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HomeMy WebLinkAboutFishers Island Garbage & Refuse ~@ i" .c.~ ~'" ~~ rnN l r so . 5 C '" ~ UNITED STATES OF AMERICA STATE OF NEW YORK COUNTY OF SUFFOLK TOWN OF SOUmOLD ( ~t,~ $560,000 BOND ANTICIPATION NOTE FOR FISHERS ISLAND GARBAGE AND REFUSE DISTRICT-2006 The Town of Southold, in the County of Suffolk, a municipal cOl]lOfation of the State of New York, hereby acknowledges itself indebted and for value received promises to pay to the bearer of this Note, or if it be registered, to the registered holder, the sum of FIVE HUNDRED SIXTY mOUSAND DOLLARS ($560,000) on the 24th day of August, 2007, together with interest thereon from the date hereof at the rate of three and seventy-six hundredths per centum (3.76%) per annum, payable at maturity or prior redemption. Both principal of and interest on this Note will be paid in lawful money of the United States of America, at the Suffolk County National Bank, Riverbead, New York. Both principal of and interest on this Note shall be payable only to the registered owner, his legal representatives, successors or transferees. lIDs Note shall then be transferable only upon presentation to such Town Clerk with a written transfer of title and such Town Clerk shall thereupon register this Note in the name of the transferee in his books and shall endorse a certificate of such registration hereon. Such transfer shall be dated, and signed by the registered owner, or his legal representatives, and it shall be duly acknowledged or proved, or in the alternative the signature thereto shall be certified as to its genuineness by an officer of a bank or trust company located and authorized to do business in this State. This Note is the only note of an authorized issue, the principal amount of which is $560,000. This Note may be called for redemption, after the giving of at least five (5) days' written notice of the date of redemption by mailing of written notice to the original purchaser, or if this Note be registered to the registered holder, and interest shall cease to be paid hereon after such date of redemption. This Note is issued pursuant 10 the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, the bond resolution adopted by the Town Board on September 12, 2000, authorizing the issuance of $2,500,000 serial bonds for the improvement of the facilities of the Fishers Island Garbage and Refuse District, in said Town, and the Certificate of Determination executed by the Supervisor on August 25, 2006. This Note has been designated by the Town as a qualified tax-exempt obligation pursuant to the provisions of Section 265 of the Internal Revenue Code of 1986, as amended. The faith and credit of such Town are hereby irrevocably pledged for the punctual payment of the principal of and interest on this Note according to its terms. It is hereby certified and recited that all conditions, acts and things required by the Constitution and statutes of the State of New York to exist, to have happened and to have been performed precedent to and in the issuance of this Note, exist, have happeoed and have been performed, and that this Note, together with all other indebtedness of such Town, is within every debt and other limit prescribed by the Constitution and laws of such State. IN WITNESS WHEREOF, the Town of Southold has caused this Note to be executed in its name by its Supervisor, and its corporate seal (or a facsimile thereof) to be affixed, imprinted or otherwise reproduced hereon and attested by its Town Clerk and this Note to be dated as of the 25th day of Augus~ 2006. ~OW FSOUmOLD (SEAL) ~ _ . # By CLr~ Supervisor ~1rhd~Cf--I'r:./~) Town lerk' PAID AUG 24 2007 The Suflolk County National bank RlVERHfAD./Di YORK REGISTRATION CERTIFICATE It is hereby certified that the within Note has been registered as follows: Date of Registration Name of Registered Holder Registered by SUFFOLK COUNTY NATIONAL BANK September 7, 2007 Town of Southold Elizabeth A. Neville, Town Clerk P.O. Box 1179 Southold, NY 11971 Dear Ms. Neville: Enclosed please find the following cancelled note, paid in full by the Town of Southold: $ 560,000.00 Town of Southold 3.76% due 8/24/2007 It was a pleasure to have accommodated the Town of Southold with these borrowings. Very truly yours, ;:JulYi(C~nC~ Barbara Danowski Assistant Comptroller :siw Encl Cmnrlrolkr's Ikparlmcnt FbrbJra D;Uh\\\ski. A,V.P PJ), Box \)I)!IU"'!\jvcrhc;/(J"'Nc\v VI.)rk"! 1901 1)lhmc(hJ I ; ~ 9l5e1ajte1d & 11/004 DgJ ONE CHASE MANHATTAN PLAZA NEW YORK, NY 10005 WNW.HAWKINS.COM August 25, 2006 The Town Board of the Town of Southold, in the County of Suffolk, New York Ladies and Gentlemen: We have examined a record of proceedings relating to the issuance of the $560,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2006 (the "Note") of the Town of South old, in the County of Suffolk, a municipal corporation of the State of New York. The Note is dated August 25, 2006, matures August 24, 2007, subject to prior redemption, is a single note in the denomination of $560,000, is numbered 3R-l, is payable to bearer, bears interest at the rate of 3.76% per annum, is issued pursuant to the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, the bond resolution adopted by the Town Board on September 12,2000, authorizing the issuance of $2,500,000 serial bonds for the increase and improvement of facilities of the Fishers Island Garbage and Refuse District, in said Town, and the Certificate of Determination executed by the Supervisor on August 25, 2006. Said Bond Anticipation Note is a temporary obligation issued in anticipation of the sale of permanent serial bonds. In our opinion, the Note is a valid and legally binding general obligation of the Town for which the Town has validly pledged its faith and credit and, unless paid from other sources, all the taxable real property within the Town is subject to the levy of ad valorem real estate taxes to pay the Note and interest thereon without limitation of rate or amount. The enforceability of rights or remedies with respect to the Note may be limited by bankruptcy, insolvency, or other laws affecting creditors' rights or remedies heretofore or hereafter enacted. The Internal Revenue Code of 1986, as amended (the "Code"), establishes certain requirements that must be met subsequent to the issuance and delivery of the Note in order that interest on the Note be and remain excludable from gross income under Section 103 of the Code. The Supervisor of the Town, in executing the Arbitrage and Use of Proceeds Certificate, has certified to the effect that the Town will comply with the provisions and procedures set forth therein and that it will do and perform all acts and things necessary or desirable to assure that interest paid on the Note is excludable from gross income under Section 103 of the Code. We have examined such Arbitrage and Use of Proceeds Certificate of the Town delivered concurrently with the delivery of the Note, and, in our opinion, such certificate contains provisions and procedures under which such requirements can be met. 507022.1 022471 CERT In our opinion, the interest on the Note is excludable under existing statutes and court decisions from the gross income of the recipients thereof for federal income tax purposes pursuant to Section 103 of the Code, and under existing statutes interest on the Note will not be treated as a preference item in calculating the alternative minimum tax that may be imposed under the Code with respect to individuals and corporations. In rendering the foregoing opinion we have assumed the Town's compliance with the Arbitrage and Use of Proceeds Certificate. Further, in our opinion, under existing statutes, interest on the Note is exempt from New York State and New York City personal income taxes. Other than such record of proceedings, we have not been requested to examine or review and have not examined or reviewed the accuracy or sufficiency of any additional proceedings, reports, correspondence, financial statements or other documents, containing financial or other information relative to the Town, which have been or may hereafter be furnished or disclosed to purchasers of the Note and we express no opinion with respect to any such financial or other information or the accuracy or sufficiency thereof The form of the Note is prescribed by Schedule B,2 of the Local Finance Law of the State of New York, but we have not examined the executed Note. Verytru~ ' f) ; ~ . 