SAN FRANCISCO - Biola University in Southern California is preparing to go to market next month with a fixed-rate bond issue that will take out variable-rate debt and assorted swaps that landed the school in hot water with the Internal Revenue Service and led Biola to sue its bankers and swap providers.

The Christian institution in La Mirada, Calif., plans to issue about $96 million in revenue bonds, which will refund the school's outstanding variable-rate bonds from 2002 and 2004 and fund termination costs for interest rate swaps that were used to hedge those bonds.

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