                                 CODE OF VIRGINIA

INVESTMENT OF FUNDS BY THE VIRGINIA HOUSING DEVELOPMENT AUTHORITY AND THE
VIRGINIA RESOURCES AUTHORITY (§ 2.2-4519)

A. For purposes of §§ 36-55.44 and 62.1-221 only, the following investments
shall be considered lawful investments and shall be conclusively presumed to
have been prudent:

   1. Obligations of the Commonwealth. Stocks, bonds, notes, and other evidences
   of indebtedness of the Commonwealth, and those unconditionally guaranteed as
   to the payment of principal and interest by the Commonwealth.

   2. Obligations of the United States. Stocks, bonds, treasury notes, and other
   evidences of indebtedness of the United States, including the guaranteed
   portion of any loan guaranteed by the Small Business Administration, an agency
   of the United States government, and those unconditionally guaranteed as to
   the payment of principal and interest by the United States; bonds of the
   District of Columbia; bonds and notes of the Federal National Mortgage
   Association and the Federal Home Loan Banks; bonds, debentures, or other
   similar obligations of federal land banks, federal intermediate credit banks,
   or banks of cooperatives, issued pursuant to acts of Congress; and obligations
   issued by the United States Postal Service when the principal and interest
   thereon is guaranteed by the government of the United States. The evidences of
   indebtedness enumerated by this subdivision may be held directly, in the form
   of repurchase agreements collateralized by such debt securities, or in the
   form of securities of any open-end or closed-end management type investment
   company or investment trust registered under the federal Investment Company
   Act of 1940, provided that the portfolio of such investment company or
   investment trust is limited to such evidences of indebtedness or repurchase
   agreements collateralized by such debt securities, or securities of other such
   investment companies or investment trusts whose portfolios are so restricted.

   3. Obligations of other states. Stocks, bonds, notes, and other evidences of
   indebtedness of any state of the United States upon which there is no default
   and upon which there has been no default for more than 90 days, provided that
   within the 20 fiscal years next preceding the making of such investment, such
   state has not been in default for more than 90 days in the payment of any part
   of principal or interest of any debt authorized by the legislature of such
   state to be contracted.

   4. Obligations of Virginia counties, cities, or other public bodies. Stocks,
   bonds, notes, and other evidences of indebtedness of any county, city, town,
   district, authority, or other public body in the Commonwealth upon which there
   is no default, provided that if the principal and interest is payable from
   revenues or tolls and the project has not been completed, or if completed, has
   not established an operating record of net earnings available for payment of
   principal and interest equal to estimated requirements for that purpose
   according to the terms of the issue, the standards of judgment and care
   required in the Uniform Prudent Investor Act (&#xA7; 64.2-780 et seq.),
   without reference to this section, shall apply.
   				In any case in which an authority, having an established record of net
   earnings available for payment of principal and interest equal to estimated
   requirements for that purpose according to the terms of the issue, issues
   additional evidences of indebtedness for the purposes of acquiring or
   constructing additional facilities of the same general character that it is
   then operating, such additional evidences of indebtedness shall be governed
   fully by the provisions of this section without limitation.

   5. Obligations of cities, counties, towns, or districts of other states.
   Legally authorized stocks, bonds, notes, and other evidences of indebtedness
   of any city, county, town, or district situated in any one of the states of
   the United States upon which there is no default and upon which there has been
   no default for more than 90 days, provided that (i) within the 20 fiscal years
   next preceding the making of such investment, the city, county, town, or
   district has not been in default for more than 90 days in the payment of any
   part of principal or interest of any stock, bond, note, or other evidence of
   indebtedness issued by it; (ii) the city, county, town, or district shall have
   been in continuous existence for at least 20 years; (iii) the city, county,
   town, or district has a population, as shown by the federal census next
   preceding the making of such investment, of not less than 25,000 inhabitants;
   (iv) the stocks, bonds, notes, or other evidences of indebtedness in which
   such investment is made are the direct legal obligations of the city, county,
   town, or district issuing the same; (v) the city, county, town, or district
   has power to levy taxes on the taxable real property therein for the payment
   of such obligations without limitation of rate or amount; and (vi) the net
   indebtedness of the city, county, town, or district, including the issue in
   which such investment is made, after deducting the amount of its bonds issued
   for self-sustaining public utilities, does not exceed 10 percent of the value
   of the taxable property in the city, county, town, or district, to be
   ascertained by the valuation of such property therein for the assessment of
   taxes next preceding the making of such investment.