'I~a.fJ 507022.1 022471 CERT ~ q)ekj1eId & 1f/rxxi Hr?JJ ONE CHASE MANHATTAN PLAZA NEW YORK, NY 10005 WWW.HA.WKINS.COM August 25, 2006 The Town Board ofthe Town of Southold, in the County of Suffolk, New York Ladies and Gentlemen: We have examined a record of proceedings relating to the issuance of the $560,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2006 (the ''Note'') of the Town of South old, in the County of Suffolk, a municipal corporation of the State of New York. The Note is dated August 25, 2006, matures August 24,2007, subject to prior redemption, is a single note in the denomination of $560,000, is numbered 3R-1, is payable to bearer, bears interest at the rate of 3.76% per annum, is issued pursuant to the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, the bond resolution adopted by the Town Board on September 12, 2000, authorizing the issuance of $2,500,000 serial bonds for the increase and improvement of facilities of the Fishers Island Garbage and Refuse District, in said Town, and the Certificate of Determination executed by the Supervisor on August 25, 2006. Said Bond Anticipation Note is a temporary obligation issued in anticipation of the sale of permanent serial bonds. In our opinion, the Note is a valid and legally binding general obligation of the Town for which the Town has validly pledged its faith and credit and, unless paid from other sources, all the taxable real property within the Town is subject to the levy of ad valorem real estate taxes to pay the Note and interest thereon without limitation of rate or amount. The enforceability of rights or remedies with respect to the Note may be limited by bankruptcy, insolvency, or other laws affecting creditors' rights or remedies heretofore or hereafter enacted. The Internal Revenue Code of 1986, as amended (the "Code"), establishes certain requirements that must be met subsequent to the issuance and delivery of the Note in order that interest on the Note be and remain excludable from gross income under Section 103 of the Code. The Supervisor of the Town, in executing the Arbitrage and Use of Proceeds Certificate, has certified to the effect that the Town will comply with the provisions and procedures set forth therein and that it will do and perform all acts and things necessary or desirable to assure that interest paid on the Note is excludable from gross income under Section 103 of the Code. We have examined such Arbitrage and Use of Proceeds Certificate of the Town delivered concurrently with the delivery of the Note, and, in our opinion, such certificate contains provisions and procedures under which such requirements can be met. 507022.1 022471 CERT In our opinion, the interest on the Note is excludable under existing statutes and court decisions from the gross income of the recipients thereof for federal income tax purposes pursuant to Section 103 of the Code, and under existing statutes interest on the Note will not be treated as a preference item in calculating the alternative minimum tax that may be imposed under the Code with respect to individuals and corporations. In rendering the foregoing opinion we have assumed the Town's compliance with the Arbitrage and Use of Proceeds Certificate. Further, in our opinion, under existing statutes, interest on the Note is exempt from New York State and New York City personal income taxes. Other than such record of proceedings, we have not been requested to examine or review and have not examined or reviewed the accuracy or sufficiency of any additional proceedings, reports, correspondence, financial statements or other documents, containing financial or other information relative to the Town, which have been or may hereafter be furnished or disclosed to purchasers of the Note and we express no opinion with respect to any such financial or other information or the accuracy or sufficiency thereof. The form of the Note is prescribed by Schedule B,2 of the Local Finance Law of the State of New York, but we have not examined the executed Note. Very truly yours, fb,L f&IIU 4!J)J c.( f 507022.1 022471 CERT c ~ ? S. c in ~ r No.4R-l $360,000 UNITED STATES OF AMERICA STATE OF NEW YORK COUNTY OF SUFFOLK TOWN OF SOUTHOLD BOND ANTICIPATION NOTE FOR FISHERS ISLAND GARBAGE AND REFUSE DISTRICT-2007 The Town of Southold, in the County of Suffolk, a municipal corporation of the State of New Yark, hereby acknowledges itself indebted and for value received promises to pay to the bearer of this Note, or if it be registered, to the registered holder, the sum of THREE HUNDRED SIXTY THOUSAND DOLLARS ($360,000) on the 22nd day of August, 2008, together with interest thereon from the date hereof at the rate of three and sixty-nine hundredths per centum (3.69%) per annum, payable at maturity or prior redemption. Both principal of and interest on this Note will be paid in lawful money of the United States of America, at the Bridgehampton National Bank, Southold, New York. Both principal of and interest on this Note shall be payable only to the registered owner, his legal representatives, successors or transferees. This Note shall then be transferable only upon presentation to such Town Clerk with a written transfer of title and such Town Clerk shall thereupon register this Note in the name of the transferee in his books and shall endorse a certificate of such registration hereon. Such transfer shall be dated, and signed by the registered owner, or his legal representatives, and it shall be duly acknowledged or proved, or in the alternative the signature thereto shall be certified as to its genuineness by an officer of a bank or trust company located and authorized to do business in this State. This Note is the only note ofan authorized issue, the principal amount of which is $360,000. This Note may be called for redemption, after the giving of at least five (5) days' written notice of the date of redemption by mailing of written notice to the original purchaser, or if this Note be registered to the registered holder, and interest shall cease to be paid hereon after such date of redemption. This Note is issued pursuant to the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, the bond resolution adopted by the Town Board on September 12, 2000, authorizing the issuance of $2,500,000 serial bonds for the improvement of the facilities ofthe Fishers Island Garbage and Refuse District, in said Town, and the Certificate of Determination executed by the Supervisor on August 24, 2007. This Note has been designated by the Town as a qualified tax-exempt obligation pursuant to the provisions of Section 265 of the Internal Revenue Code of 1986, as amended. The faith and credit of such Town are hereby irrevocably pledged for the punctual payment of the principal of and interest on this Note according to its tenns. It is hereby certified and recited that all conditions, acts and things required by the Constitution and statutes of the State of New York to exist, to have happened and to have been performed precedent to and in the issuance of this Note, exist, have happened and have been perfonned, and that this Note, together with all other indebtedness of such Town, is within every debt and other limit prescribed by the Constitution and laws of such State. IN WITNESS WHEREOF, the Town of South old has caused this Note to be executed in its name by its Supervisor, and its corporate seal (or a facsimile thereof) to be affixed, imprinted or otherwise reproduced hereon and attested by its Town Clerk and this Note to be dated as of the 24th day of August, 2007. ZTOW FSOUTHOLD (SEAL) _ // By .... "Q/':/v> . ,.d 1/ . Supervisor ATTEST: D1fMjjO.nu)4. Town Clerk ARBITRAGE AND USE OF PROCEEDS CERTIFICATE I, Scott A. Russell, Supervisor of the Town of Southold, in the County of Suffolk, New York (the "Issuer"), HEREBY CERTIFY and reasonably expect with respect to the issuance of the Issuer's $360,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2007 (hereinafter referred to as the "Note"), dated August 24, 2007, and maturing on August 22, 2008, as follows: Unless the context clearly requires otherwise, all capitalized terms used but not otherwise defined herein shall have the meanings set forth herein or in the Resolutions, the Code or the Regulations (each as defined below). ARTICLE I General 1.1. Authoritv of Signatorv. I am an officer of the Issuer, charged with the responsibility for the execution, delivery, and issuance of the Note and am acting for and on behalf of the Issuer in signing this certificate. 