Section 1. The Board covenants that the Institution will not take or omit to take
any action the taking or omission of which will cause the Refunding Bonds to be
"arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of
1986, as amended (the "1986 Code"), or otherwise cause interest on the Refunding Bonds
to be includable in the gross income of the owners thereof for federal income tax
purposes under existing laws. Without limiting the generality of the foregoing, the
Institution will pay from time to time its proportional share of any rebate to the United
States of the earnings derived from the investment of the gross proceeds of the
Refunded Bonds or the Refunding Bonds that are subject to such rebate.
