$99,625,000 MARYLAND HEALTH AND HIGHER EDUCATIONAL FACILITIES AUTHORITY Revenue Bonds The Johns Hopkins University Issue Series 2013B

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1 OFFICIAL STATEMENT DATED JUNE 11, 2013 NEW ISSUE -- BOOK-ENTRY ONLY RATINGS: See Ratings herein In the opinion of Bond Counsel to the Authority, under existing statutes, regulations and decisions, (i) assuming compliance with certain covenants described herein, interest on the Series 2013B Bonds is excludable from gross income for federal income tax purposes and (ii) by the terms of the Act, the interest on the Series 2013B Bonds, their transfer and any income derived therefrom, including any profit made on the sale thereof, are forever exempt from all Maryland state and local taxes; no opinion is expressed as to estate or inheritance taxes or any other taxes not levied or assessed directly on the Series 2013B Bonds, their transfer or the income therefrom. Interest on the Series 2013B Bonds is not includable in the alternative minimum taxable income of individuals, corporations or other taxpayers as an enumerated item of tax preference or other specific adjustment; however, interest on the Series 2013B Bonds will be included in a corporation s adjusted current earnings in the calculation of a corporation s alternative minimum taxable income for federal income tax purposes and will be subject to the branch profits tax imposed on foreign corporations engaged in a trade or business in the United States of America. See Tax Matters. $99,625,000 MARYLAND HEALTH AND HIGHER EDUCATIONAL FACILITIES AUTHORITY Revenue Bonds The Johns Hopkins University Issue Series 2013B Dated: Date of initial delivery Due: July 1, as shown below The Series 2013B Bonds are issuable only as fully registered bonds in denominations of $5,000 and integral multiples thereof. All of the Series 2013B Bonds initially will be maintained under a book-entry system under which The Depository Trust Company, New York, New York ( DTC ), will act as securities depository. Purchases of the Series 2013B Bonds will be in book-entry form only. Interest on the Series 2013B Bonds from the date of their delivery is payable on January 1, 2014 and semiannually thereafter on each July 1 and January 1. So long as the Series 2013B Bonds are maintained under a bookentry system, payments of the principal of and premium and interest on the Series 2013B Bonds will be made when due by Manufacturers and Traders Trust Company (the Trustee ), to DTC in accordance with the Resolution, and the Trustee will have no obligation to make any payments to any beneficial owner of any Series 2013B Bonds. See The Series 2013B Bonds -- Book-Entry Only System. The Series 2013B Bonds constitute special obligations of the Authority payable solely from (i) payments by The Johns Hopkins University to the Authority or the Trustee pursuant to the Loan Agreement and (ii) to the extent provided in the Resolution, the proceeds of the Series 2013B Bonds. See Sources of Payment for the Series 2013B Bonds. None of the State of Maryland, any political subdivision thereof or the Authority shall be obligated to pay the Series 2013B Bonds or the interest thereon except from the Revenues and other amounts pledged therefor under the Resolution, and neither the faith and credit nor the taxing power of the State of Maryland, of any political subdivision thereof or of the Authority is pledged to the payment of the principal of or the interest on the Series 2013B Bonds. The issuance of the Series 2013B Bonds does not directly or indirectly or contingently obligate, morally or otherwise, the State of Maryland, any political subdivision thereof or the Authority to levy or pledge any form of taxation whatever therefor or to make any appropriation for their payment. The Authority has no taxing power. The Series 2013B Bonds are subject to redemption prior to maturity as described herein under The Series 2013B Bonds -- Redemption Provisions. $60,475,000 Serial Bonds Amount $8,595,000 8,590,000 8,595,000 Due Interest Rate 5.00% Yield 1.98% CUSIP Amount PM9 $8,595, PN7 13,050, PP2 13,050,000 Due Interest Rate 5.00% Yield 2.59% 4.05* 3.81* CUSIP PQ PT PR8 $39,150, % Term Bonds due July 1, 2041 Yield 4.30% - CUSIP PS6 The Series 2013B Bonds are offered, subject to prior sale, when, as and if issued by the Authority and accepted by the Underwriters, subject to the approval of McKennon Shelton & Henn LLP, Bond Counsel to the Authority, the approval of certain legal matters by Venable LLP, counsel to the University, and Ballard Spahr LLP, counsel to the Underwriters, and to certain other conditions. It is expected that the Series 2013B Bonds will be available for delivery on or about June 20, Goldman, Sachs & Co. J.P. Morgan * Priced to first call date. Morgan Stanley Ramirez & Co., Inc.

2 IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS THAT STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SERIES 2013B BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. No dealer, broker, sales representative or other person has been authorized by Maryland Health and Higher Educational Facilities Authority (the Authority ), The Johns Hopkins University (the University ) or the Underwriters to give any information or to make any representation other than as contained in this Official Statement and, if given or made, such other information or representation must not be relied upon as having been authorized by any of the foregoing. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the Series 2013B Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. The information set forth herein has been obtained from the Authority, the University and other sources that are deemed to be reliable but is not guaranteed as to accuracy or completeness by the Underwriters, and is not to be construed as a representation either by the Authority or the Underwriters. This Official Statement is not to be construed as a contract or agreement between the Authority and the purchasers or holders of any of the Series 2013B Bonds. CUSIP numbers on the cover page of this Official Statement are copyright by the American Bankers Association. CUSIP numbers herein are provided by Standard & Poor s CUSIP Service Bureau, a division of The McGraw-Hill Companies, Inc., and none of the Authority, the Underwriters or the University takes any responsibility for the accuracy thereof. Such CUSIP numbers are not intended to create a database and do not serve in any way as a substitute for the CUSIP Service. All quotations from and summaries and explanations of provisions of laws and documents herein do not purport to be complete and reference is made to such laws and documents for full and complete statements of their provisions. Any statements made in this Official Statement involving estimates or matters of opinion, whether or not expressly so stated, are intended merely as estimates or opinions and not as representations of fact. The information and expressions of opinion herein are subject to change without notice, and neither the delivery of this Official Statement nor any sale of the Series 2013B Bonds shall under any circumstances create any implication that there has been no change in the affairs of the Authority or the University since the date hereof. The Authority has either provided or reviewed the information under the headings The Authority, State Not Liable on Series 2013B Bonds and Corporate Existence of the Authority as it relates to the Authority and will not be responsible for any other statements or information in this Official Statement. The Underwriters have reviewed the information in this Official Statement in accordance with, and as a part of, their responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriters do not guarantee the accuracy or completeness of such information. TABLE OF CONTENTS Page INTRODUCTORY STATEMENT... 1 PLAN OF FINANCING... 2 ESTIMATED USES AND SOURCES OF FUNDS... 3 SOURCES OF PAYMENT FOR THE SERIES 2013B BONDS... 3 THE SERIES 2013B BONDS... 5 ANNUAL DEBT SERVICE REQUIREMENTS ADDITIONAL INDEBTEDNESS THE AUTHORITY REFINANCED FACILITIES UNDERWRITING RATINGS TAX MATTERS LEGALITY OF SERIES 2013B BONDS FOR INVESTMENT AND DEPOSIT STATE NOT LIABLE ON SERIES 2013B BONDS CORPORATE EXISTENCE OF THE AUTHORITY FINANCIAL ADVISOR TO THE UNIVERSITY FINANCIAL ADVISOR TO THE AUTHORITY VERIFICATION OF MATHEMATICAL COMPUTATIONS LEGAL MATTERS INDEPENDENT AUDITORS RELATIONSHIPS CONTINUING DISCLOSURE MISCELLANEOUS Appendix A -- Appendix B -- Appendix C -- Appendix D -- The Johns Hopkins University Audited Financial Statements of The Johns Hopkins University Summaries of Principal Legal Documents Proposed Form of Opinion of Bond Counsel

3 MARYLAND HEALTH AND HIGHER EDUCATIONAL FACILITIES AUTHORITY 401 E. PRATT STREET SUITE 1224 BALTIMORE, MARYLAND FAX OFFICIAL STATEMENT relating to $99,625,000 MARYLAND HEALTH AND HIGHER EDUCATIONAL FACILITIES AUTHORITY Revenue Bonds The Johns Hopkins University Issue Series 2013B INTRODUCTORY STATEMENT This Official Statement, the cover page (exclusive of prices and yields) and appendices set forth certain information for use in connection with the sale by Maryland Health and Higher Educational Facilities Authority (the Authority ) of its $99,625,000 Revenue Bonds, The Johns Hopkins University Issue, Series 2013B (the Series 2013B Bonds ). The Series 2013B Bonds are issued pursuant to (i) the Maryland Health and Higher Educational Facilities Authority Act, consisting of Sections through , inclusive, of the Economic Development Article of the Annotated Code of Maryland (the Act ), (ii) certain proceedings of the Authority, and (iii) The Johns Hopkins University Bond Resolution adopted by the Authority, as amended and supplemented (the Resolution ). Pursuant to the Resolution, Manufacturers and Traders Trust Company has been appointed trustee (together with any successor in such capacity, the Trustee ). The Series 2013B Bonds are issued at the request of The Johns Hopkins University ( Johns Hopkins University or the University ) to refund (i) the Authority s Refunding Revenue Bonds, The Johns Hopkins University Issue, Series 2001B maturing on July 1, 2041 and bearing interest at 5.3% (the Refunded Series 2001B Bonds ) and (ii) all of the Authority s outstanding Revenue Bonds, The Johns Hopkins University Issue, Series 2004A (the Series 2004A Bonds and together with the Refunded Series 2001B Bonds, the Refunded Bonds ). The University is a non-profit privately endowed research and higher education institution, incorporated and existing under the laws of the State of Maryland, with campuses located in Maryland, Washington, D.C. and elsewhere. The University offers educational services to approximately 21,000 students in its various undergraduate, graduate and professional divisions. A substantial portion of the University s facilities and operations are located on two -1-

4 campuses and other sites within the city of Baltimore, Maryland. At the University s 128-acre Homewood campus, the University operates the Zanvyl Krieger School of Arts and Sciences, the G.W.C. Whiting School of Engineering and the School of Education. At the East Baltimore campus, adjacent to the facilities of The Johns Hopkins Hospital, are the University s School of Medicine, School of Nursing and the Bloomberg School of Public Health. The Carey Business School and the Peabody Institute occupy separate sites in downtown Baltimore. In addition, the University operates the Paul H. Nitze School of Advanced International Studies, with facilities in Washington, D.C., Bologna, Italy, and Nanjing, People s Republic of China. The University operates a major research facility, the Applied Physics Laboratory, located in Howard County, Maryland, as well as several other academic, research and support facilities elsewhere in Maryland. Important information on the financial condition of the University is set forth in Appendix A and Appendix B to this Official Statement, which should be read in their entirety. PLAN OF FINANCING The proceeds of the Series 2013B Bonds and other available moneys will be used to refund the Refunded Bonds. See Estimated Uses and Sources of Funds herein. The Authority will lend the proceeds of the Series 2013B Bonds to the University pursuant to a Loan Agreement between the Authority and the University, as supplemented and amended (the Loan Agreement ). The Loan Agreement is an unsecured, unconditional general obligation of the University. See Sources of Payment for the Series 2013B Bonds -- Loan Agreement. The Refunded Series 2001B Bonds are expected to be redeemed on or about July 12, In order to effect the refunding of the Series 2004A Bonds, a portion of the proceeds of the Series 2013B Bonds and other available moneys will be applied to the purchase of United States government securities or ownership interests therein (collectively, Federal Securities ), which will be deposited with Manufacturers and Traders Trust Company (the Escrow Deposit Agent ) under an Escrow Deposit Agreement (the Escrow Deposit Agreement ) between the Authority and the Escrow Deposit Agent. Such Federal Securities will be payable as to principal and interest at such times and in such amounts as will be sufficient, together with any initial cash deposit, to pay when due the principal of and interest on the Series 2004A Bonds maturing on or before July 1, 2014 and to pay on July 1, 2014 the redemption price of the Series 2004A Bonds maturing after July 1, 2014 and the interest accrued thereon. See Verification of Mathematical Computations. Such Federal Securities will be pledged only to the payment of the Series 2004A Bonds and will not be available for the payment of the Series 2013B Bonds. After the deposit of the Federal Securities as described above, the Authority and the University will be discharged from all of their obligations with respect to the Series 2004A Bonds. The Authority will not irrevocably waive its right to call the Series 2004A Bonds for redemption prior to July 1, The Series 2013B Bonds constitute Additional Bonds under the Resolution, pursuant to which the Authority has issued other series of revenue bonds on behalf of the University which will remain outstanding upon the issuance of the Series 2013B Bonds. See Additional Indebtedness. -2-

5 ESTIMATED USES AND SOURCES OF FUNDS The estimated costs to refund the Refunded Bonds and the sources of funds available therefor are as follows: USES OF FUNDS: Amount required to refund the Refunded Bonds... $114,608,000 Estimated financing expenses (1) ,000 Total uses of funds... $115,374,000 SOURCES OF FUNDS: Series 2013B Bonds... $ 99,625,000 Net original issue premium... 8,454,000 Available amounts on deposit under the Resolution... 2,675,000 Equity contribution... 4,620,000 Total sources of funds... $115,374,000 (1) Includes the Underwriters fee, certain fees and expenses of legal counsel to the University and the Underwriters and Bond Counsel to the Authority and certain accounting fees, as well as rating agency fees, printing costs, fees and expenses of the Trustee and other miscellaneous expenses. General SOURCES OF PAYMENT FOR THE SERIES 2013B BONDS The Series 2013B Bonds are special obligations of the Authority, the principal or Redemption Price of and interest on which are payable solely from the Revenues and, to the extent provided in the Resolution, the proceeds of the Series 2013B Bonds. None of the State of Maryland, any political subdivision thereof, or the Authority shall be obligated to pay the Series 2013B Bonds or the interest thereon except from Revenues and other amounts pledged therefor under the Resolution, and neither the faith and credit nor the taxing power of the State of Maryland, of any political subdivision thereof or of the Authority is pledged to the payment of the principal of or the interest on the Series 2013B Bonds. The issuance of the Series 2013B Bonds does not directly or indirectly or contingently obligate, morally or otherwise, the State of Maryland or any political subdivision thereof or the Authority to levy or to pledge any form of taxation whatever therefor or to make any appropriation for their payment. The Authority has no taxing power. See State Not Liable on Series 2013B Bonds. Pledge of Revenues Pursuant to the Resolution, the Authority pledges and assigns to the Trustee its interest in the Revenues and the Loan Agreement, subject to the rights of the Authority described under Summary of Certain Provisions of the Resolution -- Enforcement of Loan Agreement in Appendix C. The Revenues include all payments to the Authority or the Trustee pursuant to the Loan Agreement other than payments to the Authority of its initial fee, the Annual Administrative Fees or any Administrative Expenditures or any indemnity payments to the Authority. -3-