1.2. Purpose of Certificate. This certificate is made for the purpose of establishing evidence of the expectations of the Issuer as of the date hereof as to future events regarding the amount and use of proceeds of the Note. It is intended and may be relied upon for purposes of Sections 103 and 148 of the Internal Revenue Code of 1986, as amended (the "Code"), and as a certification described in Section 1.l48-2(b )(2) of the Treasury Regulations (the "Regulations"). This certificate is executed and delivered as part of the record of proceedings in connection with the issuance of the Note. The provisions of this certificate constitute a contractual obligation of the Issuer in consideration for the purchase of and payment for the Note by the purchaser(s) thereof. 1.3. Reasonable Expectations. This certificate sets forth the facts, estimates and circumstances now in existence which form the basis for the Issuer's expectation that the proceeds of the Note will not be used in a manner that would cause the Note to be an arbitrage bond under Section 148 of the Code or a private activity bond under Sections 103 and 141 of the Code. To the best of my knowledge and belief, such expectation is reasonable and there are no other facts, estimates or circumstances that would materially change that expectation. 1.4. No Composite Issue. No other governmental obligations have been sold fewer than 15 days prior to, or will be sold fewer than 15 days after, the sale date of the Note, pursuant to a common plan of financing which are expected to be paid from substantially the same source offunds as the Note. 1.5 No Federal Guarantee. The Issuer represents and covenants that, except for the gross proceeds of the Note which are: (a) invested during the temporary period referred to in Article III, (b) held in any refunding escrow or (c) invested in obligations of the United States 528411.1 022471 CERT Treasury or in obligations issued pursuant to Section 2IB(d)(3) of the Federal Home Loan Bank Act, as amended by Section 51l(a) of the Financial Institutions Reform, Recovery and Enforcement Act of 1989, or any successor provision to Section 2IB(d)(3) of the Federal Home Loan Bank Act, as amended: (i) No portion of the payment of principal or interest with respect to the Note is or will be guaranteed directly or indirectly by the United States or any agency or instrumentality thereof (herein "federally guaranteed"); and (ii) No portion of the gross proceeds of the Note in excess of five percent of such gross proceeds is or will be (A) used in making loans the payment of principal or interest with respect to which is to be federally guaranteed, or (B) invested directly or indirectly in federally insured deposits or accounts. 1.6. Tax Representation. The Issuer expects to be able to and will comply with all the procedures and provisions set forth herein, and will do and perform all acts and things necessary and desirable within its reasonable control in order to assure that interest paid on the Note shall be excluded from gross income of the owners thereof for the purpose of federal income taxation. 1.7. Additional Information. The Issuer will provide such other information as may be required to assure the exclusion from gross income of interest on the Note for federal income taxation purposes. 1.8. Non-Purpose Investments. Not more than 50% of the proceeds of the Note are being invested in investments not acquired to carry out the governmental purposes of the issue at a guaranteed yield and having a term of 4 years or more. 1.9 IRS Information Reporting. The Issuer will make a timely filing of the appropriate IRS Form 8038-0 or 8038-0C. ARTICLE II Use ofProiect and Proceeds 2.1. Authorization. (a) The Note is authorized to be issued pursuant to applicable provisions of the laws of the State of New York and the bond resolution adopted by the Town Board on September 12, 2000, (the "Resolution"), as referred to in the Certificate of Determination executed by the Supervisor on August 24, 2007. (b) For purposes of this Article II, the term "Original Proceeds" means the Sale Proceeds received (or deemed to be received) by the Issuer from the sale of the Notes net of the amount used or to be used for the payment of all costs and expenses associated with issuing the Notes, and excluding accrued interest. 528411.1 022471 CERT 2.2. Pumose of Issue. The Notes are being issued for the increase and improvement of the facilities of the Fishers Island Garbage and Refuse District (the "Project), in said Town. 2.3. Use of Original Proceeds. The proceeds of sale of the Note in the amount of $360,000, together with $200,000 in available funds, will be used to redeem a prior issue of bond anticipation notes in the amount of $560,000 which mature on August 24, 2007 (the "Prior Issue"), heretofore issued to finance the Project. 2.4. Ownership/Lease/Sale. The Project will be owned by the Issuer or another state or local governmental unit and will not be leased to any person who is not a state or local governmental unit. It will not (except to the extent that any of the projects financed involve grants) be sold or otherwise disposed of, in whole or in part, except for incidental sales of surplus items the proceeds of which will not constitute net operating profits or net capital profits to the Issuer, prior to the maturity date of the Note. 2.5. Private Loans. Not more than the lesser of 5 percent or $5,000,000 of the proceeds of the Note will be used directly or indirectly to make loans to persons other than a governmental unit. 2.6. Private Use. The aggregate amount of proceeds of the Note used directly or indirectly in a trade or business carried on by a person other than a state or local governmental unit ("Private Use"), will not exceed 10% of such proceeds in the event that more than 10% of the principal or 10% of the interest due on the Note during the term thereof is, under the terms of the Note or any underlying arrangement, directly or indirectly, secured by any interest in property used or to be used for a Private Use or in payments in respect of property used or to be used for a Private Use or is to be derived from payments, whether or not to the Issuer, in respect of property or borrowed money used or to be used for a Private Use. 2.7. Unrelated/Related Disproportionate Use. No more than 5% of the proceeds of the Note will be used directly or indirectly in the trade or business of a person other than a governmental unit that is unrelated or related and disproportionate to the governmental use of the property being financed, including any private loan financing described in Section 2.5 which meets this test. For purposes of this Arbitrage and Use of Proceeds Certificate, proceeds of the Note are allocable to an unrelated Private Use if such use is neither directly nor operationally related to a governmental use and proceeds of the Note are allocable to a disproportionate related Private Use to the extent that the proceeds of the Note which are to be used to finance property used by a nongovernmental person in a trade or business which is related to the governmental use of the property referred to in Section 2.6 above, exceeds the proceeds of the Note which are to be used for the governmental use to which such Private Use relates. 2.8. Other Private Uses Defined. For purposes of Section 2.6 and 2.7, a Private Use consists of any contract or other arrangement including, without limitation, leases, management contracts, guarantee contracts, take or pay contracts, or put or pay contracts, which provides for a use of the Project by a person or persons who are not State or local governments 528411.1 022471 CERT on a basis different than the general public. Any management, or operations contract or agreement which provides for nongovernmental use will provide for reasonable compensation which is in no part based on net profits and will satisfy the provisions of (a), (b) or (c) below: (a) for contracts which provide compensation for each annual period based on a periodic fixed fee, a capitation fee or combination thereof, (i) the contract has a term (including renewal options) not exceeding five years; (ii) the issuer may terminate the contract, without penalty, at the end of any three year period, and (iii) at least 50% of the compensation paid is on a periodic, fixed fee basis; (b) for contracts entered into or materially modified (other than pursuant to a renewal option) after March IS, 1993, which provide compensation based on a per unit fee or a combination per unit and periodic fixed fee, (i) the contract has a term (including renewal options) not exceeding three years; (ii) the issuer may terminate such contract (without penalty) at the end of the second year of the term, and (iii) the amount of the per unit fee is specified in the contract or otherwise limited by the qualified user or a third party; (c) for contracts entered into or materially modified (other than pursuant to a renewal option) after March 15, 1993, which provide compensation based on a percentage of fees charged, (i) the contract has a term (including renewal options) not exceeding two years, (ii) the issuer may terminate the contract (without penalty) at the end of the first year, and (iii) the service provider primarily provides services to third parties or the contract involves a facility during an initial start-up period; (d) For purposes of this Section 2.8: (i) "capitation fee" means a fixed periodic amount paid under a management contract or agreement for each person for whom the service provider assumes the responsibility to provide all needed services for a specified period, provided the quantity and type of services actually provided vary substantially; (ii) "periodic fixed fee" means a stated dollar amount for services rendered during a specified period of time (i.e. $XX per month) which amount may automatically increase according to a specified, objective, external standard; and (iii) "per unit fee" means a stated dollar amount for each unit of service provided (i.e. $XX per medical procedure). 