   6. Obligations subject to repurchase. Investments set forth in subdivisions 1
   through 5 may also be made subject to the obligation or right of the seller to
   repurchase these on a specific date.

   7. Bonds secured on real estate. Bonds and negotiable notes directly secured
   by a first lien on improved real estate or farm property in the Commonwealth,
   or in any state contiguous to the Commonwealth within a 50-mile area from the
   borders of the Commonwealth, not to exceed 80 percent of the fair market value
   of such real estate, including any improvements thereon at the time of making
   such investment, as ascertained by an appraisal thereof made by two reputable
   persons who are not interested in whether or not such investment is made.

   8. Bonds secured on city property in Fifth Federal Reserve District. Bonds and
   negotiable notes directly secured by a first lien on improved real estate
   situated in any incorporated city in any of the states of the United States
   which lie wholly or in part within the Fifth Federal Reserve District of the
   United States as constituted on June 18, 1928, pursuant to the act of Congress
   of December 23, 1913, known as the Federal Reserve Act, as amended, not to
   exceed 60 percent of the fair market value of such real estate, with the
   improvements thereon, at the time of making such investment, as ascertained by
   an appraisal thereof made by two reputable persons who are not interested in
   whether or not such investment is made, provided that such city has a
   population, as shown by the federal census next preceding the making of such
   investments, of not less than 5,000 inhabitants.

   9. Bonds of Virginia educational institutions. Bonds of any of the educational
   institutions of the Commonwealth that have been or may be authorized to be
   issued by the General Assembly.

   10. Securities of the Richmond, Fredericksburg and Potomac Railroad Company.
   Stocks, bonds, and other securities of the Richmond, Fredericksburg and
   Potomac Railroad Company, including bonds or other securities guaranteed by
   the Richmond, Fredericksburg and Potomac Railroad Company.

   11. Obligations of railroads. Bonds, notes, and other evidences of
   indebtedness, including equipment trust obligations, which are direct legal
   obligations of or which have been unconditionally assumed or guaranteed as to
   the payment of principal and interest by, any railroad corporation operating
   within the United States that meets the following conditions and requirements:
   				a. The gross operating revenue of such corporation for the fiscal year
   preceding the making of such investment, or the average of the gross operating
   revenue for the five fiscal years next preceding the making of such
   investment, whichever of these two is the larger, shall have not been less
   than $10 million;
   				b. The total fixed charges of such corporation, as reported for the fiscal
   year next preceding the making of the investment, shall have been earned an
   average of at least two times annually during the seven fiscal years preceding
   the making of the investment and at least one and one-half times during the
   fiscal year immediately preceding the making of the investment. The term
   &#8220;total fixed charges&#8221; as used in this subdivision and subdivision
   c shall be deemed to refer to the term used in the accounting reports of
   common carriers as prescribed by the regulations of the Interstate Commerce
   Commission; and
   				c. The aggregate of the average market prices of the total amounts of each
   of the individual securities of such corporation junior to its bonded debt and
   outstanding at the time of the making of such investment shall be equal to at
   least two-thirds of the total fixed charges for such railroad corporation for
   the fiscal year next preceding the making of such investment capitalized at an
   annual interest rate of five percent. Such average market price of any one of
   such individual securities shall be determined by the average of the highest
   quotation and the lowest quotation of the individual security for a period
   immediately preceding the making of such investment, which period shall be the
   full preceding calendar year plus the then-expired portion of the calendar
   year in which such investment is made, provided that if more than six months
   of the calendar year in which such investment is made shall have expired, then
   such period shall be only the then-expired portion of the calendar year in
   which such investment is made, and provided further that if such individual
   security shall not have been outstanding during the full extent of such
   period, such period shall be deemed to be the length of time such individual
   security shall have been outstanding.

