On August 22, 2005, at 1615 eastern daylight time, a Piper PA-18-105, N262T, registered to and operated by Barnstormer Flite Signs Inc, collided with the Atlantic Ocean at North Myrtle Beach, South Carolina. The banner tow flight was operated under the provisions of Title 14 CFR Part 91 and no flight plan was filed. Visual meteorological conditions prevailed at the time of the accident. The pilot was not injured, and the airplane received substantial Damage. The flight departed Grand Stand Airport, North Myrtle Beach, South Carolina, at 1330 August 22, 2005. The pilot departed Grand Stand Airport on a routine banner tow flight around the North Myrtle Beach area. The airplane had flown for about two and a half hours and was at an altitude of 500 feet when engine started to run rough. The engine continued to run rough for 45-60 seconds followed by the engine completely losing power. The pilot's attempts to restart the engine were unsuccessful and the pilot chose to ditch the airplane in the Atlantic Ocean. The airplane was ditched 125 yards from the coast and was recovered by witnesses at the scene of the accident. Post accident-examination of the airplane revealed saltwater throughout the engine and engine accessories. Saltwater was drained from the recovered engine and the engine was started and a functional run was accomplished. The pilot stated there was 15 gallons of fuel in the left fuel tank and 5 gallons remaining in the right fuel tank when he ditched the airplane. Weather conditions were favorable for the formation of carburetor ice. The pilot reported that he did not apply carburetor heat during the flight.