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Section 23. Leaseā€¢ Possession and Use. Lessor hereby leases the Equipment to Lessee, and Lessee hereby leases the Equipment from <br />Lessor, upon the terra and conditions set forth herein. Lessee shall have quiet use and enjoyment of and peaceably have and hold each <br />Equipment Group during the related Lease Temr, except as expressly set forth in this Ageement. <br />Section 2.4. Escrow Procedure. If Lessor and Lessee agree that the cost of an Equipment Group is to be paid from an Escrow Account: <br />(a) Lessor and Lessee shall execute an Escrow Ageement substantially in the form of Exhibit F; (b) Lessor and Lessee shall execute an <br />Equipment Schedule relating to such Equipment Group; and (c) Lessor shall deposit an amount equal to the cost of the Equipment Group <br />into the Escrow Account. All amounts deposited by Lessor into the Escrow Account shall constitute a loan from Lessor to Lessee which <br />shall be repaid by the Rental Payments due under the related Lease. <br />ARTICLE III. TERM <br />Section 3.1. Term. This Ageement shall be in effect from the Ageement Date unffi the earliest of (a) termination under Section 3.2 or <br />(b) termination under Section 12.2; ron vided, however, no Equipment Schedules shall be executed after any Non-Appropriation or Event of <br />Default. Each Lease with respect to an Equipment Group shall be in effect for a Lease Term commencing upon the Lease Date and ending <br />as provided in Section 3.5. <br />Section 3.2. Termination by Lessee. In the sole event of Non-Appropriation, this Agreement and each Lease hereunder shall terminate, <br />in whole, but not in part, as to all Equipment effective upon the last day of the Fiscal Yeaz for which funds were appropriated, in the n>armer <br />and subject to the temvs specified in this Article. Lessee may effect such termination by giving Lessor a written notice of termination and <br />by paying to Lessor any Rental Payments and other amounts which aze due and have not been paid at or before the end of its then curent <br />Fiscal Yeaz. Lessee shall endeavor to give notice of such termination not less than ninety (90) days prior to the end of the Fiscal Yeaz for <br />which appropriations were made, and shall notify Lessor of any anticipated tem~ination. In the event of temilnation of this Ageement as <br />provided in this Section, Lessee shall comply with the instnrctions received from Lessor in accordance with Section 12.3. <br />Section 33. EffeM of Termination. Upon termination of this Ageement as provided in Section 3.2, Lessee shall not be responsible for <br />the payment of any additional Rental Payments coming due in succeeding Fiscal Years, but if Lessee has not complied with the instructions <br />received from Lessor in accordance with Section 12.3, the termination shall nevertheless be effective, but Lessee shall be responsible for <br />the payment of damages in an amount equal to the amount of the Rental Payments treat would thereafter have come due if this Ageement <br />had not been temilnated and which aze attnbutable to the number of days after which Lessee fails to comply with Lessor's instructions and <br />for any other loss suffered by Lessor as a result of Lessee's failure to take such actions as required. <br />Section 3.4. Non-substitution. If this Ageement is terminated by Lessee in accordance with Section 3.2, to the extent permitted by State <br />law, Lessee agees not to purchase, lease, rent, borow, seek appropriations for, acquire or otherwise receive the benefits of any personal <br />property to perfomr the same functions as, or functions taking the place of, those performed by any of. the Equipment, and agees not to <br />pemut such functions to be performed by its own employees or by any agency. or entity affiliated with or hired by Lessee, for a period of <br />one yeaz following such termination; rovid however, these restrictions shall not be applicable in the event the Equipment shall be sold <br />by Lessor and the amount received from such sale, less all costs of such sale, is sufficient to pay the then applicable Prepayment Prices <br />relating thereto as set forth in the Equipment Schedules; or to the extent the application of these restrictions is unlawful and would affect the <br />validity of this Ageement. <br />Section 3.5. Termination of Lease Term. The Lease Term with respect to any Lease will terminate upon the occurence of the fast of the <br />following events: (a) the temilnation of this Ageement by Lessee in accordance with Section 3.2; (b) the payment of the Prepayment Price <br />by Lessee pursuant to Article V; (c) an Event of Default by Lessee and Lessor's elecfion to temmnate such Lease pursuant to Article XII; or <br />(d) the payment by Lessee of ail Rental Payments and all other amounts authorized or required m be paid by Lessee pursuant to such Lease. <br />ARTICLE>V. RENTAL PAYMENTS <br />Section 4.1. Rental Payments. The Lessee agees to pay the Rental Payments due as specified in the Payment Schedule in Exhibit A. A <br />portion of each Rental Payment is paid as interest as specified in the Payment Schedule of each lease, and the first Rental Payment will <br />include Interest accring from the Funding Date. Lessor is authorized to insert the due date of the first Rental Payment in the Payment <br />Schedule in Exhibit A. All Rental Payments shall be paid to Lessor, or to such assignee(s) Lessor has assigned as stipulated in Article XI, <br />at such places as Lessor or such assignee(s) may from lime to time designate by written notice to Lessee. Lessee shall pay the Rental <br />Payments with lawful money of the United States of America from moneys legally available therefor. <br />Section 4.2. Current Expense. The obligations of Lessee, including its obligation to pay the Rental Payments due in any Fiscal Yeaz of a <br />Lease Terri, shall constitute a curent expense of Lessee for such Fiscal Yeaz and shall not constitute an indebtedness of Lessee within the <br />meaning of the Constitution and laws of the State. Nothing herein shall constitute a pledge by Lessee of any taxes or other moneys (other <br />than moneys lawfully appropriated from time to time by or for the benefit of Lessee for [his Ageement and the Net Proceeds of the <br />Equipment) to the payment of any Rental Payment or other amount coming due hereunder. <br />Sectiom 43. Unconditional Rental Payments. The Lessee's obligation to make Rental Payments shall be absolute and unconditional. <br />Also, any other payments required hereunder shall be absolute and unconditional. Lessee shall make these payments when due and shalt <br />not withhold any of these payments pending final resolution of any disputes. The Lessee shall not assert any right of set-off or counterclaim <br />against its obligation to make these payments. Lessee's obligation to make Rental Payments or other payments shall not be abated through <br />accident, unforeseen circumstances, failure of the Equipment to perform as desired, damage or destruction to the Equipment, loss of <br />possession of the Equipment or obsolescence of the Equipment The Lessee shall be obligated to continue to make payments required of it <br />3/I8I2008:NBQ-ESC DOChev 01/OSsOe <br />