   12. Obligations of leased railroads. Stocks, bonds, notes, other evidences of
   indebtedness, and any other securities of any railroad corporation operating
   within the United States, the railroad lines of which have been leased by a
   railroad corporation, either alone or jointly with other railroad
   corporations, whose bonds, notes, and other evidences of indebtedness shall,
   at the time of the making of such investment, qualify as lawful investments
   for fiduciaries under the terms of subdivision 11, provided that the terms of
   such lease shall provide for the payment by such lessee railroad corporation
   individually, irrespective of the liability of other joint lessee railroad
   corporations, if any, in this respect, of an annual rental of an amount
   sufficient to defray the total operating expenses and maintenance charges of
   the lessor railroad corporation plus its total fixed charges, plus, in the
   event of the purchase of such a stock, a fixed dividend upon any issue of such
   stock in which such investment is made, and provided that if such investment
   so purchased shall consist of an obligation of definite maturity, such lease
   shall be one which shall, according to its terms, provide for the payment of
   the obligation at maturity or extend for a period of not less than 20 years
   beyond the maturity of such obligations so purchased, or if such investment so
   purchased shall be a stock or other form of investment having no definite date
   of maturity, such lease shall be one which shall, according to its terms,
   extend for a period of at least 50 years beyond the date of the making of such
   investment.

   13. Equipment trust obligations. Equipment trust obligations issued under the
   &#8220;Philadelphia Plan&#8221; in connection with the purchase for use on
   railroads of new standard gauge rolling stock, provided that the owner,
   purchaser, or lessee of such equipment, or one or more of such owners,
   purchasers, or lessees, shall be a railroad corporation whose bonds, notes,
   and other evidences of indebtedness shall, at the time of the making of such
   investment, qualify as lawful investments for fiduciaries under the terms of
   subdivision 11, and provided that all of such owners, purchasers, or lessees
   shall be both jointly and severally liable under the terms of such contract of
   purchase or lease, or both, for the fulfillment thereof.

   14. Preferred stock of railroads. Any preference stock of any railroad
   corporation operating within the United States, provided such stock and such
   railroad corporation meet the following conditions and requirements:
   				a. Such stock shall be preferred as to dividends, such dividends shall be
   cumulative, and such stock shall be preferred as to assets in the event of
   liquidation or dissolution;
   				b. The gross operating revenue of such corporation for the fiscal year
   preceding the making of such investment, or the average of the gross operating
   revenue for the five fiscal years next preceding the making of such
   investment, whichever of these two is the larger, shall have been not less
   than $10 million;
   				c. The total fixed charges, as defined in subdivision 11 b, of such
   corporation, as reported for the fiscal year next preceding the making of such
   investment, plus the amount, at the time of making such investment, of the
   annual dividend requirements on such preference stock and any preference stock
   having the same or senior rank, such fixed charges and dividend requirements
   being considered the same for every year, shall have been earned an average of
   at least two and one-half times annually for the seven fiscal years preceding
   the making of such investment and at least two times for the fiscal year
   immediately preceding the making of such investment; and
   				d. The aggregate of the average market prices of the total amount of each
   of the individual securities of such corporation, junior to such preference
   stock and outstanding at the time of the making of such investment, shall be
   at least equal to the par value of the total issue of the preference stock in
   question plus the total par value of all other issues of its preference stock
   having either the same rank as, or a senior rank to, the issue of such
   preference stock plus total fixed charges, as defined in subdivision 11 b, for
   such railroad corporation for the fiscal year next preceding the making of
   such investment capitalized at an annual interest rate of five percent. Such
   average market price of any one of such individual securities shall be
   determined in the same manner as prescribed in subdivision 11 c.

