtain gifts and bequests; governmental assistance for student financial aid; and grants and contracts from governmental bodies, agencies and others.

The University has delivered a portfolio of more than twenty discrete projects totaling in excess of $640 million over the last two decades and believes that it has the experience to design, bid, permit and construct each of the projects to be funded by the Bonds both on-time and on-budget.

Current Funds Unrestricted(1)

Fiscal Year 2012 2013 2014 2015 2016 Excess of revenues over expenditures and mandatory transfers (or operating surplus) $27,941,402 $21,908,479 $37,928,882 $39,165,901 $36,075,250

Transfers: Plant Funds (6,403,000) (7,960,000) (15,429,655) (8,645,000) (9,647,386) Designated Funds (Gainsharing) (10,250,000) (8,450,000) (11,100,000) (13,800,000) (12,200,000) Other Transfers *FTN (10,743,000) (4,942,000) (10,781,439) (16,192,680) (13,703,594)

Net Increase in fund balance $ 545,402 $ 556,479 $ 617,788 $ 528,221 $ 524,270

(1) See “UNIVERSITY FINANCIAL INFORMATION--Summary of Certain Historical Financial Information” above for a history of the results in the Operating Fund.

Source: University’s Office of Financial Affairs.

Budget Process

Annual budget requests are formulated by the various schools and departments under the supervision of the Provost, working under the direction of the Chancellor and with the Vice Chancellor for Business and Financial Affairs. In the fall, the administration develops in conjunction with the academic deans and administrative managers, proposed guidelines for the upcoming budget, including revenue projections based upon enrollment levels, tuition rates, housing charges, salary rates, capital expenditures and other financial and policy considerations. The guidelines receive approval of the Finance and Budget Committee and the Board of Trustees during the winter. Subsequently, the various schools and departments submit annual budget requests, through their respective deans and administrative managers to the Provost and Vice Chancellor for Business and Financial Affairs. After review, primarily for consistency with the approved guidelines, the budget is adopted by the Board of Trustees in the spring of the ensuing calendar year.

The monitoring and control of the budget, after its adoption by the Board of Trustees, is the ultimate responsibility of the Chancellor and Vice Chancellor for Business and Financial Affairs who reports to the Budget and Finance Committee, the Executive Committee and the Board of Trustees at periodic intervals during the fiscal year. The budget development and monitoring processes utilize a responsibility reporting technique wherein the budgeting and monthly accounting activities correspond to the University’s organizational structure of decision making and authority. Information for budget development is gathered at the lowest operational levels of the University and is then aggregated up the organizational structure at each level (e.g., department, school, division, university). Monthly and year-to-date reports of actual activities compared to plan are presented to the responsible individual with the requirement that variations from plan be explained to the Vice Chancellor for Business and Financial Affairs and corrective action, if necessary, be undertaken. This review is the basis of the Vice Chancellor’s and Chancellor’s periodic reporting to the Finance and Budget Committee, the Executive Committee and the Board of Trustees. 57

The Fiscal Year 2017 Budget

Budget. The Board of Trustees adopted the budget for Fiscal Year 2016-17 in June 2016. The Unrestricted Operating Fund had budgeted operating net revenues of $434,635,000 and budgeted expenditures of $434,635,000 (including $15.0 million of transfers to other funds that in the prior year were recorded below the operating margin subtotal) resulting in a budgeted operating margin of $0. Accordingly, budgeted revenues and expenditures represent an increase by the equal amount over the approved Fiscal Year 2016 budget.

Net tuition increases are $12,584,000. For a discussion of tuition increases and the basis for budgeting enrollment figures, see “UNIVERSITY FINANCIAL INFORMATION - Sources of Revenues.” Employee compensation represents the single largest budgeted expenditure. This category has increased by $17,905,000 (to $270,130,000) over the Fiscal Year 2016 budget. Total compensation, expressed as a percent of revenues, is 62.2%, an increase from the 60.9% from the previous fiscal year budget. The University currently expects a flat operating margin for Fiscal Year 2017.

The Fiscal Year 2017 budget capitalized on the continued increase in undergraduate student enrollment to offset continued declines, planned and unplanned, in graduate enrollments, specifically in the Sturm College of Law and the Daniels College of Business. The overall tuition volume change from all types of tuition, net unfunded aid, was a decline of $1.85 million. In January 2016, the Board of Trustees approved a 4.9% tuition rate increase for the fall of 2016. Fiscal Year 2017 is the second year of a three year plan to increase tuition close to 5% per year. The tuition rate increase provided the majority of new revenue in Fiscal Year 2016-17, or $14.4 million, net of unfunded aid. The rate increase provided 70.6% of the total increase in institutional revenue between the Fiscal Year 2016 budget and the Fiscal Year 2017 budget. The University’s dependence on strong traditional undergraduate enrollments continues to increase. Of the new revenue from tuition, net of unfunded aid, 93.6% is coming from traditional undergraduate academic year tuition. The multiple year tuition rate increase plan is coupled with an intentional focus on expanding financial aid for all students, both undergraduate and graduate. The decision at the end of Fiscal Year 2015 to move $125 million in unrestricted net assets into a quasi‐endowment allowed for the expenditure of $2.5 million in earnings from the quasi‐endowment to undergraduate financial aid in Fiscal Year 2017.

The investment strategy for Fiscal Year 2017 incorporated reallocations across units and investments reflecting the University’s priorities. Such investment strategies included:

• A two-year evaluation of existing infrastructure reserve balances and transfers to plant fund reserves in the base budget. In Fiscal Year 2017, $3.3 million in infrastructure transfers to plant reserves were reallocated to fund investments in other areas. The University’s plan is to rebuild such transfers in future years to what the University determines to be a more prudent level;

• A sizing and expense reduction in the Sturm College of Law, which continued in Fiscal Year 2016-17; and

• Institutional reserves being built into base budgets over multiple years for specific initiatives (including Renew DU, the Knoebel Institute for Healthy Aging, and the

expanded engineering and computer science program) being allocated from central reserves into the financial divisions overseeing these initiatives.

The Fiscal Year 2017 budget continues to shift the University from a risk-averse planning model toward a budget structure to fulfill the aspirations of DU IMPACT 2025, as described below. The University believes this initiative will allow it to become a model for higher education to serve its students in newer and more innovative ways.

Budget Process. The Fiscal Year 2017 budget was shaped by the University’s DU IMPACT 2025 strategic plan. Investments focused on the directions identified in the plan and on providing resources to implement and sustain these initiatives. Implementation will be a multi‐ year process, as will funding initiatives that fulfill the aspirations of the strategic plan. The University is working to challenge the existing budget structure to evolve in ways that support innovation, collaboration, and interdisciplinary work through responsibility-centered management. Through this initiative, year‐end outcomes are a shared responsibility between management at the unit level and central oversight. It is the University’s intent that incentives within the current model encourage people to be thoughtful and careful in the management of resources under their control, as they share in positive outcomes. A few specific impediments to academic integration across units were addressed in the Fiscal Year 2017 proposed budget. Such changes include:

• In recent years, master’s programs in the Daniels College of Business have charged for every credit hour with no flat rate. Beginning in Fiscal Year 2017, all master’s programs, with the exception of the Executive MBA, will revert to the traditional flat rate billing structure in which a student only pays for the first 12 credit hours, and the hours beyond the first 12 are free. This is the billing structure used by all other quarter‐based, traditional graduate programs.

• The Graduate Tax Program is also moving from a non‐traditional program with a unique credit hour rate to the traditional quarter flat rate billing structure. The program will also be moved into the Sturm College of Law’s financial division as one of the multiple master’s programs offered. As a result, Graduate Tax will no longer be a stand‐alone financial division.

• The Public Policy Program and the Institute for Public Policy Studies have moved out of Arts, Humanities, and Social Sciences and Centers and Institutes to become part of the Josef Korbel School of International Studies. The University believes this integration will allow for more expanded and collaborative academic offerings.

• The Josef Korbel School of International Studies will have transitioned the majority of its graduate course per-credit hours from five to four by Fiscal Year 2018. This will match the most common credit hour course format in other graduate schools.

Additional reorganizations across units include:

i. The Center for Multicultural Excellence (“CME”) is no longer a stand‐alone division. The student services and support functions provided by CME are now part of Campus Life and Inclusive Excellence. The academic and institution‐wide functions are now in the Office of the Provost and the Office of the Chancellor.

The University believes this reorganization will allow for expanded program development across the University. ii. The Career Center was previously housed in Campus Life. The new strategic directions identified for University Advancement and Alumni Relations support the move of the Career Center to that division. This will allow for a full integration of career services for existing students and University alumni. Alumni will be encouraged to access career services throughout their professional careers and be able to contribute more directly to internship and career opportunities for current students. iii. The Office of Research and Sponsored Programs’ (the “ORSP”) administrative staff, which previously reported to the University Controller’s Office, will now report directly to the Associate Provost for Research. This reporting line change provides a more complete integration of faculty resources and needs into the organization and functioning of ORSP. iv. As work continues to maximize all institutional resources dedicated to advancement and alumni relations, four academic units moved an existing development position and position funding into University Advancement. It is the belief of the University that it will continue to see a more unified advancement effort at the University in the future.

LEGAL MATTERS

Absence of Litigation - The Authority

There is not now pending or, to the knowledge of the Authority, threatened against the Authority, any litigation restraining or enjoining the issuance or delivery of the Bonds or questioning or affecting the validity of the Bonds or the proceedings or authority under which they are to be issued. There is no litigation pending or, to the Authority’s knowledge, threatened against the Authority which in any manner questions the right of the Authority to enter into the Agreement with the University or to secure the Bonds in the manner provided in the Indenture.

Absence of Litigation - The University

The University, like other similar institutions, is subject to a variety of suits and proceedings arising in the ordinary course of business. The University has advised that no litigation or proceedings are pending or, to its knowledge, threatened against the University except litigation in which the probable recoveries and the estimated costs and expenses of defense, in the opinion of the Vice Chancellor for Legal Affairs and General Counsel, will be entirely within applicable insurance policy limits (subject to applicable deductibles) or will not have a material adverse effect on the operation or condition, financial or otherwise, of the University.

There is no litigation or proceeding pending or threatened against or affecting the University that challenges the validity of the Loan Agreement or the validity of the transactions contemplated by this Official Statement.

Approval of Legal Proceedings

The approving opinion of Sherman & Howard L.L.C., as bond counsel, will be delivered with the Bonds. A form of the bond counsel opinion is attached to this Official Statement as Appendix E. Sherman & Howard L.L.C., Denver, Colorado, has also acted as special counsel to the University in connection with this Official Statement. Certain legal matters, including the status of the University as qualifying as exempt from federal income taxation under Section 501(c)(3) of the Tax Code, will be passed on for the University by its counsel, Hoffman, Crews, Nies, Waggener & Foster LLP. Bond counsel will rely upon that opinion in delivering its approving opinion. See Appendix E. Certain legal matters will be passed upon for the Authority by its general counsel, Sherman & Howard L.L.C. Certain legal matters will be passed on for the Underwriter by its counsel, Kutak Rock LLP, Denver, Colorado. The various legal opinions to be delivered concurrently with the delivery of the Bonds will be qualified as to the enforceability of the various legal instruments by limitations imposed by bankruptcy, reorganization, insolvency or other similar laws and by legal and equitable principles affecting the rights of creditors.

TAX MATTERS

Series 2017A Bonds

In the opinion of Bond Counsel, assuming continuous compliance with certain covenants described below, interest on the Series 2017A Bonds is excluded from gross income under federal income tax laws pursuant to the Tax Code, and interest on the Series 2017A Bonds is excluded from alternative minimum taxable income as defined in Section 55(b)(2) of the Tax Code except that such interest is required to be included in calculating the “adjusted current earnings” adjustment applicable to corporations for purposes of computing the alternative minimum taxable income of corporations as described below. Pursuant to State laws in effect on the date of delivery of the Bonds, the Bonds, the transfer thereof and the income therefrom are exempt from all taxation and assessments in the State.

The Tax Code imposes several requirements which must be met with respect to the Series 2017A Bonds in order for the interest thereon to be excluded from gross income, alternative minimum taxable income (except to the extent of the aforementioned adjustment applicable to corporations). Certain of these requirements must be met on a continuous basis throughout the term of the Series 2017A Bonds. These requirements include: (a) limitations as to the use of proceeds of the Series 2017A Bonds; (b) limitations on the extent to which proceeds of the Series 2017A Bonds may be invested in higher yielding investments; and (c) a provision, subject to certain limited exceptions, that requires all investment earnings on the proceeds of the Series 2017A Bonds above the yield on the Series 2017A Bonds to be paid to the United States Treasury. The University will covenant and represent in the Loan Agreement that it will take all steps to comply with the requirements of the Tax Code and Colorado law (in effect on the date of delivery of the Series 2017A Bonds) to the extent necessary to maintain the exclusion of interest on the Series 2017A Bonds from gross income and alternative minimum taxable income (except to the extent of the aforementioned adjustment applicable to corporations) under such federal income tax laws and Colorado taxable income and Colorado alternative minimum taxable income under such Colorado income tax laws. Bond Counsel’s opinion as to the exclusion of interest on the Series 2017A Bonds from gross income and alternative minimum taxable income (to the extent described above) is rendered in reliance on these covenants, and assumes continuous compliance therewith. The failure or inability of the University to comply with these requirements could cause the interest on the Series 2017A Bonds to be included in gross income or alternative minimum taxable income, or both, from the date of issuance. Bond Counsel’s opinion also is rendered in reliance upon certifications of the University and other certifications furnished to Bond Counsel. Bond Counsel has not undertaken to verify such certifications by independent investigation.

Section 55 of the Tax Code contains a 20% alternative minimum tax on the alternative minimum taxable income of corporations. Under the Tax Code, 75% of the excess of a corporation’s “adjusted current earnings” over the corporation’s alternative minimum taxable income (determined without regard to this adjustment and the alternative minimum tax net operating loss deduction) is included in the corporation’s alternative minimum taxable income for purposes of the alternative minimum tax applicable to the corporation. “Adjusted current earnings” includes interest on the Series 2017A Bonds.

The Tax Code contains numerous provisions which may affect an investor’s decision to purchase the Series 2017A Bonds. Owners of the Series 2017A Bonds should be 62

aware that the ownership of tax-exempt obligations by particular persons and entities, including, without limitation, financial institutions, insurance companies, recipients of Social Security or Railroad Retirement benefits, taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry tax-exempt obligations, foreign corporations doing business in the United States and certain “subchapter S” corporations may result in adverse federal and Colorado tax consequences. Under section 3406 of the Tax Code, backup withholding may be imposed on payments on the Series 2017A Bonds made to any owner who fails to provide certain required information, including an accurate taxpayer identification number, to certain persons required to collect such information pursuant to the Tax Code. Backup withholding may also be applied if the owner underreports “reportable payments” (including interest and dividends) as defined in Section 3406, or fails to provide a certificate that the owner is not subject to backup withholding in circumstances where such a certificate is required by the Tax Code. Certain of the Series 2017A Bonds may be sold at a premium, representing a difference between the original offering price of those Series 2017A Bonds and the principal amount thereof payable at maturity. Under certain circumstances, an initial owner of such bonds (if any) may realize a taxable gain upon their disposition, even though such bonds are sold or redeemed for an amount equal to the owner’s acquisition cost. Bond Counsel’s opinion relates only to the exclusion of interest on the Series 2017A Bonds from gross income, alternative minimum taxable income and Colorado taxation as described above and will state that no opinion is expressed regarding other federal or Colorado tax consequences arising from the receipt or accrual of interest on or ownership of the Series 2017A Bonds. Owners of the Series 2017A Bonds should consult their own tax advisors as to the applicability of these consequences.

The opinions expressed by Bond Counsel are based on existing law as of the delivery date of the Bonds. No opinion is expressed as of any subsequent date nor is any opinion expressed with respect to any pending or proposed legislation. Amendments to the federal and or state tax laws may be pending now or could be proposed in the future that, if enacted into law, could adversely affect the value of the Bonds, the exclusion of interest on the Series 2017A Bonds from gross income, alternative minimum taxable income, Colorado taxation, or any combination thereof from the date of issuance of the Series 2017A Bonds or any other date, the tax value of that exclusion for different classes of taxpayers from time to time, or that could result in other adverse tax consequences. In addition, future court actions or regulatory decisions could affect the tax treatment or market value of the Bonds. Owners of the Bonds are advised to consult with their own tax advisors with respect to such matters.

The Internal Revenue Service (the “Service”) has an ongoing program of auditing tax-exempt obligations to determine whether, in the view of the Service, interest on such tax- exempt obligations is includable in the gross income of the owners thereof for federal income tax purposes. No assurances can be given as to whether or not the Service will commence an audit of the Series 2017A Bonds. If an audit is commenced, the market value of the Series 2017A Bonds may be adversely affected. Under current audit procedures, the Service will treat the Authority as the taxpayer and the Owners may have no right to participate in such procedures. The University has covenanted in the Loan Agreement not to take any action that would cause the interest on the Series 2017A Bonds to lose its exclusion from gross income for federal income tax purposes or lose its exclusion from alternative minimum taxable income except to the extent described above for the owners thereof for federal income tax purposes. None of the University, the Authority, the Financial Advisors, the Underwriters or Bond Counsel or Special Counsel is responsible for

paying or reimbursing any Registered Owner or Beneficial Owner for any audit or litigation costs relating to the Series 2017A Bonds.

Series 2017B Bonds

In the opinion of Bond Counsel, interest on the 2017B Bonds is included in gross income pursuant to the Tax Code. Pursuant to State laws in effect on the date of delivery of the 2017B Bonds, the transfer thereof and the income therefrom are exempt from all taxation and assessments in the State.

The Tax Code contains numerous provisions, including provisions related to the imposition of additional taxes, which may affect an investor’s decision to purchase the 2017B Bonds. Further, under Section 3406 of the Tax Code, backup withholding may be imposed on payments on the 2017B Bonds in certain situations including: (i) an owner who fails to provide certain required information to certain persons required to collect such information; (ii) the owner underreports “reportable payments” (including interest and dividends) as defined in Section 3406; or (iii) an owner fails to provide a certificate that the owner is not subject to backup withholding when such a certificate is required by the Tax Code.

The opinions expressed by Bond Counsel are based on existing law as of the delivery date of the 2017B Bonds. No opinion is expressed as of any subsequent date nor is any opinion expressed with respect to pending or proposed legislation. Amendments to the federal or state tax laws may be pending now or could be proposed in the future that, if enacted into law, could adversely affect the value of the 2017B Bonds. In addition, future court actions or regulatory decisions could affect the market value of the 2017B Bonds. Owners of the 2017B Bonds are advised to consult with their own tax advisors with respect to such matters.

Any tax advice concerning the Bonds, interest on the Bonds or any other federal income tax issues associated with the Bonds, express or implicit in the provisions of this Official Statement, is not intended or written to be used, and cannot be used, by any taxpayer for the purpose of avoiding penalties that may be imposed on any taxpayer by the Internal Revenue Service. This document supports the promotion or marketing of the transactions or matters addressed herein. Each taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor.

INDEPENDENT AUDITORS

The financial statements of the University of Denver (Colorado Seminary) included in this Official Statement as Appendix A, for June 30, 2015 and 2016, have been audited by CliftonLarsonAllen LLP, independent certified public accountants to the extent and for the periods indicated in their report thereon.

RATINGS

Moody’s Investor Service and Fitch Ratings have assigned the Bonds the ratings shown on the cover page of this Official Statement.

Such ratings reflect only the views of the rating agencies, and there is no assurance that the ratings will continue for any given period of time or any rating will not be 64

revised downward or withdrawn entirely by a rating agency if, in their respective judgments, circumstances so warrant. Any such downward revision or withdrawal of one or both ratings may have an adverse effect on the market price of the Bonds. Other than the University’s obligations under the Continuing Disclosure Agreement, neither the Authority nor the University has undertaken any responsibility to bring to the attention of the owners of the Bonds any proposed change in or withdrawal of a rating once it is received or to oppose any such proposed revision.

UNDERWRITING

General. RBC Capital Markets LLC, on behalf of itself and as representative of Wells Fargo Securities, (the “Underwriters”) has agreed to purchase the Bonds from the Authority pursuant to a Bond Purchase Agreement at a purchase price of $______(representing the par amount of the Bonds, plus net original issue premium of $______, and less Underwriter’s discount of $______). The Underwriters are committed to take and pay for all of the Bonds if any are taken. The Bond Purchase Agreement provides that the obligations of the Underwriters are subject to certain conditions. The Underwriters intend to offer the Bonds to the public at the offering prices appearing on the inside cover page of this Official Statement. After the initial public offering, the public offering price may be varied from time to time by the Underwriters.

The Underwriters and their respective affiliates are full-service financial institutions engaged in various activities that may include securities trading, commercial and investment banking, municipal advisory, brokerage, and asset management. In the ordinary course of business, the Underwriters and their respective affiliates may actively trade debt and, if applicable, equity securities (or related derivative securities) and provide financial instruments (which may include bank loans, credit support or interest rate swaps). The Underwriters and their respective affiliates may engage in transactions for their own accounts involving the securities and instruments made the subject of this securities offering or other offering of the Issuer and/or Borrower. The Underwriters and their respective affiliates may make a market in credit default swaps with respect to municipal securities in the future. The Underwriters and their respective affiliates may also communicate independent investment recommendations, market color or trading ideas and publish independent research views in respect of this securities offering or other offerings of the Issuer and/or Borrower.