2.9. Pooled Loan Financings. To the extent the amount of proceeds of the Note to be used to make loans to any borrowers (including loans referred to in Section 2.5 above and loans to state or local governmental units) exceeds $5,000,000, at least 95% of the net proceeds of the issue (as defined in Section ISO of the Code but without including proceeds used to finance costs of issuance or capitalized interest) that are to be used to make loans, will have been 528411.1 022471 CERT used within 3 years of the date hereof to make such loans. The payment of legal and underwriting costs is not contingent and at least 95% of the reasonably expected legal and underwriting costs associated with issuance will be paid within 180 days of the date hereof. 2.1 O. Output Facilities. No more than 5% of the proceeds of the Note are to be used with respect to any output facility (other than a facility for the furnishing of water). No more than the lesser of $5,000,000 or 5% of the proceeds of the Note are to be used (directly or indirectly) for the acquisition of a nongovernmental output facility. ARTICLE III Arbitrage/Rebate Exemption 3.1. Temporary Period-Refunding. With respect to the proceeds of the Note allocable to the Prior Issue, such proceeds may be invested without restriction as to yield during the three-year temporary period commencing on the date hereof, because: (a) All of the proceeds of the Prior Issue have been expended, or any such proceeds which have not been expended as of the date hereof, shall become transferred proceeds of this issue. Such transferred proceeds may be invested without restriction as to yield until three years after the date of original issuance ofthe Prior Issue. If any transferred proceeds remain unexpended after three years after the date of original issuance of the Prior Issue, such proceeds will be invested at a yield not in excess of the yield on the Note. (b) The proceeds of the Note will be used to refund the Prior Issue within 90 days of the date hereof, and may be invested during such time without restriction as to yield. 3.2. Rebate. (a) The Prior Issue was not subject to the rebate requirement imposed by Section 148 of the Code because at the time of original issuance of the first note or notes issued pursuant to the Resolution, in renewal of which the Prior Issue and/or the Note are issued: (i) the Issuer was a governmental unit with general taxing powers; (ii) the Prior Issue did not constitute a "private activity bond" as that term is defined in Section 141 of the Code; (iii) ninety-five percent or more of the net proceeds of the sale of the Prior Issue was used for local governmental activities of the Issuer; and (iv) the Issuer (including all agencies, instrumentalities and political subdivisions of the Issuer) reasonably expected that the aggregate face amount of all tax-exempt bonds issued by the Issuer during the calendar year in which the Prior Issue was issued would not exceed $5,000,000. 528411.1 022471 CERT For purposes of such determination, no tax-exempt obligation was taken into account if it was a current refunding obligation issued in the calendar year in which the Prior Issue was being issued which does not exceed the outstanding (redeemed) principal amount of the obligation to be refunded. (b) The Note is not subject to the rebate requirement imposed by Section 148 of the Code because all of the proceeds of such Note will be expended to pay the Prior Issue within 90 days of the date hereof and will, therefore, qualify for the six-month expenditure exception to rebate. 3.3. No Excess Proceeds. The total proceeds of sale of all obligations issued to date for the Project do not exceed the total cost of the Project. 3.4. Source of Repavment Funds. The Note will be paid from taxes and the proceeds of other obligations of the Issuer issued to fund the Note. 3.5. Debt Service Fund. The taxes used to pay principal and interest on the Note, whether or not deposited in a debt service fund, will be expended within 13 months of the date of deposit in such fund, or the date of their accumulation, in the payment of debt service on the Note. Any amounts received from the investment of such deposit or accumulation will be expended within one year of receipt. The debt service fund, if any, will be used to achieve a proper matching of revenues and debt service and will be depleted at least annually except for a reasonable carryover amount which will not exceed the greater of the earnings on such fund for the immediately preceding year or one-twelfth of the debt service on the Bonds for the immediately preceding year. 3.6. Sinking Funds. Except for the debt service fund described herein the Issuer has not created or established, and does not expect to create or establish, any sinking fund or other similar fund which the Issuer reasonably expects to use to pay principal or interest on the Note. ARTICLE IV Bank Qualification 4.1. Designation. The Note is hereby designated as a "qualified tax-exempt obligation" pursuant to the provisions of Section 265 of the Code. In making such designation it has been determined that: (i) the Note currently refunds the Prior Issue; (ii) the Prior Issue was designated as a "qualified tax-exempt obligation"; (iii) the aggregate face amount of the Note does not exceed $10,000,000; (iv) the Prior Issue had a weighted average maturity of 3 years or less; 528411.1 022471 CERT (SEAL) (v) the maturity date of the Note, as measured from the original date of issuance of the notes issued pursuant to the Resolution, in renewal of which such Note is being issued, does not exceed 30 years; and (vi) not more than $10,000,000 of obligations issued by the Issuer during the calendar year in which the Prior Issue was issued were designated by the Issuer as "qualified tax-exempt obligations." IN WITNESS WHEREOF, I have hereunto set my hand and affixed the corporate seal of the Town of Southold on this 24th day of August, 2007. ~~oL- .tt,ft Supervisor 528411.1 022471 CERT , " , AFFIDAVIT AS TO NO CONFLICT OF INTEREST STATE OF NEW YORK ) :ss: COUNTY OF SUFFOLK ) Elizabeth A, Neville, being duly sworn upon her oath deposes and says: I. I am the duly appointed, qualified and acting Town Clerk of the Town of Southold, in the County of Suffolk, New York (herein and in Schedule A annexed hereto called "Town"); 2. That with respect to the contract of sale of the Note of the Town described in the Certificate of Determination executed by the Supervisor on the 24th day of August, 2007, to the financial institution indicated in such Certificate, I have made a careful inquiry of each officer and employee of the Town having the power or duty to (a) negotiate, prepare, authorize or approve the contract or authorize or approve payment thereunder, (b) audit bills or claims under the contract, or (c) appoint an officer or employee who has any of the powers or duties set forth above, as to whether or not such officer or employee has an interest (as defined pursuant to Article 18 of the General Municipal Law) in such contract; 3. That upon information and belief, as a result of such inquiry, no such officer or employee has any such interest in said contract unless otherwise noted in Schedule A annexed hereto and by this reference made a part hereof. p~-j,dJO.TJ~juM Town Clerk Subscribed and sworn to before me this 24th day of August, 2007, ~/h~ a~o / Notary Pub ic, State of New York LINDA J COOPER '!"lTARY PUBLIC, State of New York ig, 01 C04822563, Suffolk COUlD ,~!m Expires December 31, 20 528411.1 022471 CERT I SCHEDULE A I. , is a stockholder of the Purchaser owning or controlling, directly or indirectly, less than five per centum (5%) of the outstanding stock thereof but no disclosure of such interest by said officer is required pursuant to said Law. 2. , has an interest in the Purchaser solely by reason of employment as an officer or employee thereof, but the remuneration of such employment will not be directly affected as a result of said contract and the duties of such employment do not directly involve the procurement, preparation or performance of any such part of such contract. 