ENDOWMENT FUND SPENDING AUTHORIZATION JUNE 30, 2003

WHEREAS, The Board of Trustees of Lincoln University has elected to be governed by the provisions of Section 5548(c) of the Pennsylvania Non-profit Corporation Law of 1998, as amended, with respect to the endowment funds held by the University; and

WHEREAS, The provisions of Section 5548(c)(3) provide that if an election is made to be governed by that subsection, the term "income", for the purposes of the endowment funds, shall mean a percentage of the value of endowment fund assets as the Board shall select annually, after determining that the percentage selected is consistent with the long-term preservation of the real value of the assets; provided, however, that the percentage selected shall in no event be less than 2% or more than 7% per year; now therefore, it is hereby

RESOLVED, That pursuant to Section 5548(c) (3) of the Pennsylvania Non-profit Corporation Law of 1998, as amended, and for the fiscal year ending June 30, 2003 the Board of Trustees hereby determines that endowment fund income shall be five percent (5.0%) of the value of the endowment fund assets, to be determined in accordance with the provisions of Section 5548 (c) (5), using the value of endowment fund assets on December 31, 2002 and averaged over a period of three (3) preceding years; provided however that if any assets have been held for less than three (3) years, the average shall be determined over the period during which the assets have been held; and be it further

RESOLVED, That the Board of Trustees hereby determines that the Board's decision to treat five percent (5.0%) of the value of the endowment fund assets held by the University as income is consistent with the long-term preservation of the real value of such assets; and further

RESOLVED, That this Resolution shall be maintained as part of the permanent records of the University.