Wells Fargo Securities Trade Name Disclosure. Wells Fargo Securities is the trade name for certain securities-related capital markets and investment banking services of Wells Fargo & Company and its subsidiaries, including Wells Fargo Bank, National Association, which conducts its municipal securities sales, trading and underwriting operations through the Wells Fargo Bank, NA Municipal Products Group, a separately identifiable department of Wells Fargo Bank, National Association, registered with the Securities and Exchange Commission as a municipal securities dealer pursuant to Section 15B(a) of the Securities Exchange Act of 1934. Wells Fargo Bank, National Association, acting through its Municipal Products Group ("WFBNA"), one of the underwriters of the Bonds, has entered into an agreement (the "WFA Distribution Agreement") with its affiliate, Wells Fargo Clearing Services, LLC (which uses the trade name “Wells Fargo Advisors”) ("WFA"), for the distribution of certain municipal securities offerings, including the Bonds. Pursuant to the WFA Distribution Agreement, WFBNA will share a portion of its underwriting or remarketing agent compensation, as applicable, with

respect to the Bonds with WFA. WFBNA has also entered into an agreement (the “WFSLLC Distribution Agreement”) with its affiliate Wells Fargo Securities, LLC (“WFSLLC”), for the distribution of municipal securities offerings, including the Bonds. Pursuant to the WFSLLC Distribution Agreement, WFBNA pays a portion of WFSLLC’s expenses based on its municipal securities transactions. WFBNA, WFSLLC, and WFA are each wholly-owned subsidiaries of Wells Fargo & Company.

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

MUNICIPAL ADVISOR

North Slope Capital Advisors, Denver, Colorado, is acting as municipal advisor to the University with respect to the issuance of the Bonds. As the University’s municipal advisor, North Slope has assisted in the preparation of this Official Statement and in other matters relating to the planning, structure, rating and issuance of the Bonds. In its role of municipal advisor to the University, North Slope has not undertaken to make an independent verification of or to assume responsibility for the accuracy or completeness of the information contained in this Official Statement.

CERTIFICATION OF OFFICIAL STATEMENT

The undersigned official of the University hereby confirms and certifies that the execution and delivery of this Official Statement and its use in connection with the offering and sale of the Bonds have been duly authorized by the Board of Trustees.

COLORADO SEMINARY

By: Vice Chancellor for Business and Financial Affairs

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APPENDIX A

AUDITED FINANCIAL STATEMENTS OF THE UNIVERSITY OF DENVER (COLORADO SEMINARY) FOR THE FISCAL YEARS ENDED JUNE 30, 2016 AND 2015 (WITH INDEPENDENT AUDITOR’S REPORT THEREON)

[THIS PAGE INTENTIONALLY LEFT BLANK] UNIVERSITY OF DENVER (COLORADO SEMINARY)

Financial Statements

June 30, 2016 and 2015

(With Independent Auditors’ Report Thereon)

UNIVERSITY OF DENVER (COLORADO SEMINARY)

Table of Contents

Page

Independent Auditors’ Report 1

Financial Statements

Statement of Financial Position, June 30, 2016 3

Statement of Financial Position, June 30, 2015 4

Statement of Activities, Year ended June 30, 2016 5

Statement of Activities, Year ended June 30, 2015 6

Statements of Cash Flows, Years ended June 30, 2016 and 2015 7

Notes to Financial Statements 8 CliftonLarsonAllen LLP CLAconnect.com

INDEPENDENT AUDITORS' REPORT

Board of Trustees University of Denver Denver, Colorado

Report on Financial Statements We have audited the accompanying financial statements of University of Denver (Colorado Seminary) (the University), which comprise the statements of financial position as of June 30, 2016 and 2015, and the related statements of activities and cash flows for the years then ended, and the related notes to the financial statements.

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

Auditors’ Responsibility Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America 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.

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

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

Board of Trustees University of Denver

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

Report on Supplementary Information Our audits were conducted for the purpose of forming an opinion on the 2016 and 2015 financial statements as a whole. The presentation of the operating, plant and long-term investment fund information in the statement of financial position and statement of activities is presented for purposes of additional analysis and is not a required part of the financial statements.

The presentation of the operating, plant and long-term investment fund information in the statement of financial position and statement of activities is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated November 30, 2016 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 result 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. a

CliftonLarsonAllen LLP

Greenwood Village, Colorado November 30, 2016

UNIVERSITY OF DENVER (COLORADO SEMINARY) Statement of Financial Position As of June 30, 2016

Long-term Assets Operations Plant investment Total Cash and cash equivalents $ 36,510,190 42,407,208 4,361,641 83,279,039 Short-term investments 94,393,191 — 510,361 94,903,552 Accounts receivable, net 19,854,781 — 328,442 20,183,223 Pledges receivable, net 11,697,925 4,944,359 21,150,815 37,793,099 Inventories, prepaid expenses, and other assets 3,902,011 — — 3,902,011 Long-term investments 544,950 — 639,481,841 640,026,791 Loans to students, net — — 17,557,233 17,557,233 Property, plant, and equipment, net of accumulated depreciation — 632,000,871 — 632,000,871 Total assets $ 166,903,048 679,352,438 683,390,333 1,529,645,819 Liabilities and Net Assets Accounts payable and accrued liabilities $ 59,638,154 16,748,883 — 76,387,037 Deferred revenues 19,285,436 — — 19,285,436 Other liabilities — — 413,763 413,763 Annuity obligations — — 10,291,496 10,291,496 Long-term debt — 112,046,697 — 112,046,697 U.S. government grants refundable — — 16,195,054 16,195,054 Total liabilities 78,923,590 128,795,580 26,900,313 234,619,483 Net assets: Unrestricted: Available for operations 8,140,465 13,763,935 — 21,904,400 Designated student loans — — 1,676,751 1,676,751 Designated gain sharing 53,391,662 — — 53,391,662 Board-designated endowments — — 189,625,647 189,625,647 Designated plant — 519,954,174 — 519,954,174 Donor advised funds — — 9,034,862 9,034,862 Total unrestricted net assets 61,532,127 533,718,109 200,337,260 795,587,496 Temporarily restricted: Gifts and distributed endowment income 26,447,331 — — 26,447,331 Plant — 16,838,749 — 16,838,749 Endowments — — 128,656,364 128,656,364 Annuity life income — — 5,750,356 5,750,356 Total temporarily restricted net assets 26,447,331 16,838,749 134,406,720 177,692,800 Permanently restricted: Endowments — — 310,237,094 310,237,094 Annuity life income — — 9,343,796 9,343,796 Student loans — — 2,165,150 2,165,150 Total permanently restricted net assets — — 321,746,040 321,746,040 Total net assets 87,979,458 550,556,858 656,490,020 1,295,026,336 Commitments and contingencies (notes 10, 11, and 13) Total liabilities and net assets $ 166,903,048 679,352,438 683,390,333 1,529,645,819

See accompanying notes to financial statements.

3 UNIVERSITY OF DENVER (COLORADO SEMINARY) Statement of Financial Position As of June 30, 2015

Long-term Assets Operations Plant investment Total Cash and cash equivalents $ 1,502,327 60,053,944 4,793,894 66,350,165 Short-term investments 113,148,628 15,710,971 125,510,361 254,369,960 Accounts receivable, net 19,129,729 80,961 308,098 19,518,788 Pledges receivable, net 12,539,916 11,225,150 18,636,984 42,402,050 Inventories, prepaid expenses, and other assets 3,982,204 — — 3,982,204 Long-term investments 438,270 — 539,597,706 540,035,976 Loans to students, net — — 17,876,730 17,876,730 Property, plant, and equipment, net of accumulated depreciation — 587,965,074 — 587,965,074 Total assets $ 150,741,074 675,036,100 706,723,773 1,532,500,947 Liabilities and Net Assets Accounts payable and accrued liabilities $ 65,475,228 16,128,274 — 81,603,502 Deferred revenues 19,585,571 — — 19,585,571 Other liabilities — — 450,583 450,583 Annuity obligations — — 11,440,164 11,440,164 Long-term debt — 118,050,581 — 118,050,581 U.S. government grants refundable — — 16,262,713 16,262,713 Total liabilities 85,060,799 134,178,855 28,153,460 247,393,114 Net assets: Unrestricted: Available for operations 6,869,384 18,136,078 — 25,005,462 Designated student loans — — 1,684,425 1,684,425 Designated gain sharing 31,552,426 — — 31,552,426 Board-designated endowments — — 200,184,201 200,184,201 Designated plant — 469,914,493 — 469,914,493 Donor advised funds 7,963,189 7,963,189 Total unrestricted net assets 38,421,810 488,050,571 209,831,815 736,304,196 Temporarily restricted: Gifts and distributed endowment income 27,258,465 — — 27,258,465 Plant — 52,806,674 — 52,806,674 Endowments — — 157,405,243 157,405,243 Annuity life income — — 6,024,109 6,024,109 Total temporarily restricted net assets 27,258,465 52,806,674 163,429,352 243,494,491 Permanently restricted: Endowments — — 293,808,754 293,808,754 Annuity life income — — 9,366,832 9,366,832 Student loans — — 2,133,560 2,133,560 Total permanently restricted net assets — — 305,309,146 305,309,146 Total net assets 65,680,275 540,857,245 678,570,313 1,285,107,833 Commitments and contingencies (notes 10, 11, and 13) Total liabilities and net assets $ 150,741,074 675,036,100 706,723,773 1,532,500,947

See accompanying notes to financial statements.

4 UNIVERSITY OF DENVER (COLORADO SEMINARY) Statement of Activities Year ended June 30, 2016

Designated Total Long-term Operating unrestricted operating Plant investment Total Change in unrestricted net assets: Revenues and gains (losses): Tuition and fees $ 444,343,003 — 444,343,003 — — 444,343,003 Less institutional scholarships 136,883,022 — 136,883,022 — — 136,883,022 307,459,981 — 307,459,981 — — 307,459,981 Less noninstitutional scholarships 14,865,432 — 14,865,432 — — 14,865,432 Net tuition and fees 292,594,549 — 292,594,549 — — 292,594,549 Private gifts 588,038 175 588,213 5,000 1,519,231 2,112,444 Grants and contracts 29,364,139 — 29,364,139 — — 29,364,139 Endowment income 2,410,154 — 2,410,154 3,041 178,610 2,591,805 Other investment income 1,140,380 — 1,140,380 10,216 314,612 1,465,208 Net realized and unrealized gains (losses) on endowments 3,557,423 — 3,557,423 — (9,726,637) (6,169,214) Net realized and unrealized gains (losses) on other investments (1,130,030) — (1,130,030) 23,882 (406,830) (1,512,978) Sales and services of educational activities 14,203,727 779,121 14,982,848 — — 14,982,848 Sales and services of auxiliary enterprise 35,506,190 — 35,506,190 — — 35,506,190 Other sources 20,966,807 32,832 20,999,639 234,504 20,431 21,254,574 Total unrestricted revenues and gains (losses) 399,201,377 812,128 400,013,505 276,643 (8,100,583) 392,189,565 Net assets released from restrictions 30,992,713 — 30,992,713 38,086,406 — 69,079,119 Net assets reclassified to permanently restricted — — — — (2,879,512) (2,879,512) Net assets reclassified from temporarily restricted — — — — 377,496 377,496 Total unrestricted revenues, gains (losses), and other support 430,194,090 812,128 431,006,218 38,363,049 (10,602,599) 458,766,668 Expenses: Educational and general: Instruction 152,837,022 20,301 152,857,323 9,472,375 — 162,329,698 Research 13,850,493 9 13,850,502 1,832,906 — 15,683,408 Public service 8,229,594 — 8,229,594 78,277 — 8,307,871 Academic support 64,289,227 3,724,569 68,013,796 1,292,506 — 69,306,302 Student services 49,732,866 — 49,732,866 3,454,406 — 53,187,272 Institutional support 52,226,652 2,781 52,229,433 1,739,299 — 53,968,732 Total educational and general expenses 341,165,854 3,747,660 344,913,514 17,869,769 — 362,783,283 Auxiliary enterprises 27,546,578 — 27,546,578 9,153,507 — 36,700,085 Total expenses 368,712,432 3,747,660 372,460,092 27,023,276 — 399,483,368 Transfers among unrestricted net assets 60,210,573 (24,774,768) 35,435,805 (34,327,765) (1,108,040) — Total expenses and transfers 428,923,005 (21,027,108) 407,895,897 (7,304,489) (1,108,040) 399,483,368 Increase (decrease) in unrestricted net assets 1,271,085 21,839,236 23,110,321 45,667,538 (9,494,559) 59,283,300

Changes in temporarily restricted net assets: Private gifts 14,554,567 — 14,554,567 1,775,209 11,899 16,341,675 Endowment income 4,894,833 — 4,894,833 — 8,591 4,903,424 Other investment income 16,600 — 16,600 17,201 — 33,801 Net realized and unrealized gains (losses) on endowments 13,315,198 — 13,315,198 — (30,621,313) (17,306,115) Net realized and unrealized gains (losses) on other investments (67,725) — (67,725) (18) — (67,743) Net assets released from restrictions (30,992,713) — (30,992,713) (38,086,406) — (69,079,119) Net assets reclassified to unrestricted — — — — (377,496) (377,496) Actuarial adjustment on annuity obligations — — — — (250,118) (250,118) Transfers among temporarily restricted net assets (2,531,898) — (2,531,898) 326,089 2,205,809 — Increase (decrease) in temporarily restricted net assets (811,138) — (811,138) (35,967,925) (29,022,628) (65,801,691) Changes in permanently restricted net assets: Private gifts — — — — 13,454,862 13,454,862 Net realized and unrealized gains (losses) on other investments — — — — 17,767 17,767 Net assets reclassified from unrestricted — — — — 2,879,512 2,879,512 Actuarial adjustment on annuity obligations — — — — 84,753 84,753 Increase in permanently restricted net assets — — — — 16,436,894 16,436,894 Change in net assets 459,947 21,839,236 22,299,183 9,699,613 (22,080,293) 9,918,503 Net assets at beginning of year 34,127,849 31,552,426 65,680,275 540,857,245 678,570,313 1,285,107,833 Net assets at end of year $ 34,587,796 53,391,662 87,979,458 550,556,858 656,490,020 1,295,026,336

See accompanying notes to financial statements.

5 UNIVERSITY OF DENVER (COLORADO SEMINARY) Statement of Activities Year ended June 30, 2015

Designated Total Long-term Operating unrestricted operating Plant investment Total Change in unrestricted net assets: Revenues and gains (losses): Tuition and fees $ 433,463,512 — 433,463,512 — — 433,463,512 Less institutional scholarships 127,479,651 — 127,479,651 — — 127,479,651 305,983,861 — 305,983,861 — — 305,983,861 Less noninstitutional scholarships 12,751,269 — 12,751,269 — — 12,751,269 Net tuition and fees 293,232,592 — 293,232,592 — — 293,232,592 Private gifts 978,388 250 978,638 5,000 7,457,246 8,440,884 Grants and contracts 25,712,692 — 25,712,692 — — 25,712,692 Endowment income 156,323 — 156,323 2,954 654,659 813,936 Other investment income 920,290 — 920,290 38,556 465,337 1,424,183 Net realized and unrealized gains (losses) on endowments 557,481 — 557,481 — 3,101,449 3,658,930 Net realized and unrealized gains (losses) on other investments (231,879) — (231,879) (182,373) (311,046) (725,298) Sales and services of educational activities 14,215,915 289,346 14,505,261 — — 14,505,261 Sales and services of auxiliary enterprise 34,110,542 — 34,110,542 — — 34,110,542 Other sources 20,549,035 231,942 20,780,977 607,620 — 21,388,597 Total unrestricted revenues and gains (losses) 390,201,379 521,538 390,722,917 471,757 11,367,645 402,562,319 Net assets released from restrictions 30,378,136 — 30,378,136 7,064,952 — 37,443,088 Net assets reclassified to permanently restricted — — — — (6,400,641) (6,400,641) Net assets reclassified to temporarily restricted — — — — (2,406,336) (2,406,336) Total unrestricted revenues, gains (losses), and other support 420,579,515 521,538 421,101,053 7,536,709 2,560,668 431,198,430 Expenses: Educational and general: Instruction 148,228,650 109,054 148,337,704 9,405,751 — 157,743,455 Research 13,069,928 — 13,069,928 1,762,721 — 14,832,649 Public service 5,839,706 — 5,839,706 78,904 — 5,918,610 Academic support 59,831,895 3,805,130 63,637,025 1,262,633 — 64,899,658 Student services 47,046,757 — 47,046,757 3,495,723 — 50,542,480 Institutional support 50,479,021 14,383 50,493,404 1,556,404 — 52,049,808 Total educational and general expenses 324,495,957 3,928,567 328,424,524 17,562,136 — 345,986,660 Auxiliary enterprises 25,864,354 — 25,864,354 10,245,710 — 36,110,064 Total expenses 350,360,311 3,928,567 354,288,878 27,807,846 — 382,096,724 Transfers among unrestricted net assets 68,900,878 61,821,374 130,722,252 (8,647,781) (122,074,471) — Total expenses and transfers 419,261,189 65,749,941 485,011,130 19,160,065 (122,074,471) 382,096,724 Increase (decrease) in unrestricted net assets 1,318,326 (65,228,403) (63,910,077) (11,623,356) 124,635,139 49,101,706

Changes in temporarily restricted net assets: Private gifts 15,128,302 — 15,128,302 3,929,855 89,662 19,147,819 Endowment income 4,661,149 — 4,661,149 — 6,128 4,667,277 Other investment income 39,362 — 39,362 198 — 39,560 Net realized and unrealized gains (losses) on endowments 12,288,876 — 12,288,876 — 3,505,014 15,793,890 Net realized and unrealized gains (losses) on other investments 67,155 — 67,155 (16,201) — 50,954 Net assets released from restrictions (30,378,136) — (30,378,136) (7,064,952) — (37,443,088) Net assets reclassified from unrestricted — — — — 2,406,336 2,406,336 Net assets reclassified from permanently restricted — — — — 776,043 776,043 Actuarial adjustment on annuity obligations — — — — (198,669) (198,669) Transfers among temporarily restricted net assets (25,014,777) — (25,014,777) 986,288 24,028,489 — Increase (decrease) in temporarily restricted net assets (23,208,069) — (23,208,069) (2,164,812) 30,613,003 5,240,122 Changes in permanently restricted net assets: Private gifts — — — — 9,215,562 9,215,562 Net realized and unrealized gains (losses) on other investments — — — — 16,963 16,963 Net assets reclassified from unrestricted — — — — 6,400,641 6,400,641 Net assets reclassified to temporarily restricted — — — — (776,043) (776,043) Actuarial adjustment on annuity obligations — — — — 4,268 4,268 Increase in permanently restricted net assets — — — — 14,861,391 14,861,391 Change in net assets (21,889,743) (65,228,403) (87,118,146) (13,788,168) 170,109,533 69,203,219 Net assets at beginning of year 56,017,592 96,780,829 152,798,421 554,645,413 508,460,780 1,215,904,614 Net assets at end of year $ 34,127,849 31,552,426 65,680,275 540,857,245 678,570,313 1,285,107,833

See accompanying notes to financial statements.

6 UNIVERSITY OF DENVER (COLORADO SEMINARY) Statements of Cash Flows Years ended June 30, 2016 and 2015

2016 2015 Cash flows from operating activities: Change in net assets $ 9,918,503 69,203,219 Adjustments to reconcile change in net assets to net cash provided by operating activities: Depreciation of property, plant, and equipment 14,461,435 14,587,873 Disposal of property, plant, and equipment 111,638 39,343 Amortization of premium (348,884) (514,366) (Increase) in accounts receivable (664,435) (1,163,418) Decrease in pledges receivable 4,608,951 12,884,138 Decrease in inventories, prepaid expenses, and other assets 80,193 907,197 Increase (decrease) in accounts payable and accrued liabilities (5,216,465) 14,110,043 Increase (decrease) in deferred revenues (300,135) (8,386,813) Increase (decrease) in other liabilities (36,820) 9,831 Actuarial adjustment for annuity obligation (975,207) (483,215) Contributions of investments — (6,620,151) Contributions restricted for long-term investment (14,985,992) (16,762,470) Interest and dividends for long-term investments (210,610) (126,272) Net realized and unrealized gains on investments 25,038,283 (18,795,439) Net cash provided by operating activities 31,480,455 58,889,500 Cash flows from investing activities: Proceeds from sale of investments 437,309,894 526,182,828 Purchases of investments (403,046,045) (549,570,951) Purchases of property, plant, and equipment (58,608,870) (37,591,657) Disbursements for Perkins and University loans to students (2,990,277) (4,025,560) Repayment of Perkins and University loans to students 3,309,774 3,486,396 Net cash used in investing activities (24,025,524) (61,518,944) Cash flows from financing activities: Proceeds from contributions restricted for long-term investment 14,985,992 16,762,470 Interest and dividends restricted for reinvestment 210,610 126,272 Payments of bonds payable (5,655,000) (6,050,000) Decrease in refundable government loan funds, net (67,659) (174,945) Net cash provided by financing activities 9,473,943 10,663,797 Net increase in cash and cash equivalents 16,928,874 8,034,353 Cash and cash equivalents at beginning of year 66,350,165 58,315,812 Cash and cash equivalents at end of year $ 83,279,039 66,350,165

In fiscal year 2016, the University issued Series 2014A bonds in the amount of $29,075,000 to refund series 2005A bonds in the amount of $28,105,000, and issued 2014B bonds in the amount of $12,500,000 to refund series 2005B bonds in the amount of $12,085,000.

