2006 S Finance - Equipment Installment Financing Agreement

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Installment Payments then due under such Schedule, as well as the applicable Purchase Price, which may include a prepayment premium on the unpaid balance as set forth in the Schedule. After payment of all amounts owed with respect to this Agreement, Purchaser will own the Equipment free and clear of any interest of Lender therein, and Lender's security interests in and to such Equipment will be terminated. Section 4.02. Interest and Principal Components. A portion of each Installment Payment is paid as, and represents payment of, interest at the rate set forth in the Schedule, and the balance of each Installment Payment is paid as, and represents payment of, principal. The Installment Payment Schedule sets forth the principal and interest components of each " Installment Payment payable under this Agreement during the Purchase Term. Section 4.03. Reserved. Section 4.04. Tax Covenants. (a) Purchaser agrees that it will not take any action that would cause the interest component of Installment Payments to be or to become ineligible for the exclusion from gross income of the owner or owners thereof for federal income tax purposes, nor will it omit to take or cause to be taken, in timely manner, any action, which omission would cause the interest component of Installment Payments to be or to become ineligible for the exclusion from gross income of the owner or owners thereof for federal income tax purposes. (b) In the event that Purchaser does not spend the moneys in the Acquisition Fund within six (6) months of the date the deposit is made pursuant to Section 3.04(c), Purchaser will, if required by section 148(fj of the Code to pay rebate: (i) establish a Rebate Account and deposit the Rebate Amount (as defined in Section 1.148-3(b) of the Federal Income Tax Regulations) not less frequently than once per year after the applicable Commencement Date; and (ii) rebate to the United States, not less frequently than once every five (5) years after the applicable Commencement Date, an amount equal to at least 90% of the Rebate Amount and within 60 days after payment of all Installment Payments or the Purchase Price as provided in Section 10.01(a) hereof, 100% of the Rebate Amount, as required by the Code and any regulations promulgated thereunder. Purchaser shall determine the Rebate Amount, if any, at least every year and upon payment of all Installment Payments or the Purchase Price and shall maintain such determination, together with any supporting documentation required to calculate the Rebate Amount, until six (6) years after the ~ date of the final payment of the Installment Payments or the Purchase Price. (c) Purchaser represents that the Equipment will not be used in such a manner so as to cause this Agreement to constitute "private activity bonds" as defined in Section 141(a) of the Code and Sections 1.141-0 through 1.141-16 of the Regulations. (d) . This Agreement will not be federally guaranteed within the meaning of Section 149(b) of the Code. Purchaser shall file, or cause to be filed, the requisite Form 8038-G on or before the 15~' day of the second month after the calendar quarter in which this Agreement is executed. #765698v2 (BAPCC/N Carolina Installment Purch Agmt)