6 The Act provides that the Revenues deposited under the Resolution are pledged to, and charged with, the payment of the principal of and interest on the Series 2013B Bonds and other outstanding Bonds as the same become due, and the Redemption Price of Series 2013B Bonds retired by call as provided in the Resolution. The Act provides that such pledge shall be valid and binding from the time when the pledge is made, that the Revenues so pledged and received by the Authority shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act, and that 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. The pledge made by and the covenants and agreements set forth in the Resolution to be performed by or on behalf of the Authority are, by their terms, for the equal and ratable benefit, protection and security of the holders of the Series 2013B Bonds and, to the extent provided in the Resolution and the Loan Agreement, all other Bonds outstanding under the Resolution which, regardless of their times of issue or maturity, shall be of equal rank without preference, priority or distinction, except as expressly provided or permitted under the Resolution. See Additional Indebtedness. Loan Agreement The Loan Agreement is an unsecured, irrevocable, unconditional general obligation of the University, and will remain in full force and effect until all of the Series 2013B Bonds and the interest thereon have been paid or provision for the payment thereof has been made in accordance with the Resolution. The Loan Agreement requires the University to make payments at such times and in such amounts as shall be necessary to meet the debt service requirements of the Bonds. Neither the payment of the principal or Redemption Price of, or the interest on the Bonds, nor the payments by the University under the Loan Agreement, are secured by any funds or real or personal property of the University. The Loan Agreement does not in any way limit the ability of the University to incur additional debt or to pledge, mortgage, grant a security interest in, dispose of or convey any of its property without making any provision for the security of the Bonds. Enforceability The Resolution, the Loan Agreement and the Series 2013B Bonds are subject to bankruptcy, insolvency, moratorium, reorganization and other state and federal laws affecting the enforcement of creditors rights and to general principles of equity. A claim for payment of the principal of or interest on the Series 2013B Bonds could be made subject to any statutes that may be constitutionally enacted by the United States Congress or the Maryland General Assembly affecting the time and manner of payment or imposing other constraints upon enforcement. The United States Bankruptcy Code (the Bankruptcy Code ) permits a bankruptcy court to modify the rights of creditors. The potential effects of bankruptcy of the University could be to delay substantially or to preclude enforcement of remedies otherwise available to the Authority or the Trustee and to allow the bankruptcy court, under certain circumstances (i) to permit the University to cure defaults and reinstate the Loan Agreement, (ii) to discharge the debt evidenced by the Loan Agreement by payment of an amount determined by the bankruptcy -4-

7 court (even though less than the total amount of the Series 2013B Bonds outstanding), or (iii) to modify the terms of or payments due under the Loan Agreement. For additional detail, reference is made to the Bankruptcy Code, 11 U.S.C. Section 101 et seq. General THE SERIES 2013B BONDS The Series 2013B Bonds are dated the date of their initial delivery, bear interest from such date at the rates set forth on the cover page of this Official Statement, payable on January 1, 2014, and semiannually thereafter on each July 1 and January 1 and, subject to the redemption and purchase provisions set forth below, will mature on the dates and in the amounts set forth on the cover page of this Official Statement. The Series 2013B Bonds will be issued only as fully registered bonds in denominations of $5,000 and integral multiples thereof. The Series 2013B Bonds initially shall be maintained under a book-entry system. Beneficial Owners shall have no right to receive physical possession of the Series 2013B Bonds and payments of the principal or Redemption Price of and interest on the Series 2013B Bonds will be made as described below under Book-Entry Only System. If the book-entry system is discontinued, interest on the Series 2013B Bonds will be payable by check mailed by the Trustee to the persons in whose names the Series 2013B Bonds are registered as of the fifteenth day of the month preceding each interest payment date (or such other day as shall be established by the Trustee as described under Summary of Certain Provisions of the Resolution -- Special Record Dates in Appendix C) at the address shown on the registration books maintained by the Trustee, which is registrar and paying agent for the Series 2013B Bonds, and the principal or Redemption Price of the Series 2013B Bonds will be payable only upon presentation and surrender of such Bonds at the designated office of the Trustee. Redemption Provisions Optional Redemption Series 2013B Bonds maturing on or after July 1, 2024 are subject to redemption prior to maturity beginning on July 1, 2023, at the option of the Authority upon the direction of the University, as a whole or in part at any time, at a Redemption Price equal to 100% of the principal amount thereof, plus accrued interest thereon to the date set for redemption. In lieu of redeeming any Series 2013B Bonds called for redemption, the University shall have the right to purchase such Bonds or cause such Bonds to be purchased on the date named for redemption at a price equal to the principal amount of such Series 2013B Bonds, plus accrued interest thereon to the date set for redemption, and by their acceptance of the Series 2013B Bonds, the holders thereof agree to sell the Series 2013B Bonds to or upon the order of the University on such date. If there shall have been deposited with the Trustee the purchase price of such Bonds on such date, then such Bonds shall be deemed to have been purchased on such date whether or not the holders thereof surrender such Bonds for purchase and such holders shall not be entitled to interest accruing on such Bonds subsequent to such date and shall have no claims with respect thereto except to receive the purchase price of such Bonds so held by the Trustee. -5-

8 Sinking Fund Redemption The Series 2013B Bonds maturing on July 1, 2041 will be subject to redemption prior to maturity, at a Redemption Price equal to the principal amount thereof plus accrued interest to the redemption date, from mandatory Sinking Fund Installments becoming due on July 1 of the following years in the following amounts: * Final maturity. Year Term Bonds Due July 1, 2041 Sinking Fund Installment -6- Year Sinking Fund Installment 2039 $13,050, $13,050,000* ,050,000 The average life of the Series 2013B Bonds maturing on July 1, 2041 is approximately years. Upon any purchase of Series 2013B Bonds subject to redemption from a Sinking Fund Installment by or on behalf of the University and surrender of such Bonds to the Trustee for cancellation and upon any redemption of Series 2013B Bonds subject to redemption from a Sinking Fund Installment, an amount equal to the principal amount thereof shall be credited toward the applicable Sinking Fund Installment, and any principal amount of Series 2013B Bonds purchased or redeemed in excess of such Sinking Fund Installment may be applied toward the reduction of any applicable future Sinking Fund Installments as the University may designate. Extraordinary Optional Redemption The Series 2013B Bonds are subject to redemption as a whole at any time or in part at any time, at a Redemption Price equal to 100% of the principal amount thereof, plus accrued interest to the redemption date, at the option of the Authority pursuant to instructions from the University, upon the occurrence of any of the following conditions or events: (1) if title to, or the permanent use of, or use for a limited period of, any of the following is condemned or the subject of an agreement with, or action by, a public authority in the nature of or in lieu of condemnation proceedings: (a) substantially all of the facilities of (i) the University located on the University s Homewood campus in Baltimore, Maryland and more particularly described in the Loan Agreement (collectively, the Homewood Plant ), or (ii) the facilities of the University located on the University s East Baltimore campus in Baltimore, Maryland and more particularly described in the Loan Agreement (collectively, the East Baltimore Plant ), or (b) all or any portion of the facilities financed or refinanced with proceeds of the Refunded Bonds (the 2013 Refinanced Facilities ); (2) if the University s title to substantially all of the Homewood Plant or the East Baltimore Plant or all or any portion of the 2013 Refinanced Facilities is found to be deficient to the extent that the efficient utilization thereof by the University is substantially impaired;

9 (3) if substantially all of the Homewood Plant or the East Baltimore Plant or all or any portion of the 2013 Refinanced Facilities is damaged or destroyed by fire or other casualty; or (4) if as a result of any changes in the Constitution of the United States of America or of the State of Maryland, or of legislative or administrative action, or failure of administrative action, by the United States or the State of Maryland, or any agency or political subdivision thereof, or by reason of any judicial decision, (a) the Loan Agreement becomes void or unenforceable or impossible to perform without unreasonable delay or (b) unreasonable burdens or excessive liabilities are imposed on the University, including (without limitation) unreasonable burdens or excessive liabilities resulting from the imposition of federal, state or other ad valorem property, income or other taxes not being imposed on the date of the issuance of the Series 2013B Bonds. See 2013 Refinanced Facilities below for a description of the 2013 Refinanced Facilities. Under the Resolution, substantially all means either substantially total damage to or destruction of, or loss or impairment of title to or use of, the Homewood Plant or the East Baltimore Plant, or damage to or destruction of, or loss or impairment of title to or use of, such a portion of the Homewood Plant or East Baltimore Plant that, in the opinion of the University, the University is prevented from carrying on its operations thereon for a period of at least six months. The Series 2013B Bonds are subject to redemption as a whole but not in part if the basis of such redemption is the occurrence of an event described in clause (1), (2) or (3) above with respect to the Homewood Plant or the East Baltimore Plant or an event described in clause (4) above. The Series 2013B Bonds are subject to redemption in part if the basis of such redemption is the occurrence of an event described in clause (1), (2) or (3) above with respect to any portion of the 2013 Refinanced Facilities. The amount of any redemption in part shall be that portion of the aggregate principal amount of Series 2013B Bonds issued to finance or refinance such portion of the 2013 Refinanced Facilities. The Series 2013B Bonds are also subject to redemption in the event that (1) the University determines in good faith that continued operation of any portion of the 2013 Refinanced Facilities is not financially feasible or is otherwise disadvantageous to the University, (2) as a result thereof, the University sells, leases or otherwise disposes of such 2013 Refinanced Facilities to a person or entity unrelated to the University and (3) there is delivered to the Authority a Statement of Bond Counsel to the effect that, unless such Series 2013B Bonds are redeemed, retired or defeased either prior to or concurrently with such sale, lease or other disposition, or on a subsequent date prior to the first date on which the Series 2013B Bonds are subject to redemption at the option of the Authority at the direction of the University, Bond Counsel will be unable to render an unqualified opinion that such sale, lease or other disposition will not adversely affect the excludability from gross income, for federal income tax purposes, of the interest on the Series 2013B Bonds. -7-

10 Redemption of Series 2013B Bonds Subject to Deposit of Funds and Other Conditions Any redemption of Series 2013B Bonds shall be subject to the deposit of funds for such redemption by or on behalf of the University and may be subject to such other conditions as the Authority shall determine. Selection of Bonds to Be Redeemed If fewer than all of the Bonds are called for redemption, the particular Series and maturities of the Bonds to be redeemed shall be selected by the Authority at the direction of the University. So long as the Series 2013B Bonds are maintained under a book-entry system, if fewer than all of the Series 2013B Bonds of one maturity shall be called for redemption, the selection of individual ownership interests in the Series 2013B Bonds to be credited with any partial redemption or purchase shall be made as described below under Book-Entry Only System, except as otherwise provided in the Resolution. During any other period, if fewer than all of the Series 2013B Bonds of one maturity shall be called for redemption, the particular Series 2013B Bonds to be redeemed will be selected by lot or in such other manner as the Authority shall direct upon the request of the University. Notice of Redemption Any notice of redemption shall be conditioned upon receipt of funds for such redemption and may be subject to such other conditions as the Authority shall determine. So long as the Series 2013B Bonds are maintained under a book-entry system, notice of the call for any redemption of the Series 2013B Bonds shall be given as described below under Book-Entry Only System. At any other time, the Trustee shall mail notice of the call for redemption at least 20 days before the redemption date to the registered owners of the Series 2013B Bonds to be redeemed at their addresses as they appear on the registration books maintained by the Trustee, but failure so to mail any such notice to any of such registered owners shall not affect the validity of the proceedings for the redemption of any Series 2013B Bonds. The Series 2013B Bonds so called for redemption will cease to bear interest on the specified redemption date and shall no longer be secured by the Resolution, provided that any conditions to such redemption shall have been satisfied and funds for such redemption shall be on deposit at that time with the Trustee. Book-Entry Only System The information in this section has been obtained from sources that the Authority, the University and the Underwriters believe to be reliable, but none of the Authority, the University or the Underwriters takes any responsibility for the accuracy thereof. The Depository Trust Company The Depository Trust Company, New York, New York ( DTC or, together with any successor securities depository for the Series 2013B Bonds, the Securities Depository ), will act as securities depository for the Series 2013B Bonds. The Series 2013B 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 fullyregistered certificate of the Series 2013B Bonds will be issued for each maturity of the Series 2013B Bonds in principal amount equal to the aggregate principal amount of the Series 2013B Bonds of such maturity and will be deposited with DTC or its agent. -8-

11 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, as amended. DTC holds and provides asset servicing for over 3.5 million issues of United States and non-united States 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 United States and non-united States 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 (the Indirect Participants ). The DTC Rules applicable to its Direct and Indirect Participants are on file with the Securities and Exchange Commission (the SEC ). More information about DTC can be found at Ownership of Series 2013B Bonds Purchases of the Series 2013B Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the Series 2013B Bonds on DTC s records. The ownership interest of each actual purchaser of each Series 2013B Bond (the Beneficial Owner ) is in turn to be recorded on the Direct and Indirect Participants records. Beneficial Owners will not receive written confirmation from DTC of their purchases. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participants through which the Beneficial Owners entered into the transaction. Transfers of ownership interests in the Series 2013B Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of the Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in the Series 2013B Bonds except in the event that use of the book-entry only system for the Series 2013B Bonds is discontinued under the circumstances described below under Discontinuance of Book-Entry Only System. To facilitate subsequent transfers, all Series 2013B 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 Series 2013B Bonds with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Series 2013B Bonds ; DTC s records reflect only the identity of the Direct Participants to whose accounts such Series 2013B Bonds are credited, which may or -9-

12 may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of Series 2013B Bonds may wish to take certain steps to augment transmission to them of notices of significant events with respect to the Series 2013B Bonds, such as redemptions, tenders, defaults and proposed amendments to the security documents. For example, Beneficial Owners of Series 2013B Bonds may wish to ascertain that the nominee holding the Series 2013B Bonds for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the Trustee and request that copies of the notices be provided directly to them. So long as a nominee of DTC is the registered owner of the Series 2013B Bonds, references herein to the Bondholders or the holders or owners of the Series 2013B Bonds shall mean DTC and shall not mean the Beneficial Owners of the Series 2013B Bonds. The Authority and the Trustee will recognize DTC or its nominee as the holder of all of the Series 2013B Bonds for all purposes, including the payment of the principal or Redemption Price of and interest on, the Series 2013B Bonds, as well as the giving of notices and any consent or direction required or permitted to be given to or on behalf of the Bondholders under the Indenture. Neither the Authority nor the Trustee will have any responsibility or obligation to Participants or Beneficial Owners with respect to payments or notices to Direct or Indirect Participants or Beneficial Owners. Payments on and Redemption or Purchase of Series 2013B Bonds So long as the Series 2013B Bonds are held by DTC under a book-entry system, principal and interest payments on the Series 2013B 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 information from the Trustee on the applicable payment date in accordance with their respective holdings shown on DTC s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in street name, and will be the responsibility of such Participants and not of DTC, the Trustee or the Authority, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal and interest to DTC is the responsibility of the Authority or the Trustee, disbursement of such payments to Direct Participants shall be the responsibility of DTC and disbursement of such payments to the Beneficial Owners shall be the responsibility of Direct and Indirect Participants. So long as the Series 2013B Bonds are held by DTC under a book-entry only system, the Trustee will send any notice of redemption or purchase with respect to the Series 2013B Bonds only to Cede & Co. or such other nominee as may be requested by an authorized representative of DTC. Any failure of DTC to advise any Direct Participant, or of any Direct Participant to notify any Indirect Participant or of any Direct or Indirect Participant to notify any Beneficial Owner of any such notice and its content or effect will not affect the validity of the proceedings for the redemption or purchase of the Series 2013B Bonds or of any other action premised on such notice. If fewer than all of the Series 2013B Bonds are selected for redemption or purchase, -10-