See accompanying notes to financial statements.

7 UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

(1) Summary of Significant Accounting Policies (a) Nature of the Entity The University of Denver (Colorado Seminary) (the University) is an accredited, independent, coeducational institution located in Denver, Colorado. The University was founded as Colorado Seminary in 1864. In 1880, following the reorganization of the Colorado Seminary, the University was established as the degree-granting body. The University offers both undergraduate and graduate programs. Enrollment currently stands at approximately 12,500 students of which approximately 5,500 are undergraduates. The University is primarily supported by tuition and fees, private gifts, and grants and contracts.

(b) Basis of Presentation The financial statements of the University have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America.

The University maintains its accounts in accordance with the principles of fund accounting. Resources for various purposes are classified into funds that are in accordance with activities or objectives specified by donors. Separate accounts are maintained for each fund. For financial reporting purposes, resources are classified into net asset categories according to the existence or absence of donor-imposed restrictions. Accordingly, net assets of the University and changes therein are classified and reported as follows:

Unrestricted net assets – Net assets that are generally not subject to donor-imposed stipulations. Uses of certain unrestricted net assets are committed as matching funds under student loan programs of the federal government. Certain portions of unrestricted net assets are designated for specific purposes by the University.

Temporarily restricted net assets – Net assets subject to donor-imposed stipulations that may or will be met by either actions of the University and/or the passage of time. When a restriction expires, temporarily restricted net assets are reclassified to unrestricted net assets and reported in the statements of activities as net assets released from restrictions.

Permanently restricted net assets – Net assets subject to donor-imposed stipulations that are maintained permanently by the University. Generally, the donors of these assets permit the University to use all or part of the income earned on related investments for specific or general purposes.

Additionally, the University has classified activities and balances within the above-described net asset classes representing the level of operations and also the liquidity and nature of assets. These classifications (columns) are described as follows:

Operations – Activities that define the University’s “level of operations” relating to its educational activities and auxiliary enterprises. All assets, excluding pledges receivable and long term investments, are current in nature. Accounts payable and accrued liabilities, other than accumulated postretirement benefit obligations (note 10), are near maturity. Other liabilities are long term in nature. Balances and activities are unrestricted, temporarily restricted, or have been released from restrictions.

8 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

Designated unrestricted – The University’s board of trustees has elected to transfer operation funds for specific future operating purposes to a designated classification. Expenses incurred for the stated purposes are charged to expense accounts. The board may also elect to return any balances of designated funds to operations.

Plant – Activities include depreciation on equipment and buildings, interest expense on long-term debt, and receipt of gifts, which include donor-imposed restrictions for the acquisition of physical properties. All assets are limited to long-term purposes.

Long-term investment – Endowment, annuity, and loan activity balances are grouped in this column. All assets are limited to long-term purposes.

The board retains the authority to designate surpluses for funding of designated operations, plant, and long-term investment activities in subsequent years. Such designations of activities are reported as transfers among unrestricted net assets in the statements of activities.

(c) Cash and Cash Equivalents The University controls cash for all activities through one operating account. The cash balances represent cash positions for the respective funds. Certificates of deposits, short-term securities, and deposits with trustees are stated at fair value.

The University considers all liquid investments with original maturities of three months or less, except those relating to endowments or annuities, to be cash equivalents.

(d) Accounts Receivable Accounts receivable consist primarily of amounts due from students for tuition, room, board, and fees, and amounts due to the University under federal, state, and private grants and contracts. An allowance for uncollectibility is provided based on specific review of outstanding balances.

Accounts that are 120 days delinquent are reviewed to determine if they should be assigned to an outside collection agency. If a student has assets or income, has not made a payment and has not entered into a repayment agreement with the University, accounts may be assigned to preselected collection agencies.

In June of each year, student tuition accounts with delinquent balances over 365 days and no payment activity for the prior 12 months which are deemed uncollectible are written off to bad debt reserve. Holds are placed on written off student accounts which prevent future registration and the release of official transcripts and diplomas.

Account receivables are net of allowances for uncollectible accounts of $1,491,000 and $1,160,000 as of June 30, 2016 and 2015, respectively.

(e) Investments Investments received by gift, including investments in real estate, are recorded at estimated fair value at the date of the gift and are subsequently adjusted for changes in fair value thereafter. Purchased investments are carried at fair value. Realized and unrealized gains and losses are reported in the appropriate net asset classification. The University also holds shares or units in alternative investment 9 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

funds involving hedge, private equity, and real estate strategies. For financial statement presentation purposes, an investment may be considered alternative if the investment does not meet the following four criteria: (1) it is registered with the Securities Exchange Commission (SEC), (2) it makes semiannual filings with the SEC, (3) it calculates a net asset value daily, and (4) purchase and redemption of shares may be done daily. Such alternative investment funds may hold securities or other financial instruments for which a ready market exists and are priced accordingly. In addition, such funds may hold assets that require the estimation of fair values in the absence of readily determinable market values. See further discussion at note 1(n).

The University evaluates the fair value of its investments in accordance with the provisions of Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 820-10, Fair Value Measurements and Disclosures, updated by Accounting Standards Update (ASU) No. 2011-04, Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs. This standard establishes a framework for measuring fair value, clarifies the definition of fair value for financial reporting, and expands disclosures about fair value measurements. See further discussion at note 3.

In conjunction with the provisions of FASB ASC Topic 820-10, the University evaluates the fair value of its investments in accordance with the provisions of ASU No. 2009-12, Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent), for certain investments in funds that do not have readily determinable fair values including private investments, hedge funds, real estate, and other funds. This guidance amends FASB ASC Topic 820-10 and allows for the estimation of the fair value of investments in investment companies for which the investment does not have a readily determinable fair value using net asset value per share or its equivalent. Net asset value, in many instances, may not equal fair value that would be calculated pursuant to other provisions of FASB ASC Topic 820-10.

(f) Pledges Receivable Unconditional promises to give are recorded when pledges are made by the respective donors at their estimated present value. An allowance for uncollectibility is provided based on review of individually significant pledges and an estimated rate of uncollectibility. All contributions are available for unrestricted use unless specifically restricted by the donor.

Donor-restricted contributions whose restrictions are met in the same reporting period are initially reported as restricted revenue, which increases temporarily restricted net assets, then reclassed (or released from restrictions), simultaneously increasing unrestricted net assets and decreasing temporarily restricted net assets. Conditional promises to give are recognized as revenue when the conditions on which they depend are substantially met.

Net assets released from restrictions are reported in the statements of activities when the University has met the donor restrictions. Assets released from restrictions in the current year are for scholarships, plant acquisitions, and departmental operations.

(g) Inventories Inventories, which consist mainly of athletic and golf course merchandise and operating supplies, are valued at the lower of cost or fair value using the first-in, first-out (FIFO) method.

10 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

(h) Property, Plant, and Equipment Property, plant, and equipment exceeding a capitalization threshold of $5,000 are carried at cost at the date of acquisition or fair value at the date of donation in the case of gifts. Depreciation on property, plant, and equipment is calculated on the straight-line method over the estimated useful lives of the assets, which range from 3 to 15 years for equipment and 10 to 80 years for buildings and improvements.

The University reports gifts of property, plant, and equipment as unrestricted support unless explicit donor stipulations specify how the donated assets must be used. Gifts of long-lived assets with explicit restrictions that specify how the assets are to be used and gifts of cash or other assets that must be used to acquire long-lived assets are reported as restricted support.

Absent explicit donor stipulations about how long those long-lived assets must be maintained, the University reports expirations of donor restrictions when the donated or acquired long-lived assets are placed in service.

Donated works of art are considered collections under the University’s policy. Collections held for public exhibition and education in furtherance of public service rather than financial gain are not recorded in the statements of financial position.

(i) Revenue Unrestricted revenues include those items attributable to the University’s undergraduate programs, graduate programs, research conducted by academic departments, sales and services of educational activities, and the sales and services of auxiliary services. Tuition and fee revenue are recognized ratably over the academic term. Summer school tuition, fee revenue, and related expenses that are not earned or incurred as of year-end are deferred at June 30, 2016 and 2015 and recorded as revenue and expenses in the succeeding fiscal year.

(j) Compensated Absences Eligible University employees earn paid vacation each month based upon their years of service with the University. Vacation time accrues and vests proportionately between July 1 and June 30 of the current year and employees can carry a maximum of 22 days to the next fiscal year. An accrual has been made for earned vacation time in the amount of $3,905,000 and $3,823,000 as of June 30, 2016 and 2015, respectively, and is included in accounts payable and accrued liabilities in the accompanying statements of financial position.

The University has a sick leave plan covering substantially all employees. The University provides employees approximately eight hours of paid sick leave per month depending on employment status. The University employees’ accumulated unused sick leaves are carried over to the next year and are cumulative. Unused sick pay is forfeited by employees when they cease to be employed by the University. Therefore, no amount is accrued for sick leave.

(k) Annuity Obligations Annuity obligations represent the actuarially determined present value of future payments due to beneficiaries under split-interest agreements, primarily charitable remainder trusts.

11 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

(l) Taxes The University is recognized as an organization generally exempt from income taxes under Section 501(a) of the Internal Revenue Code (the Code) as an organization described in Section 501(c)(3) and a public charity, and not as a private foundation, under Section 509(a)(1). However, income generated from activities unrelated to the University’s exempt purpose is subject to tax under Section 511 of the Code. The University had no material amounts of unrelated business income for the years ended June 30, 2016 and 2015.

The University evaluates its tax position in accordance with the provisions of FASB ASC Topic 740-10, Income Taxes (formerly, FASB Interpretation No. 48). FASB ASC Topic 740-10 clarifies the accounting for uncertainty in income tax recognized in an entity’s financial statements. FASB ASC Topic 740-10 requires entities to determine whether it is more likely than not that a tax position will be sustained upon examination by the appropriate taxing authorities before any part of the benefit can be recorded in the financial statements. It also provides guidance on the recognition, measurement, and classification of income tax uncertainties, along with any related interest or penalties. A tax position is measured at the largest amount of benefit that is greater than 50% likely being realized upon settlement. The University has no uncertain income tax positions as of June 30, 2016.

(m) Functional Expenses The cost of providing the various programs and supporting services has been summarized on a functional basis in the statements of activities. Accordingly, certain costs have been allocated among the programs and supporting services benefited. Costs allocated among programs include expenses associated with the following: facilities management and planning, the depreciation and disposal expense of property, plant, and equipment, and the interest expense on long-term debt. Costs of facilities management and planning and depreciation and the disposal of property, plant, and equipment are allocated to the programs based upon square footage. Interest expense on long-term debt is allocated to the programs that benefit from the long-term financing of the University.

(n) Fair Value of Financial Instruments The fair value of the University’s financial instruments is determined as follows:

Cash and cash equivalents – Fair value is estimated to be the same as the carrying (book) value because of its short maturity.

Short and long-term investments – Fair value of U.S. government securities, mutual funds, stocks, and bonds is the market value based on quoted market prices. For alternative investments, which include hedge funds and private equity investments, fair values are based on the net asset value reported by each fund because it serves as a practical expedient to estimate the fair value of the University’s interest. See further discussion at note 3.

Accounts receivable – Fair value is estimated to be the same as the carrying (book) value because of its short maturity.

12 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

Pledges receivable – Fair value is determined by computing the present value of future cash flows discounted at the prevailing interest rate as of the period in which the agreement was received. The carrying (book) value of pledges receivable approximates fair value.

Loans to students – Fair value cannot be determined without incurring excessive costs. Repayment terms for University loans average less than one year and on average carry a 5% interest rate. The Federal Perkins Loan program (Perkins) has a maximum repayment period of 10 years and carries an average interest rate of 5%.

Accounts payable and accrued liabilities – Fair value is estimated to be the same as the carrying (book) value due to the short maturities of accounts payable; included in accrued liabilities is the present value of future obligations, which is adjusted annually. This carrying (book) value approximates fair value.

Annuity obligations – Fair value is determined by computing the present value of the University’s obligation to pay beneficiaries based on the beneficiaries’ life expectancies from actuarial tables published by the Internal Revenue Service, using the prevailing interest rate as of the date of each agreement. The University’s agreements are tied to interest rates that range from 4.9% to 10.0%. Annuity obligations are adjusted annually for these factors.

Long-term debt – Fair value, which is disclosed in note 8, is determined by computing the present value of future payments discounted at the prevailing interest rate for comparable debt instruments at year-end.

(o) Net Asset Reclassifications In 2011, The University initiated a matching program to increase endowed scholarships for undergraduates, graduates, and performing arts students. The board of trustees has designated $66 million of the University’s strategic reserves to match commitments to new and existing scholarship endowments. For the years ended June 30, 2016 and 2015, the University matched commitments to the matching program in the amount of $2,970,000 and $4,618,000, respectively. Other reclassifications included reclassifications from temporarily restricted to unrestricted net assets of $377,000 and from permanently restricted to unrestricted net assets of $80,000 for the year ended June 30, 2016, and reclassifications from unrestricted to permanently restricted net assets of $1,783,000 and from permanently restricted to temporarily restricted net assets of $776,000 for the year ended June 30, 2015.

(p) Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ significantly from those estimates.

(q) Endowment Funds The University presents its endowment funds in accordance with the provisions of FASB ASC Topic 958-205, Presentation of Financial Statements, which provides guidance about the net asset classification of donor-restricted endowment funds for a not-for-profit organization that is subject to

13 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

an enacted version of the Uniform Prudent Management of Institutional Funds Act (the Act) and expands disclosures about endowment funds. See further discussion at note 4.

(r) Subsequent Events FASB ASC Topic 855-10, Subsequent Events, establishes principles and requirements for subsequent events and applies to accounting for and disclosure of subsequent events not addressed in other applicable generally accepted accounting principles. The University evaluated events subsequent to June 30, 2016 and through November 30, 2016.

(s) Reclassifications Certain 2015 amounts have been reclassified to conform to the current year presentation.

(2) Short- and Long-Term Investments Investments at June 30 consist of the following:

2016 Unrealized Cost gain (loss) Market value Short-term investments: U.S. government securities $ 93,217,992 (54,280) 93,163,712 Mutual funds 610,242 311,288 921,530 Real estate 475,000 — 475,000 Other 343,310 — 343,310 94,646,544 257,008 94,903,552 Long-term investment: Trustee cash and cash equivalents for endowments and annuities 3,595,196 — 3,595,196 U.S. government securities 162,094,623 (675,780) 161,418,843 Alternative investments 165,556,720 38,443,196 203,999,917 Domestic equities 98,735,143 28,912,434 127,647,577 International equities 56,414,870 (1,697,082) 54,717,788 Real estate 22,979,293 17,793,315 40,772,607 Mutual funds 33,977,781 1,906,567 35,884,348 Beneficial trust interest 10,254,715 944,585 11,199,300 Other 791,215 — 791,215 554,399,556 85,627,235 640,026,791 Total all funds $ 649,046,100 85,884,243 734,930,343

14 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

2015 Unrealized Cost gain (loss) Market value Short-term investments: U.S. government securities $ 237,818,808 (175,649) 237,643,159 Mutual funds 10,545,525 5,362,966 15,908,491 Real estate 475,000 — 475,000 Other 343,310 — 343,310 249,182,643 5,187,317 254,369,960 Long-term investment: Trustee cash and cash equivalents for endowments and annuities 1,938,545 — 1,938,545 U.S. government securities 49,035,612 (112,487) 48,923,126 Alternative investments 138,058,707 59,610,348 197,669,055 Domestic equities 98,926,610 30,119,973 129,046,583 International equities 56,414,870 5,826,562 62,241,432 Real estate 24,020,538 20,649,038 44,669,576 Mutual funds 39,482,099 3,048,200 42,530,299 Beneficial trust interest 10,844,605 1,480,306 12,324,910 Other 692,450 — 692,450 419,414,036 120,621,940 540,035,976 Total all funds $ 668,596,679 125,809,257 794,405,936

During the years ended June 30, 2016 and 2015, the University paid approximately $771,000 and $814,000, respectively, in management and custodian fees, which were netted against endowment income and other investment income in the accompanying statements of activities. All endowments established by various donors over the years are accounted for separately in the accounting records of the University to ensure that the purposes for which the endowments were initially created are carried out in perpetuity. For investment purposes, to maximize total investment return and administrative efficiency, the University commingles certain assets in an investment pool.

Individual endowments own shares in the pool, the value per share being determined by the pool’s aggregate fair value, and the number of shares outstanding at the time contributions are made. The pool is valued on a quarterly basis for this purpose. At June 30, 2016, the pool had 97,042,743 shares outstanding, with a fair value of approximately $483,083,083. The University has adopted a spending policy whereby the board of trustees has authorized a stipulated percentage of the fair value of endowments participating in the investment pool to be spent for the purposes of the donors. The distribution for spending in 2016 was $0.23 per share, of which $0.05 represented income yield. The remaining $0.18 represented spending of realized and unrealized gains. At June 30, 2015, the pool had 87,032,379 shares outstanding, with a fair value of approximately $471,978,751. The distribution for spending in 2015 was $0.22 per share, of which $0.05 represented income yield. The remaining $0.17 represented spending of realized and unrealized gains

The investment pool consisted of 1,179 individual endowments at June 30, 2016. Of these endowments, 320 are considered to be “under water” as the fair value of the underlying investments is less than the original 15 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

gift value. At June 30, 2016 the fair value of the underlying investment related to these 320 endowments totaled approximately $54,369,000 while the original gift value was approximately $56,853,000. See additional discussion in note 4(b).

The investment pool consisted of 1,126 individual endowments at June 30, 2015. Of these endowments, none are considered to be “under water” as the fair value of the underlying investments is more than the original gift value for all endowments. See additional discussion in note 4(b).

The University has the following split-interest agreements, which are included in long-term investments at June 30, 2016 and 2015:

2016 Number of Net assets classification agreements Temporary Permanent Perpetual trusts held by third party 2 $ — 7,475,042 Charitable Remainder Trusts: University named trustee 24 4,552,255 12,448,580 Third-party named trustee 8 2,420,576 1,303,681 Charitable Annuity Agreements 68 2,293,638 2,623,405 102 $ 9,266,469 23,850,708

2015 Number of Net assets classification agreements Temporary Permanent Perpetual trusts held by third party 3 $ — 8,333,590 Charitable Remainder Trusts: University named trustee 24 4,704,778 13,292,329 Third-party named trustee 8 2,418,600 1,572,719 Charitable Annuity Agreements 70 2,505,077 2,608,380 105 $ 9,628,455 25,807,018

The University is the beneficiary of certain perpetual trusts held by others. The present values of the estimated future cash receipts from the trusts are recognized as assets and contribution revenue at the date the trusts are established. Distributions from the trusts are recorded as investment income, and the carrying value of the assets is adjusted for changes in the estimates of future receipts as gains and losses on the endowment investments.

The Charitable Remainder Trusts and Charitable Annuity Agreements are split-interest agreements that are held and administered either by the University or by others. In the period when the agreement is established, the University recognizes an asset at fair value, a liability to the beneficiary for the estimated future benefits to be distributed, and contribution revenue for the difference. The annuity obligation is primarily based on the person’s age at time of the gift, their life expectancy, and the prevailing interest rate as of the date of the agreement. Annual adjustments are made to the liability for the estimated future benefits to be distributed

16 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

due to changes in the actuarial assumptions and the discount rate, where applicable, over the term of the agreement.

Contribution revenue recognized for new split-interest agreements in 2016 and 2015 was approximately $188,000 and $2,021,000, respectively.

(3) FASB ASC Topic 820-10, Fair Value Measurements and Disclosures FASB ASC Topic 820-10 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under FASB ASC Topic 820-10 are as follows:

Level 1 Inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities that the University has the ability to access at the measurement date.

Level 2 Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly, including inputs in markets that are not considered to be active.

Level 3 Inputs that are unobservable and supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Inputs are used in applying the various valuation techniques and broadly refer to the assumptions that market participants use to make valuation decisions, including assumptions about risk. Inputs may include price information, volatility statistics, specific and broad credit data, liquidity statistics, and other factors. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. However, the determination of what constitutes “observable” requires significant judgment by the University. The University considers observable data to be that market data, which is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market. The categorization of a financial instrument within the hierarchy is based upon the pricing transparency of the instrument and does not necessarily correspond to the University’s perceived risk of that instrument.

In determining the placement of an investment within the hierarchy, the University separates the investment portfolio into two categories: investments and derivative instruments.

(a) Investments Investments whose values are based on quoted market prices in active markets, and are, therefore, classified within Level 1, include actively listed domestic and international equities, certain U.S. government and sovereign obligations, and certain money market securities.

Investments that trade in markets that are not considered to be active, but are valued based on quoted market prices, dealer quotations, or alternative pricing sources supported by observable inputs are classified within Level 2. These include certain U.S. government and sovereign obligations, certain government agency securities, investment grade corporate bonds, certain mortgage products, certain bank loans and bridge loans, less liquid listed equities, state, municipal, and provincial obligations, most physical commodities, and certain loan commitments. As Level 2 investments include positions 17 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect liquidity and/or nontransferability, which are generally based on available market information.

Investments classified within Level 3 have significant unobservable inputs, as they trade infrequently or not at all. Level 3 instruments include private equity and real estate investments, certain bank loans and bridge loans, less liquid corporate debt securities (including distressed debt instruments), collateralized debt obligations, investments in other funds, and less liquid mortgage securities (backed by either commercial or residential real estate).