   15. Obligations of public utilities. Bonds, notes, and other evidences of
   indebtedness of any public utility operating company operating within the
   United States, provided such company meets the following conditions and
   requirements:
   				a. The gross operating revenue of such public utility operating company
   for the fiscal year preceding the making of such investment, or the average of
   the gross operating revenue for the five fiscal years next preceding the
   making of such investment, whichever of these two is the larger, shall have
   been not less than $5 million;
   				b. The total fixed charges of such corporation, as reported for the fiscal
   year next preceding the making of the investment, shall have been earned,
   after deducting operating expenses, depreciation, and taxes, other than income
   taxes, an average of at least one and three-quarters times annually during the
   seven fiscal years preceding the making of the investment and at least one and
   one-half times during the fiscal year immediately preceding the making of the
   investment;
   				c. In the fiscal year next preceding the making of such investment, the
   ratio of the total par value of the bonded debt of such public utility
   operating company, including the total bonded indebtedness of all its
   subsidiary companies, whether assumed by the public utility operating company
   in question or not, to its gross operating revenue shall not be greater than
   four to one; and
   				d. Such public utility operating company shall be subject to permanent
   regulation by a state commission or other duly authorized and recognized
   regulatory body.
   				The term &#8220;public utility operating company&#8221; as used in this
   subdivision and subdivision 16 means a public utility or public service
   corporation (i) of whose total income available for fixed charges for the
   fiscal year next preceding the making of such investment at least 55 percent
   thereof shall have been derived from direct payments by customers for service
   rendered them; (ii) of whose total operating revenue for the fiscal year next
   preceding the making of such investment at least 60 percent thereof shall have
   been derived from the sale of electric power, gas, water, or telephone service
   and not more than 10 percent thereof shall have been derived from traction
   operations; and (iii) whose gas properties are all within the limits of one
   state, if more than 20 percent of its total operating revenues are derived
   from gas.

   16. Preferred stock of public utilities. Any preference stock of any public
   utility operating company operating within the United States, provided such
   stock and such company meet the following conditions and requirements:
   				a. Such stock shall be preferred as to dividends, such dividends shall be
   cumulative, and such stock shall be preferred as to assets in the event of
   liquidation or dissolution;
   				b. The gross operating revenue of such public utility operating company
   for the fiscal year preceding the making of such investment, or the average of
   the gross operating revenue for the five fiscal years next preceding the
   making of such investment, whichever of these two is the larger, shall have
   been not less than $5 million;
   				c. The total fixed charges of such public utility operating company, as
   reported for the fiscal year next preceding the making of such investment,
   plus the amount, at the time of making such investment, of the annual dividend
   requirements on such preference stock and any preference stock having the same
   or senior rank, such fixed charges and dividend requirements being considered
   the same for every year, shall have been earned, after deducting operating
   expenses, depreciation, and taxes, including income taxes, an average of at
   least two times annually for the seven fiscal years preceding the making of
   such investment and at least two times for the fiscal year immediately
   preceding the making of such investment;
   				d. In the fiscal year next preceding the making of such investment, the
   ratio of the sum of the total par value of the bonded debt of such public
   utility operating company, the total par value of the issue of such preference
   stock, and the total par value of all other issues of its preference stock
   having the same or senior rank to its gross operating revenue shall not be
   greater than four to one; and
   				e. Such public utility operating company shall be subject to permanent
   regulation by a state commission or other duly authorized and recognized
   regulatory body.

   17. Obligations of the following telephone companies. Bonds, notes, and other
   evidences of indebtedness of American Telephone and Telegraph, Bell Atlantic,
   Bell South, Southwestern Bell, Pacific Telesis, Nynex, American Information
   Technologies, or U.S. West, and bonds, notes, and other evidences of
   indebtedness unconditionally assumed or guaranteed as to the payment of
   principal and interest by any such company, provided that the total fixed
   charges, as reported for the fiscal year next preceding the making of the
   investment, of such company and all of its subsidiary corporations on a
   consolidated basis shall have been earned, after deducting operating expenses,
   depreciation, and taxes, other than income taxes, an average of at least one
   and three-fourths times annually during the seven fiscal years preceding the
   making of the investment and at least one and one-half times during the fiscal
   year immediately preceding the making of the investment.

   18. Obligations of municipally owned utilities. The stocks, bonds, notes, and
   other evidences of indebtedness of any electric, gas, or water department of
   any state, county, city, town, or district whose obligations would qualify as
   legal for purchase under subdivision 3, 4, or 5, the interest and principal of
   which are payable solely out of the revenues from the operations of the
   facility for which the obligations were issued, provided that the department
   issuing such obligations meets the requirements applying to public utility
   operating companies as set out in subdivisions 15 a through c.