13 DTC s practice is to determine by lot the amount of the interest of each Direct Participant to be redeemed or purchased, except as otherwise directed by the Authority. None of the Authority, the Trustee, the Underwriters or the University can give any assurances that DTC or the Direct or Indirect Participants will distribute payments of the principal or Redemption Price of and interest on the Series 2013B Bonds paid to DTC or its nominee, as the registered owner of the Series 2013B Bonds, or any redemption, purchase or other notices, to the Beneficial Owners or that they will do so on a timely basis or that DTC will serve and act in the manner described in this Official Statement. Discontinuance of Book-Entry Only System DTC may discontinue its services as a securities depository for the Series 2013B Bonds at any time by giving reasonable notice to the Authority and the Trustee, or the Authority may discontinue use of the system of book-entry transfers through DTC. Under such circumstances, in the event that a successor securities depository is not obtained, Series 2013B Bonds are required to be printed and delivered in fully certificated form to the Participants shown on the records of DTC provided to the Trustee or, to the extent requested by any Participant, to the Beneficial Owners of the Series 2013B Bonds shown on the records of such Participant provided to the Trustee. Registration and Exchange of Series 2013B Bonds So long as the Series 2013B Bonds are maintained under a book-entry system, transfers of ownership interests in the Series 2013B Bonds will be made as described above under Book- Entry Only System. If the book-entry only system is discontinued, any Series 2013B Bond may be exchanged for an equal aggregate principal amount of Series 2013B Bonds of the same maturity, bearing interest at the same rate of other authorized denominations, and the transfer of any Series 2013B Bond may be registered, upon presentation and surrender of such Series 2013B Bond at the designated office of the Trustee, together with an assignment duly executed by the registered owner or his attorney or legal representative. The Authority and the Trustee may require the person requesting any such exchange or transfer to reimburse them for any tax or other governmental charge payable in connection therewith. Neither the Authority nor the Trustee shall be required to register the transfer of any Series 2013B Bond or make any such exchange of any Series 2013B Bond (i) after a notice of the redemption of such Series 2013B Bond or any portion thereof has been mailed, or (ii) during the 15 days preceding the date of mailing of any notice of redemption. Acceleration Upon the occurrence of certain events, the due date for the payment of the principal amount of the Series 2013B Bonds may be accelerated. See Summary of Certain Provisions of the Resolution -- Events of Default and Remedies in Appendix C. -11-

14 ANNUAL DEBT SERVICE REQUIREMENTS The following table sets forth for each 12-month period ending July 1 (i) the amount required for the payment of the principal amount of the Series 2013B Bonds, (ii) the interest payable on the Series 2013B Bonds, (iii) the total debt service requirements of the 2013A Taxable Bonds (see note 2 below), (iv) the total debt service requirements of other long-term indebtedness of the University; and (v) the total debt service requirements of all long-term indebtedness of the University, after giving effect to the issuance of the Series 2013B Bonds and the refunding of the Refunded Bonds and the 2013A Refunded Obligations. Fiscal Series 2013B Bonds (1) Total Debt Service on Total Debt Service Total Debt Service on Year Principal Interest Total 2013A Taxable Bonds (1)(2) on Other Long-Term Debt (1)(3)(4) All Long-Term Debt (1)(3) 2013 $ 5,234,179 $ 82,887,918 $ 88,122, $4,763,614 $ 4,763,614 14,494,650 56,046,886 75,305, ,622,375 4,622,375 14,494,650 48,665,708 67,782, ,622,375 4,622,375 14,494,650 45,962,955 65,079, ,622,375 4,622,375 14,494,650 43,795,544 62,912, ,622,375 4,622,375 14,494,650 73,896,705 93,013, ,622,375 4,622,375 14,494, ,640, ,757, $ 8,595,000 4,622,375 13,217,375 14,494,650 30,537,776 58,249, ,590,000 4,192,625 12,782,625 14,494,650 21,378,962 48,656, ,595,000 3,763,125 12,358,125 14,494,650 20,865,964 47,718, ,595,000 3,333,375 11,928,375 14,494,650 29,112,715 55,535, ,903,625 2,903,625 14,494,650 28,903,185 46,301, ,903,625 2,903,625 14,494,650 28,580,038 45,978, ,903,625 2,903,625 14,494,650 28,129,881 45,528, ,903,625 2,903,625 14,494,650 28,157,625 45,555, ,903,625 2,903,625 14,494,650 25,575,565 42,973, ,903,625 2,903,625 14,494,650 20,423,944 37,822, ,903,625 2,903,625 14,494,650 20,020,944 37,419, ,903,625 2,903,625 14,494,650 19,617,944 37,016, ,903,625 2,903,625 14,494,650 19,214,944 36,613, ,903,625 2,903,625 14,494,650 18,811,944 36,210, ,903,625 2,903,625 14,494,650 18,428,944 35,827, ,903,625 2,903,625 14,494,650 18,045,944 35,444, ,903,625 2,903,625 14,494,650 86,927, ,326, ,050,000 2,903,625 15,953,625 14,494,650 14,600,774 45,049, ,050,000 2,316,375 15,366,375 14,494,650 99,097, ,958, ,050,000 (5) 1,663,875 14,713,875 14,494,650 9,358,774 38,567, ,050,000 (5) 1,109,250 14,159,250 14,494,650 8,960,774 37,614, ,050,000 (5) 554,625 13,604,625 14,494,650 8,557,524 36,656, ,494,650 89,274 14,583, ,494,650 89,274 14,583, ,494,650 1,893,018 16,387, ,494,650 14,494, ,494,650 14,494, ,494,650 14,494, ,494,650 14,494, ,494,650 85,494, ,595,720 82,595, ,696,790 79,696, ,797,860 76,797, ,898,930 73,898,930 (1) Amounts shown represent estimated payments for full fiscal year and are rounded to nearest dollar. (2) Represents debt service on the University s Taxable Bonds, 2013 Series A issued and dated February 21, 2013 (the 2013A Taxable Bonds ) which refunded $200,000,000 in aggregate principal amount of The Johns Hopkins University Taxable Bonds, 2009 Series A and all of the Authority s Revenue Bonds, The Johns Hopkins University Issue, Series 2008B. (3) Represents debt service requirements on outstanding revenue bonds and notes issued by and on behalf of the University and capital lease obligations of the University. Based upon the assumption that unhedged variable rate indebtedness bears interest at an average annual rate of 3% and is not required to be purchased or redeemed by the University prior to maturity. Interest on indebtedness associated with interest rate swaps is calculated at the respective swap rates. The interest rate swaps that were previously associated with the Series 2008B Bonds are no longer associated with a specific series of variable rate debt and are excluded. Excludes debt service on outstanding commercial paper. See Additional Indebtedness, Financial Information in Appendix A and the financial statements in Appendix B for a description of the University s outstanding obligations, including its commercial paper program. (4) Excludes debt service on the Series 2013B Bonds, the 2013A Taxable Bonds and the Refunded Bonds. (5) Sinking fund installment for Series 2013B Bonds maturing July 1,

15 ADDITIONAL INDEBTEDNESS The Series 2013B Bonds constitute Additional Bonds under the Resolution. Upon the issuance of the Series 2013B Bonds, after giving effect to the refunding of the Refunded Bonds, the total amount of outstanding long-term indebtedness of the University will approximate $1.17 billion, including the Series 2013B Bonds. In addition, the University currently has a taxable and tax-exempt commercial paper program under which up to $400 million principal amount of notes may be issued and outstanding from time to time to finance capital projects and cash requirements of the University. Approximately $274 million in aggregate principal amount of commercial paper notes is presently outstanding. See Financial Information -- Indebtedness and Other Obligations in Appendix A. The University has also guaranteed certain indebtedness of affiliated entities. The Resolution permits the issuance of other Additional Bonds thereunder from time to time. In addition, the Authority may issue other series of bonds and notes for the purpose of financing and refinancing other projects for the University, or for any other purpose, pursuant to a resolution or resolutions separate and apart from the Resolution and the University may issue or incur other indebtedness directly or through another issuer of tax-exempt bonds for any purpose. The Loan Agreement does not limit or restrict in any way the ability of the University to incur additional indebtedness or to pledge, mortgage or grant a security interest in property to secure any such indebtedness. THE AUTHORITY The Authority is a body politic and corporate of the State of Maryland, constituting an instrumentality organized and existing under and by virtue of the Act. The purpose of the Authority, as stated in the Act, is to assist certain educational institutions, including institutions of higher education and noncollegiate educational institutions, and health care institutions, including hospitals and life care and continuing-care retirement communities, in the construction, financing and refinancing of certain capital projects. Membership and Organization The Act provides that the Authority shall consist of nine members, one of whom shall be the Treasurer of the State of Maryland, ex officio, and eight of whom shall be residents of the State appointed by the Governor. All members serve without compensation but are entitled to reimbursement for actual and necessary expenses incurred in the performance of their duties in relation to the Authority. The Governor annually designates one of the members of the Authority to serve as Chairman and one to serve as Vice-Chairman. Subject to the approval of the Governor, the Authority appoints an Executive Director as chief administrative officer to assume responsibility for day-to-day general management of the Authority s affairs. Since 1996, Annette Anselmi has served as Executive Director of the Authority. The members of the Authority and some of their past and present affiliations are: -13-

16 Sheila K. Riggs, Chairman; term as member expires July 1, 2013; resident of Baltimore City; Trustee and former Chairman of the Board -- The Maryland Institute, College of Art; former President and Chairman of the Board -- Greater Baltimore Medical Center; former Trustee and Secretary of the Board -- Bryn Mawr School; former Co-Chairman -- Baltimore Council on Foreign Affairs; and former member -- Board of Loyola Notre Dame Library. Paul B. Meritt, Vice-Chairman; term as member expires July 1, 2014; resident of Baltimore County; Vice President -- PNC Bank, National Association; and member -- Maryland Capital Debt Affordability Committee; and Maryland Commission on State Debt. Nancy K. Kopp, ex officio; resident of Montgomery County; Treasurer of the State of Maryland; Chair -- Maryland Capital Debt Affordability Committee; College Savings Plans of Maryland; and Board of Trustees of the Maryland State Retirement and Pension System; and member -- Maryland Board of Public Works; Board of Trustees of the Maryland Teachers & State Employees Supplemental Retirement Plans; Hall of Records Commission; Board of Revenue Estimates; and Maryland Commission on State Debt. Catherine Ashley-Cotleur, Ph.D., member; term expires July 1, 2017; resident of Washington County; Associate Professor -- College of Business, Frostburg State University; and member -- American Marketing Association; United States Association of Small Business and Entrepreneurship; and International Conference of Small Business. Thomas S. Bozzuto, Jr., member; term expires July 1, 2015; resident of Baltimore City; President -- Bozzuto Development Company; member -- Urban Land Institute Baltimore District Council Executive Committee; and Maryland Institute College of Art Buildings & Grounds Committee. Thomas E. Dobyns, J.D., member; term expires July 1, 2016; resident of Montgomery County; Principal -- Thomas Dobyns Attorney at Law, Chevy Chase, Maryland; and member -- Health Law Forum Committee and Affordable Housing and Community Development Law Forum Committee of the American Bar Association; Health Law Section of the District of Columbia Bar; Health Law Section of the Maryland State Bar Association; Habitat for Humanity; and Society of St. Andrew. Frederick W. Meier, Jr., member; term expires July 1, 2015; resident of Baltimore City; Senior Advisor -- Lord Baltimore Capital Corporation; former Executive Vice President -- First Maryland Bancorp; Director -- Rodney Trust Company; Attransco; and AMA Capital Partners; member -- Baltimore City Board of Finance; former Vice President and Trustee -- The Baltimore Museum of Art; Honorary Trustee and former President of Board of Trustees -- The Boys Latin School of Maryland; former Member of Board of Governors -- The Center Club; and former Director -- Forestal San Jose (Chile); Jugos del Sur (Argentina); NORDEN A/S (Denmark); and Empresas Navieras, S.A. W. Gar Richlin, member; term expires July 1, 2013; resident of Howard County; President and Chief Operating Officer -- Clearspring Technologies, Inc.; Principal

17 Richlin/Dale LLC; former President and Chief Operating Officer -- Advertising.com; former Chief Operating Officer and Chief Financial Officer -- SITEL Corporation; former Head of Investment Banking -- Alex. Brown & Sons Incorporated; member -- Maryland Enterprise Investment Advisory Board; Trustee -- Baltimore Symphony Endowment Trust; and former Director -- Maryland Science Center; Howard County Health Alliance; and Baltimore Symphony Orchestra. Arnold Williams, member; term expires July 1, 2014; resident of Baltimore County; Managing Director -- Abrams Foster, Nole & Williams, P.A.; Chairman of the Board -- Baltimore Development Corporation; member -- Baltimore City Industrial Development Authority; Lexington Market, Inc.; The Presidents Roundtable; and The Greater Baltimore Committee; former Board Chairman -- Bon Secours Health Systems, Inc.; former member -- Baltimore City Chamber of Commerce; and Immediate Past Chair and former member -- Maryland State Board of Accountancy. Powers The Act authorizes the Authority, among other things, to issue bonds, bond anticipation notes and other obligations and to refund the same; to fix and collect rates, rentals, fees and charges for services and facilities that a project provides or makes available; to directly, or through a participating institution acting as its designated agent, acquire, improve, maintain, operate, lease as lessee or lessor, and regulate a project and enter into contracts for any of these purposes and for the management of a project for certain educational institutions, including institutions of higher education and noncollegiate educational institutions, and health care institutions, including hospitals and life care and continuing-care retirement communities; to directly or, through a participating institution acting as its designated agent, establish rules and regulations for the use of a project; to accept a grant, loan or other assistance in any form from any private source subject to the provisions of the Act; to mortgage, pledge or otherwise encumber a project and its site or hold a mortgage or other encumbrance on a project and its site for the benefit of the holders of bonds issued to finance a project; to make a loan to a participating institution to improve or acquire a project in accordance with an agreement between the Authority and a participating institution; to refinance any part of a project and refund or repay bonds, mortgages, advances, loans or other obligations of a participating institution to the Authority, any person or any unit of federal, state or local government incurred to finance any part of a project; and to do all acts and things necessary or convenient to carry out the powers expressly granted by the Act. Bonds and Notes As of January 1, 2013, the Authority had issued bonds and notes aggregating approximately $20.05 billion in principal amount, of which approximately $8.44 billion remained outstanding under the applicable bond resolution or trust agreement. Since January 1, 2013, the Authority has issued an additional $863.8 million in principal amount of bonds. The several series of outstanding bonds and notes issued by the Authority are special obligations of the Authority, payable solely from revenues of the Authority received in -15-