Most investments classified in Levels 2 and 3 consist of shares or units in investment funds as opposed to direct investments in the funds’ underlying holdings, which may be marketable. Because the net asset value reported by each fund is used as a practical expedient to estimate the fair value of the University’s interest therein, its classification in Level 2 or 3 is based on the University’s ability to redeem its interest at or near the date of the statements of financial position and the level of observable inputs. If the interest can be redeemed in the near term, the investment is classified in Level 2. The classification of investments in the fair value hierarchy is not necessarily an indication of the risks, liquidity, or degree of difficulty in estimating the fair value of each investment’s underlying assets and liabilities.

(b) Fair Value Hierarchy Table The following tables summarize the University’s short and long-term investments in the fair value hierarchy as of June 30, 2016 and 2015, as well as liquidity of the investments:

18 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

June 30, 2016 Investment/liquidity Level 1 Level 2 Level 3 Total U.S. government securities: Daily $ 254,352,554 — — 254,352,554 Monthly — 230,000 — 230,000 Total 254,352,554 230,000 — 254,582,554 Alternative investments: Monthly — 17,614,937 15,068,780 32,683,717 Quarterly — — 86,101,784 86,101,784 Annual — — 14,927,843 14,927,843 Illiquid — — 70,286,573 70,286,573 Total — 17,614,937 186,384,980 203,999,917 Mutual funds: Daily 36,805,879 — — 36,805,879 Total 36,805,879 — — 36,805,879 Domestic equities: Daily 107,229,410 — — 107,229,410 Monthly — 19,914,160 — 19,914,160 Quarterly 504,008 — — 504,008 Total 107,733,418 19,914,160 — 127,647,578 International equities: Daily 24,121,210 15,085,518 — 39,206,728 Illiquid — — 15,511,060 15,511,060 Total 24,121,210 15,085,518 15,511,060 54,717,788 Trustee cash and cash equivalents: Daily 3,595,195 — — 3,595,195 Total 3,595,195 — — 3,595,195 Real estate: Semiannually — 40,772,606 — 40,772,606 Locked-up 1 — 475,001 — 475,001 Total — 41,247,607 — 41,247,607 Beneficial trust interest: Locked-up 1 8,399,727 1,050,000 1,749,573 11,199,300 Total 8,399,727 1,050,000 1,749,573 11,199,300 Other: Daily 494,964 — — 494,964 Illiquid — — 393,296 393,296 Locked-up 2 246,265 — — 246,265 Total 741,229 — 393,296 1,134,525 Grand total $ 435,749,212 95,142,222 204,038,909 734,930,343

19 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

June 30, 2015 Investment/liquidity Level 1 Level 2 Level 3 Total U.S. government securities: Daily $ 286,336,285 — — 286,336,285 Monthly — 230,000 — 230,000 Total 286,336,285 230,000 — 286,566,285 Alternative investments: Monthly — 19,578,447 28,039,909 47,618,356 Quarterly — — 81,189,556 81,189,556 Annual — — 15,438,023 15,438,023 Illiquid — — 53,423,120 53,423,120 Total — 19,578,447 178,090,608 197,669,055 Mutual funds: Daily 43,501,239 — — 43,501,239 Monthly — — 14,937,551 14,937,551 Total 43,501,239 — 14,937,551 58,438,790 Domestic equities: Daily 108,839,064 — — 108,839,064 Monthly — 19,648,065 — 19,648,065 Quarterly 559,454 — — 559,454 Total 109,398,518 19,648,065 — 129,046,583 International equities: Daily 30,420,955 15,714,081 — 46,135,036 Illiquid — — 16,106,396 16,106,396 Total 30,420,955 15,714,081 16,106,396 62,241,432 Trustee cash and cash equivalents: Daily 1,938,545 — — 1,938,545 Total 1,938,545 — — 1,938,545 Real estate: Semiannually — 44,579,575 — 44,579,575 Locked-up 1 — 475,001 — 475,001 Locked-up 3 — 90,000 — 90,000 Total — 45,144,576 — 45,144,576 Beneficial trust interest: Locked-up 1 9,301,789 1,050,000 1,973,121 12,324,910 Total 9,301,789 1,050,000 1,973,121 12,324,910 Other: Daily 388,284 — — 388,284 Illiquid — — 393,296 393,296 Locked-up 2 254,180 — — 254,180 Total 642,464 — 393,296 1,035,760 Grand total $ 481,539,795 101,365,169 211,500,972 794,405,936

20 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

The following table includes a rollforward of the amounts for the years ended June 30, 2016 and 2015 for financial instruments classified within Level 3. The classification of a financial instrument within Level 3 is based upon the significance of the unobservable inputs to the overall fair value measurement.

Fair value measurement using Level 3 inputs:

Mutual Alternative International funds/other investments equities Total Balances at June 30, 2015 $ 17,303,968 178,090,608 16,106,396 211,500,972 Donated — — — — Purchases 3,979,974 60,823,435 — 64,803,409 Sales (14,198,786) (25,717,531) — (39,916,317) Unrealized losses (4,942,287) (26,811,532) (595,336) (32,349,155) Balances at June 30, 2016 $ 2,142,869 186,384,980 15,511,060 204,038,909

Mutual Alternative International funds/other investments equities Total Balances at June 30, 2014 $ 17,324,528 167,844,651 10,454,135 195,623,314 Donated — — — — Purchases 1,119,174 35,690,714 5,000,000 41,809,888 Sales (776,043) (20,739,662) — (21,515,705) Unrealized gains (losses) (363,691) (4,705,095) 652,261 (4,416,525) Balances at June 30, 2015 $ 17,303,968 178,090,608 16,106,396 211,500,972

All unrealized gains (losses) in the tables above are reflected in the accompanying statements of activities. There have been no transfers into or out of Level 3 investments during the years ended June 30, 2016 and June 30, 2015.

(4) Endowments As discussed in note 1(q), FASB ASC Topic 958-205 provides guidance about the net asset classification of donor-restricted endowment funds for a not-for-profit organization that is subject to the Act and expands disclosures about endowment funds. The Act was effective September 1, 2008 and provides for statutory guidance for the management, investment, and expenditure of endowment funds held by not-for-profit organizations. Amongst other provisions, the Act eliminates the “historical dollar value” rule for endowment funds in favor of guidelines regarding what constitutes prudent spending.

The University’s endowments consist of 1,179 and 1,126 individual funds as of June 30, 2016 and 2015, respectively. The endowments were established for a variety of purposes, including both donor-restricted endowment funds (true endowment) and funds designated by the board of trustees to function as endowments. Net assets associated with endowment funds, including funds designated by the board of trustees to function as endowments, are classified and reported based on the existence or absence of donor-imposed restrictions.

21 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

(a) Interpretation of Relevant Law The board of trustees of the University has interpreted the version of the Act enacted by the State of Colorado as not requiring an institution subject to the Act to implement a reclassification within its financial statements to reflect the effect of price inflation on the historic dollar value of endowment funds, bringing the current purchasing power of such funds to their original purchasing power and denominating the result as permanently restricted.

The remaining portion of the donor-restricted fund that is not classified as permanently restricted net assets is classified as temporarily restricted net assets until those amounts are appropriated for expenditure by the University in a manner consistent with the standard of prudence prescribed by the Act. In accordance with the Act, the University considers the following factors in making determination to appropriate or accumulate donor-restricted endowment funds: 1. The duration and the preservation of the fund 2. The purposes of the University and the donor-restricted endowment fund 3. General economic conditions 4. The possible effect of inflation and deflation 5. The expected total return from income and the appreciation of investments 6. Other resources of the University 7. The investment policies of the University

Net assets comprising true endowments funds and funds designated by the board of trustees to function as endowments were as follows at June 30:

Temporarily Permanently Unrestricted restricted restricted Total June 30, 2016: Board-designated endowment funds $ 189,625,647 — — 189,625,647 Donor-restricted endowment funds — 128,656,364 310,237,094 438,893,458 $ 189,625,647 128,656,364 310,237,094 628,519,105

Temporarily Permanently Unrestricted restricted restricted Total June 30, 2015: Board-designated endowment funds $ 200,184,201 — — 200,184,201 Donor-restricted endowment funds — 157,405,243 293,808,754 451,213,997 $ 200,184,201 157,405,243 293,808,754 651,398,198

22 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

The changes in endowment net assets for the years ended June 30, 2016 and 2015 are as follows:

Temporarily Permanently Unrestricted restricted restricted Total Endowment net assets, June 30, 2015 $ 200,184,201 157,405,243 293,808,754 651,398,198 Investment return: Investment income 2,591,805 4,903,424 — 7,495,229 Net realized and unrealized gains (losses) (6,169,214) (17,307,378) — (23,476,592) Total investment return (3,577,409) (12,403,954) — (15,981,363) Private gifts 19,229 24,555 13,572,727 13,616,511 Appropriation of endowment assets for expenditures (6,437,916) (18,210,031) (20,720) (24,668,667) Reinvested income 331,652 831,103 — 1,162,755 Transfer to board-designated endowments 2,071,253 920,418 — 2,991,671 Reclassification of restricted net assets (2,965,363) 89,030 2,876,333 — Changes (10,558,554) (28,748,879) 16,428,340 (22,879,093) Endowment net assets, June 30, 2016 $ 189,625,647 128,656,364 310,237,094 628,519,105

23 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

Temporarily Permanently Unrestricted restricted restricted Total Endowment net assets, June 30, 2014 $ 83,492,410 127,203,092 279,163,179 489,858,681 Investment return: Investment income 813,936 4,667,277 — 5,481,213 Net realized and unrealized gains (losses) 3,658,930 15,793,890 — 19,452,820 Total investment return 4,472,866 20,461,167 — 24,934,033 Private gifts 135,133 — 8,270,941 8,406,074 Appropriation of endowment assets for expenditures (3,779,311) (17,529,504) (6,331) (21,315,146) Present value adjustments — — 1,631 1,631 Reinvested income 37,894 721,996 — 759,890 Transfer to board-designated endowments 122,250,733 26,502,302 — 148,753,035 Reclassification of restricted net assets (6,425,524) 46,190 6,379,334 — Changes 116,691,791 30,202,151 14,645,575 161,539,517 Endowment net assets, June 30, 2015 $ 200,184,201 157,405,243 293,808,754 651,398,198

(b) Funds with Deficiencies From time to time, the fair value of assets associated with individual endowment funds may fall below the level of the book value (underwater). The University had 320 funds considered underwater with a deficiency of approximately $2,484,000 at June 30, 2016. The deficiency is recorded as unrestricted net unrealized losses on endowment within the statement of activities. There were no funds considered underwater at June 30, 2015.

(c) Return Objectives and Risk Parameters The primary objective of the investment for the endowment, quasi-endowment, and similar funds is the concept of preservation of purchasing power of the funds with an emphasis on long-term growth of the funds and with a risk profile that would be deemed to be prudent by institutional fiduciaries generally. Consistent with this objective, a reasonable return is expected.

24 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

(d) Strategies Employed for Achieving Objectives The University targets a diversified asset allocation. For the years ended June 30, 2016 and June 30, 2015 the estimated investment emphasis included: US Equities (25.0%), International Equities (20.0%), Hedged Funds (10.0%), Private Equities (10.0%), Absolute Return funds (15.0%), Fixed Income (10.0%), and Real Estate and Other investment (10.0%). The profile is reviewed quarterly and rebalanced as needed.

(e) Spending Policy The University has adopted a spending policy whereby the board of trustees has authorized a stipulated percentage of the fair value of endowments participating in the investment pool to be spent for the purposes of the donors. As of June 30, 2016 and 2015, the approved percentage was 4.5% of a moving 12-quarter average of the market value of such funds.

(5) Pledges Receivable Pledges receivable are summarized as follows at June 30:

2016 2015 Unconditional promises expected to be collected in: Less than one year $ 12,515,561 18,197,457 One to five years 17,652,144 14,704,634 Greater than five years 32,943,812 35,867,974 63,111,517 68,770,065 Less allowance for uncollectible pledges (6,311,152) (6,877,007) Less present value discount (4.75% - 8.0%) (19,007,266) (19,491,008) Net pledges receivable $ 37,793,099 42,402,050

Included in pledges receivable is the present value of approximately $8,628,000 and $11,459,000 as of June 30, 2016 and 2015, respectively, in pledges from members of the board of trustees. For the years ended June 30, 2016 and 2015, the University did not conduct any additional transactions with members of the board of trustees that were not negotiated at arm’s length.

25 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

(6) Property, Plant, and Equipment Property, plant, and equipment at June 30 consist of the following:

2016 2015 Land $ 9,290,477 8,721,577 Land improvements 28,692,747 28,538,796 Buildings and improvements 631,659,761 623,002,401 Equipment 62,924,094 57,616,970 Library books 8,915,362 8,790,011 Construction in progress 81,448,994 38,008,462 822,931,435 764,678,217 Less accumulated depreciation (190,930,564) (176,713,143) $ 632,000,871 587,965,074

The University had approximately $14,461,000 and $14,588,000 of depreciation expense for the years ended June 30, 2016 and 2015, respectively, which was reported within all functions in the accompanying statements of activities.

The University monitors asset retirement obligations in accordance with the provisions of FASB ASC Topic 410-20, Asset Retirement and Environmental Obligations. Under FASB ASC Topic 410-20, costs related to the legal obligation to perform certain activities in connection with the retirement, disposal, or abandonment of assets are required to be accrued. The University has identified asbestos abatement as a conditional retirement obligation. For the years ended June 30, 2016 and 2015, respectively, an asset retirement obligation of approximately $7,799,000 and $8,138,000 is included in accounts payable and accrued liabilities.

(7) Operating Leases The University leases an apartment building adjacent to the campus under an operating lease which began on July 1, 2015 and expires on June 30, 2022. Rent expense on the lease for the year ended June 2016 was approximately $845,000.

Future minimum lease payments under the operating lease as of June 30, 2016 through the years ending June 30, 2022 are:

2017 $ 780,000 2018 811,200 2019 843,648 2020 868,957 2021 895,026 2022 921,877 $ 5,120,708

26 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

(8) Long-Term Debt Bonds payable at June 30 consist of the following:

2016 2015 Colorado Educational and Cultural Facilities Authority Refunding Revenue Bonds, Series 2014A $ 27,360,000 — Colorado Educational and Cultural Facilities Authority Refunding Revenue Bonds, Series 2014B 12,500,000 — Colorado Educational and Cultural Facilities Authority Refunding Revenue Bonds, Series 2013 22,395,000 22,520,000 Colorado Educational and Cultural Facilities Authority Refunding Revenue Bonds, Series 2012 — 2,860,000 Colorado Educational and Cultural Facilities Authority Refunding Revenue Bonds, Series 2008 4,955,000 5,585,000 Colorado Educational and Cultural Facilities Authority Refunding Revenue Bonds, Series 2007 39,920,000 39,920,000 Colorado Educational and Cultural Facilities Authority Refunding Revenue Bonds, Series 2005A — 28,105,000 Colorado Educational and Cultural Facilities Authority Revenue Bonds, Series 2005B — 13,795,000 107,130,000 112,785,000 Unamortized bond premium 4,916,697 5,265,581 Total long-term debt 112,046,697 118,050,581 Less current installments 6,955,000 6,260,000 Long-term debt, excluding current installments $ 105,091,697 111,790,581

The University had approximately $3,622,000 and $5,457,000 of interest expense for the years ended June 30, 2016 and 2015, respectively, which was reported in various functions under plant in the accompanying statements of activities. Interest of approximately $4,000,000 and $5,539,000 was paid in cash during the years ended June 30, 2016 and 2015, respectively. The fair value of bonds payable was approximately $104,956,000 and $112,526,000 at June 30, 2016 and 2015, respectively.

(a) Issuance of Series 2014A Bonds In September 2015, the Colorado Educational and Cultural Facilities Authority (the Authority) issued $29,075,000 of University of Denver Revenue Bonds, Series 2014A. The proceeds from the sale of the 2014A bonds were used to (1) refund $28,105,000 aggregate principal amount of the Authority’s Revenue Bonds Series 2005A and (2) pay certain costs associated with the issuance of the 2014A Bonds.

The bond agreement provides for principle payments of $1,715,000 in 2016, increasing to $6,490,000 in 2022. Interest is payable semiannually at a fixed rate of 2.620%.

27 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

(b) Issuance of Series 2014B Bonds In March 2016, the Colorado Educational and Cultural Facilities Authority (the Authority) issued $12,500,000 of University of Denver Revenue Bonds, Series 2014B. The proceeds from the sale of the 2014B bonds were used to (1) refund $12,085,000 aggregate principal amount of the Authority’s Revenue Bonds Series 2005B and (2) pay certain costs associated with the issuance of the 2014B Bonds.

The bond agreement provides for principle payments of $3,235,000 in 2017, increasing to $6,820,000 in 2023. Interest is payable semiannually at a fixed rate of 2.710%. (c) Issuance of Series 2013 Bonds In February 2013, the Colorado Educational and Cultural Facilities Authority (the Authority) issued $22,780,000 of University of Denver Revenue Bonds, Series 2013. The proceeds from the sale of the 2013 bonds were used to (1) refund $21,240,000 aggregate principal amount of the Authority’s Revenue Bonds Series 2005B and (2) pay certain costs associated with the issuance of the 2013 Bonds.

The bond agreement provides for principle payments of $125,000 in 2016, increasing to $2,255,000 in 2030. Interest is payable semiannually at rates ranging from 2.00% to 4.00%.

(d) Issuance of Series 2012 Bonds In March 2012, the Authority issued $8,370,000 of University of Denver Revenue Bonds, Series 2012. The proceeds from the sale of the 2012 bonds were used to (1) refund $8,530,000 aggregate principal amount of the Authority’s Revenue Bonds Series 2001B and (2) pay certain costs associated with the issuance of the 2012 Bonds.

The bond agreement provides for principle payments of $2,860,000 in 2016. Interest is payable semiannually at 4.00%.

The bond was matured on March 1, 2016.

(e) Issuance of Series 2008 Bonds In February 2008, the Authority issued $9,390,000 of University of Denver Refunding Revenue Bonds, Series 2008. The proceeds from the sale of the 2008 bonds were used to (1) refund all of the Authority’s Revenue Bonds (University of Denver Project) Series 1997 Bonds outstanding in the aggregate principal amount of $9,725,000 and (2) pay certain costs associated with the issuance of the 2008 Bonds.

The bond agreement provides for principle payments of $630,000 in 2016, increasing to $2,535,000 in 2018. Interest is payable semiannually at rates ranging from 4.00% to 5.00%. Payment of principal and interest on the bonds is guaranteed by Financial Guaranty Insurance Corporation.

28 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

(f) Issuance of Series 2007 Bonds In December 2006, the Authority issued $39,920,000 of University of Denver Refunding Revenue Bonds, Series 2007. The proceeds from the sale of the 2007 bonds were used to (1) (i) refund all of the Authority’s Revenue Bonds (University of Denver Project) Series 2001A Bonds outstanding in the aggregate principal amount of $27,000,000 and (ii) refund $14,905,000 of aggregate principal amount of the Authority’s Revenue Bonds (University of Denver Project) Series 2005B Bonds; (2) purchase a municipal bond insurance policy and a reserve fund surety bond for the 2007 Bonds; and (3) pay certain costs associated with the issuance of the 2007 Bonds.

The bond agreement provides for principle payments of $1,650,000 in 2023, $5,825,000 in 2024, $6,135,000 in 2025, $6,455,000 in 2026, $6,790,000 in 2027, and ranging from $2,365,000 in 2031 to $2,870,000 in 2035. Interest is payable semiannually at the rate of 5.25%. Payment of principal and interest on the bonds is guaranteed by Financial Guaranty Insurance Corporation.

(g) Issuance of Series 2005A Bonds In July 2005, the Authority issued $30,255,000 of University of Denver Refunding Revenue Bonds, Series 2005A. The proceeds from the sale of the 2005A bonds were used to (1) advance refund $29,670,000 aggregate principal amount of the Authority’s Revenue Bonds (University of Denver Project) Series 2000; (2) purchase a municipal bond insurance policy and a reserve fund surety bond for the 2005A Bonds; and (3) pay certain costs associated with the issuance of the 2005A Bonds.

The Series 2005A with remaining balance of $28,105,000 was refunded by Series 2014A on September 1, 2015. (h) Issuance of Series 2005B Bonds In November 2005, the Authority issued $61,815,000 of University of Denver Revenue Bonds, Series 2005B. The proceeds from the sale of the 2005B bonds were used to (1) finance a portion of the construction, acquisition, and furnishing of a residences hall and a parking facility; (2) pay capitalized interest; (3) refund $7,075,000 in outstanding bonds of the Authority’s Revenue Bonds Series 1997; (4) refund $8,700,000 in outstanding bonds of the Authority’s Revenue Bonds Series 2000; (5) purchase a municipal bond insurance policy and a reserve fund surety bond for the 2005B Bonds; and (6) pay certain costs associated with the issuance of the 2005B Bonds.

As mentioned above, $14,905,000 of the 2005B Series Bonds was legally defeased during fiscal year 2007 from proceeds of the 2007 bonds and removed from the accounting records of the University and $21,240,000 of the 2005B Series Bonds was legally defeased during fiscal year 2013 from proceeds of the 2013 bonds and removed from the accounting records of the University.

The Series 2005B with remaining balance of $12,085,000 was refunded by Series 2014B on March 1, 2016.

