Common use of REBATE COMPLIANCE Clause in Contracts

REBATE COMPLIANCE. a. It is acknowledged by the Sponsor that funds provided under this Agreement constitute indirect proceeds of New York State Housing Finance Agency Service Contract Obligation revenue bonds (the "Bonds"). The Sponsor will receive proceeds originally funded with advances received from the State and to be subsequently reimbursed with the proceeds of the Bonds. It is intended that interest on the bonds be excluded from gross income for Federal income tax purposes by virtue of Section 103(a) of the Internal Revenue Code of 1986, as amended (the "Code"). The Code and the regulations promulgated thereunder impose certain conditions with respect to the exclusion from gross income pursuant to Section 103(a) of the Code of interest paid or accrued on obligations such as the Bonds. It will be necessary to comply with the Code and regulations in order to assure the exclusion from gross income of interest paid on the boards pursuant to Section 103 of the Code. It is further necessary to comply with the provisions of the temporary Treasury Regulations Sections 1.148-OT through 1.150-IT, concerning arbitrage rebate. b. It is further acknowledged that the Corporation, together with other State public benefit corporations entered into a rebate compliance agreement with the New York State Housing Finance Agency (the "Agency") under which agreement the Corporation has agreed, among other things, to cause its Sponsors under the HHAC to (a) furnish such information as may be required in writing by the Agency in order to monitor investments of funds received by Sponsors which constitute Bond proceeds and (b) to invest such Bond proceeds in the manner and in the types of investments subsequently specified by the Agency. c. The Sponsor agrees to invest any proceeds disbursed under this Final Award Agreement only in demand deposit bank accounts, i.e., an account which permits the withdrawal of funds, without penalty, at any time, as opposed to a time deposit account, which permits withdrawal without penalty only upon maturity. d. The Sponsor agrees to promptly furnish to the Corporation upon request monthly statements of demand deposit bank accounts showing: the amount and dates of deposits into such accounts, the amount and dates of expenditure from such accounts, the amount and dates of the crediting of earnings to such accounts, together with the interest rates pursuant to which such earnings accrue, as much interest rates may change from time to time. Where statements do not specify the interest rates paid on a demand deposit account, the Sponsor shall furnish, at the request of the Corporation, such information in some other form acceptable to the Corporation. e. The Sponsor acknowledges that the Corporation may subsequently require the Sponsor to comply with any additional investment or accounting requirement that may be imposed upon the Corporation in writing at the written request of the Agency. The Sponsor further acknowledges that, if a failure by the Sponsor to comply with investment or accounting requirements under this Section or pursuant to a directive from the Project Officer results in a rebate penalty being imposed upon the Corporation, the Sponsor may be liable to the Corporation in the amount of the penalty so imposed.

REBATE COMPLIANCE. a. It is acknowledged by the Sponsor that funds provided under this Agreement AGREEMENT constitute indirect proceeds of New York State Housing Finance Agency Service Contract Obligation revenue bonds (the "Bonds"). The Sponsor will receive proceeds originally funded with advances received from the State and to be subsequently reimbursed with the proceeds of the Bonds. It is intended that interest on the bonds be excluded from gross income for Federal income tax purposes by virtue of Section 103(a) of the Internal Revenue Code of 1986, as amended (the "Code"). The Code and the regulations promulgated thereunder impose certain conditions with respect to the exclusion from gross income pursuant to Section 103(a) of the Code of interest paid or accrued on obligations such as the Bonds. It will be necessary to comply with the Code and regulations in order to assure the exclusion from gross income of interest paid on the boards pursuant to Section 103 of the Code. It is further necessary to comply with the provisions of the temporary Treasury Regulations Sections 1.148-OT through 1.150-IT, concerning arbitrage rebate. b. It is further acknowledged that the Corporation, together with other State public benefit corporations entered into a rebate compliance agreement with the New York State Housing Finance Agency (the "Agency") under which agreement the Corporation has agreed, among other things, to cause its Sponsors under the HHAC to (a) furnish such information as may be required in writing by the Agency in order to monitor investments of funds received by Sponsors which constitute Bond proceeds and (b) to invest such Bond proceeds in the manner and in the types of investments subsequently specified by the Agency. c. The Sponsor agrees to invest any proceeds disbursed under this Final Award Agreement AGREEMENT only in demand deposit bank accounts, i.e., an account which permits the withdrawal of funds, without penalty, at any time, as opposed to a time deposit account, which permits withdrawal without penalty only upon maturity. d. The Sponsor agrees to promptly furnish to the Corporation upon request monthly statements of demand deposit bank accounts showing: the amount and dates of deposits into such accounts, the amount and dates of expenditure from such accounts, the amount and dates of the crediting of earnings to such accounts, together with the interest rates pursuant to which such earnings accrue, as much interest rates may change from time to time. Where statements do not specify the interest rates paid on a demand deposit account, the Sponsor shall furnish, at the request of the Corporation, such information in some other form acceptable to the Corporation. e. The Sponsor acknowledges that the Corporation may subsequently require the Sponsor to comply with any additional investment or accounting requirement that may be imposed upon the Corporation in writing at the written request of the Agency. The Sponsor further acknowledges that, if a failure by the Sponsor to comply with investment or accounting requirements under this Section or pursuant to a directive from the Project Officer results in a rebate penalty being imposed upon the Corporation, the Sponsor may be liable to the Corporation in the amount of the penalty so imposed.