18 connection with the respective projects financed or refinanced, and do not constitute general obligations of the Authority, and the full faith and credit of the Authority is not pledged to the payment of the principal or redemption price of and interest on these bonds or notes. Other than money available from the administrative fees received from participating institutions, it is not anticipated that the Authority will have any assets of its own. Property and funds held by or mortgaged to the Authority for a particular issue of bonds are not available to satisfy claims of holders of other issues of the Authority s bonds. The Authority has no taxing powers. The Authority expects to enter into separate agreements with other hospitals and related institutions, institutions for higher education and noncollegiate educational institutions to finance and refinance eligible projects. The Authority intends to issue other series of bonds and notes for the purpose of financing and refinancing projects pursuant to such agreements, and each such series will be issued pursuant to a resolution or trust agreement separate and apart from any other resolution or trust agreement, except to the extent a series of bonds may be issued on parity with bonds of another series if permitted by the applicable resolution or trust agreement REFINANCED FACILITIES Proceeds of the Refunded Bonds were used to finance all or a portion of the following facilities of the University: Cancer Research Building II. Construction of a 267,000 square foot facility to house research laboratories, supporting spaces, vivarium, administrative offices, and a permanent loading dock located on the University s East Baltimore campus. San Martin Center. Construction of a 540-space parking garage and a 44,000 square foot shell office building above it on the University s Homewood campus. Mason F. Lord Building Renovation. Renovation of approximately 132,000 square feet of space located on the campus of Johns Hopkins Bayview Medical Center, including the design and construction of labs, offices, employee fitness center and clinical use facilities. Homewood Chiller Expansion. Construction of a new chiller supplying central chilled water to the University s Homewood campus. School of Hygiene and Public Health Expansion. Construction of two additions totaling 106,000 square feet to the existing School of Hygiene and Public Health building. -16-

19 School of Medicine Project. Construction and equipping of a 260,000 square foot research building, including a 300-vehicle parking structure and loading dock on the campus of the University s School of Medicine. Remote Shelving Facility. Construction of a 26,700 square foot highdensity compact shelving facility to accommodate University library collections located on a site at the Applied Physicals Laboratory in Howard County, Maryland. UNDERWRITING The Series 2013B Bonds are being purchased by Goldman, Sachs & Co. ( Goldman Sachs ) and Morgan Stanley & Co. LLC, as co-senior managing underwriters, and J.P. Morgan Securities LLC ( JPMS ) and Samuel A. Ramirez & Co., Inc., as co-managing underwriters (collectively, the Underwriters ). The Underwriters have agreed to purchase the Series 2013B Bonds for a fee of $319,425. The bond purchase agreement provides that the Underwriters will purchase all the Series 2013B Bonds if any are purchased, and contains the University s agreement to indemnify the Underwriters and the Authority against losses, claims, damages and liabilities arising out of certain incorrect statements or information contained in this Official Statement. Goldman Sachs has entered into a master dealer agreement (the Master Dealer Agreement ) with Incapital LLC ( Incapital ) for the distribution of certain municipal securities offerings, including the Series 2013B Bonds, to Incapital s retail distribution network at the initial public offering prices. Pursuant to the Master Dealer Agreement, Incapital will purchase Series 2013B Bonds from Goldman Sachs at the initial public offering prices less a negotiated portion of the selling concession applicable to any Series 2013B Bonds that Incapital sells. Morgan Stanley, parent company of Morgan Stanley & Co. LLC, a co-senior managing underwriter of the Series 2013B Bonds, has entered into a retail brokerage joint venture with Citigroup Inc. As part of the joint venture, Morgan Stanley & Co. LLC will distribute municipal securities to retail investors through the financial advisor network of Morgan Stanley Smith Barney LLC. As part of this arrangement, Morgan Stanley & Co. LLC will compensate Morgan Stanley Smith Barney LLC for its selling efforts with respect to the Series 2013B Bonds. JPMS has entered into negotiated dealer agreements (each, a Dealer Agreement ) with each of UBS Financial Services Inc. ( UBSFS ) and Charles Schwab & Co., Inc. ( CS&Co. ) for the retail distribution of certain securities offerings at the original issue prices. Pursuant to each Dealer Agreement (if applicable to this transaction), each of UBSFS and CS&Co. will purchase Series 2013B Bonds from JPMS at the original issue price less a negotiated portion of the selling concession applicable to any Series 2013B Bonds that such firm sells. The initial offering prices set forth on the cover of this Official Statement may be changed from time to time by the Underwriters. The Underwriters may offer and sell the Series 2013B Bonds to certain dealers (including dealers depositing the Series 2013B Bonds into investment trusts, certain of which may be -17-

20 sponsored or managed by one or more of the Underwriters) and others at prices lower than the offering prices set forth on the cover page hereof. The Underwriters and their affiliates are full service financial institutions engaged in various activities, which may include securities trading, commercial and investment banking, financial advisory, investment management, principal investment, hedging, financing and brokerage activities. In the ordinary course of their various business activities, the Underwriters and their respective affiliates, officers, directors and employees may purchase, sell or hold a broad array of investments and actively trade securities, derivatives, loans, commodities, currencies, credit default swaps and other financial instruments for their own account and for the accounts of their customers, and such investment and trading activities may involve or relate to assets, securities and/or instruments of the Authority and the University (directly, as collateral securing other obligations or otherwise) and/or persons and entities with relationships with the Authority or the University. The Underwriters and their respective affiliates may also communicate independent investment recommendations, market color or trading ideas and/or publish or express independent research views in respect of such assets, securities or instruments and may at any time hold, or recommend to clients that they should acquire, long and/or short positions in such assets, securities and instruments. RATINGS Moody s Investors Service, Inc. ( Moody s ), Standard & Poor s Ratings Services ( S&P ) and Fitch Ratings ( Fitch ) have assigned the Series 2013B Bonds ratings of Aa2, AA, and AA+, respectively. The University and the Authority furnished to the rating agencies certain materials and information respecting the Series 2013B Bonds and themselves. Generally, the rating agencies base their ratings on such materials and information and on investigations, studies and assumptions by the rating agencies. These ratings reflect only the views of Moody s, S&P and Fitch, respectively. No assurance can be given that such ratings will remain in effect for any given period of time or that they may not be reduced or withdrawn by the rating agencies, or any of them, if in the judgment of such rating agencies circumstances so warrant. Any downward change in or withdrawal of such ratings, or any of them, could adversely affect the market price of the Series 2013B Bonds. The rating of Aa2 assigned by Moody s to the Series 2013B Bonds is described as follows: Obligations rated Aa are judged to be of high quality and are subject to very low credit risk. Moody s appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa through Caa. The modifier 2 indicates that the obligation ranks in the mid-range of its generic rating category. The rating of AA assigned by S&P to the Series 2013B Bonds is described as follows: -18-

21 An obligation rated AA differs from the highest-rated obligations only to a small degree. The obligor s capacity to meet its financial commitment on the obligation is very strong. The rating of AA+ assigned by Fitch to the Series 2013B Bonds is described as follows: AA ratings denote expectations of very low default risk. They indicate very strong capacity for payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events. The modifiers + or - may be appended to a rating to denote relative status within major rating categories. The description of each rating set forth above was obtained from the rating agency furnishing such rating and none of the Authority, the University or the Underwriters takes any responsibility for such description. Further information relating to the significance of any rating may be obtained from the rating agency furnishing such rating. TAX MATTERS The following is only a general summary of certain provisions of the Internal Revenue Code of 1986, as amended (the Code ), as enacted and in effect on the date hereof and does not purport to be complete; holders of the Series 2013B Bonds should consult their own tax advisors as to the effects, if any, of the Code (and any proposed or subsequently enacted amendments to the Code) in their particular circumstances. Tax Exemptions McKennon Shelton & Henn LLP, Bond Counsel to the Authority, is of the opinion that, under existing statutes, regulations and decisions, (i) assuming compliance with certain covenants described herein, the interest on the Series 2013B Bonds is excludable from gross income for federal income tax purposes and (ii) by the terms of the Act, the interest on the Series 2013B Bonds, their transfer and any income derived from the Series 2013B Bonds, including profit made in their sale or transfer, are forever exempt from all Maryland state and local taxes. No opinion is expressed as to estate or inheritance taxes or any other taxes not levied or assessed directly on the Series 2013B Bonds, their transfer or the income therefrom. Under the provisions of the Code, there are certain restrictions that must be met subsequent to the delivery of the Series 2013B Bonds in order for interest on the Series 2013B Bonds to remain excludable from gross income for federal income tax purposes, including restrictions that must be complied with throughout the term of the Series 2013B Bonds. These include the following: (i) a requirement that certain earnings received from the investment of amounts deemed to be proceeds of the Series 2013B Bonds be rebated to the United States of America under certain circumstances (or that certain payments in lieu of rebate be made); (ii) other requirements applicable to the investment of the proceeds of the Series 2013B Bonds; and (iii) other requirements applicable to the use of the proceeds of the Series 2013B Bonds and the facilities financed or refinanced with proceeds of the Series 2013B Bonds. Failure to comply with one or more of these requirements could result in the inclusion of the interest payable on the -19-

22 Series 2013B Bonds in gross income for federal income tax purposes, effective from the date of their issuance. The Authority and the University have made certain covenants regarding actions required to maintain the excludability of interest on the Series 2013B Bonds from gross income for federal income tax purposes. It is the opinion of Bond Counsel that, assuming compliance with such covenants, the interest on the Series 2013B Bonds will remain excludable from gross income for federal income tax purposes under the provisions of the Code. Further, Bond Counsel is of the opinion that interest on the Series 2013B Bonds is not included in the alternative minimum taxable income of individuals, corporations or other taxpayers as an enumerated item of tax preference or other specific adjustment. However, for purposes of calculating the corporate alternative minimum tax, a corporation subject to such tax will be required to increase its alternative minimum taxable income by 75% of the amount by which its adjusted current earnings exceed its alternative minimum taxable income (computed without regard to this current earnings adjustment and the alternative tax net operating loss deduction). For such purposes, adjusted current earnings would include, among other items, interest income from the Series 2013B Bonds. In addition, interest income on the Series 2013B Bonds will be subject to the branch profits tax imposed by the Code on certain foreign corporations engaged in a trade or business in the United States of America. In rendering its opinion, McKennon Shelton & Henn LLP will rely on the University s Tax and Section 148 Certificate and Agreement with respect to certain material facts within the knowledge of the University relevant to the tax-exempt status of interest on the Series 2013B Bonds and will assume the correctness of the opinion of Venable LLP, counsel to the University, with respect to the tax-exempt status of the University, in each case without independent investigation. See Appendix D hereto for the proposed form of opinion of Bond Counsel. Tax Accounting Treatment of Discount Bonds Certain maturities of the Series 2013B Bonds may be issued at an initial public offering price which is less than the amount payable on such Series 2013B Bonds at maturity (the Discount Bonds ). The difference between the initial offering price at which a substantial amount of the Discount Bonds of each maturity was sold and the principal amount of such Discount Bonds payable at maturity constitutes original issue discount. In the case of any holder of Discount Bonds, the amount of such original issue discount which is treated as having accrued with respect to such Discount Bonds is added to the original cost basis of the holder in determining, for federal income tax purposes, gain or loss upon disposition (including sale, early redemption or purchase or repayment at maturity). For federal income tax purposes (i) any holder of a Discount Bond will recognize gain or loss upon the disposition of such Discount Bond (including sale, early redemption or purchase or payment at maturity) in an amount equal to the difference between (a) the amount received upon such disposition and (b) the sum of (1) the holder s original cost basis in such Discount Bond, and (2) the amount of original issue discount attributable to the period during which the holder held such Discount Bond, and (ii) the amount of the basis adjustment described in clause (i)(b)(2) will not be included in the gross income of the holder. -20-

23 Original issue discount on Discount Bonds will be attributed to permissible compounding periods during the life of any Discount Bonds in accordance with a constant rate of interest accrual method. The yield to maturity of the Discount Bonds of each maturity is determined using permissible compounding periods. In general, the length of a permissible compounding period cannot exceed the length of the interval between debt service payments on the Discount Bonds and must begin or end on the date of such payments. Such yield then is used to determine an amount of accrued interest for each permissible compounding period. For this purpose, interest is treated as compounding periodically at the end of each applicable compounding period. The amount of original issue discount which is treated as having accrued in respect of a Discount Bond for any particular compounding period is equal to the excess of (i) the product of (a) the yield on the Discount Bond (adjusted as necessary for an initial short period) divided by the number of compounding periods in a year multiplied by (b) the amount that would be the tax basis of such Discount Bond at the beginning of such period if held by an original purchaser who purchased at the initial public offering price, over (ii) the amount actually payable as interest on such Discount Bond during such period. The tax basis of a Discount Bond, if held by an original purchaser, can be determined by adding to the initial public offering price of such Discount Bond the original issue discount that is treated as having accrued during all prior compounding periods. If a Discount Bond is sold or otherwise disposed of between compounding dates, then interest which would have accrued for that compounding period for federal income tax purposes is to be apportioned in equal amounts among the days in such compounding period. Holders of Discount Bonds should note that, under applicable regulations, the yield and maturity of a Discount Bond is determined without regard to commercially reasonable sinking fund payments and any original issue discount remaining unaccrued at the time that a Discount Bond is redeemed or purchased in advance of stated maturity will be treated as taxable gain. Moreover, tax regulations prescribe special conventions for determining the yield and maturity of certain debt instruments that provide for alternative payment schedules upon the occurrence of certain contingencies. The yields (and related prices) provided by the Underwriters shown on the cover of this Official Statement may not reflect the initial issue prices for purposes of determining the original issue discount for federal income tax purposes. The foregoing summarizes certain federal income tax consequences of original issue discount with respect to the Discount Bonds but does not purport to deal with all aspects of federal income taxation that may be relevant to particular investors or circumstances, including those set out above. Prospective purchasers of Discount Bonds should consider possible state and local income, excise or franchise tax consequences arising from original issue discount on Discount Bonds. In addition, prospective corporate purchasers should consider possible federal tax consequences arising from original issue discount on such Discount Bonds under the alternative minimum tax or the branch profits tax. The amount of original issue discount considered to have accrued may be reportable in the year of accrual for state and local tax purposes or for purposes of the alternative minimum tax or the branch profits tax without a corresponding receipt of cash with which to pay any tax liability attributable to such discount. Purchasers with questions concerning the detailed tax consequences of transactions in the Discount Bonds should consult their tax advisors. -21-

24 Additional Federal Income Tax Considerations Certain Federal Tax Consequences of Ownership There are other federal income tax consequences of ownership of obligations such as the Series 2013B Bonds under certain circumstances, including the following: (i) deductions are disallowed for certain expenses of taxpayers allocable to interest on tax-exempt obligations, as well as interest on indebtedness incurred or continued to purchase or carry tax-exempt obligations and interest expense of financial institutions allocable to tax-exempt interest; (ii) for property and casualty insurance companies, the amount of the deduction for losses incurred must be reduced by 15% of the sum of tax-exempt interest received or accrued and the deductible portion of dividends received by such companies; (iii) interest income which is exempt from tax must be taken into account for the purpose of determining whether, and what amount of, social security or railroad retirement benefits are includable in gross income for federal income taxation purposes; (iv) for S corporations having Subchapter C earnings and profits, the receipt of certain levels of passive investment income, including interest on tax-exempt obligations such as the Series 2013B Bonds, can result in the imposition of tax on such passive investment income and, in some cases, loss of S corporation status; and (v) net gain realized upon the sale or other disposition of property such as the Bonds generally must be taken into account when computing the 3.8% Medicare tax with respect to net investment income imposed on certain high income individuals and specified trusts and estates. Purchase, Sale and Retirement of Series 2013B Bonds Except as noted below with respect to accrued market discount, the sale or other disposition of a Series 2013B Bond may result in capital gain or loss to its holder. A holder s initial tax basis in a Series 2013B Bond will be its cost. For federal income tax purposes, a holder will recognize capital gain or loss upon the sale or retirement of a Series 2013B Bond (including sale, early redemption or purchase or payment at maturity) in an amount equal to the difference between (a) the amount received upon such disposition and (b) the tax basis in such Series 2013B Bond, determined by adding to the original cost basis in such Series 2013B Bond the amount of original issue discount that is treated as having accrued as described above under Tax Accounting Treatment of Discount Bonds. Such gain or loss will be long-term capital gain or loss if at the time of the sale or retirement the Series 2013B Bond has been held for more than one year. Under present law both long and short-term capital gains of corporations are taxed at the rates applicable to ordinary income. For noncorporate taxpayers, however, shortterm capital gains are taxed at the rates applicable to ordinary income, while net capital gains are taxed at lower rates. Net capital gains are the excess of net long-term capital gains (gains on capital assets held for more than one year) over net short-term capital losses. If a holder acquires a Series 2013B Bond at a discount from its principal amount (or in the case of a Series 2013B Bond issued at an original issue discount, at a price that produces a yield to maturity higher than the yield to maturity at which such Series 2013B Bond was first issued), the holder will be deemed to have acquired the Series 2013B Bond at market discount, unless the amount of market discount is de minimis, as described in the following paragraph. If a holder that acquires a 2013 Bond with market discount subsequently realizes a gain upon the disposition of the Series 2013B Bond, such gain shall be treated as taxable ordinary income to -22-