29 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

(i) Aggregate Annual Maturities of Bonds Payable At June 30, 2016, the aggregate annual maturities of bonds payable for the five succeeding years and thereafter are as follows:

2017 $ 6,955,000 2018 7,205,000 2019 7,610,000 2020 7,825,000 2021 8,050,000 Thereafter 69,485,000 $ 107,130,000

(j) Restrictive Bond Covenants The University is required by bond covenants to maintain expendable resources (as defined by the Loan Agreement) of at least 75% of the outstanding principal of its long-term debt and maintain a debt service coverage ratio (as defined by the Loan Agreement) of at least 1.15. The University is also required to comply with various other covenants while the bonds are outstanding. Management believes the University is in compliance with the bond covenants.

(k) Security for the Bonds Under all the University’s bond loan agreements, the University is obligated to pay amounts sufficient to provide payment of the principal and interest on the bonds. The obligation of the University to make such payments under the loan agreements is secured by a security interest in the gross revenues of the University, as defined.

(9) Retirement Plan Full-time employees, including part-time employees who work at least 20 hours per week for at least six months, of the University are eligible to participate in a contributory tax-deferred annuity retirement plan (the Retirement Plan) under Section 403(b) of the Code. Administrators, faculty members, and staff-appointed employees are eligible to participate in the Retirement Plan after one year of service. Participating employees may contribute up to 4% of their base salary, limited by the Code to $18,000 per employee. The University contributes an amount twice that of the employee up to 8%. Participants have a fully vested interest in the total contributions immediately. Accounts of each employee are invested at the employee’s discretion. Under the Retirement Plan, the University contributed approximately $11,568,000 and $11,142,000 for the years ended June 30, 2016 and 2015, respectively, which were charged to operations expenses.

(10) Postretirement Benefits Other than Pensions The University records postretirement benefits in accordance with the provisions of FASB ASC Topic 715-20, Compensations – Retirement Benefits. FASB ASC Topic 715-20 requires balance sheet recognition of the net asset or liability for the overfunded or underfunded status of defined-benefit pension and other postretirement benefit plans and recognition of changes in the funded status in the year in which the changes occur.

30 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

The University sponsors a defined-benefit healthcare plan (the Healthcare Plan) that provides postretirement medical benefits to full-time employees who have worked 10 years and attained age 55 while in service with the University if hired prior to January 1, 1992, or full-time employees who have worked 20 years and attained age 55 while in service with the University if hired after December 31, 1991. Participants receive $60 per month toward the cost of their postretirement medical costs. At June 30, 2016, the Healthcare Plan covered 210 retirees with an additional 2,386 active employees potentially eligible for coverage. At June 30, 2015, the Healthcare Plan covered 226 retirees with an additional 2,352 active employees potentially eligible for coverage. The Healthcare Plan is noncontributory.

The changes in benefit obligations (all unfunded) were as follows:

2016 2015 Acrued postretirement benefit obligation (APBO), beginning of year $ 2,916,553 3,442,036 Service cost 52,222 214,586 Interest cost 114,936 134,115 Actuarial loss (gain) 107,073 (712,184) Benefits paid (155,100) (162,000) APBO (all unfunded), end of year $ 3,035,684 2,916,553

At June 30, net periodic postretirement benefit cost included the following components:

2016 2015 Service cost $ 52,222 90,432 Interest cost 114,936 134,115 Amortization of prior service cost 11,125 18,222 Recognized net actuarial gain (10,813) — Net periodic postretirement benefit cost $ 167,470 242,769

An accrual has been made for the APBO and is included in accounts payable and accrued liabilities in the accompanying statements of financial position. The weighted average discount rate used in determining the APBO was 3.24% and 4.07% for June 30, 2016 and 2015, respectively. It is the University’s policy to fund the benefit cost with current cash balances. Under the Healthcare Plan, the University paid benefits of approximately $155,000 and $162,000 for the years ended June 30, 2016 and 2015, respectively, which were charged to operating expenses.

31 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

The estimated benefits expected to be paid in following years are as follows:

2017 $ 181,307 2018 179,642 2019 176,684 2020 175,149 2021 174,277 2022 – 2026 850,115 Total $ 1,737,174

For the years ended June 30, 2016 and 2015, all medical premiums were greater than the amount subsidized by the University. Therefore, a healthcare trend was not used as all retirees receiving the subsidy received the full $60.

The measurement date for the Healthcare Plan was June 30, 2016.

(11) Loans to Students Student loans made through Perkins constitute substantially all of the student loans outstanding at June 30, 2016 and 2015. Prior to 2005, contributions to the Perkins programs were funded 75% by the federal government with the University providing the remaining 25%; yet for fiscal years 2016 and 2015, no additional contributions were funded. Perkins provides for cancellation of a note at rates of 10% to 30% per year up to a maximum of 100% if the debtor complies with certain provisions of Perkins. The federal government reimburses the loan funds of the University at rates of 10% to 30% for canceled indebtedness due to certain teaching service and various types of services for the U.S. government and 100% for loans declared not collectible due to death, permanent disability, or a declaration of bankruptcy.

At June 30, 2016 and 2015, the allowance for possible loan losses of Perkins approximated $750,000; however, due to federal regulations, no loans of Perkins have been written off since the inception of Perkins.

The University has other loan funds obtained primarily through gifts and grants from individuals, corporations, and foundations. At June 30, 2016 and 2015, the allowance for possible loan losses of these funds was $153,000.

(12) Fund-Raising Expenses The University had fund-raising expenses of approximately $16,895,000 and $16,797,000 in 2016 and 2015, respectively, which were recognized in institutional support in the accompanying statements of activities.

32 (Continued) UNIVERSITY OF DENVER (COLORADO SEMINARY) Notes to Financial Statements June 30, 2016 and 2015

(13) Commitments and Contingencies At June 30, 2016 and 2015, the University had outstanding commitments totaling approximately $10,768,000 and $45,726,000, respectively, for contracts related to various construction projects on campus.

During the 2016 fiscal year, the University invested approximately $5,297,000 in 20 long-term partnerships, all of which were formed prior to the 2016 fiscal year, bringing its cumulative contributions to the partnerships to approximately $105,922,000. Under the terms of the partnership agreements, the University and other investors are committed to fund additional investments. As of June 30, 2016, the University’s remaining commitments to 14 partnerships total approximately $31,727,000.

During the 2015 fiscal year, the University invested approximately $5,676,000 in 20 long-term partnerships, 17 of which were formed prior to the 2015 fiscal year, bringing its cumulative contributions to the partnerships to approximately $100,625,000. Under the terms of the partnership agreements, the University and other investors are committed to fund additional investments. As of June 30, 2015, the University’s remaining commitments to 14 partnerships totaled approximately $39,100,000.

The University participates in a number of federal programs, which are subject to financial and compliance audits. The amount of expenses that may be disallowed by the granting agencies cannot be determined at this time although the University does not expect these amounts, if any, to be material to the financial statements.

The University is a party to a number of matters of litigation. It is the opinion of management, based on the advice of counsel, that the University’s liability insurance is sufficient to cover the potential judgments and that the outcome of the suits will not have a material adverse effect on the financial position or operations of the University.

(14) Subsequent Events On August 29, 2016, the University entered into an investment management agreement with Investure, LLC, a Delaware limited liability company, for investment advisory and management services. The scope of the agreement pertains to the management of the University’s Consolidated Endowment Fund. An initial amount of approximately $562 million will be managed by Investure, LLC on a discretionary basis. The University has authorized Investure, LLC to act as the University’s attorney-in-fact to enter into, make, execute and perform agreements or other undertakings on behalf of the University in connection with each investment.

33 (Continued)

APPENDIX B

CERTAIN DEFINITIONS AND SUMMARIES OF CERTAIN PROVISIONS OF THE INDENTURE AND THE LOAN AGREEMENT

The following constitutes summaries of certain portions of the Indenture and the Loan Agreement. The summaries do not purport to be complete and reference is hereby made to the full text of each such document for a complete description thereof. Copies of the Indenture and the Loan Agreement are available from the sources listed in “INTRODUCTION--Additional Information.”

DEFINITIONS

The following are definitions of certain terms used in the Indenture, the Loan Agreement and this Official Statement. As used herein, the term “Bonds” refers to the 2013 Bonds, and the term “Corporation” refers to the University.

“Accountant” means any independent public accounting firm licensed to practice in the State of Colorado (which may be the firm of accountants who regularly audit the financial statements of the Corporation) from time to time selected by the Corporation.

“Additional Parity Indebtedness” means any Indebtedness incurred in accordance with the Loan Agreement (other than the Loan but including the Prior Parity Bonds) secured on a parity with the obligations of the Corporation under the Loan Agreement (except that the owners of such Indebtedness shall have no interest in the Funds and other trust accounts created in the Indenture and shall have no interest in moneys provided by any credit enhancement device for the Bonds).

“Authorized Representative” means, in the case of the Authority, the Chairman, any Vice-Chairman, any Assistant Vice-Chairman or the Executive Director thereof or, in the case of the Corporation, the Treasurer, the Assistant Treasurer, the Chancellor, the Vice- Chancellor for Financial Affairs, the Chairman, the Vice-Chairman, the Provost or the Controller thereof, and, when used with reference to the performance of any act, the discharge of any duty or the execution of any certificate or other document, any officer, employee, or other person authorized to perform such act, discharge such duty, or execute such certificate or other document.

“Bond Interest Fund” means the Bond Interest Fund created under the Indenture.

“Bond Principal Fund” means the Bond Principal Fund under the Indenture.

“Bonds” means the Series 2017A Bonds and the Series 2017B Taxable Bonds.

“Building” means that certain building or buildings and all other structures and facilities now owned or hereafter acquired (excluding equipment, but including all fixtures, heating and air conditioning equipment and all other equipment and machinery affixed to the Land or Building) which are located on the Land, as they may from time to time exist.

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“Business Day” means any day other than a Saturday or Sunday or a day on which banking institutions in the State of Colorado are authorized to close.

“Code” means the Internal Revenue Code of 1986, as amended to the date of delivery of the Bonds, and the regulations prescribed thereunder.

“Commitment Indebtedness” means the obligation of any person to repay amounts disbursed pursuant to a commitment from a financial institution to refinance when due other Indebtedness of such person or purchase when tendered for purchase by the holder thereof in accordance with the terms thereof other Indebtedness of such person, which other Indebtedness would be classified as Short-Term Indebtedness or Indebtedness described in the first sentence of the definition of “Maximum Annual Debt Service” set forth below, and which other Indebtedness was incurred in accordance with the provisions of the Loan Agreement, plus any fees payable to such financial institution for such commitment and any other ascertainable expenses thereunder.

“Completion Indebtedness” means any Long-Term Additional Parity Indebtedness incurred by the Corporation for the purpose of financing the completion of a project for which the Bonds or Long-Term Additional Parity Indebtedness has theretofore been incurred.

“Consultant” means an independent consulting or management firm selected by the Corporation and accepted by the Authority and the Trustee as having a national reputation in the field of consulting or management of private institutions of higher education.

“Corporation” means (i) Colorado Seminary, a Colorado corporation pursuant to a legislative charter of March 5, 1864 adopted by the Council and House of Representatives of the Territory of Colorado or (ii) any surviving, resulting or transferee corporation as provided in Section 8.2 hereof, constituting an “educational institution” within the meaning of the Act. The Corporation is referred to as the University in the body of this Official Statement.

“Cost of the Project” means the sum total of all reasonable or necessary costs incidental to the Project which may be financed pursuant to the Act, including, without limitation, the initial fees and expenses of the Trustee, the payment of accrued interest and premium, if any, capitalized interest, if any, and all other necessary and incidental expenses in connection with the foregoing, and payment of certain costs of issuance of the Bonds.

“Debt Service Coverage Ratio” means the ratio for the period in question of Net Income Available for Debt Service to Maximum Annual Debt Service.

“Exempt Person” means a state or local governmental unit or an organization exempt from federal income taxation under section 501(a) of the Code by reason of being described in section 501(c)(3) of the Code.

“Expendable Resources” means all of the Corporation’s (A) unrestricted net assets and temporarily restricted net assets, less (B) the number derived by subtracting (i) outstanding long term debt from (ii) net property plant, and equipment, all as determined in accordance with generally accepted accounting principles.

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“Facilities” means the Land and the Building.

“Fiscal Year” means the Corporation’s Fiscal Year, which currently begins on July 1 and ends on June 30 of the following calendar year.

“Government Obligations” means (i) cash (insured at all times by the Federal Deposit Insurance Corporation or otherwise collateralized with obligations described in (ii) hereof, or (ii) direct obligations of (including obligations issued or held in book entry form on the books of) the Department of the Treasury of the United States of America.

“Gross Revenues” means all revenues of the Corporation including, but not limited to, (i) investment income (excluding income from Irrevocable Deposits), (ii) rental income, (iii) income from the operations of the Facilities, (iv) net proceeds of business interruption insurance, if any, (v) income from tuition, fees, charges (whether such tuition, fees and charges are paid by or on behalf of students or by any other party) and quasi-endowments, (vi) gifts, donations, pledges, grants, legacies, bequests, devises and contributions heretofore or hereafter made, and the income derived therefrom (collectively, “Donated Property”), but only to the extent that the Donated Property is not specifically restricted by the donor or grantor to a particular purpose inconsistent with its use for payment of Loan Payments, and (vii) all other accounts receivable, revenues, profits and receipts derived by or on behalf of the Corporation from any source; provided, however, that this definition shall not include rental income, income from operations, insurance proceeds, accounts receivable, revenues, profits and receipts relating to or derived from Property not included within the Facilities.

“Guaranty” means all loan commitments of the Corporation and all obligations of the Corporation guaranteeing in any manner whether directly or indirectly, any obligation of any Person which would, if such Person were the Corporation, constitute Indebtedness.

“Indebtedness” means all indebtedness of the Corporation for borrowed moneys, or which has been incurred or assumed in connection with the acquisition of Property, all indebtedness, no matter how created, secured by Property, whether or not such indebtedness is assumed by the Corporation, any leases required to be capitalized in accordance with generally accepted accounting principles, installment purchase obligations and Guaranties. Indebtedness shall not include obligations of the Corporation for taxes, assessments and governmental charges or levies and claims for labor and materials (as and to the extent permitted to remain unpaid and undischarged pursuant to the Loan Agreement), accounts payable or other obligations of the Corporation incurred in the ordinary course of business, which obligations are not required to be capitalized in accordance with generally accepted accounting principles.

For all purposes of determining the amount of Indebtedness pursuant to the Loan Agreement, Indebtedness shall not include any requirement to pay principal of, premium, if any, or interest on any obligation to the extent that Irrevocable Deposits sufficient to pay such principal, premium, if any, or interest have been made. In addition, there shall be included in Indebtedness for purposes of the computations and covenants in the Loan Agreement 30% of the debt service relating to each Guaranty entered into by the Corporation. If the Corporation must pay any amount pursuant to a Guaranty, the full amount of such Guaranty will be included for purposes of this calculation for two calendar years from the date of such payment forward notwithstanding the provisions described in the preceding sentence.

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“Insurance Consultant” means an insurance consultant and/or risk management firm or an insurance broker or an insurance agent (which may be a consultant, firm, broker or agent with whom the Corporation, the Authority or the Trustee regularly transacts business) selected by the Corporation.

“Investment Obligations” means those investment obligations set forth in the Indenture as such list may be amended from time to time.

“Irrevocable Deposit” means the irrevocable deposit in trust of cash in an amount (or Government Obligations or obligations having a rating in one of the three highest rating categories assigned by any nationally recognized rating agency, the principal of and interest on which will be in an amount) and under terms sufficient to pay all or a specified portion of the principal of, premium, if any, and/or the interest on, as the same shall become due, any Indebtedness which would otherwise be considered Outstanding. The trustee of such deposit shall have possession of any cash and securities (other than book entry securities) and may be the Trustee or any other trustee authorized to act in such capacity.

“Land” means the real estate, interests in real estate, and other real property rights described in Exhibit A to the Loan Agreement, which are owned by the Corporation, together with all real estate, interests in real estate and other real property rights made a part of the Land in connection with the issuance of Additional Parity Indebtedness, or in connection with the substitution of such real estate, and other real property rights or as the result of replacement of property taken in condemnation, or otherwise, less such real estate, interests in real estate and other real property rights released, or taken by the exercise of the power of eminent domain as provided in the Loan Agreement.

“Lien” means any mortgage or pledge of, security interest in, or lien or encumbrance on, any Property which secures any Indebtedness or other obligation of the Corporation or which secures any obligation of any person other than an obligation to the Corporation but excluding liens applicable to Property in which the Corporation has only a leasehold interest unless the lien secures Indebtedness.

“Loan” means the loan by the Authority to the Corporation of the proceeds from the sale of the Bonds pursuant to the Loan Agreement.

“Loan Payments” means the payments required to be paid by the Corporation pursuant to the Loan Agreement.

“Long-Term” means, with respect to Indebtedness, having an original term greater than one year or renewable at the option of the Corporation for a period greater than one year from the date of original issuance thereof.

“Maximum Annual Debt Service” means as of any date of calculation the highest principal and interest payment requirements with respect to the Bonds and Long-Term Additional Parity Indebtedness for any succeeding Fiscal Year excluding the amount of interest on Indebtedness payable in such period from the proceeds of such Indebtedness deposited with a trustee for such purpose and excluding Indebtedness for the payment of which an Irrevocable Deposit has been made; provided that if any such Indebtedness is subject to redemption or tender for purchase at the option of the holder prior to maturity, the term of such Indebtedness will be B-4

deemed to be the stated term of such Indebtedness and provided further, that if any such Indebtedness has 20% or more of the original principal amount thereof payable in any one Fiscal Year, such Indebtedness will be treated for purposes of this calculation as if the principal amount of such Indebtedness were amortized over the greater of the stated term of such Indebtedness or 20 years and as if the interest rate were as assumed by an expert reasonably selected by the Trustee based on present market conditions in a certificate filed with the Corporation. In addition, if interest on any Indebtedness is payable pursuant to a variable interest rate formula or is otherwise incapable of determination, such Indebtedness shall be assumed to bear interest at a fixed rate equal to the average of the daily interest rate on such Indebtedness during the twelve months preceding the calculation or during such time the Indebtedness has been Outstanding if less than twelve months, and if such Indebtedness is not at the time of calculation Outstanding, it shall be deemed to have borne interest at a fixed rate equal to the average daily interest rate such Indebtedness would have borne according to the applicable rate formula had it been outstanding for the preceding twelve month period.

In the case of any interest rate exchange agreements entered into by the Corporation for a term exceeding one year pursuant to which the Corporation is obligated to make interest-like payments to or on behalf of another person and that person is obligated to make similar interest-like payments to or on behalf of the Corporation (based on a different rate of or formula for interest), with neither party obligated to repay any principal, the net amount to be paid by the Corporation (computed in accordance with this sentence) shall be taken into account in calculating Maximum Annual Debt Service; if such net amount is less than zero, such net amount may be credited against other interest coming due in so calculating Maximum Annual Debt Service. In the event the Corporation enters into any interest rate exchange agreement with a person other than a Qualified Counterparty, the calculation of Maximum Annual Debt Service shall not be subject to adjustment as provided in this paragraph.

No debt service shall be deemed payable with respect to Commitment Indebtedness until such time as funding occurs (which has not been reimbursed) under the commitment which gave rise to such Commitment Indebtedness. From and after such funding, the amount of such debt service shall be calculated in accordance with the actual amount required to be repaid on such Commitment Indebtedness and the actual interest rate and amortization schedule applicable thereto utilizing the various assumptions contained in above. No additional Indebtedness shall be deemed to arise when any funding occurs under any such commitment or any such commitment is renewed upon terms which provide for substantially the same terms of repayment of amounts disbursed pursuant to such commitment as obtained prior to such renewal.

“Net Income Available for Debt Service” means, as to any period of time, the excess of all operating revenues of the Corporation (excluding income from Irrevocable Deposits) over operating expenses (inclusive of payments to pension, retirement, health and hospitalization funds), excluding from such expenses depreciation, amortization, interest expense with respect to the Bonds and Long-Term Additional Parity Indebtedness, and expenses relating to gifts, donations, pledges, grants, legacies, bequests, devises and contributions heretofore or hereafter made to the extent specifically restricted by the donor to a particular purpose inconsistent with their use for payment of debt service on Indebtedness or operation and maintenance expenses (“Restricted Gifts”) to the extent of the income on such Restricted Gifts, all as determined in accordance with generally accepted accounting principles (as in effect on the

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date of calculation or, in the case of audited financial statements, as of the date of the relevant report thereon) consistently applied, and also excluding from revenues Restricted Gifts and the income derived therefrom; provided, that no determination thereof shall take into account any gain or loss resulting from either the extinguishment of Indebtedness or the sale, exchange or other disposition of capital assets not in the ordinary course of business.

“Net Proceeds” means, when used with respect to any insurance payment or condemnation award, the gross proceeds thereof less the expenses (including attorneys’ fees) incurred in the collection of such gross proceeds.

“Opinion of Counsel” means an opinion in writing of legal counsel, who may be counsel to the Authority, the Trustee or the Corporation.

“Non-Recourse Indebtedness” means any Indebtedness secured by a Lien, liability for which is effectively limited to the Property (other than the Facilities or any portion thereof) subject to such Lien with no recourse, directly or indirectly, to any other Property of the Corporation.

“Other Indebtedness” means any Indebtedness other than the Bonds and Additional Parity Indebtedness.