   19. Obligations of industrial corporations. Bonds, notes, and other evidences
   of indebtedness of any industrial corporation incorporated under the laws of
   the United States or of any state thereof, provided such corporation meets the
   following conditions and requirements:
   				a. The gross operating revenue of such corporation for the fiscal year
   preceding the making of such investment, or the average of the gross operating
   revenue for the five fiscal years next preceding the making of such
   investment, whichever of these two is the larger, shall have been not less
   than $10 million;
   				b. The total fixed charges of such corporation, as reported for the fiscal
   year next preceding the making of the investment, shall have been earned,
   after deducting operating expenses, depreciation, and taxes, other than income
   taxes, and depletion in the case of companies commonly considered as depleting
   their natural resources in the course of business, an average of at least
   three times annually during the seven fiscal years preceding the making of the
   investment and at least two and one-half times during the fiscal year
   immediately preceding the making of the investment;
   				c. The net working capital of such industrial corporation, as shown by its
   last published fiscal year-end statement prior to the making of such
   investment, or in the case of a new issue, as shown by the financial statement
   of such corporation giving effect to the issuance of any new security, shall
   be at least equal to the total par value of its bonded debt as shown by such
   statement; and
   				d. The aggregate of the average market prices of the total amounts of each
   of the individual securities of such industrial corporation, junior to its
   bonded debt and outstanding at the time of the making of such investment,
   shall be at least equal to the total par value of the bonded debt of such
   industrial corporation at the time of the making of such investment, such
   average market price of any one of such individual securities being determined
   in the same manner as prescribed in subdivision 11 c.

   20. Preferred stock of industrial corporations. Any preference stock of any
   industrial corporation incorporated under the laws of the United States or of
   any state thereof, provided such stock and such industrial corporation meet
   the following conditions and requirements:
   				a. Such stock shall be preferred as to dividends, such dividends shall be
   cumulative, and such stock shall be preferred as to assets in the event of
   liquidation or dissolution;
   				b. The gross operating revenue of such corporation for the fiscal year
   preceding the making of such investment, or the average of the gross operating
   revenue for the five fiscal years next preceding the making of such
   investment, whichever of these two is the larger, shall have been not less
   than $10 million;
   				c. The total fixed charges of such corporation, as reported for the fiscal
   year next preceding the making of such investment, plus the amount, at the
   time of making such investment, of the annual dividend requirements on such
   preference stock and any preference stock having the same or senior rank, such
   fixed charges and dividend requirements being considered the same for every
   year, shall have been earned, after deducting operating expenses,
   depreciation, and taxes, including income taxes, and depletion in the case of
   companies commonly considered as depleting their natural resources in the
   course of business, an average of at least four times annually for the seven
   fiscal years preceding the making of such investment and at least three times
   for the fiscal year immediately preceding the making of such investment;
   				d. The net working capital of such industrial corporation, as shown by its
   last published fiscal year-end statement prior to the making of such
   investment, or, in the case of a new issue, as shown by the financial
   statement of such corporation giving effect to the issuance of any new
   security, shall be at least equal to the total par value of its bonded debt
   plus the total par value of the issue of such preference stock plus the total
   par value of all other issues of its preference stock having the same or
   senior rank; and
   				e. The aggregate of the lowest market prices of the total amounts of each
   of the individual securities of such industrial corporation junior to such
   preference stock and outstanding at the time of the making of such investment
   shall be at least two and one-half times the par value of the total issue of
   such preference stock plus the total par value of all other issues of its
   preference stock having the same or senior rank plus the par value of the
   total bonded debt of such industrial corporation. Such lowest market price of
   any one of such individual securities shall be determined by the lowest single
   quotation of the individual security for a period immediately preceding the
   making of such investment, which period shall be the full preceding calendar
   year plus the then-expired portion of the calendar year in which such
   investment is made, and if such individual security shall not have been
   outstanding during the full extent of such period, such period shall be deemed
   to be the length of time such individual security shall have been outstanding.