25 the extent such gain does not exceed the accrued market discount attributable to the period during which the holder held such Series 2013B Bond, and any gain realized in excess of such market discount will be treated as capital gain. Potential purchasers should consult their tax advisors as to the proper method of accruing market discount. In the case of a Series 2013B Bond not issued at an original issue discount, market discount will be de minimis if the excess of such Series 2013B Bond s stated redemption or purchase price at maturity over the holder s cost of acquiring such Series 2013B Bond is less than 0.25% of the stated redemption price at maturity multiplied by the number of complete years between the date the holder acquires such Series 2013B Bond and its stated maturity date. In the case of a Series 2013B Bond issued with original issue discount, market discount will be de minimis if the excess of such Series 2013B Bond s revised issue price over the holder s cost of acquiring such Series 2013B Bond is less than 0.25% of the revised issue price multiplied by the number of complete years between the date the holder acquires such Series 2013B Bond and its stated maturity date. For this purpose, a Series 2013B Bond s revised issue price is the sum of (i) its original issue price and (ii) the aggregate amount of original issue discount that is treated as having accrued with respect to such Series 2013B Bond during the period between its original issue date and the date of acquisition by the holder. Tax Accounting Treatment of Premium Bonds A Series 2013B Bond will be considered to have been issued at a premium if, and to the extent that, the holder s tax basis in such Series 2013B Bond exceeds the amount payable at maturity (or, in the case of a Series 2013B Bond callable prior to maturity, the amount payable on the earlier call date). Under regulations applicable to the Series 2013B Bonds, the amount of the premium is determined with reference to the amount payable on that call date (including for this purpose the maturity date) which produces the lowest yield to maturity on the Series 2013B Bond. The holder will be required to reduce his tax basis in the Series 2013B Bond for purposes of determining gain or loss upon disposition of such Series 2013B Bond by the amount of amortizable bond premium that accrues, determined in the manner prescribed in the regulations. Generally, no deduction (or other tax benefit) is allocable in respect of any amount of amortizable bond premium on the Series 2013B Bonds. Purchasers with questions concerning the detailed tax consequences of transactions in Series 2013B Bonds issued at a premium should consult their tax advisors. Legislative Developments Legislative proposals recently under consideration or proposed after issuance and delivery of the Series 2013B Bonds could adversely affect the market value of the Series 2013B Bonds. Further, if enacted into law, any such proposal could cause the interest on the Series 2013B Bonds to be subject, directly or indirectly, to federal income taxation and could otherwise alter or amend one or more of the provisions of federal tax law described above or their consequences. Prospective purchasers of the Series 2013B Bonds should consult with their tax advisors as to the status and potential effect of legislative proposals, as to which Bond Counsel expresses no opinion. -23-

26 LEGALITY OF SERIES 2013B BONDS FOR INVESTMENT AND DEPOSIT The Act provides that the Series 2013B Bonds are securities in which all public officers and public bodies of the State of Maryland and its political subdivisions, all insurance companies, state banks and trust companies, savings banks, savings and loan associations, investment companies, executors, administrators, trustees and other fiduciaries in the State of Maryland may properly and legally invest funds. The Series 2013B Bonds, under the Act, may be deposited with and received by any State or municipal officer or any agency or political subdivision of the State of Maryland for any purpose for which the deposit of bonds or obligations of the State of Maryland may be authorized by law. STATE NOT LIABLE ON SERIES 2013B BONDS The Series 2013B Bonds are special obligations of the Authority payable solely from the Revenues and other amounts pledged therefor under the Resolution, and neither the faith and credit nor the taxing power of the State of Maryland, of any political subdivision thereof or of the Authority is pledged to the payment of the principal of or interest on the Series 2013B Bonds. The sources of revenues of the Authority are limited to those provided by the Act, and the issuance of the Series 2013B Bonds does not directly or indirectly or contingently obligate, morally or otherwise, the State of Maryland, any political subdivision thereof or the Authority to levy or to pledge any form of taxation whatever therefor or to make any appropriation for their payment. The Authority has no taxing power. CORPORATE EXISTENCE OF THE AUTHORITY The Act states that the Authority and its corporate existence shall continue until terminated by law, provided that no such law shall take effect so long as the Authority shall have bonds, notes or other obligations outstanding, unless adequate provision has been made for the payment thereof. Upon termination of the existence of the Authority, all its rights and properties shall pass to and be vested in the State of Maryland. FINANCIAL ADVISOR TO THE UNIVERSITY Prager & Co., LLC, serves as financial advisor to the University (the University s Financial Advisor ) and has been engaged by the University to provide financial advisory services for the development and implementation of the financial plan leading to the issuance of the Series 2013B Bonds. The University s Financial Advisor advises the University in connection with the issuance of its obligations and certain other financial matters. The University s Financial Advisor is a national investment banking firm which serves a variety of educational institutions. -24-

27 FINANCIAL ADVISOR TO THE AUTHORITY Public Financial Management, Inc. ( PFM ) has served as financial advisor to the Authority in connection with the issuance of the Series 2013B Bonds. PFM is not obligated to undertake, and has not undertaken, either to make an independent verification of or to assume responsibility for, the accuracy, completeness or fairness of the information contained in this Official Statement. PFM is an independent financial advisory firm and is not engaged in the business of underwriting, trading or distributing securities. VERIFICATION OF MATHEMATICAL COMPUTATIONS Causey Demgen & Moore Inc., a firm of independent public accountants, will deliver to the Authority, on or before the date of issuance of the Series 2013B Bonds, its verification report indicating that it has examined, in accordance with standards established by the American Institute of Certified Public Accountants, certain information and assertions provided by the Underwriters with respect to the Refunded Bonds. Included in the scope will be a verification of the mathematical accuracy of the mathematical computations of the adequacy of the cash and the maturing principal of and interest on the federal securities deposited with the Trustee to pay (i) upon redemption, the principal of and interest on the Refunded Series 2001B Bonds on or about July 12, 2013 and (ii) when due the principal of and interest on the Series 2004A Bonds becoming due on or before July 1, 2014 and to pay on July 1, 2014 the redemption price of the Series 2004A Bonds maturing after July 1, 2014 and accrued interest thereon. The examination performed by Causey Demgen & Moore Inc. will be solely based upon data, information and documents provided to Causey Demgen & Moore Inc. by the Underwriters. The Causey Demgen & Moore Inc. report will state that Causey Demgen & Moore Inc. has no obligation to update the report because of events occurring, or data or information coming to its attention, subsequent to the date of the report. LEGAL MATTERS McKennon Shelton & Henn LLP is acting as Bond Counsel to the Authority in connection with the issuance of the Series 2013B Bonds. The proposed form of Bond Counsel s approving opinion appears as Appendix D. Certain legal matters will be passed upon for the Underwriters by Ballard Spahr LLP and for the University by Venable LLP. INDEPENDENT AUDITORS The financial statements of the University as of and for the years ended June 30, 2012 and 2011 included in Appendix B have been audited by KPMG LLP, independent auditors, as stated in their report appearing therein. -25-

28 RELATIONSHIPS The University maintains a conflict of interest policy. From time to time the University enters into business arrangements with entities that are related to officers or trustees of the University. See Board of Trustees in Appendix A. Certain trustees of the University were formerly affiliated with entities under common control with J.P. Morgan Securities, Inc. and Morgan Stanley & Co. LLC, two of the Underwriters of the Series 2013B Bonds. The University believes that all such arrangements are consistent with the University s conflict of interest policy. Venable LLP is acting as counsel to the University. In addition, from time to time, Venable LLP represents the Authority on legislative matters. McKennon Shelton & Henn LLP serves as general counsel to the Authority and is acting as Bond Counsel in connection with the issuance of the Series 2013B Bonds. CONTINUING DISCLOSURE In accordance with Rule 15c2-12 (the Rule ) promulgated by the Securities and Exchange Commission, the University has undertaken for the benefit of the Holders of the Series 2013B Bonds to provide certain financial information or operating data and audited financial statements, and to provide notices of the occurrence of certain events, as described under Summary of Certain Provisions of the Loan Agreement -- Continuing Disclosure in Appendix C. The University has failed in the past to comply with certain continuing disclosure undertakings made for the benefit of holders of bonds issued by the Authority for its benefit. The University failed to file its audited financial statements for fiscal years 2008 with the nationally recognized municipal information repositories (as required by the Rule at that time) and for fiscal year 2011 with the Municipal Securities Rulemaking Board (the MSRB ) through its Electronic Municipal Market Access System ( EMMA ). The University s filings with the MSRB through EMMA for fiscal year 2009 omitted the CUSIP number of certain thenoutstanding bonds which are no longer outstanding. All of the University s filings with the MSRB through EMMA omitted the CUSIP number for a certain series of bonds guaranteed by the University, but issued for the benefit of JHMI Utilities, LLC, an entity jointly owned by the University and The Johns Hopkins Health System Corporation. The University has since filed the omitted continuing disclosure information and CUSIP number links with the MSRB through EMMA and has implemented procedures to ensure future compliance. MISCELLANEOUS The references herein to the Act, the Resolution, the Loan Agreement and other materials are brief outlines of certain provisions thereof. Such outlines do not purport to be complete and, for full and complete statements of such provisions, reference is made to such instruments, documents and other materials, copies of which are on file at the offices of the Authority. The information contained in this Official Statement has been compiled or prepared from information obtained from the University and official and other sources deemed to be reliable -26-

29 and, while not guaranteed as to completeness or accuracy, is believed to be correct as of this date. Any statements involving matters of opinion, whether or not expressly so stated, are intended as such and not as representations of fact. The attached Appendices are integral parts of this Official Statement and should be read in their entirety together with all of the foregoing information. The University has reviewed the information contained herein. -27-

30 The execution and delivery of this Official Statement by the Chairman or other authorized Member and the Executive Director of the Authority have been duly authorized by the Authority. MARYLAND HEALTH AND HIGHER EDUCATIONAL FACILITIES AUTHORITY By: /s/ Sheila K. Riggs Sheila K. Riggs Chairman By: /s/ Annette Anselmi Annette Anselmi Executive Director Approved: June 11, 2013 THE JOHNS HOPKINS UNIVERSITY By: /s/ Gregory S. Oler Gregory S. Oler Controller -28-

31 THE JOHNS HOPKINS UNIVERSITY APPENDIX A

32 Appendix A THE JOHNS HOPKINS UNIVERSITY Table of Contents Overview... A-1 Academic and Research Programs... A-2 Principal Affiliates of the University... A-5 Board of Trustees... A-7 University Management... A-9 Faculty... A-11 Employees... A-11 Students... A-11 Financial Information... A-12 Litigation and Administrative Proceedings... A-21

33 THE JOHNS HOPKINS UNIVERSITY The Johns Hopkins University ( Johns Hopkins or the University ) is a premier, privately endowed research and higher education institution based in Baltimore, incorporated and existing under the laws of the State of Maryland. The University is a non-profit corporation with total net assets of approximately $4.4 billion as of June 30, 2012, total operating revenues of approximately $4.6 billion for the fiscal year ended June 30, 2012, and enrollment of approximately 21,000 students. The University is internationally recognized as a leader in research, teaching, and medical care, providing students and faculty of the highest caliber the resources to excel. The University was the first educational institution in the United States established with advanced studies and research as its primary goal, and, as such, it has been described as the first true research university in America. The University currently receives more U.S. government research support than any other academic institution in the country, according to the annual National Science Foundation Survey. The University was incorporated in 1867, and was established following the death of Johns Hopkins, a Quaker merchant and financier from Baltimore. He directed that a $7 million bequest from his estate be divided equally between the University and The Johns Hopkins Hospital (the Hospital ), which is a separate corporate entity (see Principal Affiliates of the University The Johns Hopkins Hospital below). The mission of the University is to educate its students and cultivate their capacity for lifelong learning, to foster independent and original research, and to bring the benefits of discovery to the world. A substantial portion of the University s facilities and operations are located on two campuses and other sites within the city of Baltimore, Maryland. At the University s 128-acre Homewood campus, the University operates the Zanvyl Krieger School of Arts and Sciences, the G.W.C. Whiting School of Engineering and the School of Education. At the East Baltimore campus, adjacent to the facilities of the Hospital, are the University s School of Medicine, School of Nursing and the Bloomberg School of Public Health. The Carey Business School and the Peabody Institute occupy separate sites in downtown Baltimore. In addition, the University operates the Paul H. Nitze School of Advanced International Studies, with facilities in Washington, D.C., Bologna, Italy and Nanjing, People s Republic of China. The University operates a major research facility, the Applied Physics Laboratory ( APL ), located in Howard County, Maryland, as well as several other academic, research and support facilities elsewhere in Maryland. A-1

34 Academic and Research Programs Undergraduate and graduate programs are designed to provide students the maximum opportunity for advanced study and original research. Graduate programs are offered in each of the University s nine academic divisions, while undergraduate programs are offered at six divisions. The University encourages interdisciplinary collaborations and offers several inter-departmental degree programs. Undergraduate students are encouraged to pursue independent study, research and graduate level course work. Over the years, 36 individuals associated with Johns Hopkins including four current faculty members have won Nobel prizes in peace, physics, medicine, chemistry, and economics. Over 50 current faculty members have been elected to the Institute of Medicine, 20 have been elected to the National Academy of Sciences, and 12 have been elected to the National Academy of Engineering. The University is accredited by the Middle States Association of Colleges and Schools, the major accrediting body for institutions of higher education in the Middle Atlantic region. Each professional school also holds accreditations from applicable professional associations. Zanvyl Krieger School of Arts and Sciences. The Zanvyl Krieger School of Arts and Sciences was the first school established at the University in 1876 and is located on the Homewood campus. The School offers instruction at the undergraduate, graduate and postdoctoral levels. The School s undergraduate program provides instruction in four general areas: natural sciences, behavioral sciences, quantitative studies and humanistic studies. Each of these programs leads to a bachelor s degree. Graduate programs are offered in each of the School s departments. G.W.C. Whiting School of Engineering. The G.W.C. Whiting School of Engineering was originally established in 1913 as a division of the Arts and Sciences program and was later established as a separate division of the University in The School was created to provide increased emphasis on, and greater visibility of, engineering education at the University. The School now consists of eight departments in addition to the undergraduate program in biomedical engineering, which is run jointly by the Schools of Engineering and Medicine. It offers bachelors, masters and doctoral degrees. School of Medicine. The School of Medicine, which opened in 1893, is consistently ranked among the top medical schools in the country and is one of the leading medical research institutions in the world. Innovative methods of patient care and medical research have been hallmarks of Johns Hopkins throughout its history. The School of Medicine has been responsible for numerous important medical discoveries and developments and was the first medical school in the United States to combine experience in the research laboratory with the care of patients in a hospital as part of the basic curriculum, now a widespread practice. The School of Medicine offers instruction leading to the M.D. degree, as well as other advanced degrees. A-2

