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Merrifields Apartments, L.P., as Developer, may proceed with plans therefor and enter into contracts, advance monies and take such other steps as it may deem necessary and appropriate therefor, provided that nothing herein shall be deemed to authorize the Developer to obligate the Authority, without its prior written consent in each instance, to the payment of any monies or the performance of any acts in connection with the Housing Project. It is further agreed that, should the Portsmouth City Council approve (a) the making of the Loan by the Authority to the Developer, and (b) the issuance by the Authority of the Bonds to provide funds for the Loan, and should the Loan be obtained by the Developer, then any monies advanced by the Developer in accordance with this paragraph may be reimbursed from the proceeds of the Loan, subject to approval by the Authority and its counsel. If for any reason the Loan is not obtained, it is understood that all such advances and any other costs and expenses which may be incurred in connection with the acquisition of the Housing Project shall be paid by the Developer forthwith upon receipt by the Developer of invoices for such costs and expenses and that the Authority shall have no liability or responsibility therefor. 3. This resolution shall not be construed to impose upon the Authority any obligation to make the Loan unless and until: (a) the Authority has held a public hearing on the Developer's application as prescribed by Section 15.2-4906 of the Virginia Code and Section 147 of the Code, (b) the Portsmouth City Council has re-approved the making of the Loan by the Authority and the issuance by the Authority of the Bonds to provide ftmds for the Loan; (c) the Authority's bond counsel is satisfied that the interest on the Loan will be exempt from taxation by the Commonwealth of Virginia and under the United States Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder; (d) the Authority shall have received an allocation of $2,800,000, with respect to the Bonds, if required, from the Virginia Small Business Financing pursuant to Section t 5.2-5000, et seq, Code of Virginia of 1950, as amended; and (e) the Developer, the Authority and the financial institution or other person or entity which agrees to fund the Loan have all agreed upon the terms and conditions of the Loan and the documents to be executed in connection with the Loan. 4. The Council of the City of Portsmouth, Virginia is hereby requested to (a) approve the issuance by the Authority of the Bonds in an aggregate principal amount not to exceed $2,800,000 to provide funds for the Loan, to the extent such approval is required by Section 147(0 of the Internal Revenue Code and Section 15.2-4906, subsection 9 of the Section 36-19 and Section 36-19.2 of the Virginia Code, and (b) make a request, if required, to the Virginia Small Business Financing Authority for an allocation of $2,800,000 with respect to the Bonds pursuant to Section 15.2-5000, et seq.,of the Code of Virginia of 1950, as amended, and a copy of this resolution shall be submitted to the Council for its consideration. 5. All costs and expenses in connection with the financing and the acquisition, reconstruction. renovation and equipping of the Housing Project. including, but not limited to, the fees and expenses of bond counsel, counsel to the Authority, and the agent or underwriter for the sale of the Bonds, shall be paid from the proceeds of the Bonds or from funds of the Developer. If for any reason such Bonds are not issued, it is underslood that all such expenses shall be paid by the Developer forthwith upon receipt by the developer of invoices for such costs and expenses and that the Authority shall have no responsibility or liability therefor.