   21. Obligations of finance corporations. Bonds, notes, and other evidences of
   indebtedness of any finance corporation incorporated under the laws of the
   United States or of any state thereof, provided such corporation meets the
   following conditions and requirements:
   				a. The gross operating income of such corporation for the fiscal year
   preceding the making of such investment, or the average of the gross operating
   income for the five fiscal years next preceding the making of such investment,
   whichever of these two is the larger, shall have been not less than $5
   million;
   				b. The total fixed charges of such corporation, as reported for the fiscal
   year next preceding the making of the investment, shall have been earned,
   after deducting operating expenses, depreciation, and taxes, other than income
   taxes, an average of at least two and one-half times annually during the seven
   fiscal years preceding the making of the investment and at least two times
   during the fiscal year immediately preceding the making of the investment;
   				c. The aggregate indebtedness of such finance corporation as shown by its
   last fiscal year-end statement, or, in the case of a new issue, as shown by
   the financial statement giving effect to the issuance of any new securities,
   shall be no greater than three times the aggregate net worth, as represented
   by preferred and common stocks and surplus of such corporation; and
   				d. The aggregate of the average market prices of the total amounts of each
   of the individual securities of such finance corporation, junior to its bonded
   debt and outstanding at the time of the making of such investment, shall be at
   least equal to one-third of the sum of the par value of the bonded debt plus
   all other indebtedness of such finance corporation as shown by the last
   published fiscal year-end statement, such average market price of any one of
   such individual securities being determined in the same manner as prescribed
   in subdivision 11 c.

   22. Preferred stock of finance corporations. Any preference stock of any
   finance corporation incorporated under the laws of the United States or of any
   state thereof, provided such stock and such corporation meet the following
   conditions and requirements:
   				a. Such stock shall be preferred as to dividends, such dividends shall be
   cumulative, and such stock shall be preferred as to assets in the event of
   liquidation or dissolution;
   				b. The gross operating income of such corporation for the fiscal year
   preceding the making of such investment, or the average of the gross operating
   income for the five fiscal years next preceding the making of such investment,
   whichever of these two is the larger, shall have been not less than $5
   million;
   				c. The total fixed charges of such finance corporation, as reported for
   the fiscal year next preceding the making of such investment, plus the amount,
   at the time of making such investment, of the annual dividend requirements on
   such preference stock and any preference stock having the same or senior rank,
   such fixed charges and dividend requirements being considered the same for
   every year, shall have been earned, after deducting operating expenses,
   depreciation, and taxes, including income taxes, an average of at least three
   and one-half times annually for the seven fiscal years preceding the making of
   such investment and at least three times for the fiscal year immediately
   preceding the making of such investment;
   				d. The aggregate indebtedness and par value of the purchased stock, both
   the issue in question and any issues equal or senior thereto, of such finance
   corporation as shown by its last published fiscal year-end statement, or, in
   the case of a new issue, as shown by the financial statement giving effect to
   the issuance of any new securities, shall be no greater than three times the
   aggregate par value of the junior securities and surplus of such corporation;
   and
   				e. The aggregate of the lowest market prices of the total amounts of each
   of the individual securities of such finance corporation junior to such
   preference stock and outstanding at the time of the making of such investment
   shall be at least equal to one-third of the sum of the par value of such
   preference stock plus the total par value of all other issues of preference
   stock having the same or senior rank plus the par value of the total bonded
   debt plus all other indebtedness of such finance corporation as shown by the
   last published fiscal year-end statement, such lowest market price of any one
   of such individual securities being determined in the same manner as
   prescribed in subdivision 20 e.

   23. Federal housing loans. First mortgage real estate loans insured by the
   Federal Housing Administrator under Title II of the National Housing Act.