35 Bloomberg School of Public Health. The Bloomberg School of Public Health opened in 1916, and was the first institution in the United States devoted to advanced study in problems in international health and health care delivery. The School offers instruction toward graduate and postdoctoral degrees in the diverse fields of public health. The scope of the School s instruction and research activities includes such areas as chronic and infectious diseases, environmental health and medicine, health economics, maternal and child health, mental hygiene, population dynamics, behavioral health and public health administration. School of Nursing. The School of Nursing was founded in 1983 by the University in collaboration with the former Church Hospital, The Johns Hopkins Hospital and Sinai Hospital of Baltimore. The School opened in 1984, and offers bachelors, masters and doctoral degrees. Post-doctoral programs were established in Paul H. Nitze School of Advanced International Studies. The Paul H. Nitze School of Advanced International Studies was established in Washington, D.C. in 1943 to provide advanced study, research opportunities and training for persons planning careers in international service and research. It became a graduate division of the University in A branch of the School was established in Bologna, Italy, in 1955, to provide European training for American and foreign graduate students. In a joint venture with Nanjing University, the Center for Chinese and American Studies opened in Nanjing, China in Peabody Institute. The Peabody Institute is located in central Baltimore and was founded in 1857 under the terms of a gift from Baltimore philanthropist George Peabody. The Institute is composed of two divisions: the Conservatory, which provides undergraduate and graduate programs leading to degrees in musical arts, and the Preparatory School, which provides musical training and instruction for the community at large. Under a 1986 affiliation agreement between the University and the Institute, Peabody maintains its separate corporate identity and title to its endowment funds. The University has been granted title to substantially all of the other assets of Peabody and has assumed all of the liabilities and other obligations of Peabody as well as full responsibility for management of the Institute. School of Education. The School of Education was established in 2007 as a result of the University s Board of Trustees decision to separate the business and education programs into two schools. The School of Education focuses on research regarding the nation s primary and secondary schools. The School offers a variety of undergraduate, graduate and certificate programs in teacher preparation, special education, counseling, educational leadership, reading and educational technology. Doctoral degrees are offered in special education and in teacher development and leadership. Carey Business School. The Carey Business School was established in 2007 and offers flexible part-time and full-time MBA programs in finance, real estate, information and telecommunications systems, and marketing. The School also offers various certificate and graduate degree programs with other University divisions. A-3

36 University-sponsored Online Education. Johns Hopkins has offered various forms of online education for many years. During the academic year, the University enrolled approximately 2,400 students who were registered for courses in an approved degree or certificate online program across multiple divisions of the University. To expand its online presence and its mission of sharing knowledge and research with the world, in July 2012, the University commenced offering certain graduate courses online at no cost through Coursera. Applied Physics Laboratory. The Applied Physics Laboratory, located in Howard County, Maryland, was established during World War II with funding from the United States government. APL functions as a research facility and conducts research and development primarily in national defense and space sciences. The University owns and operates the facility and conducts research under a multiple task order contract with the United States Navy (the Navy Contract ) and separate contracts with other government agencies. In March 2009, working in coordination with the Department of Defense to change the University s organizational structure for its classified research, the University established The Johns Hopkins Applied Physics Laboratory LLC ( APLLLC ) to operate APL. The University owns and controls APLLLC and the President of APLLLC reports directly to a Board of Managers composed of existing University Trustees. In accordance with an agreement between the U.S. government and the University, APL has been designated a national resource. Under the agreement, if the University determines that it can no longer sponsor APL or if the Secretary of the Navy determines that the Navy can no longer contract with the University with respect to APL on mutually satisfactory terms, the University is required to establish a charitable trust to provide for the continued availability of APL. One of the purposes of the trust is to provide for a reduction in the size and/or scope of work performed at APL, or an orderly dissolution of APL. The trust would consist of the University s interest in the APL facilities and the balances in the University s APL stabilization, contingency and research fund. APL is also discussed in Note 2 in the financial statements of the University included in Appendix B. Approximately 78% and 15% of the APL s contract revenues in fiscal 2012 were from the Department of Defense (primarily under the Navy Contract) and the National Aeronautics and Space Administration, respectively. Contract work includes evaluation and design of various types of missile systems and command, control, and communication systems, assessment of submarine technologies, design of space systems for precision tracking, location and navigation, and conduct of space experiments. The contracts define costs for which reimbursements may be received and provide a management fee to the University. The Navy Contract requires that a portion of the fees earned under the Navy Contract be retained and used for various APL-related purposes, including, among other things, APL working capital, capital projects at APL and APL reserves. APL revenues for the fiscal year ended June 30, 2012 were approximately $1.1 billion and represented approximately 24% of the University s operating revenues. A-4

37 The University works under an omnibus contract with the U.S. Navy. The most recent contract was signed in February, The new Navy Contract provides for a five year intial term ending in September 2017, plus a five year renewal option, and establishes an aggregate purchase limit of $4.9 billion over the ten-year contract period. The prior contract was signed in 2002, ran for a five year initial term and a five year optional renewal term, and provided for an aggregate purchase limit of $4.7 billion for its scheduled ordering period, which ended on September 30, The prior contract allowed for a twelve month period following conclusion of the ordering period for additional funding and completion of existing task orders. APL has continued to work on task orders under the prior contract. Principal Affiliates of the University The Johns Hopkins Hospital. The Hospital is a separately incorporated nonprofit corporation, the sole member of which is The Johns Hopkins Health System Corporation (the Health System ). The Hospital owns and operates the largest academic medical center in Maryland, located at the East Baltimore campus. The Hospital provides a complete range of inpatient and outpatient services and serves as the principal teaching hospital for the School of Medicine. The Hospital has served as the primary teaching facility of the School of Medicine since 1893, and the physical facilities of the School of Medicine and the Hospital are located adjacent to one another. The University s Bloomberg School of Public Health and School of Nursing are also located at the East Baltimore campus. The School of Medicine occupies approximately one-quarter of the Hospital s facilities in carrying out its research, educational and clinical activities. Most full-time medical staff at the Hospital are faculty members or clinical associates employed by the School of Medicine. Fees for professional services provided by members of the University s faculty to patients at the Hospital and other hospitals and outpatient care facilities in the Baltimore area constitute clinical services revenues of the University. Clinical services provided approximately 11% of the University s operating revenues in the fiscal year ended June 30, All members of the Hospital resident staff are residents or fellows employed by the School of Medicine. The exchange of services between the University and the Hospital is formalized each year in a Joint Administrative Agreement ( JAA ) which details the amounts negotiated for each major service provided by one institution to the other, primarily professional medical services from the University and space rentals from the Hospital. Historically, the University has consistently provided more services to the Hospital than it has received in services. Under the JAA, the net amount due to the University is paid in periodic installments, and after the close of each fiscal year, a final settlement is made based upon actual costs of services rendered. The net payment to the University for the fiscal year 2012 was approximately $130 million. The Hospital draws patients not only from metropolitan Baltimore and the surrounding counties, but also significantly from a five-state radius as well as the rest of the United States and over 100 other countries. In a number of surveys of consumers and health professionals, the Hospital is consistently rated among the top hospitals in the A-5

38 country. U.S. News & World Report has ranked the Hospital number one in the United States for 21 consecutive years out of the 24 years in which U.S. News & World Report has held its annual rankings of U.S. hospitals. In the rankings, the Hospital is ranked number one nationally in five specialties, and it is ranked number two overall in the nation. The Johns Hopkins Health System Corporation. The Health System was incorporated in 1986 at the direction of the Hospital s Board of Trustees to serve as the parent entity of an academically-based health system with the Hospital as its core. The Health System is a private, nonprofit, non-stock, membership corporation organized under the laws of the State of Maryland. The Health System offers a range of health services, including acute care on an inpatient and outpatient basis, rehabilitation, chronic care and skilled nursing care, home health care services and specialty inpatient programs involving highly sophisticated medical procedures. In addition to the Hospital, which is the flagship institution, the Health System has grown to include the following entities, among others: Johns Hopkins Bayview Medical Center, Howard County General Hospital, Suburban Hospital, Sibley Memorial Hospital, All Children s Hospital, and Johns Hopkins Community Physicians Inc., a primary care community-based physician group practice with a network of locations throughout Maryland, and several other health care related entities. The Hospital and the Health System are not owned by the University, not included in the University s financial statements, and not obligated to make payments on any University indebtedness, but are important to the research, clinical and teaching missions of the University and linked to the University by significant contractual and other relationships. The University is not obligated to make payments on any indebtedness of the Hospital or the Health System. For information concerning affiliated organizations controlled by the University and investments in organizations which the University does not control, see Notes 1(b) and 11 in the financial statements of the University included in Appendix B. Johns Hopkins Medicine. In 1995, to coordinate the linked activities of the Hospital and the Health System and the University at the East Baltimore campus, the Boards of Trustees of the Hospital, the Health System and the University established Johns Hopkins Medicine and an Office of Johns Hopkins Medicine ( JHM ). In 1996, the Health System and the University expanded JHM to include a Board of Johns Hopkins Medicine consisting of members who are trustees of the University or the Health System, or both. JHM s main function is to direct, integrate and coordinate the clinical activities of the University and the Health System. JHM is not a separate legal entity and does not have the authority to incur indebtedness or issue guarantees. The Chief Executive Officer of JHM is the dean of the University s School of Medicine and vice chairman of the Health System. A-6

39 Board of Trustees The University is governed by the Board of Trustees (the Board ). Current voting membership of the Board is 45, including four ex officio Trustees: the Chair of the Board of Johns Hopkins Medicine, the President and Vice President of the Johns Hopkins Alumni Council, and the President of the University. Former Chairs of the Board may also serve as voting ex officio Trustees. Currently, there are 30 regular members of the Board; 12 Alumni Trustees, who are nominated by the alumni; and three Young Trustees, recent graduates who serve a four-year term. Both regular and Alumni Trustees are elected to serve a six-year term, with the possibility of election to a second and final term; Young Trustees are not eligible for additional terms. In 2011, the Board completed a review of its governance structure and amended its bylaws to provide, among other things, that there will be no more than 35 regular and Alumni Trustees, and no Young Trustees, effective July 1, In matters of policy and operations, the Board delegates broad authority to the Executive Committee of the Board and the President of the University and, through the President, to the administration and the faculty. However, the Board retains direct responsibility for those duties specifically assigned to it under the terms of the University bylaws, including the selection of the President and the formulation of policies concerning the financial health and physical properties of the University. The Board usually meets four times each year, once in the fall, once in the winter and twice in the spring. Much of the work of the Board is done by its twelve standing committees: Executive; Finance; Academic Policy; Audits, Compliance and Insurance; Investments; Applied Physics Laboratory; Development; Trusteeship, Nominations and By-laws; Compensation; External Affairs and Community Engagement; Intermediate Sanctions; and Student Life. The following table lists the current and emeritus members of the Board of Trustees as well as their primary affiliations. PAMELA P. FLAHERTY, CHAIR 1... CEO and President, Citi Foundation, Director, Corporate... Citizenship, Citigroup, Inc. C. MICHAEL ARMSTRONG, VICE CHAIR 1,2,3... Retired Chairman, Hughes, AT&T and Comcast Corporation RICHARD S. FRARY, VICE CHAIR 1... President, Tallwood Associates, Inc. GAIL J. McGOVERN, VICE CHAIR 1... President and CEO, American Red Cross ROBERT J. ABERNETHY 3... President, American Standard Development Company LEONARD ABRAMSON 3... Consultant, The Abramson Group PETER G. ANGELOS 3... Attorney, Law Office of Peter G. Angelos JEFFREY H. ARONSON 1... Managing Principal, Centerbridge Partners, L.P. NORMAN R. AUGUSTINE 3... Retired Chairman and CEO, Lockheed Martin Corporation JANIE E. BAILEY... Financial Services LENOX D. BAKER, JR Manager and Owner, Pitchfork Ranch H. FURLONG BALDWIN 3... Chairman, The NASDAQ OMX Group, Inc. JEREMIAH A. BARONDESS 3... President Emeritus, The New York Academy of Medicine ERNEST A. BATES 3... Neurosurgeon, Chairman and CEO, American Shared Hospital Services DAVID H. BERNSTEIN 3... Consultant, Carisam/Samuel Meisel ABHIRAM R. BHASHYAM... Medical Student, Harvard Medical School PAULA E. BOGGS... Attorney/Former Executive VP, General Counsel & Secretary, Starbucks Coffee Company AURELIA G. BOLTON 3... Associate, Aurelia G. Bolton & Elizabeth K. Schroeder, LLC GEORGE L. BUNTING, JR President, The Bunting Management Group CONSTANCE R. CAPLAN 3... Chairman, The Time Group A. JAMES CLARK 3... Chairman and CEO, Clark Enterprises, Inc. CHARLES I. CLARVIT 1... Chief Executive Officer, Vinci Partners A-7