“Outstanding” when used with reference to Indebtedness under the Loan Agreement, means, as of any date of determination, all Indebtedness theretofore issued or incurred and not paid and discharged other than (a) Indebtedness theretofore canceled by the Trustee or the holder of such Indebtedness or delivered to the Trustee or the holder for cancellation, (b) Indebtedness deemed paid and no longer Outstanding as provided in the Indebtedness instrument, (c) any evidence of Indebtedness held by the Corporation and (d) evidence of Indebtedness and any coupons appurtenant thereto in lieu of which other evidence of indebtedness has been authenticated and delivered or has been paid pursuant to the provisions of the documents pursuant to which it was issued regarding mutilated, destroyed, lost or stolen evidence of Indebtedness unless proof satisfactory to the Trustee has been received that any such evidence of Indebtedness is held by a bona fide purchaser.

If two or more instruments represent the same underlying Indebtedness, for purposes of the various financial covenants contained in the Loan Agreement, but only for such purposes, only the instrument or instruments on which payments are then being made shall be deemed Outstanding.

“Outstanding” when used with reference to the Bonds pursuant to the Indenture means, as of any particular time, all Bonds which have been duly authenticated and delivered by the Trustee under the Indenture, except (a) Bonds theretofore canceled by the Trustee or delivered to the Trustee for cancellation after purchase in the open market or because of payment at or redemption prior to maturity; (b) Bonds for the payment or redemption of which cash funds (or securities to the extent permitted by the Indenture) shall have been theretofore deposited with the Trustee (whether upon or prior to the maturity or redemption date of any such Bonds); provided that if such Bonds are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given or arrangements satisfactory to the Trustee shall have been made therefor, or waiver of such notice satisfactory in form to the Trustee, shall have been filed with the Trustee; and provided further, that if the moneys and/or securities to pay the principal B-6

and/or interest due on the Bonds shall have been provided by the; (c) Bonds in lieu of which other Bonds have been authenticated under those Indenture provisions relating to registration, transfer and exchange of bonds and lost, stolen, destroyed and mutilated bonds; and (d) Bonds which have become due and payable by redemption pursuant to the terms of the Indenture.

“Parity Instrument” means any instrument creating or securing Additional Parity Indebtedness.

“Person” includes an individual, association, company or limited liability company or similar organization, corporation, partnership, limited liability partnership or similar organization, joint venture or a government or an agency or a political subdivision thereof.

“Project” means the acquisition, construction, renovation and equipping of: (i) a multiple story residence hall; (ii) the Driscoll Student Center on the University’s central campus; (iii) a multiple story Career Achievement Center and (iv) such other capital improvements undertaken by the Corporation on the Land.

“Project Fund” means the Project Fund created under the Indenture and the accounts therein.

“Prior Parity Bonds” means the 2007 Bonds, the 2008 Bonds, the 2013 Bonds, the 2014A Bonds and the 2014B Bonds at any time then Outstanding.

“Property” means any and all rights, title and interest in and to any and all property of the Corporation whether real or personal, tangible or intangible and wherever situated and whether now owned or hereafter acquired.

“Qualified Counterparty” means any bank or trust company organized under the laws of any state or the United States of America or any national banking association, insurance company or broker or dealer (as defined by the Securities Exchange Act of 1934, as amended) or other financial institution which is a member of the Securities Investors Protection Corporation, whose unsecured obligations are rated in one of the two highest rating categories by either Moody’s Investors Service Inc. or S&P Global Ratings or their successors or assigns.

“Series 2017A Bonds” means the “Educational and Cultural Facilities Authority Revenue Bonds (University of Denver Project) Tax-Exempt Series 2017A” to be authenticated and delivered under the Indenture.

“Series 2017B Taxable Bonds” means the “Educational and Cultural Facilities Authority Revenue Bonds (University of Denver Project) Taxable Series 2017B” to be authenticated and delivered under the Indenture.

“Short-Term” when used in connection with Indebtedness, means having an original maturity less than or equal to one year and not renewable at the option of the Corporation for a term greater than one year beyond the date of original issuance, except that such Indebtedness does not include that which the Corporation certifies to the Authority and the Trustee is to be refinanced and not retired with revenues of the Corporation at maturity.

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“Tax Compliance Certificate” means the Tax Compliance Certificate delivered by the Corporation in connection with the initial issuance and delivery of the Series 2017A Bonds, as modified from time to time pursuant to its terms.

“Total Operating Revenues” means the total operating revenues of the Corporation as determined in accordance with generally accepted accounting principles.

“Trustee” means UMB Bank, n.a., in its capacity as trustee, being the paying agent, the registrar and the trustee under the Indenture, or any successor corporate trustee.

“Trust Estate” means the property pledged and assigned to the Trustee pursuant to the granting clauses in the Indenture.

“2007 Bonds” means the “Colorado Educational and Cultural Facilities Authority Refunding Revenue Bonds (University of Denver Project) Series 2007.”

“2008 Bonds” means the “Colorado Educational and Cultural Facilities Authority Refunding Revenue Bonds (University of Denver Project) Series 2008.”

“2013 Bonds” means the “Colorado Educational and Cultural Facilities Authority Refunding Revenue Bonds (University of Denver Project) Series 2013.”

“2014A Bonds” means the “Colorado Educational and Cultural Facilities Authority Refunding Revenue Bonds (University of Denver Project) Series 2014A.”

“2014B Bonds” means the “Colorado Educational and Cultural Facilities Authority Refunding Revenue Bonds (University of Denver Project) Series 2014B.”

THE INDENTURE

General

The Indenture is a contract between the Authority and the Trustee for the benefit of the owners of the Bonds issued pursuant to the Indenture.

Pledge and Agreement of the State of Colorado

By the enactment of Section 23-15-124 of the Act, the State has pledged to and agreed with the owners of any bonds, notes, and other obligations issued under the Act, and with those parties who may enter into contracts with the Authority pursuant to the provisions of the Act, that the State will not limit, alter, restrict, or impair the rights vested in the Authority to acquire, construct, reconstruct, maintain, and operate any facility as defined in the Act or to establish, revise, charge, and collect rates, rents, fees, and other charges as may be convenient or necessary to produce sufficient revenues to meet the expenses of maintenance and operation thereof and to fulfill the terms of any agreements made with the owners of bonds, notes, or other obligations authorized and issued pursuant to the Act, and with the parties who may enter into contracts with the Authority pursuant to the Act, and will not in any way impair the rights or remedies of the owners of such bonds, notes, or other obligations of such parties until such B-8

bonds, notes, or other obligations, together with interest thereon, with interest on any unpaid installment of interest and all costs and expenses in connection with any action or proceeding by or on behalf of such owners, are fully met and discharged and such contracts are fully performed on the part of the Authority. Nothing in the Act precludes such limitation or alteration if and when adequate provision is made by law for the protection of the owners of such bonds, notes, or other obligations of the Authority or those entering into such contracts with the Authority.

Pledge of Trust Estate

Subject only to the rights of the Authority to apply amounts under the provisions of the Indenture, a pledge of the Trust Estate to the extent provided in the Indenture is made, and the same is pledged to secure the payment of the principal of and interest on the Bonds. The pledge made in the Indenture shall be valid and binding from and after the time of the delivery by the Trustee of the first Bond authenticated and delivered under the Indenture. The security so pledged and then or thereafter received by the Authority shall immediately be subject to the lien of such pledge and the obligation to perform the contractual provisions made in the Indenture shall have priority over any or all other obligations and liabilities of the Authority with respect to the Trust Estate and the lien of such pledge shall be valid and binding as against all parties having claims of any kind in tort, contract, or otherwise against the Authority irrespective of whether such parties have notice thereof.

Limited Obligation

The Bonds shall be limited obligations of the Authority payable solely out of the security specified in the Indenture. The Bonds shall not constitute or become an indebtedness, a debt, or a liability of or a charge against the general credit or taxing power of the State, the General Assembly of the State, or of any county, city, city and county, town, school district, or other political subdivision of the State, or of any other political subdivision or body corporate and politic within the State other than the Authority (but only to the extent provided in the Indenture) and neither the State, the General Assembly of the State, nor any county, city, city and county, town, school district, or other subdivision of the State except the Authority to the extent provided above shall be liable thereon; nor shall the Bonds constitute the giving, pledging, or loaning of the faith and credit of the State, the General Assembly of the State, or any county, city, city and county, town, school district, or other subdivision of the State or of any other political subdivision or body corporate and politic within the State but shall be payable solely from the funds provided therefor in the Indenture. The issuance of the Bonds shall not, directly, indirectly or contingently, obligate the State or any subdivision of the State nor empower the Authority to levy or collect any form of taxes or assessments therefor or to create any indebtedness payable out of taxes or assessments or make any appropriation for their payment, and such appropriation or levy is prohibited. Nothing in the Act shall be construed to authorize the Authority to create a debt of the State within the meaning of the Constitution or statutes of the State or authorize the Authority to levy or collect taxes or assessments. Neither the members of the Authority nor any person executing the Bonds shall be liable personally on the Bonds or be subject to any personal liability or accountability by reason of the issuance thereof. The State shall not in any event be liable for the payment of the principal of, premium, if any, or interest on the Bonds or for the performance of any pledge, mortgage, obligation, or agreement of any kind whatsoever undertaken by the Authority. No breach of any such pledge, mortgage, obligation, or

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agreement shall impose any pecuniary liability upon the State or any charge upon its general credit or against its taxing power.

Establishment of Funds

The Indenture creates the Bond Principal Fund, the Bond Interest Fund, the Issuance Expense Fund, the Project Fund and the Rebate Fund, all of which are to be held in trust by the Trustee for the purposes specified in the Indenture.

Bond Interest Fund and Bond Principal Fund

There shall be deposited into the Bond Interest Fund the capitalized interest designated in the Agreement for deposit therein. There shall be deposited into the Bond Interest Fund and the Bond Principal Fund, as appropriate, and as and when received by the Trustee, (i) the payments of interest to be made by the Corporation pursuant to the Loan Agreement, (ii) all moneys transferred to the Bond Principal Fund and the Bond Interest Fund from the Project Fund to the extent provided in the Indenture, (iii) all other moneys deposited into such Fund pursuant to the Loan Agreement or the Indenture, and (iv) all other moneys received by the Trustee when accompanied by directions not inconsistent with the Loan Agreement or the Indenture that the moneys be deposited into the Bond Principal Fund or Bond Interest Fund. Subject to any necessary transfers to the Rebate Fund, investment income of the Bond Principal Fund and Bond Interest Fund moneys will be retained in the Bond Principal Fund or the Bond Interest Fund, respectively.

Except in the case of default by the Corporation, upon payment in full of the Bonds or if required to fund the Rebate Fund, moneys in the Bond Principal Fund and Bond Interest Fund are to be used solely for the payment of principal of, premium, if any, and interest on the Bonds. Whenever the total amount in the Bond Principal Fund and the Bond Interest Fund is sufficient to redeem all of the Bonds Outstanding and to pay interest to accrue thereon prior to such redemption, and redemption premium, if any, the Trustee, subject to the requirements of the Loan Agreement, will take and cause to be taken the necessary steps to redeem all of the Bonds on the redemption date for which the required redemption notice has been given.

Project Fund

The proceeds of the sale of the Bonds remaining after the required deposits to the Bond Interest Fund, consisting of capitalized interest, and the Issuance Expense Fund shall be deposited in the respective accounts of the Project Fund as provided in the Indenture. There shall be deposited into the Project Fund all other moneys the Corporation makes available to pay the Cost of the Project. Except as otherwise provided in the Indenture, the proceeds in the Project Fund shall be expended as described in the Loan Agreement and the Trustee shall be furnished with copies of all requisitions. The Trustee is hereby authorized and directed to issue its checks on the Project Fund accounts for each payment pursuant to the Loan Agreement but the Trustee may, prior to any such payment, require proof from the Corporation that such payment is reasonable, necessary, and authorized. The Trustee shall keep and maintain adequate records pertaining to the Project Fund and all payments therefrom, which shall be open to inspection by the Authority, the B-10

Corporation, or their duly authorized agents during normal business hours of the Trustee. After the Project has been completed and the certificate of an Authorized Representative of the Corporation filed as provided in the Indenture, the Trustee shall file a statement of income and disbursements with respect to the Project Fund with the Authority and the Corporation.

Issuance Expense Fund

Certain amounts from the proceeds of the Bonds will be deposited into the Issuance Expense Fund. Moneys in the Issuance Expense Fund will be used to pay issuance expenses incurred by the Corporation in connection with this financing. Upon receipt by the Trustee of a certificate of the Corporation to the effect that all expenses incurred in connection with this financing have been paid, any moneys remaining in the Issuance Expense Fund will be transferred to the Bond Interest Fund. Subject to the preceding and any necessary transfers to the Rebate Fund, any moneys received as investment income on the moneys in the Issuance Expense Fund will be retained in the Issuance Expense Fund.

Rebate Fund

The Corporation must provide, each five years, to the Trustee a certificate of the Corporation that (i) all requirements of the Loan Agreement, the Indenture and the Tax Compliance Certificate with respect to the Rebate Fund have been met on a continuing basis, (ii) the proper amounts are on deposit in the Rebate Fund and (iii) timely payment of amounts due to the United States Treasury, if any, have been made. The Corporation may either (i) transmit the amounts required to make such certification to the Trustee for deposit in the Rebate Fund or for payment to the United States Treasury, or (ii) direct the Trustee to transfer available investment income in any Fund to the Rebate Fund or the United States Treasury, subject to the provision that no transfer may be made if such transfer would cause the amount then on deposit in such Fund to be less than required under the Indenture. If the Corporation does not fund the Rebate Fund as required by the Indenture and there is not sufficient investment income subject to transfer from the other funds, the Trustee is required to make up the deficiency in the Rebate Fund by transferring moneys from the following funds in the following order of priority: the Project Fund, the Issuance Expense Fund, the Bond Principal Fund and the Bond Interest Fund. Any money received as investment income on the moneys in the Rebate Fund will be retained in the Rebate Fund, provided however, if the Trustee receives an opinion of nationally recognized bond counsel that the amount in the Rebate Fund is in excess of the amount required, the excess will be transferred to the Bond Interest Fund.

Investment of Funds

The moneys held by the Trustee in the various Funds created under the Indenture are to be invested in Investment Obligations, all in accordance with instructions from the Corporation to the Trustee. The Investment Obligations are to mature or be redeemable within designated time limits and prior to the time when the moneys so invested will be required for expenditure and will be valued as described in the Indenture. Any loss suffered from any investment will be charged to the Fund with respect to which the investment was made. The Trustee is specifically authorized to purchase or invest in shares of any investment company that (i) is registered under the Investment Company Act of 1940, as amended (including both corporations and Massachusetts business trusts, and including companies for which the Trustee may provide advisory, administrative, custodial, or other services for compensation), (ii) invests B-11

substantially all of its assets in short-term high-quality money-market instruments, limited to obligations issued or guaranteed by the United States, and (iii) maintains a constant asset value per share.

Discharge

When the Bonds become due and payable and the whole amount of the principal of, premium, if any, and interest due and payable upon all of the Bonds have been paid, or provisions have been made for such payment, together with the payment of all other sums payable under the Indenture, including all amounts payable to the Authority and all amounts payable to the United States pursuant to Section 148 of the Code, then the Indenture and all rights granted therein will cease, terminate and become void and be discharged and satisfied, and the right, title, and interests of the Trustee under the Indenture and all obligations to the owners of the Bonds (except with respect to the moneys or securities described in the next paragraph) will thereupon cease, terminate and become void and be discharged and satisfied.

Any Outstanding Bond will be deemed to have been paid prior to maturity or redemption when (a) in case said Bond is to be redeemed on any date prior to its maturity, the Corporation has given to the Trustee irrevocable instructions to give notice of redemption of such Bond, (b) there have been deposited in trust either moneys in an amount which will be sufficient (or Government Obligations which do not contain provisions permitting the redemption thereof at the option of the issuer, the principal of and the interest on which when due, and without any reinvestment thereof, will provide moneys which, together with the moneys, if any, deposited with or held in trust at the same time, will be sufficient) to pay when due the principal of, premium, if any, and interest due and to become due on said Bond on or prior to its redemption or maturity date, (c) in the event such payment would constitute an advance refunding under the Internal Revenue Code of 1986, an opinion of bond counsel satisfactory to the Trustee and the Authority that such payment does not adversely affect the exclusion from gross income of the interest on the Series 2017A Bonds s and a report from a firm of certified public accountants certifying as to the sufficiency of the deposit to pay the Bonds when due and that the yield on the investment of such deposit complies with the Code of 1986, as amended, and (d) in the event said Bond is not subject to redemption within the next 60 days, the Corporation has given the Trustee irrevocable instructions to give, as soon as practicable, a notice to the owner of such Bond that the deposit required by (b) above has been made with the Trustee and that said Bond is deemed to have been paid and stating such maturity or redemption date upon which moneys are to be available for the payment of the principal of, premium, if any, and interest on said Bond.

Events of Default

Under the Indenture an “Event of Default” is defined to include, in general terms (a) default in making payment of principal of, premium if any, or interest on any Bond when due, (b) the occurrence of any “event of default” under the Loan Agreement, and (c) any default in the observance or performance of any other provision in the Bonds or the Indenture which continues for 30 days after written notice to the Authority, the Corporation and the Trustee from the owners of at least 25% in aggregate principal amount of the Bonds and Additional Parity Indebtedness then Outstanding or to the Authority and the Corporation from the Trustee, provided, with respect to any such failure, no Event of Default will be deemed to have occurred so long as a course of action adequate in the judgment of the Trustee to remedy such failure will B-12

have been commenced within such 30 day period and will thereafter be diligently prosecuted to completion and the failure shall be remedied thereby.

Remedies on Default

Under the Indenture, upon the occurrence of an Event of Default the Trustee has the following rights and remedies. The Trustee may, or upon the written request of the owners of not less than a majority in aggregate principal amount of the Bonds and Additional Parity Indebtedness then Outstanding, (after indemnification as provided in the Indenture), declare all the Bonds immediately due and payable. In addition, upon the occurrence of an Event of Default the Trustee may seek the appointment of a receiver or sue to recover a judgment. The remedies specified in the Indenture are cumulative and are not intended to be exclusive.

The Trustee may in its discretion waive any Event of Default under the Indenture and its consequences and may rescind any declaration of acceleration of maturity of principal of and interest on the Bonds and Additional Parity Indebtedness and will do so upon the written request of the owners of a majority in aggregate principal amount of all the Bonds and Additional Parity Indebtedness then Outstanding in respect of which default exists. However, the Trustee may not waive (a) any Event of Default in the payment of the principal of, or premium on, any Outstanding Bonds or Additional Parity Indebtedness at the date of maturity or redemption thereof, or (b) any default in the payment when due of the interest on any such Bonds or Additional Parity Indebtedness, unless prior to such waiver or rescission, all arrears of interest or all arrears of payments of the principal and premium, if any (with penalty interest to the extent provided), and all amounts to be paid to the Authority and the Trustee under the Indenture and under the Loan Agreement, in connection with such default, will have been paid or provided for.

No owner of any Bond or any Additional Parity Indebtedness will have the right to institute any suit, action or proceeding for the enforcement of the Indenture unless, as more specifically provided in the Indenture, the Trustee has resigned or has failed to proceed within a reasonable time after having been requested to institute such suit, action or proceeding by the owners of not less than a majority in aggregate principal amount of Bonds and Additional Parity Indebtedness then Outstanding and has been offered reasonable indemnity against the costs and liabilities to be incurred. The owners of a majority in aggregate principal amount of Bonds and Additional Parity Indebtedness then Outstanding will have the right, at any time and to the extent permitted by law, to direct the time, method and place of conducting all proceedings to be taken in connection with the enforcement of the terms and conditions of the Indenture, provided such directions are in accordance with the provisions of the Indenture and provided satisfactory indemnity is furnished to the Trustee.

The Indenture provides that all moneys collected by the Trustee pursuant to its provisions concerning remedies on default, after payment of the expenses of the collection proceedings, will be deposited into a separate trust account and applied to the Bonds and Additional Parity Indebtedness in the order and manner set forth in the Indenture. Notwithstanding any other provisions, all moneys held as described in this paragraph which relate to moneys in any of the Funds will be applied only to payment of principal of and interest on the Bonds. All other moneys held as described in this paragraph will be applied to the payment of all Bonds and any Additional Parity Indebtedness specifically secured thereby.

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Supplemental Indentures of Trust

Supplemental Indentures Not Requiring Consent of Bondholders. Without the consent of or notice to any of the owners of the Bonds, the Trustee may, at any time enter into supplemental indentures for the following purposes: (a) to add covenants and agreements to the Indenture for the protection or benefit of the owners of the Bonds, (b) to cure any ambiguity, or to cure, correct or supplement any defect or inconsistent provision in the Indenture or to make any provisions with respect to matters arising under the Indenture or for any other purpose if, in the opinion of the Trustee, which may be in reliance upon an opinion of counsel, such provisions are necessary or desirable and do not materially adversely affect the interests of the owners of the Bonds, (c) to subject to the lien of the Indenture additional revenues, properties or collateral, (d) in connection with the issuance of Additional Parity Indebtedness pursuant to the provisions of the Loan Agreement or (e) to permit the qualification of the Indenture under the Trust Indenture Act of 1939, as amended.