3. , has publicly disclosed the nature and extent of such interest in writing to the governing board of the Town. Such written disclosure has been made a part of and set forth in the official record of proceedings of the Town. 528411.1 022471 CERT 11 CERTIFICATE OF DETERMINATION BY THE SUPERVISOR RELATIVE TO AUTHORIZATION, SALE, ISSUANCE, FORM AND CONTENTS OF THE $360,000 BOND ANTICIPATION NOTE FOR FISHERS ISLAND GARBAGE AND REFUSE DISTRICT-2007 OF THE TOWN OF SOUTHOLD, NEW YORK I, Scott A. Russell, Supervisor of the Town of Southold, New York (herein called the "Town"), HEREBY CERTIFY that pursuant to the powers and duties delegated to me, the chief fiscal officer of the Town, by the Town Board of the Town, pursuant to the bond resolution duly adopted and as referred to in paragraph I hereof, and subject to the limitations prescribed in said bond resolution, I have made the following determinations: I. A bond anticipation note (hereinafter referred to as the "Note") of the Town in the principal amount of $360,000 shall be issued to renew, in part, a bond anticipation note in the principal amount of $560,000 heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted September 12, 2000, appropriating the amount of $2,500,000 for the improvement of facilities of the Fishers Island Garbage and Refuse District, in said Town, and authorizing the issuance of $2,500,000 serial bonds of said Town to finance said appropriation" duIy adopted by the Town Board on the date therein referred to, and the Certificate of Determination executed by the Supervisor on August 25, 2006; the redemption of said $560,000 bond anticipation note having been heretofore provided to the extent of $200,000 from a source other than the proceeds of serial bonds. 2. The terms, form and details of said Note shall be as follows: Amount and Title: $360,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2007 Dated: August 24, 2007 Matures: August 22, 2008, subject to prior redemption Number and Denomination: No. 4R-I, at $360,000 Interest Rate per annum: 3.69% Form of Note: Substantially in accordance with form prescribed by Schedule B,2 of the Local Finance Law of the State of New Yark. 528411.1 022471 CERT " 3. The amount of bond anticipation notes originally issued in anticipation of the issuance of the serial bonds authorized pursuant to the resolution referred to in paragraph 1, hereof, including the Note, is $1,170,000, and the amount of bond anticipation notes which will be outstanding after the issuance of the Note, including the Note, will be $360,000. 4. The serial bonds authorized pursuant to the resolution referred to in paragraph 1, hereof, are for improvements which are assessable. 5. Pursuant to said powers and duties delegated to me, I DO HEREBY AWARD AND SELL said Note to Bridgehampton National Bank, SouthoId, New York, for the purchase price of $360,000, plus accrued interest, if any, from the date of said Note to the date of delivery thereof; and I FURTHER DETERMINE that said Note shall be payable as to both principal and interest at Bridgehampton National Bank, Southold, New York, and shall bear interest at the rate of three and sixty-nine hundredths per centum (3.69%) per annum, payable at maturity, or prior redemption. 6. The Note shall be executed in the name of the Town by the manual signature of its Supervisor and the corporate seal of the Town will be affixed, imprinted, impressed or otherwise reproduced thereon and attested by its Town Clerk. I HEREBY FURTHER CERTIFY that the powers and duties delegated to me to issue and sell the Note hereinabove referred to are in full force and effect and have not been modified, amended or revoked. IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of August, 2007. ~~~ 528411.1 022471 CERT . CLERK'S CERTIFICATE I, Elizabeth A. Neville, Town Clerk of the Town of Southold, in the County of Suffolk, New York, HEREBY CERTIFY that I have compared the foregoing copy of the Certificate of Determination executed by the Supervisor and the same is a true and complete copy of the Certificate filed with said Town in my office as Town Clerk on or before the 24th day of August, 2007, and I FURTHER CERTIFY that no resolution electing to reassume any of the powers or duties mentioned in said Certificate and delegated to the Supervisor by the resolution cited in said Certificate has been adopted by said Town Board. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the corporate seal of said Town this 24th day of August, 2007 (SEAL) ~-<-~"I(rtIi{} Y'Luj~ Town Clerk 528411.1 022471 CERT CERTIFICATES AS TO SIGNATURES, LITIGATION, AND DELIVERY AND PAYMENT WE, the undersigned officers of the Town of Southold, in the County of Suffolk, a municipal corporation of the State of New York and herein referred to as the "Town", HEREBY CERTIFY that on or before August 24, 2007, we officially signed and properly executed by manual signatures the $360,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2007 (the "Note") of the Town, payable to bearer, and described in Schedule A annexed hereto and by this reference made a part hereof, and that at the time of such signing and execution and on the date hereof we were and are the duly chosen, qualified and acting officers of the Town authorized to execute the Note and holding the respective offices indicated by the respective titles set opposite our signatures hereto for term expiring on the respective dates set opposite such titles. WE FURTHER CERTIFY that no litigation of any nature is now pending or threatened restraining or enjoining the issuance or delivery of the Note or the levy or collection of any taxes to pay the interest on or principal of the Note, or in any manner questioning the authority or proceedings for the issuance of the Note or for the levy or collection of said taxes, or relating to the Note or affecting the validity thereof or the levy or collection of said taxes, that neither the corporate existence or boundaries of the Town nor the title of any of the present officers thereof to their respective offices is being contested, and that no authority or proceedings for the issuance of the Note has or have been repealed, revoked or rescinded. WE FURTHER CERTIFY that the seal which is impressed upon this certificate (or a facsimile thereof) has been affixed, impressed, imprinted or otherwise reproduced upon the Note and is the legally adopted, proper and only official corporate seal of the Town. And I, Scott A. Russell, Supervisor, HEREBY FURTHER CERTIFY that on August 24, 2007, I delivered or caused the delivery of the Note to Bridgehampton National Bank, Southold, New York, the purchaser thereof, and that at the time of such delivery of said Note, the Town received from said purchaser the amount hereinbelow stated, in full payment for said Note, computed as follows: Price. ..... ........... ..... ... ...... .... ........ ... .... .... ....... .... ... ......... ........ ... .$360,000.00 Interest on said Note accrued to the date of such delivery.............................................................. -0- Amount Received.. ... ....... ... ....... .... .... .... ... .... .... ... ............. ... ... ..