(a) The University of Tennessee has express authority and power to act as trustee of charitable trusts, including annuity trusts, unitrusts and pooled income funds as defined in the Federal Tax Reform Act of 1969, heretofore or hereafter created pursuant to an agreement between the university and a donor or donors, by deed of gift to the university, or by a will, under or by which the university is a beneficiary or trustee of a charitable trust.

(b)

(1) Any endowment fund of the University of Tennessee containing assets with a fair market value in excess of one million dollars ($1,000,000) and representing contributions from nongovernmental sources to or for the use of the University of Tennessee may, at the written request of the donor or donors of the fund, be treated in all respects as trust funds.

(2) Separate accounting may be set up to assure that the assets of the funds are at all times used in accordance with the deeds of gift accepted by the University of Tennessee or the contracts entered into by the University of Tennessee with respect to the funds.

(3) All transactions between donors and the University of Tennessee shall be on an arm's length basis; and no assets shall be diverted directly or indirectly from the trust funds, either by application or transfer to other University of Tennessee uses or purposes or to other University of Tennessee funds, that are not in accordance with the written gift instrument, will or other document except at fair cash market value based on qualified appraisals of disinterested parties.

(4) Where funds in a trust so established are specifically earmarked for the benefit of activities or branches of the University of Tennessee in a designated county of this state, the cash and assets of the fund will be recorded in separate accounts and accounted for in such a manner that the intent and purpose or purposes of such a trust will be accomplished.

(5) Anyone refusing or neglecting to comply with this subsection (b) commits a Class C misdemeanor.