Supplemental Indentures Requiring Consent of Bondholders. Exclusive of the events described in the prior paragraph, with the consent of the owners of at least 66-2/3% in aggregate principal amount of the Bonds then Outstanding, the Authority and the Trustee may enter into supplemental indentures for any other purpose, except that no supplemental indenture without the consent of all owners of Bonds Outstanding adversely affected thereby may (i) extend the maturity, reduce the principal amount, reduce the rate of interest on or extend the time of payment of interest, or reduce any redemption premium of, any Bond, (ii) deprive any owner of a Bond then Outstanding of the lien created by the Indenture (other than as permitted by the Indenture when such Bond was initially issued), (iii) give a privilege or priority to any Bond over any other Bond, (iv) reduce the aggregate principal amount of the Bonds required for consent to any supplemental indenture or any amendment to the Loan Agreement, or (v) reduce the rights granted under the Indenture to the holders of Additional Parity Indebtedness (consent to such reduction must also be obtained as required under the Parity Instrument creating such Additional Parity Indebtedness).

The Indenture describes the procedures to be used to give notice to and to obtain the consent of the owners of any Bonds whenever the Authority and the Trustee propose to enter into a supplemental indenture requiring such consents.

Amendments to Loan Agreement. Pursuant to the Indenture, the Loan Agreement may be amended as described in “THE LOAN AGREEMENT--Amendments to the Loan Agreement” below.

Trustee

Under the Indenture, in connection with actions to be taken with respect to defaults, the Trustee will be entitled to require indemnification against any liabilities which it may incur in the exercise and performance of its powers and duties under the Indenture and which are not due to its negligence or willful default. The Indenture establishes procedures and conditions for the resignation or removal of the Trustee and for the appointment of successors by the owners of a majority in aggregate principal amount of the Bonds then Outstanding. Prior to the appointment of a successor Trustee by the owners of the Bonds, the Authority may appoint an interim successor Trustee.

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If an Event of Default occurs of which the Trustee is required to take notice, or if notice of an Event of Default is given, then the Trustee shall, within 30 days, give written or electronic notice thereof to the Bondholders of all Bonds then Outstanding, unless such Event of Default has been cured or waived.

The initial Trustee is UMB Bank, n.a., 1670 Broadway, Denver, Colorado 80202.

THE LOAN AGREEMENT

General

The Loan Agreement provides for the Loan from the Authority to the Corporation. The Corporation is obligated to repay the Loan by making Loan Payments of principal and interest to the Trustee for the account of the Authority for deposit into the Bond Principal Fund and the Bond Interest Fund created under the Indenture. See “THE INDENTURE--Bond Interest Fund and Bond Principal Fund.” The Corporation is also required to make Loan Payments equal to the redemption price of any Bonds called for prior redemption on or before the redemption date.

Under the loan agreement entered into in connection with the 2007 Bonds, the Corporation is obligated to deposit moneys (or reserve fund insurance policies) into bond reserve funds for those bonds. The Corporation has funded the required reserve requirement with a reserve fund insurance policies issued by a municipal bond insurance company. If draws are made on one or more of those reserve fund insurance policies to pay debt service on the 2007 Bonds, reimbursement must be made from Gross Revenues on a pro-rata basis.

The Corporation is obligated to operate and maintain the Facilities in substantial compliance with all governmental laws, building codes, ordinances, regulations and zoning laws and keep the Facilities reasonably safe and in good operating condition and in good repair. In addition, under the Loan Agreement the Corporation is obligated to pay all taxes and assessments relating to the Facilities, any other governmental charges and impositions on the Facilities and all utility and other charges related to the Facilities.

The Loan Agreement will remain in full force and effect from the date of its delivery until all of the Bonds have been fully paid or provision for such payment has been made pursuant to the Indenture, and all reasonable and necessary fees and expenses of the Trustee and the Authority, and all other liabilities of the Corporation, accrued and to accrue through final payment of the Bonds, have been paid or provision for such payment has been made pursuant to the Indenture; provided, however, notwithstanding any provision of the Loan Agreement, (i) the indemnification provisions set forth in the Indenture will survive the termination of the Loan Agreement and (ii) the Corporation’s tax covenants will survive the termination of the Loan Agreement until expiration of statutes of limitations applicable to bond owners for state income tax with respect to interest on the Bonds and federal income tax with respect to interest on the Series 2017A Bonds.

The Loan Agreement provides that the obligations of the Corporation will be absolute and unconditional. B-15

Security Provisions

To secure the payment of the Loan and Additional Parity Indebtedness and payment of all other amounts payable under the Loan Agreement, and the performance of its other covenants under the Loan Agreement, the Corporation grants to the Authority a present security interest, within the meaning of the Colorado Uniform Commercial Code and to the extent permitted by law, in the Gross Revenues. The Corporation’s pledge is on parity with the pledge thereof of the Prior Parity Bonds. The Corporation also pledges all its right, title and interest, if any, in the Funds and in any trust accounts referred to in the Loan Agreement and the Indenture.

Insurance Provisions

Throughout the term of the Loan Agreement, the Corporation agrees to maintain the following insurance:

(i) Insurance against loss or damage to the Facilities by all perils, with uniform standard extended coverage endorsement limited only as may be provided in the standard form of extended coverage endorsement at the time in use in the State, to such extent as is necessary to provide for not less than full recovery whenever a loss from perils insured does not exceed 90% of the full insurable value, but with deductible clauses in such amounts as are customary for facilities of similar size and character within the State.

(ii) Comprehensive general accident and public liability insurance (including coverage for all losses arising from the ownership or use of any vehicle) providing coverage limits (including deductible clauses) of not less than the coverage limits customarily carried by owners or operators of facilities of similar size and character within the State.

(iii) Fidelity insurance or bonds on those of its officers and employees who handle funds of the Corporation, both in such amounts and to such extent as are customarily carried by organizations similar to the Corporation and operating properties similar in size and character to the facilities of the Corporation.

(iv) Worker’s compensation insurance, disability benefits insurance and such other forms of insurance as the Corporation is required by law to provide with respect to the Facilities.

At least every three years from June 1, 2017, the Corporation will employ an Insurance Consultant to review its insurance coverage and to render to the Authority, the Corporation and the Trustee a report as to the adequacy of such coverage and as to its recommendations, if any, for adjustments thereto. Such insurance coverage must be increased or otherwise adjusted by the Corporation if as a result of such review the Insurance Consultant finds that the existing coverage is inadequate, taking into account the availability, terms, cost of such insurance, and the effect of such terms and such cost upon the Corporation’s costs and charges for its services. The insurance coverage required by the Loan Agreement may be reduced or otherwise adjusted by the Corporation without the consent of the Authority or the Trustee, provided that all coverages after such reduction or other adjustment are certified by the Insurance B-16

Consultant to be adequate and customary for facilities of like size and type, taking into account the aforementioned factors.

The Authority and Trustee may permit the Corporation to become self-insured (beyond customary deductibles) for all or any part of the foregoing requirements if the Trustee has received a written evaluation with respect to such self-insurance programs from a nationally recognized Insurance Consultant stating that such self-insurance is consistent with sound risk management policies.

The proceeds from casualty insurance will be disposed of as provided under the caption “Damage, Destruction and Condemnation,” below.

Damage, Destruction, and Condemnation

In the event damage or destruction to the Facilities occurs such that claims for loss are less than $2,000,000 or in the event title to or the temporary use of the Facilities or any portion thereof will be taken under the exercise of the power of eminent domain and the Net Proceeds from any condemnation award are less than $2,000,000, the Net Proceeds of insurance resulting from such claims or from any such condemnation award will be paid to the Corporation and will be used by the Corporation for such purposes as the Corporation deems appropriate. In the event any damage or destruction is such that claims for loss are $2,000,000 or more or the Net Proceeds from any condemnation award are $2,000,000 or more, all Net Proceeds of insurance resulting from such claims or from any such condemnation award will be held by the Trustee and the Corporation is required to elect either to have the Net Proceeds applied to the redemption of the Bonds and the payment of Additional Parity Indebtedness on a pro rata basis in accordance with Outstanding principal amount, or to repair, rebuild, restore or replace the property. If the Corporation elects the latter option, then the Net Proceeds will be paid out by the Trustee from time to time upon evidence of the expenditures therefor, upon receipt of a certificate of a consulting architect. The Corporation may elect to redeem less than all of the Bonds and pay less than all of the Additional Parity Indebtedness only if (a) the property damaged, destroyed or condemned is not essential to the Corporation’s use or occupancy of the Facilities; or (b) the Facilities have been restored to a condition substantially equivalent to their condition prior to such damage, destruction or condemnation; or (c) suitable improvements have been acquired for the Corporation’s operations at the Facilities.

Additional Indebtedness

The loan agreements for all of the Prior Parity Bonds contain the Additional Indebtedness tests described below. The Loan Agreement does not contain these provisions. The Corporation will no longer be required to comply with the test described below once all of the Prior Parity Bonds are retired or defeased.

Under the loan agreements for the Prior Parity Bonds, the Corporation covenanted that it will not incur any additional Indebtedness other than one or more of the following:

(a) Additional Parity Indebtedness (either Short-Term or Long-Term), if prior thereto, there is delivered to the Trustee any of the following:

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(i) a report of the Treasurer or Assistant Treasurer of the Corporation setting forth the Debt Service Coverage Ratio for the two most recent Fiscal Years for which audited financial statements are available, computed as if such proposed Additional Parity Indebtedness had been issued at the beginning of the first such Fiscal Year, and such Debt Service Coverage Ratio for each such Fiscal Year is not less than 1.15; or

(ii) the written consent of any other insurer of Additional Parity Indebtedness, if required by the applicable Parity Instrument; or

(iii) a report of the Treasurer or Assistant Treasurer of the Corporation stating that the Debt Service Coverage Ratio has not been less than 110% for each of the immediately preceding two Fiscal Years and (b) a report of the Treasurer or Assistant Treasurer stating that the projected Debt Service Coverage Ratio, taking the proposed Additional Parity Indebtedness into account, for (1) in the case of Long-Term Additional Parity Indebtedness (other than a Guaranty) to finance capital improvements, each of the two Fiscal Years succeeding the date on which such capital improvements are expected to be in operation, or (2) in the case of Long-Term Additional Parity Indebtedness not financing capital improvements or in the case of a Guaranty or Short-Term Additional Parity Indebtedness, for each of the two Fiscal Years succeeding the date on which the Additional Parity Indebtedness is incurred, is not less than 110%.

(b) Long-Term Indebtedness incurred to refund the Loan Agreement (or a part thereof), Additional Parity Indebtedness or Other Indebtedness if prior to incurrence thereof there is delivered to the Trustee and the Authority an opinion of independent counsel to the effect that upon the incurrence of such Long-Term Indebtedness and the application of the proceeds thereof, the Bonds or Indebtedness to be refinanced or refunded thereby will no longer be deemed to be Outstanding and the Trustee receives a certificate of an Authorized Representative of the Corporation stating that, taking the proposed Long-Term Indebtedness and the refunding of existing Bonds or other Indebtedness into account, Maximum Annual Debt Service will be reduced by any amount or will be increased by 10% or less; provided that for this paragraph (b), the debt service on the Indebtedness being refunded and the refunding Indebtedness shall be taken into account in calculating Maximum Annual Debt Service regardless of whether such Indebtedness is Additional Parity Indebtedness. Such Long-Term Indebtedness may be Additional Parity Indebtedness if it relates to Bonds or Additional Parity Indebtedness.

(c) Other Indebtedness (either Short-Term or Long-Term) (i) provided that such Indebtedness is secured by and payable solely from payments made to the Corporation pursuant to restricted contributions, grants, contracts, sponsored programs, or pledges or (ii) provided that immediately after the incurrence of such Indebtedness the aggregate principal of all Other Indebtedness Outstanding (and not incurred pursuant to clause (i) of this paragraph (c) or another paragraph under this caption) shall not exceed 25% of Total Operating Revenues for the immediately preceding Fiscal Year or the conditions described in paragraph (a) above are met and provided further that if such Other Indebtedness is Short-Term, during the 12 months immediately preceding the incurrence of such Indebtedness there shall have been a period of at least 30 consecutive days in which the amount of such Outstanding Short-Term Indebtedness did not exceed 5% of Total Operating Revenues in the immediately preceding Fiscal Year of the

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Corporation and provided further that the aggregate principal amount of all Short-Term Indebtedness incurred pursuant as described in this paragraph Outstanding shall not exceed 15% of Total Operating Revenues for the immediately preceding Fiscal Year of the Corporation.

(d) Non-Recourse Indebtedness without limit and without regard to paragraph (c) above.

(e) Commitment Indebtedness without limit and without regard to paragraph (c) above, which may be Additional Parity Indebtedness if it relates to Bonds or Additional Parity Indebtedness.

(f) Capital leases and obligations granting purchase money security interests not governed by paragraph (d) above and without regard to paragraph (c) above, but only to the extent that the total aggregate payments per Fiscal Year due under such leases and purchase money security interests, taken together, do not exceed $2,500,000.

(g) Completion Indebtedness in a principal amount not exceeding ten percent (10%) of the aggregate original face amount of Bonds or Additional Parity Indebtedness issued to finance the project for which Completion Indebtedness is proposed to be issued which may be Additional Parity Indebtedness if it relates to the Loan Agreement or Additional Parity Indebtedness, without regard to the limitations of subsections (a) or (c) above.

Notwithstanding the foregoing, so long as any of the 2007 Bonds are outstanding, the Corporation shall not incur Additional Parity Indebtedness, unless prior thereto a report of the Treasurer or Assistant Treasurer of the Corporation is delivered to the Trustee certifying that the Expendable Resources Ratio (defined in “Expendable Resources Test” below) is not less than .75x based upon the most recent Fiscal Year for which audited financial statements are available, computed as if such proposed Additional Parity Indebtedness had been issued on last day of such Fiscal Year. See “Expendable Resource Test” below.

The Corporation may elect to have Indebtedness issued pursuant to any preceding category reclassified as having been incurred under another category, by demonstrating compliance with such other provision on the assumption that such Indebtedness then Outstanding is being reissued on the date of delivery of the materials required to be delivered under such other provision.

No debt service will be deemed payable with respect to Commitment Indebtedness until such time as funding occurs (which has not been reimbursed) under the commitment which gave rise to such Commitment Indebtedness. From and after such funding, the amount of such debt service will be calculated in accordance with the actual amount required to be repaid on such Commitment Indebtedness and the actual interest rate and amortization schedule applicable thereto utilizing the various assumptions contained in the definition of “Maximum Annual Debt Service.” No additional Indebtedness shall be deemed to arise when any funding occurs under any such commitment or any such commitment is renewed upon terms which provide for substantially the same terms of repayment of amounts disbursed pursuant to such commitment as obtained prior to such renewal.

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Parity Instruments Cross – Default Provisions

The Loan Agreement provides that Parity Instruments shall contain cross-default provisions with the Loan Agreement and all other Parity Instruments. Any collateral given or to be given to secure Additional Parity Indebtedness (other than reserve funds and credit enhancement devices such as bond insurance, letters of credit, standby bond purchase agreements, liquidity agreements, insurance or surety bonds) shall also secure the obligations of the Corporation under the Loan Agreement on a parity basis; and the Parity Instruments shall contain provisions that all Additional Parity Indebtedness and the obligations of the Corporation under the Loan Agreement shall be secured equally and ratably by all such security provided for any such Additional Parity Indebtedness. The Gross Revenues and any other collateral (other than reserve funds and credit enhancement devices such as bond insurance, letters of credit, standby bond purchase agreements, liquidity agreements, insurance or surety bonds) at any time given to secure the obligations of the Corporation under the Loan Agreement shall likewise secure Additional Parity Indebtedness, and such shall be set forth and so provided in any Parity Instrument. No release by or permission from the Authority or the Trustee under the Loan Agreement shall be necessary to allow such collateral to be pledged pursuant to any Parity Instrument.

Expendable Resources Test

The loan agreement entered into in connection with the issuance of the 2007 Bonds contains the Expendable Resources Test described below. The Loan Agreement does not contain this provision, nor do the loan agreements entered into with respect to any other Prior Parity Bonds. The Corporation will no longer be required to comply with the test described below once the 2007 Bonds are retired or defeased.

The Corporation has covenanted and agreed in the loan agreement entered into in connection with the 2007 Bonds (but not in any other Prior Parity Bond loan agreement or the Loan Agreement) to maintain Expendable Resources equal to at least .75x of the Outstanding principal amount of its long term debt, based upon the Corporation’s annual audited financial statements, all as determined in accordance with generally accepted accounting principles (the “Expendable Resources Ratio”), evidenced by the annual filing of a certificate with the Trustee and the insurer of the 2007 Bonds. Failure to maintain the Expendable Resources Ratio shall constitute a breach of this covenant if not cured by means reasonably acceptable to the insurer of the 2007 Bonds within 60 days succeeding the annual filing of such certificate with the Trustee and such insurer. In the event the value of Expendable Resources falls below the Expendable Resources Ratio solely due to financial market conditions, the insurer of the 2007 Bonds may waive such breach at its discretion.

Merger and Consolidation

The Corporation agrees that it will maintain its corporate existence and will continue to be a nonprofit Corporation duly qualified to do business in the State and will not merge or consolidate with any person or entity unless it first acquires the consent of the Authority to such transaction and the surviving, resulting or transferee corporation shall (a) provide the Trustee with an opinion of bond counsel to the effect that the exclusion from gross income for federal income tax purposes of interest on the Series 2017A Bonds will not be adversely affected; (b) assume all of the obligations of the Corporation under the Loan B-20

Agreement and any Parity Instrument; and (c) provide the Trustee with a no litigation Opinion of Counsel to the Corporation in the form set forth in the Loan Agreement.

Annual Audit and Other Financial Records

The Corporation agrees in the Loan Agreement that it will maintain proper books of records and accounts of the Facilities with full, true and correct entries of all of its dealings substantially in accordance with generally accepted accounting principles and that it will provide a statement of current fund revenues and expenses in comparative form with the Corporation’s operating budget, and such other data and information such as admissions, enrollment, schedules of fees and charges, and similar items which reflect its operation as may reasonably be requested by the Authority and the Trustee from time to time. The Corporation agrees that it will annually calculate the Debt Service Coverage Ratio and shall provide such calculation to the Authority and the Trustee within 150 days after the end of each Fiscal Year. The Corporation also agrees that it will have its books and records audited annually by an accountant as soon as practicable after the close of each Fiscal Year, and shall furnish within 150 days after the end of each Fiscal Year to the Authority and the Trustee a copy of the audit report.

Assignment

The Corporation may assign the Loan Agreement, with the prior written consent of the Authority and the Trustee, subject to each of the following conditions: (a) no assignment (other than in the context of an authorized merger or consolidation) will relieve the Corporation from primary liability for any obligation under the Loan Agreement and for performance and observance of the other agreements on its part provided in the Loan Agreement (except those provisions governing continuing disclosure which shall apply to the Corporation so long as it is an obligated person); (b) no assignment shall occur unless the Corporation has delivered to the Trustee an opinion of nationally recognized bond counsel acceptable to the Authority and the Trustee to the effect that such assignment will not adversely affect the exclusion from gross income of interest on the Series 2017A Bonds for federal income tax purposes; (c) the Corporation has delivered to the Trustee an Opinion of Counsel that such assignment will not conflict or constitute a default under any instrument or law to which the assignee is subject; (d) the assignee will assume the obligations of the Corporation under the Loan Agreement to the extent of the interest assigned; and (e) the Corporation will, within 10 days prior to the delivery thereof, furnish or cause to be furnished to the Authority a true and complete copy of each such assumption of obligations and assignment.

Events of Default

Under the Loan Agreement an “event of default” is defined to include, in general terms, (a) any failure by the Corporation to make any Loan Payment within five days after it is due and payable, (b) failure of the Corporation to observe or perform any other covenant, condition or agreement under the Loan Agreement or the Tax Compliance Certificate (other than those covenants set forth under the caption “INTRODUCTION--Continuing Disclosure Undertaking” in the body of this Official Statement or as set forth in (a) above) within 30 days after receiving written notice thereof from the Authority or the Trustee unless a course of action adequate in the judgment of the Trustee, being advised by counsel, to remedy such failure has been commenced within such 30-day period and is thereafter diligently prosecuted to completion, (c) default in the payment of any Indebtedness other than Non-Recourse B-21

Indebtedness in a material amount (other than under the Loan Agreement) or any Additional Parity Indebtedness, (d) the dissolution or liquidation of the Corporation (except as expressly allowed in cases of mergers and consolidations), or the failure by the Corporation to lift executions, garnishments or attachments which will impair its ability to carry on its operations at the Facilities or to make any payments under the Loan Agreement, (e) entry of a decree or order for relief in an involuntary case under the federal bankruptcy laws or any other similar proceedings and the continuance of any such decree or order unstayed and in effect for a period of 60 consecutive days, or (f) the voluntary commencement of bankruptcy or reorganization proceedings, or the occurrence of certain similar events.

Within 180 days after the end of each Fiscal Year, the Corporation agrees to furnish to the Trustee and the Authority a certificate of an Authorized Representative of the Corporation which provides, inter alia, that no event of default under the Loan Agreement has occurred and is continuing and that she has no knowledge of an event which, with the passage of time or giving of notice, or both, would constitute any such event, or describing any such event of default.

No event of default will be deemed to exist (except with respect to its obligations to make Loan Payments, to make payments due to the Trustee and the Authority, to pay taxes and other governmental charges, to satisfy its covenant with respect to maintaining the exclusion from federal gross income of interest on the Series 2017A Bonds, to maintain insurance coverages and to hold the Authority and others harmless) during any period of noncompliance to the extent that the Corporation is unable to comply due to acts of God, governmental orders, or the like.