$360,000.00 (SEAL) 52841t.1 022471 CERT IN WITNESS WHEREOF, we have hereunto set our hands and said corporate seal has hereunto been affixed this 24th day of August, 2007. ~~ture ~~ PfltihdJ/l1)",jfl Term of Office Expires Title December 31, 2007 Supervisor December 31, 2009 Town Clerk I HEREBY CERTIFY that the signatures of the officers of the above-named Town, which appear above, are true and genuine and that I koow said officers and koow them to hold the respective offices set opposite their signatures. ~I1SS/~nf ~(~/lC~ 4r (Title) (jfli~ljaPjJj,~ Nt/I ~/(, ame of Bank) 528411.1 022471 CERT ATTORNEY'S CERTIFICATE I, Patricia Finnegan, HEREBY CERTIFY that I am a licensed attorney at law of the State of New York, having offices at 53095 Main Road, Southold, New York, and am the duly chosen, qualified and acting Town Attorney of the Town of Southold, in the County of Suffolk, a municipal corporation of the State of New York and herein referred to as the "Town", that no litigation of any nature is now pending or threatened restraining or enjoining the issuance or delivery of the Note of the Town, said Note to be payable to Bridgehampton National Bank, Southold, New York, and otherwise described as set forth in Schedule A annexed hereto and by this reference made a part hereof, or the levy or collection of any taxes to pay the interest on or principal of the Note, or in any manner questioning the authority or proceedings for the issuance of the Note or for the levy or collection of said taxes, or relating to the Note or affecting the validity thereof or the levy or collection of said taxes, that neither the corporate existence or boundaries of the Town nor the title of any of the present officers thereof to their respective offices is being contested, and that no authority or proceedings for the issuance of the Note has or have been repealed, revoked or rescinded. IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of Au s, 2007. ~ 528411.1 022471 CERT Amount and Title: Dated: Matures: Number and Denomination: Interest Rate per annum: Form of Note: SCHEDULE A $360,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2007 August 24, 2007 August 22, 2008, subject to prior redemption No. 4R-l, at $360,000 3.69% Substantially in accordance with form prescribed by Schedule B,2 of the Local Finance Law ofthe State of New York. 528411.1 022471 CERT ~ 9lJeIajleId & 1f/muI nPJJ RECElVi:D ONE CHASE MANHATTAN PLAZA NEW YORK, NY 10005 WWW.HAWKINS.COM c~,.. 1 ,"-i' . ,; 2807 August 24, 2007 The Town Board ofthe Town of South old, in the County of Suffolk, New York $oulh&!d TuV'fl Clerk Ladies and Gentlemen: We have examined a record of proceedings relating to the issuance of the $360,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2007 (the "Note") of the Town of Southold, in the County of Suffolk, a municipal corporation of the State of New York. The Note is dated August 24,2007, matures August 22,2008, subject to prior redemption, is a single note in the denomination of $360,000, is numbered 4R-l, is payable to bearer, bears interest at the rate of3.69% per annum, is issued pursuant to the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, the bond resolution adopted by the Town Board on September 12, 2000, authorizing the issuance of $2,500,000 serial bonds for the increase and improvement of facilities of the Fishers Island Garbage and Refuse District, in said Town, and the Certificate of Determination executed by the Supervisor on August 24, 2007. Said Bond Anticipation Note is a temporary obligation issued in anticipation of the sale of permanent serial bonds. In our opinion, the Note is a valid and legally binding general obligation of the Town for which the Town has validly pledged its faith and credit and, unless paid from other sources, all the taxable real property within the Town is subject to the levy of ad valorem real estate taxes to pay the Note and interest thereon without limitation of rate or amount. The enforceability of rights or remedies with respect to the Note may be limited by bankruptcy, insolvency, or other laws affecting creditors' rights or remedies heretofore or hereafter enacted. The Internal Revenue Code of 1986, as amended (the "Code"), establishes certain requirements that must be met subsequent to the issuance and delivery of the Note in order that interest on the Note be and remain excludable from gross income under Section 103 of the Code. The Supervisor of the Town, in executing the Arbitrage and Use of Proceeds Certificate, has certified to the effect that the Town will comply with the provisions and procedures set forth therein and that it will do and perform all acts and things necessary or desirable to assure that interest paid on the Note is excludable from gross income under Section 103 of the Code. We have examined such Arbitrage and Use of Proceeds Certificate of the Town delivered concurrently with the delivery of the Note, and in our opinion, such certificate contains provisions and procedures under which such requirements can be met. 528411.1 022471 CERr In our opinion, under existing statutes and court decisions, (i) interest on the Note is excluded from gross income for federal income tax purposes pursuant to Section 103 of the Code, and (ii) interest on the Note is not treated as a preference item in calculating the alternative minimum tax imposed on individuals and corporations under the Code; such interest, however, is included in the adjusted current earnings of certain corporations for purposes of calculating the alternative minimum tax imposed on such corporations. In rendering the opinion in this paragraph, we have (i) relied on the representations, certifications of fact, and statements of reasonable expectations made by the Town in the Arbitrage and Use of Proceeds Certificate and others in connection with the Note, and (ii) assumed compliance by the Town with certain provisions and procedures set forth in the Arbitrage and Use of Proceeds Certificate relating to compliance with applicable requirements of the Code to assure the exclusion of interest on the Note from gross income under Section 103 of the Code. Further, in our opinion, under existing statutes, interest on the Note is exempt from personal income taxes of New York State and its political subdivisions, including The City of New York. Except as stated above, we express no opinion regarding any other federal or state tax consequences with respect to the Note. We render our opinion under existing statutes and court decisions as of the issue date, and we assume no obligation to update our opinion after the issue date to reflect any future action, fact or circumstance, or change in law or interpretation, or otherwise. We express no opinion on the effect of any action hereafter taken or not taken in reliance upon an opinion of other counsel on the exclusion from gross income for federal income tax purposes of interest on the Note, or on the exemption from state and local tax law of interest on the Note. Other than such record of proceedings, we have not been requested to examine or review and have not examined or reviewed the accuracy or sufficiency of any additional proceedings, reports, correspondence, financial statements or other documents, containing fmancial or other information relative to the Town, which have been or may hereafter be furnished or disclosed to purchasers of the Note and we express no opinion with respect to any such financial or other information or the accuracy or sufficiency thereof The form of the Note is prescribed by Schedule B,2 of the Local Finance Law of the State of New York, but we have not examined the executed Note. This letter is issued as of the date hereof, and we assume no obligation to update, revise or supplement this letter to reflect any action hereafter taken or not taken, or any facts or circumstances, or changes in law or in interpretations thereof, that may hereafter occur, or for any other reason. ;;:;J1fft i$uP 528411.1 022471 eERr ~ 9lJefaIdd & ft/rxxI gyp RECEIVCD c ~ ~ 1" 0"07 \__ _.1 ,.~ C.I ONE CHASE MANHATTAN PLAZA NEW YORK, NY 10005 WWW.HAWKINS.COM SOIl:hdd T(,r,n Cl~rk August 24, 2007 The Town Board ofthe Town of Southold, in the County of Suffolk, New York Ladies and Gentlemen: We have examined a record of proceedings relating to the issuance of tl1e $360,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2007 (the "Note") oftl1e Town of Soutl1old, in the County of Suffolk, a municipal corporation of the State of New York. The Note is dated August 24,2007, matures August 22,2008, subject to prior redemption, is a single note in the denomination of $360,000, is numbered 4R-l, is payable to bearer, bears interest at the rate of 3.69% per annum, is issued pursuant to the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, tl1e bond resolution adopted by the Town Board on September 12, 2000, autl10rizing tl1e issuance of $2,500,000 serial bonds for the increase and improvement of facilities of the Fishers Island Garbage and Refuse District, in said Town, and the Certificate of Determination executed by the Supervisor on August 24, 2007. Said Bond Anticipation Note is a temporary obligation issued in anticipation of tl1e sale of permanent serial bonds. In our opinion, the Note is a valid and legally binding general obligation of the Town for which the Town has validly pledged its faith and credit and, unless paid from other sources, all tl1e taxable real property within tl1e Town is subject to the levy of ad valorem real estate taxes to pay tl1e Note and interest thereon without limitation of rate or amount. The enforceability