   24. Certificates of deposit and savings accounts. Certificates of deposit of,
   and savings accounts in, any bank, banking institution, or trust company,
   whose deposits are insured by the Federal Deposit Insurance Corporation at the
   prevailing rate of interest on such certificates or savings accounts; however,
   no such fiduciary shall invest in such certificates of, or deposits in, any
   one bank, banking institution, or trust company an amount from any one fund in
   his or its care which shall be in excess of such amount as shall be fully
   insured as a deposit in such bank, banking institution, or trust company by
   the Federal Deposit Insurance Corporation. A corporate fiduciary shall not,
   however, be prohibited by the terms of this subdivision from depositing in its
   own banking department, in the form of demand deposits, savings accounts, time
   deposits, or certificates of deposit, funds in any amount awaiting investments
   or distribution, provided that it shall have complied with the provisions of
   &#xA7;&#xA7; 6.2-1005 and 6.2-1007, with reference to the securing of such
   deposits.

   25. Obligations of International Bank, Asian Development Bank, and African
   Development Bank. Bonds and other obligations issued, guaranteed, or assumed
   by the International Bank for Reconstruction and Development, the Asian
   Development Bank, or the African Development Bank.

   26. Deposits in savings institutions. Certificates of deposit of, and savings
   accounts in, any state or federal savings institution or savings bank lawfully
   authorized to do business in the Commonwealth whose accounts are insured by
   the Federal Deposit Insurance Corporation or other federal insurance agency;
   however, no such fiduciary shall invest in such shares of any one such
   association an amount from any one fund in his or its care which shall be in
   excess of such amount as shall be fully insured as an account in such
   association by the Federal Deposit Insurance Corporation or other federal
   insurance agency.

   27. Certificates evidencing ownership of undivided interests in pools of
   mortgages. Certificates evidencing ownership of undivided interests in pools
   of bonds or negotiable notes directly secured by first lien deeds of trust or
   mortgages on real property located in the Commonwealth improved by
   single-family residential housing units or multi-family dwelling units,
   provided that (i) such certificates are rated AA or better by a nationally
   recognized independent rating agency; (ii) the loans evidenced by such bonds
   or negotiable notes do not exceed 80 percent of the fair market value, as
   determined by an independent appraisal thereof, of the real property and the
   improvements thereon securing such loans; and (iii) such bonds or negotiable
   notes are assigned to a corporate trustee for the benefit of the holders of
   such certificates.

   28. Shares in credit unions. Shares and share certificates in any credit union
   lawfully authorized to do business in the Commonwealth whose accounts are
   insured by the National Credit Union Share Insurance Fund or the Virginia
   Credit Union Share Insurance Corporation, provided no such fiduciary shall
   invest in such shares an amount from any one fund in his or its care which
   shall be in excess of such amount as shall be fully insured as an account in
   such credit union by the National Credit Union Share Insurance Fund or the
   Virginia Credit Union Share Insurance Corporation.

B. Whenever under the terms of this section the par value of a preference stock
is required to be used in a computation, there shall be used instead of such par
value the liquidating value of such preference stock in the case of involuntary
liquidation, as prescribed by the terms of its issue, in the event that such
liquidating value shall be greater than the par value of such preference stock;
or in the event that the preference stock in question has no par value, then
such liquidating value shall be used instead; or when such preference stock
shall be one of no par value and one for which no such liquidating value shall
have been so prescribed, then for the purposes of such computation the
preference stock in question shall be deemed to have a value of $100 per share.

C. When any security provided for in this section is purchased by a fiduciary
and at the time of such purchase the statement for the preceding fiscal year of
the corporation issuing the security so being purchased has not been published
and is therefore not available, the statement of such corporation for the fiscal
year immediately prior to such preceding fiscal year shall be considered the
statement for such preceding fiscal year and shall have the same force and
effect as the statement for the fiscal year preceding such purchase, provided
the date of such purchase is not more than four months after the end of the last
fiscal year of the corporation.

D. In testing a new issue of securities under the provisions of this section, it
shall be permissible, in determining the number of times that fixed charges or
preferred dividend requirements have been earned, to use pro forma fixed charges
or dividend requirements, provided the corporation or its corporate predecessor
has been in existence for a period of not less than seven years.

E. Investments made under the provisions of this section, if in conformity with
the requirements of this section at the time such investments were made, may be
retained even though they cease to be eligible for purchase under the provisions
of this section, but shall be subject to the provisions of the Uniform Prudent
Investor Act (&#xA7; 64.2-780 et seq.).

HISTORY: 2012, c. 614.