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CC Resolution No. 1816 84 RESOLUTION NO. 1816 RESOLUTION BY THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS, APPROVING THE MODIFICATION OF TWO PRIOR BOND ISSUES ISSUED BY THE MILFORD HIGHER EDUCATION FACILITIES CORPORATION FOR BAYTOWN CHRISTIAN ACADEMY, INC., APPROVING THE ISSUANCE OF A NEW TAX EXEMPT NOTE BY THE MILFORD HIGHER EDUCATION FACILITIES CORPORATION FOR BAYTOWN CHRISTIAN ACADEMY, INC., AND PROVIDING FOR THE EFFECTIVE DATE THEREOF WHEREAS, Baytown Christian Academy, Inc. (the "School") is an accredited primary or secondary school located within the City of Baytown, Texas (the "City") and has constructed a school campus consisting of five buildings including classrooms, library, computer lab, cafetorium, administrative facilities, parking facilities and a gymnasium, located at the new school campus at 5555 N. Main, Baytown,Texas 77521 (the "Project"); and WHEREAS, the Project was financed by the issuance of tax exempt bonds including the Milford Higher Education Facilities Corporation Education Revenue Bonds (Baytown Christian Academy Project) Series 2003 (the "Series 2003 Bonds") and the Milford Higher Education Facilities Corporation Education Revenue Bonds (Baytown Christian Academy Project) Series 2004 (the"Series 2004 Bonds"); and WHEREAS, the Bank, the School, and the Milford Higher Education Facilities Corporation all desire to modify the terms of the Series 2003 Bonds and the Series 2004 Bonds to extend the time for repayment thereof and to re-determine the interest rate on such bonds; and WHEREAS, Citizens National Bank of Texas further made a conventional loan to the School which both the School and the Bank desire to refinance into a new tax exempt obligation to provide for completion of the Project; and WHEREAS, the modification of the two prior bond issues and the issuance of the new tax exempt loan must be approved by the City of Baytown, Texas pursuant to the provisions of Section 147(f) of the Internal Revenue Code of 1986 as amended; and WHEREAS, the City is willing to consider the School's request in order that the bonds may be modified and the new tax exempt loan may be issued; and WHEREAS, a public hearing has been held by this City Council with regard to the modification of the bonds and the issuance of the new tax exempt loan for the Project, all in the manner required by law; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN,TEXAS: Section I: Solely for the purpose of satisfying the provisions of Section 147(f) of the Internal Revenue Code of 1986 as amended, the City hereby approves the modifications to the Series 2003 Bonds and the Series 2004 Bonds, each evidenced by "Bond Modification Agreements" dated as of October 20, 2006. The present outstanding principal balance of the Series 2003 Bonds is $2,392,280.80. The present outstanding principal balance of the Series 2004 Bonds is $962,882.72. Section 2: Solely for the purpose of satisfying the provisions of Section 147(f) of the Internal Revenue Code of 1986 as amended, the City hereby approves the issuance of a tax exempt note (the "2006 Issuer Note") by the Milford Higher Education Facilities Corporation. The 2006 Issuer Note 85 will be issued in a maximum principal amount not to exceed $575,000 and will be used to refund a previous taxable note issued in the amount of$565,753.55 and used by the School to finance the Project. Section 3: The proceeds of the Bonds as modified, and the proceeds of the 2006 Issuer Note are all being used to finance or refinance completion of construction of the Project. The sole user of the Project is Baytown Christian Academy, Inc., a Texas nonprofit corporation. Section 4: This Resolution is passed based on the express understanding and representation by the School and the Milford Higher Education Facilities Corporation that the Bonds and the 2006 Issuer Note do not and will not constitute in any way a liability or obligation of the City in any manner whatsoever, and do not and will not count against the City's bonding authority in any way whatsoever. The School shall indemnify the City from all liabilities regarding the Bonds and the 2006 Issuer Note in a manner and form acceptable to the City Attorney. Section 5: The City does not by this Resolution waive any requirement of the City relating to the construction or acquisition of the School's Project, including but not limited to any requirement for building permits or certificates of occupancy. Section 6: This Resolution shall take effect immediately from and after its passage by the City Council of the City of Baytown. INTRODUCED, READ and PASSED, by the a4ehe City Council of the City of Baytown this the 12thday of October, 2006. CARLOS, Mayor EST: N y •. a II D , City Clerk APPROVED AS TO FORM: efGI�ACIO RAMIREZ, SR., i y Attorney R:\Karen\Files\City Council\Reao1utions\2006\0ctober 12\Baytow Christi nAcademyFinaneing.DOC