of rights or remedies with respect to tl1e Note may be limited by bankruptcy, insolvency, or otl1er laws affecting creditors' rights or remedies heretofore or hereafter enacted. The Internal Revenue Code of 1986, as amended (tl1e "Code"), establishes certain requirements that must be met subsequent to tl1e issuance and delivery of the Note in order tl1at interest on the Note be and remain excludable from gross income under Section 103 oftl1e Code. The Supervisor of the Town, in executing tl1e Arbitrage and Use of Proceeds Certificate, has certified to the effect that the Town will comply with the provisions and procedures set forth therein and tl1at it will do and perform all acts and things necessary or desirable to assure that interest paid on the Note is excludable from gross income under Section 103 of the Code. We have examined such Arbitrage and Use of Proceeds Certificate of the Town delivered concurrently with the delivery of tl1e Note, and in our opinion, such certificate contains provisions and procedures under which such requirements can be met. 528411.1 022471 CERT In our opinion, under existing statutes and court decisions, (i) interest on the Note is excluded from gross income for federal income tax purposes pursuant to Section 103 of the Code, and (ii) interest on the Note is not treated as a preference item in calculating the alternative minimum tax imposed on individuals and corporations under the Code; such interest, however, is included in the adjusted current earnings of certain corporations for purposes of calculating the alternative minimum tax imposed on such corporations. In rendering the opinion in this paragraph, we have (i) relied on the representations, certifications of fact, and statements of reasonable expectations made by the Town in the Arbitrage and Use of Proceeds Certificate and others in connection with the Note, and (ii) assumed compliance by the Town with certain provisions and procedures set forth in the Arbitrage and Use of Proceeds Certificate relating to compliance with applicable requirements of the Code to assure the exclusion of interest on the Note from gross income under Section 103 of the Code. Further, in our opinion, under existing statutes, interest on the Note is exempt from personal income taxes of New York State and its political subdivisions, including The City of New York. Except as stated above, we express no opinion regarding any other federal or state tax consequences with respect to the Note. We render our opinion under existing statutes and court decisions as of the issue date, and we assume no obligation to update our opinion after the issue date to reflect any future action, fact or circumstance, or change in law or interpretation, or otherwise. We express no opinion on the effect of any action hereafter taken or not taken in reliance upon an opinion of other counsel on the exclusion from gross income for federal income tax purposes of interest on the Note, or on the exemption from state and local tax law of interest on the Note. Other than such record of proceedings, we have not been requested to examine or review and have not examined or reviewed the accuracy or sufficiency of any additional proceedings, reports, correspondence, financial statements or other documents, containing financial or other information relative to the Town, which have been or may hereafter be furnished or disclosed to purchasers of the Note and we express no opinion with respect to any such financial or other information or the accuracy or sufficiency thereof. The form of the Note is prescribed by Schedule B,2 of the Local Finance Law of the State of New York, but we have not examined the executed Note. This letter is issued as of the date hereof, and we assume no obligation to update, revise or supplement this letter to reflect any action hereafter taken or not taken, or any facts or circumstances, or changes in law or in interpretations thereof, that may hereafter occur, or for any other reason. Very truly yours, . f) ,1 ~~,P/_tt:jj 528411.1 022471 CERT ARBITRAGE AND USE OF PROCEEDS CERTIFICATE I, Scott A. Russell, Supervisor of the Town of Southold, in the County of Suffolk, New York (the "Issuer"), HEREBY CERTIFY and reasonably expect with respect to the issuance of the Issuer's $560,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2006 (hereinafter referred to as the "Note"), dated August 25, 2006, and maturing on August 24, 2007, as follows: Unless the context clearly requires otherwise, all capitalized terms used but not otherwise defined herein shall have the meanings set forth herein or in the Resolutions, the Code or the Regulations (each as defined below). ARTICLE I General 1.1. Authoritv of Signatol)'. I am an officer of the Issuer, charged with the responsibility for the execution, delivery, and issuance of the Note and am acting for and on behalf of the Issuer in signing this certificate. 1.2. PUI:pose of Certificate. This certificate is made for the purpose of establishing evidence of the expectations of the Issuer as of the date hereof as to future events regarding the amount and use of proceeds of the Note. It is intended and may be relied upon for purposes of Sections 103 and 148 of the Internal Revenue Code of 1986, as amended (the "Code"), and as a certification described in Section 1.148-2(b )(2) of the Treasury Regulations (the "Regulations"). This certificate is executed and delivered as part of the record of proceedings in connection with the issuance of the Note. The provisions of this certificate constitute a contractual obligation of the Issuer in consideration for the purchase of and payment for the Note by the purchaser(s) thereof. 1.3. Reasonable Expectations. This certificate sets forth the facts, estimates and circumstances now in existence which form the basis for the Issuer's expectation that the proceeds of the Note will not be used in a manner that would cause the Note to be an arbitrage bond under Section 148 of the Code or a private activity bond under Sections 103 and 141 of the Code. To the best of my knowledge and belief, such expectation is reasonable and there are no other facts, estimates or circumstances that would materially change that expectation 1.4 No Composite Issue. No other governmental obligations have been sold fewer than 15 days prior to, or will be sold fewer than 15 days after, the sale date of the Note, pursuant to a common plan of financing which are expected to be paid from substantially the same source of funds as the Note. 1.5 No Federal Guarantee. The Issuer represents and covenants that, except for the gross proceeds of the Note which are: (a) invested during the temporary period referred to in Article III, (b) held in any refunding escrow or (c) invested in obligations of the United States 507022.1 022471 CERT Treasury or in obligations issued pursuant to Section 21B(d)(3) of the Federal Home Loan Bank Act, as amended by Section 511(a) of the Financial Institutions Reform, Recovery and Enforcement Act of 1989, or any successor provision to Section 21B(d)(3) of the Federal Home Loan Bank Act, as amended: (i) No portion of the payment of principal or interest with respect to the Note is or will be guaranteed directly or indirectly by the United States or any agency or instrumentality thereof (herein "federally guaranteed"); and (ii) No portion of the gross proceeds ofthe Note in excess of five percent of such gross proceeds is or will be (A) used in making loans the payment of principal or interest with respect to which is to be federally guaranteed, or (B) invested directly or indirectly in federally insured deposits or accounts. 1.6. Tax Representation. The Issuer expects to be able to and will comply with all the procedures and provisions set forth herein, and will do and perform all acts and things necessary and desirable within its reasonable control in order to assure that interest paid on the Note shall be excluded from gross income of the owners thereof for the purpose of federal income taxation. 1.7. Additional Information. The Issuer will provide such other information as may be required to assure the exclusion from gross income of interest on the Note for federal income taxation purposes. 