40 N. ANTHONY COLES 1... President & CEO, Onyx Pharmaceuticals, Inc. RONALD J. DANIELS 1,2... President, The Johns Hopkins University ANTHONY W. DEERING 1... Chairman, Exeter Capital ANDREAS C. DRACOPOULOS... Director & Co-President, Stavros Niarchos Foundation INA R. DREW... Retired Chief Investment Officer, J.P. Morgan Chase & Company MANUEL DUPKIN II 3... Former Chairman and President, Johnston Laboratories, Inc. HARVEY P. EISEN... Chairman, Managing Partner, Bedford Oak Partners ROGER C. FAXON... Board Member, ITV, United Kingdom MARJORIE M. FISHER... Adjunct Assistant Professor of Egyptology, University of Michigan JAMES A. FLICK, JR President, Winnow, Inc. LOUIS J. FORSTER 1... Chairman, Cerberus Asia Pacific Advisors; Managing Director, Cerberus Capital Mgmt., L.P. SANFORD D. GREENBERG 3... Chairman and CEO, TEI Industries, Inc. BENJAMIN H. GRISWOLD, IV 3... Chairman, Brown Advisory TAYLOR A. HANEX... Senior Vice President, Investments & Wealth Management Advisor, Merrill Lynch MICHAEL D. HANKIN... President & CEO, Brown Investment Advisory and Trust Company ROBERT D. H. HARVEY 2,3...Former Chairman of the Board, MNC Financial Corporation/Maryland National Bank LEE MEYERHOFF HENDLER... Educator RAFAEL HERNANDEZ-COLON 3... Former Governor of Puerto Rico DAVID C. HODGSON... Managing Director, General Atlantic, LLC R. CHRISTOPHER HOEHN-SARIC 1... Senior Managing Director, Sterling Capital Partners, L.P. FRANK L. HURLEY, Ph. D.... Chairman and Chief Scientific Officer, RRD International, LLC STUART S. JANNEY, III 1... Chairman, Bessemer Trust Company, N.A. JEONG H. KIM 3... President, Bell Labs-Alcatel-Lucent DAVID H. KOCH 3... Executive Vice President, Koch Industries DONALD A. KURZ... Chairman and CEO, Omelet, LLC ETHAN D. LEDER... Co-Founder, Precision Health Holdings CHRISTOPHER H. LEE... Founder and Managing Partner, Highstar Capital JOANNE LEEDOM-ACKERMAN... Writer JAY L. LENROW 2... Attorney/Of Counsel, Adelberg, Rudow, Dorf & Hendler, LLC ALEXANDER H. LEVI... Clinical Psychologist KWOK-LEUNG LI 3... President and CEO, RioRey, Inc. SAMUEL R. LICHTENSTEIN... Teacher, Teach for America Corps F. PIERCE LINAWEAVER 3... Retired Consulting Environmental and Civil Engineer ROGER C. LIPITZ 3... Managing Member, Ocean Assets, LLC CHRISTOPHER E. LOUIE... President, Limbix Productions, Inc. RAYMOND A. MASON 2, 3... Senior Advisor, Legg Mason, Inc. CHRISTINA MATTIN 3... Philanthropist, C. Mattin and Associates TERRI L. McBRIDE 2... Global Knowledge Manager, Private Equity, McKinsey & Company, Inc. HARVEY M. MEYERHOFF 3... Chairman, Magna Holdings, Inc. WESTLEY W. O. MOORE... Author, Media/Entertainment HEATHER HAY MURREN..... Retired, Co-Founder and Chairman, Nevada Cancer Institute NANEEN H. NEUBOHN 3... Former Advisory Director, Morgan Stanley DAVID P. NOLAN... Co-President and Chief Risk Officer, Millennium Partners, LP RONALD M. NORDMANN 3... Co-President, Global Health Associates, LLC RALPH S. O CONNOR 3... President and CEO, Ralph S. O Connor & Associates SARAH BROWN O HAGAN... Co-Chair, International Rescue Committee (IRC) MORRIS W. OFFIT 2,3... Chairman, Offit Capital Advisors, LLC WALTER D. PINKARD, JR Chairman, Cassidy Turley GEORGE G. RADCLIFFE 3... Former Chairman of the Board and CEO, The Baltimore Life Insurance Company JOSEPH R. REYNOLDS JR 3... President and CEO, RTI Group, LLC BRIAN C ROGERS 1... Chairman of the Board, T. Rowe Price Group DAVID M. RUBENSTEIN... Managing Director and Co-Founder, The Carlyle Group MARK E. RUBENSTEIN 3...Retired Chairman, The Rubenstein Company, LP JOHN F. RUFFLE 3... Retired Vice Chairman of the Board, J.P. Morgan & Company, Inc. ARTHUR SARNOFF 3... Retired President, Bruno Appliance Corporation MARSHAL L. SALANT.....Managing Director, CitiGroup Global Markets, Inc. FRANK SAVAGE 3... Chief Executive Officer, Savage Holdings, LLC CHARLES W. SCHARF... Chief Executive Officer, Visa, Inc. WAYNE N. SCHELLE 3... Chairman, Wayne N. Schelle, Ltd. HERSCHEL L. SEDER 3... Chairman of the Board Emeritus, Milwaukee Valve Company HUNTINGTON SHELDON 3... Retired Professor of Pathology, McGill University (Montreal) R. CHAMPLIN SHERIDAN, JR Retired Chairman, The Sheridan Group RAJENDRA SINGH... Chairman and President, Telcom Ventures, LLC A-8

41 WENDELL A. SMITH 3... Attorney, Senior Partner, Greenbaum, Rowe, Smith, & Davis, LLP SHALE D. STILLER 3... Partner, DLA Piper MORRIS TANENBAUM 3... Former Vice Chairman of the Board, AT&T ADENA W. TESTA 3... Retired Attorney, Stewart, Plant and Blumenthal, LLC WILLIAM F. WARD, JR..... President, Wyoming Ventures, Inc. JAMES L. WINTER 1... Principal, Winter Organization CALMAN J. ZAMOISKI, JR Chairman and CEO, Independent Distributors, Inc. 1 Member of the Executive Committee 2 Ex-officio 3 Emeritus University Management Listed below are the principal executive officers of the University. Brief biographies of certain officers appear after the list of officers. Name Position Since Ronald J. Daniels, J.D. President 2009 Robert C. Lieberman 1 Jonathan A. Bagger Provost and Senior Vice President for Academic Affairs Interim Provost and Senior Vice President for Academic Affairs Vice Provost for Graduate and Post-doctoral Programs and Special Projects Paul B. Rothman, M.D. Chief Executive Officer of Johns Hopkins Medicine 2012 Daniel G. Ennis Senior Vice President for Finance and Administration, and Treasurer Kathryn J. Crecelius, Ph.D. Vice President, Investments, and Chief Investment Officer Mark B. Rotenberg 2 Frederick G. Savage 2 Vice President and General Counsel Deputy General Counsel Fritz W. Schroeder Vice President for Development and Alumni Relations 2010 Charlene Moore Hayes Vice President for Human Resources 2003 Maureen Marsh Interim Secretary of the Board of Trustees 2013 Thomas S. Lewis Vice President for Government and Community Affairs 2010 Glenn M. Bieler Vice President for Communications 2011 Alan Fish Vice President for Real Estate and Campus Services 2011 Helene Grady Vice President for Planning and Budget 2012 Phillip Spector Vice President, Strategic Initiatives 2012 Stephanie L. Reel 1 Effective date July 1, Effective date June 3, 2013 Vice Provost for Information Technology and Chief Information Officer 1999 A-9

42 Ronald J. Daniels, President of the University, effective March Mr. Daniels previously served as Provost of the University of Pennsylvania, a position he held from 2005 to Prior to that, he was dean of the Faculty of Law and James M. Tory Professor of Law at the University of Toronto for 10 years. Mr. Daniels earned a Master of Laws from Yale University in 1988 and a J.D. in 1986 from the University of Toronto, where he served as co-editor-in-chief of the law review and earned several academic honors. He received a B.A. from the University of Toronto in 1982, with high distinction as a political science and economics major. He has been visiting professor and Coca-Cola World Fellow at Yale Law School and John M. Olin Visiting Fellow at Cornell Law School. Robert C. Lieberman, Provost and Senior Vice President of Academic Affairs effective July 1, Dr. Lieberman previously served as interim dean of Columbia s School of International and Public Affairs and professor of political science and public affairs. As provost, Dr. Lieberman will be the University s chief academic officer. He will be responsible for working with the deans of the nine academic divisions and will have oversight for research at the University. He has been a faculty member at Columbia since 1994, becoming department chair in 2007, vice dean for academic affairs in 2009, and interim dean of School of International and Public Affairs more than a year ago. Jonathan A. Bagger, Interim Provost and Senior Vice President of Academic Affairs since September Dr. Bagger, a Johns Hopkins faculty member since 1989, was appointed vice provost for graduate and post-doctoral programs and special projects in March As vice provost, Dr. Bagger focuses on the quality of graduate and postdoctoral programs, strategic planning and enhancing relationships with government funding agencies. Paul B. Rothman, Chief Executive Officer of Johns Hopkins Medicine, Vice President for Medicine and Dean of the Medical Faculty since July Paul B. Rothman, a distinguished physician, scientist, educator and academic health care leader, became the 14th dean of the Johns Hopkins University School of Medicine and second chief executive officer of Johns Hopkins Medicine on July 1, Dr. Rothman, a rheumatologist and molecular immunologist, had been dean of the Carver College of Medicine at the University of Iowa and leader of that university's clinical practice plan. Daniel G. Ennis, Senior Vice President for Finance and Administration since August Mr. Ennis serves as the University s chief financial and administrative officer. Before coming to the University, he had served since 2007 as the executive dean for administration for Harvard Medical School, and before that as Harvard University's associate vice president for finance and financial planning, interim director of treasury management, and director of budgets, financial planning and institutional research. Previously, Mr. Ennis worked as a consultant with McKinsey and Co. He is a 1992 graduate of Boston College and completed a dual master's degree program at Harvard, earning a master's of business administration from the business school and a master's in public administration from the John F. Kennedy School of Government. He is also serving as Treasurer. A-10

43 Faculty At June 30, 2012, the full-time faculty in the academic divisions of the University numbered 4,092 and the part-time faculty numbered 325. Of the 4,092 full-time professors and associate professors, 24.5% were tenured. Employees Staff of the University (excluding employees at APL, students, and faculty) numbered 13,603 as of November 2012, including 2,721 part-time employees. Approximately 570 service and maintenance employees are covered under a three year collective bargaining agreement with Public Service Employees Local Union 572, Laborers International Union of North America AFL-CIO which expires December 31, The University expects to negotiate a renewal of the agreement. As of June 30, 2012, there were 4,680 full-time and 277 part-time employees at APL. With the exception of the tenured faculty, employees under certain union contracts, and a limited number of employees with term employment contracts, substantially all employees of the University, including employees at APL, are at-will employees. Information about the University s pension and postretirement benefit plans for full-time faculty and employees is provided in Note 12 to the University s financial statements included in Appendix B. Most of these plans are defined contribution plans. The University also has a defined benefit pension plan covering bargaining unit employees and those classified as support staff. Effective July 1, 2011, the University closed the support staff pension plan to new participants. Students Admissions. Admission to the freshman class of the University s main undergraduate programs at the Krieger School of Arts and Sciences and the G.W.C. Whiting School of Engineering is highly competitive, with applications increasing by approximately 28% since academic year For the class entering the University in the Fall of 2012, applications increased to 20,502 while admissions were 3,626, representing an 18% admitted rate. The average freshman combined SAT score for the most recent enrolled class was 1,385 for the School of Arts and Sciences and 1,436 for the School of Engineering. For the class entering the University in the Fall of 2013, applications increased to 20,614 while admissions were 3,464, representing a 16.8% admitted rate. A-11

44 The following table provides a five-year summary of undergraduate applications, acceptances and matriculations. UNDERGRADUATE APPLICATIONS, ACCEPTANCES, AND MATRICULATIONS 1 Academic Year Applications Admitted % Admitted Matriculations % Matriculated ,011 4,062 25% 1,235 30% ,122 4,308 27% 1,349 31% ,459 3,787 21% 1,241 33% ,395 3,564 18% 1,279 36% ,502 3,626 18% 1,330 37% (1) Undergraduate applications, acceptances and matriculations at the School of Arts and Sciences and the School of Engineering only. Source: The University. Enrollments. The University enrolled 6,186 undergraduate and 15,081 graduate students during the Fall of The following table shows total headcount enrollments for each of the last five academic years, as well as combined full-time equivalent (FTE) enrollments. UNIVERSITY FALL ENROLLMENT Undergraduate Headcount 5,680 5,976 5,971 6,014 6,186 Graduate Headcount 14,469 14,784 15,392 15,396 15,081 Total Headcount 20,149 20,760 21,363 21,410 21,267 FTE Enrollment 14,808 15,111 15,952 16,134 16,103 Source: The University. Financial Information The University s annual audited financial statements for the fiscal years ended June 30, 2012 and 2011 are included in Appendix B. The financial statements include the balance sheets and the related statements of activities and cash flows. The financial statements include the accounts of the various academic and support divisions, APL, the Johns Hopkins University Press and affiliated organizations which are controlled by the University, including Jhpeigo Corporation and Peabody Institute of the City of Baltimore. The audited financial statements are an integral part hereof and should be read in their entirety. The selected financial and other information below has been derived by management from the audited financial statements of the University prepared in accordance with generally accepted accounting principles, unless otherwise denoted. The University currently makes certain annual operating and financial information, including its audited financial statements, available through the Municipal Securities Rulemaking Board Electronic Municipal Market Access ( as required in accordance with Rule 15c2-12 promulgated under the Securities Exchange Act of 1934, as amended, in connection with bonds issued for the benefit of the University by Maryland Health and Higher Educational Facilities Authority. A-12

45 SUMMARY OF FINANCIAL POSITION AS OF JUNE 30 (in thousands of dollars) 2008 (1) Total Assets $6,603,211 $6,427,525 $6,853,422 $7,670,654 $7,815,285 Total Liabilities 2,490,752 2,948,837 3,216,654 3,207,861 3,462,511 Total Net Assets $4,112,459 $3,478,688 $3,636,768 $4,462,793 $4,352,774 Unrestricted $2,407,626 $1,425,428 $1,491,376 $1,997,486 $1,899,596 Temporarily Restricted 509, , ,907 1,051, ,155 Permanently Restricted 1,195,021 1,223,707 1,264,485 1,414,172 1,455,023 (1) Data presented prior to the change to the Uniform Prudent Management of Institutional Funds Act. Source: The University. The following table provides a summary of operating revenues and operating expenses excluding depreciation, amortization and interest for the fiscal years ended June 30, 2008 through June 30, SUMMARY OF NET AVAILABLE REVENUES YEAR ENDED JUNE 30 (in thousands of dollars) Unrestricted operating revenues: (1) Tuition and fees, gross $ 553,492 $ 586,690 $618,272 $ 672,433 $ 706,209 Less financial aid (180,348) (197,223) (207,292) (230,582) (249,829) Tuition and fees, net 373, , , , ,380 Grants, contracts and similar agreements 2,000,934 2,189,150 2,390,824 2,551,874 2,629,364 Clinical services 371, , , , ,840 Contributions (2) 171, , , , ,566 Investment income 145, , , , ,732 Other (3) 485, , , , ,761 Total operating revenues 3,548,333 3,844,234 4,103,192 4,369,981 4,560,643 Certain operating expenses (4) 3,293,210 3,570,163 3,780,491 4,034,803 4,201,152 Net available revenues $ 255,123 $ 274,071 $ 322,701 $ 335,178 $ 359,491 (1) Excludes non-operating revenues, gains and losses. (2) Includes net assets released from restrictions. (3) Includes reimbursements from affiliated institutions, Maryland State aid, sales and services of auxiliary enterprises and other revenues. (4) Excludes depreciation, amortization and interest. Source: The University. A-13

46 As set forth in the table above, total operating revenues have grown at a compound rate of 6.5% per year for the fiscal years ended June 30, 2008 through June 30, There can be no assurance that the rate of increase in total operating revenues achieved by the University in the past will be maintained or increased in the future. Operating Budget. The policy of the University is for each division to operate with a balanced budget each fiscal year. The annual operating budget is the primary financial control over operations of the University. The annual operating budget is embedded in a five-year financial plan. The plan is developed on a divisional basis within a set of institution-wide financial planning assumptions. The budget details revenues and expenditures for each academic or administrative division for each fiscal year. The budget preparation process begins in the fall, preceding the start of each fiscal year, with an assessment of the goals and resources of the individual departments. Proposed budgets developed by the departments as a result of these assessments are submitted to and reviewed by divisional and central management and amended, where necessary. The budget includes amounts allocated to the respective divisions from the aggregate annual payout of endowment funds set by the Board. The final proposed budget is submitted to the Board for its review and approval at the late spring meeting. During the fiscal year, quarterly operating statements are prepared comparing budgeted and actual revenues and expenditures. These statements are reviewed by divisional and central management. The University receives a significant amount of its funding either directly or indirectly from a number of federal government sources for areas such as grant or contract supported research, clinical services, and student financial aid, some or all of which could be affected by reduced federal funding. (See Financial Information--Grants and Contracts, Clinical Services and Financial Aid below.) As part of its ongoing budgeting and review process, the University analyzes the potential short term and longer term effects of various economic occurrences and has undertaken planning and risk mitigation analyses. There is uncertainty in the short, medium, and long term related to sequestration and the future of federal funding. While the ultimate impact is unknown, the University continues to prepare for potential funding reductions as part of its regular budgeting and risk management activities. In addition, the University maintains strong levels of available liquidity in the event of short term cash flow interruptions. (See Financial Information Liquidity below.) Tuition and Fees. Tuition and fees are subject to annual review and revision by the Board. Tuition for the academic year for undergraduate and graduate students in the schools of Arts and Sciences and Engineering is currently set at $43,930, with first year medical tuition at $44,100. One-time or yearly fees for matriculation or use of facilities vary throughout the University, but in general such fees are approximately $500 for full-time students. Annual room and board charges range from $7,176 to $19,380 for the academic year In fiscal year 2012, net tuition and fees provided approximately 10% of the University s operating revenues. The following table shows annual tuition rates for each of the last five academic years. A-14