Remedies on Default

Whenever an event of default as defined in the Loan Agreement has occurred and is continuing, the Trustee (as assignee of the Authority) or the Authority (in the event of a failure of the Trustee to act) shall, at the request of the owners of at least a majority in aggregate principal amount of the Bonds, (a) declare all Loan Payments payable for the remainder of the term of the Loan Agreement to be immediately due and payable; (b) take any action permitted under the Indenture with respect to an Event of Default thereunder; (c) realize upon the security interest in the Gross Revenues and exercise all the rights and remedies of a secured party under the Colorado Uniform Commercial Code with respect thereto; and (d) take whatever action at law or in equity may appear necessary or desirable to collect the amounts then due or to enforce the performance or observance of any obligation, agreements or covenants of the Corporation under the Loan Agreement. In addition, the Trustee may take any action permitted under the Indenture with respect to an Event of Default thereunder. No remedy specified in the Loan Agreement is intended to be exclusive; and each and every remedy is cumulative. Events of Default may be waived pursuant to the Loan Agreement under certain circumstances.

Notwithstanding any other provision hereof, while any Parity Bonds are Outstanding, the trustee shall have the sole power to select remedies to be used to enforce rights against common security for the Bonds and Additional Parity Indebtedness, subject to the right of the owners of at least a majority in aggregate principal amount of the sum of the Bonds and Additional Parity Indebtedness then Outstanding to direct remedies in the manner provided in the Indenture.

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Options to Prepay

Under the Loan Agreement, the Corporation has the option to make at any time prepayments against all or any portion of the Loan (in integral multiples of $5,000) by paying to the Trustee an amount of money or securities sufficient to pay the principal of, premium, if any, and interest on any portion of the Bonds then Outstanding under the Indenture. The exercise of such option will not be cause for redemption of Bonds unless such redemption is permitted at that time under the provisions of the Indenture and the Corporation specifies the date for such redemption. In the event the Corporation prepays all of the Loan and all reasonable and necessary fees and expenses of the Trustee accrued and to accrue through final payment of the Bonds called for redemption as a result of such prepayment and all of its liabilities accrued and to accrue under the Loan Agreement to the Authority through final payment of the Bonds called for redemption as a result of such prepayment, the Loan Agreement will terminate, except as otherwise provided therein.

Amendments to the Loan Agreement

Except as otherwise provided in the Loan Agreement or in the Indenture, the Loan Agreement may not be effectively amended, changed, modified, altered or terminated without the written consent of the Trustee.

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APPENDIX C

BOOK-ENTRY ONLY SYSTEM

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

Purchases of Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the Bonds on DTC’s records. The ownership interest of each actual purchaser of each Bond (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not receive written confirmation from DTC of their 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 Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Bonds, except in the event that use of the book-entry system for the Bonds is discontinued.

To facilitate subsequent transfers, all Bonds deposited by 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 authorized representative of DTC. The deposit of 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 Bonds; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Bonds are credited,

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which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Bonds may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Bonds, such as redemptions, tenders, defaults, and proposed amendments to the Bond documents. For example, Beneficial Owners of Bonds may wish to ascertain that the nominee holding the Bonds for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the 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 Bonds within an issue 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 Bonds unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the Authority 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 Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).

Principal, interest and redemption proceeds on the Bonds will be made to Cede& Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from the Authority or the Trustee on 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 Trustee or the Authority, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal, interest or redemption proceeds to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the Authority or the Trustee, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

DTC may discontinue providing its services as depository with respect to the Bonds at any time by giving reasonable notice to the Authority or the Trustee. Under such circumstances, in the event that a successor depository is not obtained, Bond certificates are required to be printed and delivered.

The Authority 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.

The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that the Authority believes to be reliable, but the Authority takes no responsibility for the accuracy thereof. C-2

APPENDIX D

FORM OF CONTINUING DISCLOSURE AGREEMENT

CONTINUING DISCLOSURE AGREEMENT

This Continuing Disclosure Agreement (the “Disclosure Agreement”) is executed and delivered __ 1, 2017, by the Colorado Seminary, more commonly known as the University of Denver (the “University”), and Digital Assurance Certification, L.L.C., as dissemination agent (the “Dissemination Agent”), in connection with the issuance of the Colorado Educational and Cultural Facilities Authority Revenue Bonds (University of Denver Project) Tax-Exempt Series 2017A, in the original aggregate principal amount of $______and of the Colorado Educational and Cultural Facilities Authority Revenue Bonds (University of Denver Project) Taxable Series 2017B (together, the “Bonds”). The Bonds are being issued pursuant to an Indenture of Trust dated as of June 1, 2017, between the Colorado Educational and Cultural Facilities Authority (the “Authority”) and UMB Bank, n.a., as trustee (the “Indenture”). The University and the Dissemination Agent covenant and agree as follows:

SECTION 1. Purpose of the Disclosure Agreement. This Disclosure Agreement is being executed and delivered by the University and the Dissemination Agent for the benefit of the holders and beneficial owners of the Bonds and in order to assist the Participating Underwriters in complying with Rule 15c2-12(b)(5) (the “Rule”) of the Securities and Exchange Commission (the “SEC”). The University is an “obligated person” within the meaning of the Rule

SECTION 2. Definitions. In addition to the definitions set forth in the Indenture or parenthetically defined herein, which apply to any capitalized terms used in this Disclosure Agreement unless otherwise defined in this Section, the following capitalized terms shall have the following meanings:

“Annual Report” shall mean any Annual Report provided by the University pursuant to, and as described in, Sections 3 and 4 of this Disclosure Agreement.

“Dissemination Agent” shall mean, initially, Digital Assurance Certification, L.L.C., in its capacity as dissemination agent, or any successor.

“Material Events” shall mean any of the events listed in Section 5 of this Disclosure Agreement.

“MSRB” shall mean the Municipal Securities Rulemaking Board. As of the date hereof, the MSRB’s required method of filing is electronically via its Electronic Municipal Market Access (EMMA) system available on the Internet at http://emma.msrb.org.

“Participating Underwriters” shall mean the original underwriters of the Bonds required to comply with the Rule in connection with an offering of the Bonds.

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“Rule” shall mean Rule 15c2-12(b)(5) adopted by the SEC under the Securities Exchange Act of 1934, as the same may be amended from time to time.

SECTION 3. Provision of Annual Reports.

a. The University shall, while any Bonds are outstanding, provide an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Agreement to the Dissemination Agent within 150 days after the end of the University’s fiscal year (the “Submission Date”), beginning with respect to the University’s fiscal year ending June 30, 2017, and the Dissemination Agent shall provide to the MSRB (in an electronic format as prescribed by the MSRB) the Annual Report that is provided to it by the University within ten days of the day it receives it (the “Report Date”). The University shall include with each submission of the Annual Report to the Dissemination Agent a written representation addressed to the Dissemination Agent to the effect that the Annual Report is the Annual Report required by this Disclosure Agreement and that it complies with the applicable requirements of this Disclosure Agreement. 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 4 of this Disclosure Agreement; provided that the audited financial statements of the University may be submitted separately from the balance of the Annual Report. Neither the Authority nor the Dissemination Agent shall have any obligation to examine or review the Annual Report and neither shall have a duty to verify the accuracy or completeness of the Annual Report. The information to be updated may be reported in any format chosen by the University; it is not required that the format reflected in the Official Statement be used in future years.

b. If the University is unable to provide to the Dissemination Agent an Annual Report by the date required in subsection (a), which results in the Dissemination Agent’s inability to provide an Annual Report to the MSRB by the date required, the Dissemination Agent shall file or cause to be filed a notice in substantially the form attached as Exhibit “A” with the MSRB and the Authority.

c. The Dissemination Agent shall:

(1) determine prior to the date of each filing of an Annual Report the appropriate electronic format prescribed by the MSRB;

(2) send written notice to the University at least 45 days prior to the date an Annual Report is due stating that the Annual Report is due as provided in Section 3(a) hereof; and

(3) file a report with the University certifying that the Annual Report has been provided pursuant to this Disclosure Agreement, stating the date it was provided and listing all the entities to which it was provided.

SECTION 4. Content of Annual Reports. The Annual Report shall contain or incorporate by reference the following:

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a. A copy of the University’s annual financial statements, which may be presented as a component unit of the Colorado Seminary’s annual financial statements, prepared in accordance with generally accepted accounting principles audited by a firm of certified public accountants. If audited annual financial statements are not available by the time specified in Section 3(a) above, unaudited financial statements will be provided as part of the Annual Report and audited financial statements will be provided when and if available.

b. An update of the type of information identified in Exhibit “B” hereto, which is contained in the tables in the Official Statement with respect to the Bonds.

Any or all of the items listed above may be incorporated by reference from other documents, including official statements of debt issues of the University or related public entities, which are available to the public on the MSRB’s Internet Web Site or filed with the SEC. The University shall clearly identify each such document incorporated by reference.

SECTION 5. Reporting of Material Events. The University shall file or shall cause to be filed with the MSRB, in a timely manner not in excess of ten business days after the occurrence of the event, notice of any of the events listed below with respect to the Bonds:

a. Principal and interest payment delinquencies;

b. Non-payment related defaults, if material;

c. Unscheduled draws on debt service reserves reflecting financial difficulties;

d. Unscheduled draws on credit enhancements reflecting financial difficulties;

e. Substitution of credit or liquidity providers or their failure to perform;

f. 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;

g. Modifications to rights of bondholders, if material;

h. Bond calls, if material, and tender offers;

i. Defeasances;

j. Release, substitution or sale of property securing repayment of the Bonds, if material;

k. Rating changes;

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l. Bankruptcy, insolvency, receivership or similar event of the obligated person;4

m. 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

n. Appointment of a successor or additional trustee or the change of name of a trustee, if material.

SECTION 6. Format; Identifying Information. All documents provided to the MSRB pursuant to this Disclosure Agreement shall be in the format prescribed by the MSRB and accompanied by identifying information as prescribed by the MSRB.

As of the date of this Disclosure Agreement, all documents submitted to the MSRB must be in portable document format (PDF) files configured to permit documents to be saved, viewed, printed and retransmitted by electronic means. In addition, such PDF files must be word-searchable, provided that diagrams, images and other non-textual elements are not required to be word-searchable.

SECTION 7. Termination of Reporting Obligation. The University’s and Dissemination Agent’s obligations under this Disclosure Agreement shall terminate upon the earliest of: (i) the date of legal defeasance, prior redemption or payment in full of all of the Bonds; (ii) the date that the University shall no longer constitute an “obligated person” within the meaning of the Rule; or (iii) the date on which those portions of the Rule which require this written undertaking are held to be invalid by a court of competent jurisdiction in a non- appealable action, have been repealed retroactively or otherwise do not apply to the Bonds. The University shall give notice to the MSRB in a timely manner and in prescribed form if this Section is applicable.

SECTION 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Agreement, the University and the Dissemination Agent may amend this Disclosure Agreement and may waive any provision of this Disclosure Agreement, without the consent of the holders and beneficial owners of the Bonds, if such amendment or waiver does not, in and of itself, cause the undertakings herein (or action of any Participating Underwriters in reliance on the undertakings herein) to violate the Rule, but taking into account any subsequent change in or

4 For the purposes of the event identified in subparagraph (b)(5)(i)(C)(12) of the Rule, 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 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 official 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.

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official interpretation of the Rule. The Dissemination Agent will provide notice of such amendment or waiver to the MSRB and the Authority.

SECTION 9. Additional Information. Nothing in this Disclosure Agreement shall be deemed to prevent the University from disseminating any other information, using the means of dissemination set forth in this Disclosure Agreement or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Material Event, in addition to that which is required by this Disclosure Agreement. If the University chooses to include any information in any Annual Report or notice of occurrence of a Material Event in addition to that which is specifically required by this Disclosure Agreement, the University shall have no obligation under this Disclosure Agreement to update such information or include it in any future Annual Report or notice of occurrence of a Material Event.

SECTION 10. Default. In the event of a failure of the University to comply with any provision of this Disclosure Agreement, any holder or beneficial owner of the Bonds may take such actions as may be necessary and appropriate, including seeking mandamus or specific performance by court order, to cause the University to comply with its obligations under this Disclosure Agreement. A default under this Disclosure Agreement shall not be deemed an event of default under the Loan Agreement, and the sole remedy under this Disclosure Agreement in the event of any failure of the University to comply with this Disclosure Agreement shall be an action to compel performance. Neither the Authority nor the Dissemination Agent shall have any power or duty to enforce this Agreement.

SECTION 11 Compensation. As compensation for its services under this Disclosure Agreement, the Dissemination Agent shall be compensated or reimbursed by the University for its reasonable fees and expenses in performing the services specified under this Disclosure Agreement.

SECTION 12. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit of the University, the Dissemination Agent, the Authority, the Participating Underwriters and the holders and beneficial owners from time to time of the Bonds, and shall create no rights in any other person or entity.

SECTION 13. Jurisdiction and Venue. The rights of the University under this Disclosure Agreement shall be deemed to be a contract under and shall be construed in accordance with and governed by the laws of the State of Colorado. Jurisdiction and venue for any disputes related to this Disclosure Agreement shall be in the United States District Court for the District of the State of Colorado or in Colorado District Court in the City and County of Denver, Colorado.

SECTION 14. Dissemination Agent. The Dissemination Agent may resign as dissemination agent hereunder at any time upon 30 days prior written notice to the University. In addition, the University may replace the Dissemination Agent or any of its successors at any time upon 30 days prior written notice to the dissemination agent hereunder. In such event the University may select a successor Dissemination Agent or may act as its own Dissemination Agent. The Dissemination Agent shall not be responsible in any manner for the content of any

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notice or report (including, without limitation, the Annual Report) prepared by the University pursuant to this Agreement. The Dissemination Agent shall have only such duties as are specifically set forth in this Agreement, and to the extent permitted by law, if at all, the University agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorney’s fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent’s negligence or willful misconduct.

SECTION 15. Electronic Transactions. The parties hereto agree that the transactions described herein may be conducted and related documents may be stored by electronic means. Copies, telecopies, facsimiles, electronic files and other reproductions of original executed documents shall be deemed to be authentic and valid counterparts of such original documents for all purposes, including the filing of any claim, action or suit in the appropriate court of law.

IN WITNESS WHEREOF, the University and the Dissemination Agent have caused this Disclosure Agreement to be executed in their respective names, all as of the date first above written.

Colorado Seminary

By: ______Name: Craig Woody Title: Vice Chancellor for Business and for Financial Affairs/Treasurer

Digital Assurance Certification, L.L.C.

By: ______Name: ______Title: ______

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EXHIBIT “A”

NOTICE OF FAILURE TO FILE ANNUAL REPORT

Name of University: Colorado Seminary, more commonly known as the University of Denver

Name of Bond Issue: the Colorado Educational and Cultural Facilities Authority Revenue Bonds (University of Denver Project) Tax-Exempt Series 2017A, in the original aggregate principal amount of $______and the Colorado Educational and Cultural Facilities Authority Revenue Bonds (University of Denver Project) Taxable Series 2017B, in the original aggregate principal amount of $______.

CUSIP: 19645R [Base Number]

Date of Issuance: ______, 2017

NOTICE IS HEREBY GIVEN that the University has not provided an Annual Report with respect to the above-named Bonds, and the Continuing Disclosure Agreement executed ______, 2017, by the University. The University anticipates that the Annual Report will be filed by ______.

Dated: ______, _____

______as Dissemination Agent

By: Its:

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EXHIBIT “B”

INDEX OF OFFICIAL STATEMENT TABLES TO BE UPDATED

Net Income Available for Debt Service and Pro-Forma Debt Service Coverage Historical Fall-Term Enrollment by Home Unit (Headcount) Traditional Undergraduate New Enrollment - Headcount Historical Admission Activity Data Historical College Entrance Exam Scores Full-Time Faculty and Tenure Trends Historical Student/Faculty Ratios Total Development Activity (Restricted and Unrestricted) Endowment Fund Summary (in thousands) Statement of Activities - Changes in Net Assets for Operating Fund Only (In Thousands) Current Funds Unrestricted

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APPENDIX E

FORM OF OPINION OF BOND COUNSEL

[Closing date]

Colorado Educational and Cultural Facilities Authority 1800 Glenarm Place, Suite 1201 Denver, Colorado 80202

Colorado Educational and Cultural Facilities Authority Revenue Bonds (University of Denver Project) Tax-Exempt Series 2017A and Taxable Series 2017B

Ladies and Gentlemen:

We have acted as bond counsel to the Colorado Educational and Cultural Facilities Authority (the “Authority”) in connection with the issuance of its “Colorado Educational and Cultural Facilities Authority Revenue Bonds (University of Denver Project) Tax-Exempt Series 2017A” in the aggregate principal amount of $______(the “Series 2017A Bonds”) and its “Colorado Educational and Cultural Facilities Authority Revenue Bonds (University of Denver Project) Taxable Series 2017B” in the aggregate principal amount of $______(the “Series 2017B Bonds,” and together with the Series 2017A Bonds, the “Bonds”) pursuant to an Indenture of Trust dated as of June 1, 2017 (the “Indenture”), between the Authority and UMB Bank, n.a., as trustee (the “Trustee”). In such capacity, we have examined the Authority’s certified proceedings and such other documents and such law of the State of Colorado and of the United States of America as we have deemed necessary to render this opinion letter. Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Indenture.

The proceeds of the Bonds will be used by the Authority to make a loan pursuant to a Loan Agreement dated as of June 1, 2017 (the “Agreement”) between the Authority and Colorado Seminary, doing business as the University of Denver (the “Corporation”), to finance the cost of the Project (as defined in the Agreement).

Regarding questions of fact material to our opinions, we have relied upon the Authority’s certified proceedings and other representations and certifications of officials of the Authority, officials of the Corporation, public officials and others furnished to us, without undertaking to verify the same by independent investigation.

Based upon such examination, it is our opinion as bond counsel that:

1. The Authority is an independent public body politic and corporate constituting a public instrumentality of the State of Colorado created and existing by virtue of Article 15, Title 23 of the Colorado Revised Statutes and has the authority to enter into the

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Agreement and the Indenture, to issue and sell the Bonds, and to the loan the proceeds of the Bonds to the Corporation to finance the Project.

2. The Bonds have been duly authorized by the Authority, duly executed and delivered by authorized officials of the Authority, and (assuming due authentication by the Trustee) are valid and binding, limited obligations of the Authority payable solely out of the loan payments to be made by the Corporation to the Authority under the Agreement, except to the extent otherwise provided in the Indenture and the Agreement.

3. The Agreement and the Indenture have been duly authorized by the Authority, duly executed and delivered by authorized officials of the Authority and (assuming valid authorization, execution and delivery by the other parties thereto) are valid and binding obligations of the Authority enforceable against the Authority in accordance with their respective terms.

4. Interest on the Series 2017A Bonds is excluded from gross income under federal income tax laws pursuant to Section 103 of the Internal Revenue Code of 1986, as amended to the date hereof (the “Tax Code”), and interest on the Series 2017A Bonds is excluded from alternative minimum taxable income as defined in Section 55(b)(2) of the Tax Code except that such interest is required to be included in calculating the adjusted current earnings adjustment applicable to corporations for purposes of computing the alternative minimum taxable income of corporations. The opinions expressed in this paragraph assume continuous compliance with the covenants and representations contained in the Authority’s certified proceedings, in certain documents or certifications of the Corporation, and in certain other documents and certain other certifications furnished to us.

5. Interest on the Series 2017B Bonds is included in gross income for federal income tax purposes.

6. The Bonds, the transfer thereof and the income therefrom are exempt from all taxation and assessments in the State of Colorado.

The opinions expressed in this opinion letter are subject to the following:

In rendering the opinions set forth in paragraph 4 above, we are relying upon the opinion of Hoffman, Crews, Nies, Waggener & Foster LLP, counsel to the Corporation, as to the status of the Corporation as qualifying as exempt from federal income taxation under Section 501(c)(3) of the Tax Code.

In rendering the foregoing opinions, we are not passing upon matters of (i) the corporate status of the Corporation, (ii) the power of the Corporation to execute and deliver the Agreement or to perform its obligations thereunder, or (iii) the enforceability of the Agreement against the Corporation. Additionally, we are not passing upon the title to or description of the Facilities (as defined in the Agreement).

The obligations of the Authority pursuant to the Bonds, the Indenture and the Agreement are subject to the application of equitable principles, to the reasonable exercise in the future by the State of Colorado and its governmental bodies of the police power inherent in the sovereignty of the State of Colorado, and to the exercise by the United States of America of the E-2

powers delegated to it by the Federal Constitution, including without limitation, bankruptcy powers.

In this opinion letter issued in our capacity as bond counsel, we are opining only upon those matters set forth herein, and we are not passing upon the accuracy, adequacy or completeness of the Official Statement or any other statements made in connection with any offer or sale of the Bonds or upon any federal or state tax consequences arising from the receipt or accrual of interest on or the ownership or disposition of the Bonds, except those specifically addressed herein.

This opinion letter is issued as of the date hereof and we assume no obligation to revise or supplement this opinion letter to reflect any facts or circumstances that may hereafter come to our attention or any changes in law that may hereafter occur.

Respectfully submitted,

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COLORADO EDUCATIONAL AND CULTURAL FACILITIES AUTHORITY • (UNIVERSITY OF DENVER PROJECT) REVENUE BONDS, TAX-EXEMPT SERIES 2017A and TAXABLE SERIES 2017B