47 ANNUAL TUITION RATES Graduate and Undergraduate (1) $37,700 $39,150 $40,680 $42,280 $43,930 First Year Medicine (2) 38,000 39,500 41,200 42,600 44,100 (1) Tuition for schools of Arts and Sciences and Engineering; students in other programs may pay slightly different tuition rates. (2) Second, third, and fourth year medical students pay slightly different tuition rates. Source: The University. Financial Aid. The University is committed to helping students manage the cost of their education by providing financial assistance to all eligible students who qualify based on the availability of funds and demonstrated financial need. Scholarships, loans and employment are provided by the University as financial assistance to students and the awards normally consist of a packaged combination of grants and self-help (loans and employment). The University also provides loans to students from University funds. Federal grants, loan and work-study programs, state grants and scholarships and direct aid to students from charitable foundations and government agencies are also available. Grants and Contracts. A significant amount of the University s revenues and expenditures relate to research and instruction performed under grants, contracts and similar agreements with government agencies. Research and related services (including APL research and related services) produced about 58% of the University s operating revenues in fiscal year Approximately 88% of the revenues from research services are earned under agreements with departments and agencies of the United States government. Major government sponsors include centers, divisions and institutes of the Department of Health and Human Services; agencies of the Department of Defense; the National Aeronautics and Space Administration; and the Agency for International Development. Agreements with these sponsors produced approximately 32%, 34%, 7% and 9%, respectively, of revenues from grants, contracts and similar agreements in fiscal year These revenues include recoveries of facilities and administrative costs, which are generally determined as a negotiated or agreed-upon percentage of direct costs, with certain exclusions. Facilities and administrative cost recovery revenues for the academic and support divisions of the University were $309.1 million for the fiscal year ended June 30, The University s current facilities and administrative rate agreement with the Federal government extends through June 30, The table below summarizes the sources of grants and contracts revenue to the University for the five fiscal years ended June 30, 2008 through June 30, A-15

48 SOURCES OF UNIVERSITY GRANTS AND CONTRACTS YEAR ENDED JUNE 30 (in thousands of dollars) Federal Government Grants and Contracts: Department of Defense $716,385 $765,324 $816,092 $886,844 $884,604 Department of Health and Human Services 703, , , , ,647 National Aeronautics and Space Administration 125, , , , ,515 Agency for International Development 114, , , , ,119 Other Federal Agencies 64,183 65, , , ,146 Total Federal Government Grants and Contracts $1,723,605 $1,867,788 $2,100,228 $2,264,280 $2,285,031 Other Sponsors 277, , , , ,333 Total Grants and Contracts $2,000,934 $2,189,150 $2,390,824 $2,551,874 $2,629,364 Source: The University (unaudited). Historically, the largest single University contract has been the APL contract with the U.S. Navy, which produced approximately 20% of grant and contract revenues in fiscal year See Academic and Research Programs Applied Physics Laboratory. Clinical Services. Professional medical services are provided by certain members of the University s faculty to patients at The Johns Hopkins Hospital and certain other hospitals and outpatient care facilities. These clinical services produced approximately 11% of the University s operating revenues in fiscal year Capital Campaigns. On May 4, 2013, the University and Johns Hopkins Medicine announced a $4.5 billion goal for a new capital campaign, named Rising to the Challenge. The University expects the campaign to generate funds primarily for the endowment and for operating support of the various academic programs, centers and institutes. The campaign will include a focus on signature initiatives in new multidisciplinary ventures. The last campaign was launched in 2002, when the University and the Health System announced a $2 billion goal for a fund-raising campaign called The Johns Hopkins Campaign: Knowledge for the World. The purpose of the campaign was to build and upgrade facilities on all Johns Hopkins campuses, to strengthen endowment for student aid and faculty support, and to advance research, academic and clinical initiatives. The campaign closed in December, 2008 and generated over $3 billion in receipts over a ten year period from more than 250,000 individuals and organizations. A-16

49 Campaign results are described in accordance with Council for Advancement and Support of Education ( CASE ) Management Reporting Standards. Contributions are reported in the University s financial statements included in Appendix B based on U.S. Generally Accepted Accounting Principles ( GAAP ) as described in Notes 1(d) and 4. CASE standards and GAAP standards differ in certain respects, including the treatment and recognition of certain types of contributions, such as bequests, and the present value discounting of long-term contributions receivable. Investments. The following table summarizes the fair value of the University s investments, including operating investments, as of June 30 for the five fiscal years ended June 30, 2008 through June 30, 2012 and for the period ending March 31, UNIVERSITY INVESTMENTS AS OF JUNE 30 AND FOR THE PERIOD ENDED MARCH 2013 (in thousands of dollars) Mar 2013 (unaudited) Operating Investments $ 159,247 $ 681,083 $ 776,768 $ 775,227 $ 820,488 $ 941,676 Long Term Investments 3,466,001 2,657,560 3,021,735 3,535,805 3,492,777 3,800,581 Total Investments 3,625,248 3,338,643 3,798,503 4,311,032 4,313,265 4,742,257 Less: Investments Managed for Others (1) (437,183) (340,687) (399,981) (489,252) (480,629) (510,617) University Investments (2) $3,188,065 $2,997,956 $3,398,522 $3,821,780 $3,832,636 $4,231,640 (1) Includes amounts held for The Johns Hopkins Hospital Endowment Fund, Incorporated and two other entities. (2) Includes unrestricted, temporarily restricted and permanently restricted amounts. Source: The University. The University's total investments described above include certain endowment and similar funds held for others and include operating investments. The funds held for others related to the July 1, 2007 agreement with The Johns Hopkins Hospital Endowment Fund, Incorporated ( JHHEFI ), pursuant to which JHHEFI agreed to invest its funds as part of the University s Endowment Investment Pool (the Pool ) and gave the University full discretionary power to manage and invest the JHHEFI assets in the Pool. Subsequently, two additional not-for-profit affiliates entered the Pool. Investments are stated at their fair values, which are generally determined based on quoted market prices or estimates provided by external investment managers or other independent sources. Investments managed within the Pool had an aggregate fair value of approximately $3.1 billion, or approximately 72% of total investments, as of June 30, The Pool has achieved a compound average annual return for the year ended June A-17

50 30, 2012 and the past five and ten year periods of 2.0%, 2.2% and 6.6%, respectively. The Pool s unaudited return for the nine month period ended March 31, 2013 was 10.5%. The Committee on Investments of the Board oversees management of the University s investments. The University has retained external firms to manage the majority of the Pool s investments. The managers invest within policy limits established by the Committee. Investment managers are required to provide quarterly reports to the Chief Investment Officer for performance evaluation. Investments in the Pool are diversified by asset class and by investment manager and style. The management structure of the Pool includes separately managed domestic and international equity portfolios, domestic and international commingled and index funds, fixed income portfolios, and alternative investments, consisting of venture capital limited partnerships, private equity limited partnerships, real assets limited partnerships, hedge funds and absolute return funds. The University s portion of the Pool is made up of approximately 3,400 individual accounts that are invested collectively, but accounted for separately to assure compliance with any donor restrictions. The annual appropriation of income and realized gains from the University s portion of the Pool is subject to the approval of the Committee on Investments. With respect to donor-restricted endowment accounts, the University s Board of Trustees appropriates for expenditure or accumulates funds, in the exercise of ordinary business care and prudence, taking into account the facts and circumstances and pertinent legal requirements. The annual appropriation is determined in the context of the University s spending rate policy. The policy, which is based on a long-term investment return assumption as well as an estimated inflation factor, targets the appropriation to be in a range of 4.5% to 5.5% of the prior three years average market value of the endowment. The Committee on Investments sets investment policy and determines the Pool s asset allocation guidelines. The asset allocation of the Pool for the last five fiscal years is shown in the following table: HISTORICAL ENDOWMENT INVESTMENT POOL ASSET ALLOCATION AT JUNE 30 YEAR END Domestic equities 19.9% 17.5% 13.7% 14.3% 14.4% International equities 28.0% 22.3% 22.1% 24.5% 22.6% Fixed income 13.1% 9.3% 8.5% 7.4% 7.6% Marketable alternatives (1) 18.7% 23.0% 26.2% 20.2% 19.5% Non-marketable alternatives (2) 20.0% 26.3% 28.3% 28.9% 32.7% Cash and equivalents 0.3% 1.6% 1.2% 4.7% 3.2% Total 100.0% 100.0% 100.0% 100.0% 100.0% (1) Marketable alternatives include hedge funds and absolute return funds (2) Non-marketable alternatives include real estate and other real assets, venture capital and private equity investments Source: The University. A-18

51 Additional information regarding the University s investments is provided in Note 5 to the financial statements of the University included in Appendix B. There can be no assurance that the level of returns on investments achieved by the University in the past will be maintained or increased in the future. Liquidity. The University s cash and cash equivalents and short term fixed income investments had an unaudited fair market value of approximately $1.36 billion as of March 31, Substantially all of these investments can be liquidated for same day or next day funds. The University's short term indebtedness consists of commercial paper notes and variable rate demand bonds outstanding in the aggregate principal amount of approximately $343.4 million as of March 31, The University maintains three standby liquidity support agreements with available commitments of $100 million, $175 million and $100 million, with maturity dates of April 2014, January 2016 and January 2016, respectively. These agreements are intended to enable the University to fund the purchase of variable rate demand bonds, which are tendered and not remarketed and to pay the maturing principal of and interest on commercial paper notes in the event they cannot be remarketed. The University also maintains a revolving credit facility with a bank in the amount of $100 million, with a maturity date of March 2014, to support operating needs arising from seasonal and cyclical variations for APL. Plant Assets. Investments in plant assets are stated at cost or at estimated fair value if acquired by gift, less accumulated depreciation and amortization. Title to certain equipment purchased using funds provided by government granting or contracting agencies is vested in the University. Such equipment is included in investment in plant assets. Certain facilities utilized by APL in connection with its performance under agreements with the United States government are owned by the government. Such facilities are not included on the University s balance sheet; however, APL is accountable to the government for them. The net investment in plant assets for each of the five most recent fiscal years ended June 30 is set forth in the following table: NET INVESTMENT IN PLANT ASSETS AS OF JUNE 30 (in thousands of dollars) Land $50,481 $59,151 $76,324 $76,324 $76,324 Land improvements 78,259 80,200 79,489 83,778 84,975 Buildings and leasehold improvements 2,126,838 2,267,335 2,364,129 2,504,818 2,678,694 Equipment 527, , , , ,738 Capitalized Software costs 103, , , , ,217 Library collections 194, , , , ,054 Construction in progress 161, , , , ,111 3,241,818 3,466,154 3,639,957 3,855,115 4,057,113 Less accumulated depreciation and (1,324,690) (1,479,120) (1,632,162) (1,796,471) (1,953,838) amortization Total $1,917,128 $1,987,034 $2,007,795 $2,058,644 $2,103,275 Source: The University A-19

52 Indebtedness and Other Obligations. The University has outstanding a number of bond and note issues, commercial paper notes and other obligations. For a discussion of these obligations, please refer to Notes 8, 14 and 15 in the financial statements of the University as of June 30, 2012 included in Appendix B. On February 21, 2013, the University issued $355.0 million The Johns Hopkins University Taxable Bonds, 2013 Series A, and used the proceeds to refund all of the then outstanding Maryland Health and Higher Educational Facilities Authority Revenue Bonds, The Johns Hopkins University Issue, Series 2008B, and $200.0 million in aggregate principal amount of The Johns Hopkins University Taxable Bonds, 2009 Series A, and to pay the costs of issuance. The total unaudited outstanding indebtedness of the University was approximately $1.5 billion as of March 31, The commercial paper indebtedness was incurred pursuant to authorization from the University's Board of Trustees to implement and maintain a commercial paper program (including both taxable and tax-exempt notes) in an aggregate amount not to exceed $400 million. The commercial paper program is used to fund a variety of capital items. The Board of Trustees has adopted and reviews annually debt policies that provide a framework with regard to use of debt to finance capital projects. Management and the Board use selected financial ratios with specific targets to help the University to achieve its strategic objectives. Among other things, the debt policy statement includes guidelines for monitoring and managing the level of indebtedness and for the use of derivative products for the purpose of limiting interest rate exposure and reducing debt service costs. As of March 31, 2013, the University was a party to three interest rate swap agreements with Goldman Sachs Mitsui Marine Derivative Products, L. P. as shown in the table below: Notional Amount University Pays University Receives Rate/ Index Termination Date $69,265, % variable SIFMA July 1, 2036 $10,495, % variable 67% 1 Month LIBOR July 1, 2027 $95,335, % variable 67% 1 Month LIBOR July 1, 2020 The University's swap agreements call for posting of collateral at a threshold of $25 million when the parties have ratings in the double "A" category or better. The fair value of each swap is the estimated amount the University would receive or pay to terminate the swap agreement at the reporting date considering current interest rates and creditworthiness of the swap counterparties. The aggregate unaudited fair value of the University's interest rate swap agreements as of March 31, 2013 was a negative market value of $29.2 million. The fair value of required collateral as of March 31, 2013, was $4.2 million held by the counterparty. A-20

53 Future Borrowing. The University maintains a capital budget identifying potential capital spending needs over the next five fiscal years. Funding for capital projects has historically come from a combination of gifts and grants, the operating budget and debt financing. The amount of debt to be issued is guided by the Board of Trustees' debt policy statement. The University may incur additional indebtedness either to refinance certain currently outstanding indebtedness of the University, to convert existing variable rate debt to fixed rate debt, or to finance new capital projects. Litigation and Administrative Proceedings The University is subject to various claims, administrative proceedings, litigation, tax and other assessments in connection with its domestic and foreign operations. In the opinion of management, adequate provision has been made for possible losses on these matters, where material, including insurance for malpractice and general liability claims, and their ultimate resolution will not have a significant effect on the financial position of the University. Amounts received and expended by the University under various state and federal programs are subject to audit by government agencies. In the opinion of management, audit adjustments, if any, will not have a significant effect on the financial position of the University. In the opinion of management and counsel to the University, there is no litigation pending or threatened against the University that would materially affect the University s ability to meet its obligations with respect to the Series 2013B Bonds in the event of an adverse result. A-21

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55 APPENDIX B THE JOHNS HOPKINS UNIVERSITY Financial Statements June 30, 2012 and 2011 (With Independent Auditors Report Thereon)