1.8 Non-Purpose Investments. Not more than 50% of the proceeds of the Note are being invested in investments not acquired to carry out the governmental purposes of the issue at a guaranteed yield and having a term of 4 years or more. I. 9 IRS Information Reporting. The Issuer will make a timely filing of the appropriate IRS Form 8038-G or 8038-GC. ARTICLE II Use ofProiect and Proceeds 2.1. Authorization. (a) The Note is authorized to be issued pursuant to applicable provisions of the laws of the State of New York and the bond resolution adopted by the Town Board on September 12, 2000, (the "Resolution"), as referred to in the Certificate of Determination executed by the Supervisor on August 25, 2006. (b) For purposes of this Article II, the term "Original Proceeds" means the Sale Proceeds received (or deemed to be received) by the Issuer from the sale of the Notes net of the amount used or to be used for the payment of all costs and expenses associated with issuing the Notes, and excluding accrued interest. 507022.1 022471 CERT 2.2. Purpose of Issue. The Notes are being issued for the increase and improvement of the facilities of the Fishers Island Garbage and Refuse District (the "Project), in said Town. 2.3. Use of Original Proceeds. The proceeds of sale of the Note in the amount of $560,000, together with a like amount of available funds, will be used to redeem a prior issue of bond anticipation notes in the amount of $1,120,000 which mature on August 25, 2006 (the "Prior Issue"), heretofore issued to finance the Project. 2.4. Ownership/Lease/Sale. The Project will be owned by the Issuer or another state or local governmental unit and will not be leased to any person who is not a state or local governmental unit. It will not (except to the extent that any of the projects financed involve grants) be sold or otherwise disposed of, in whole or in part, except for incidental sales of surplus items the proceeds of which will not constitute net operating profits or net capital profits to the Issuer, prior to the maturity date of the Note. 2.5. Private Loans. Not more than the lesser of 5 percent or $5,000,000 of the proceeds of the Note will be used directly or indirectly to make loans to persons other than a governmental unit. 2.6. Private Use. The aggregate amount of proceeds of the Note used directly or indirectly in a trade or business carried on by a person other than a state or local governmental unit ("Private Use"), will not exceed I 0% of such proceeds in the event that more than I 0% of the principal or 10% of the interest due on the Note during the term thereof is, under the terms of the Note or any underlying arrangement, directly or indirectly, secured by any interest in property used or to be used for a Private Use or in payments in respect of property used or to be used for a Private Use or is to be derived from payments, whether or not to the Issuer, in respect of property or borrowed money used or to be used for a Private Use. 2.7. UnrelatedlRelated Disproportionate Use. No more than 5% of the proceeds of the Note will be used directly or indirectly in the trade or business of a person other than a governmental unit that is unrelated or related and disproportionate to the governmental use ofthe property being financed, including any private loan financing described in Section 2.5 which meets this test. For purposes of this Arbitrage and Use of Proceeds Certificate, proceeds of the Note are allocable to an unrelated Private Use if such use is neither directly nor operationally related to a governmental use and proceeds of the Note are allocable to a disproportionate related Private Use to the extent that the proceeds of the Note which are to be used to finance property used by a nongovernmental person in a trade or business which is related to the governmental use of the property referred to in Section 2.6 above, exceeds the proceeds of the Note which are to be used for the governmental use to which such Private Use relates. 2.8. Other Private Uses Defined For purposes of Section 2.6 and 2.7, a Private Use consists of any contract or other arrangement including, without limitation, leases, management contracts, guarantee contracts, take or pay contracts, or put or pay contracts, which provides for a use of the Project by a person or persons who are not State or local governments 507022.1 022471 CERT on a basis different than the general public. Any management, or operations contract or agreement which provides for nongovernmental use will provide for reasonable compensation which is in no part based on net profits and will satisfy the provisions of ( a), (b) or (c) below: (a) for contracts which provide compensation for each annual period based on a periodic fixed fee, a capitation fee or combination thereof, (i) the contract has a term (including renewal options) not exceeding five years; (ii) the issuer may terminate the contract, without penalty, at the end of any three year period, and (iii) at least 50% of the compensation paid is on a periodic, fixed fee basis; (b) for contracts entered into or materially modified (other than pursuant to a renewal option) after March 15, 1993, which provide compensation based on a per unit fee or a combination per unit and periodic fixed fee, (i) the contract has a term (including renewal options) not exceeding three years; (ii) the issuer may terminate such contract (without penalty) at the end of the second year of the term, and (iii) the amount of the per unit fee is specified in the contract or otherwise limited by the qualified user or a third party; (c) for contracts entered into or materially modified (other than pursuant to a renewal option) after March 15, 1993, which provide compensation based on a percentage offees charged, (i) the contract has a term (including renewal options) not exceeding two years, (ii) the issuer may terminate the contract (without penalty) at the end of the first year, and (iii) the service provider primarily provides services to third parties or the contract involves a facility during an initial start-up period; (d) For purposes of this Section 2.8: (i) "capitation fee" means a fixed periodic amount paid under a management contract or agreement for each person for whom the service provider assumes the responsibility to provide all needed services for a specified period, provided the quantity and type of services actually provided vary substantially; (ii) "periodic fixed fee" means a stated dollar amount for services rendered during a specified period oftime (i.e. $XX per month) which amount may automatically increase according to a specified, objective, external standard; and (iii) "per unit fee" means a stated dollar amount for each unit of service provided (i.e. $XX per medical procedure). 2.9. Pooled Loan Financings. To the extent the amount of proceeds of the Note to be used to make loans to any borrowers (including loans referred to in Section 2.5 above and loans to state or local governmental units) exceeds $5,000,000, at least 95% of the net-proceeds of the issue (as defined in Section 150 of the Code but without including proceeds used to finance costs of issuance or capitalized interest) that are to be used to make loans, will have been 507022.1 022471 CERT used within 3 years of the date hereof to make such loans. The payment of legal and underwriting costs is not contingent and at least 95% of the reasonably expected legal and underwriting costs associated with issuance will be paid within 180 days ofthe date hereof 2.10. Output Facilities. No more than 5% of the proceeds of the Note are to be used with respect to any output facility (other than a facility for the furnishing of water). No more than the lesser of $5,000,000 or 5% of the proceeds of the Note are to be used (directly or indirectly) for the acquisition of a nongovernmental output facility. ARTICLE III ArbitragelRebate Exemption 3.1. Temporary Period-Refunding. With respect to the proceeds of the Note allocable to the Prior Issue, such proceeds may be invested without restriction as to yield during the three-year temporary period commencing on the date hereof, because: (a) All of the proceeds of the Prior Issue have been expended, or any such proceeds which have not been expended as ofthe date hereof, shall become transferred proceeds of this issue. Such transferred proceeds may be invested without restriction as to yield until three years after the date of original issuance of the Prior Issue. If any transferred proceeds remain unexpended after three years after the date of original issuance of the Prior Issue, such proceeds will be invested at a yield not in excess of the yield on the Note (b) The proceeds of the Note will be used to refund the Prior Issue within 90 days of the date hereof, and may be invested during such time without restriction as to yield. 3.2. Rebate. (a) The Prior Issue was not subject to the rebate requirement imposed by Section 148 of the Code because at the time of original issuance of the first note or notes issued pursuant to the Resolution, in renewal of which the Prior Issue and/or the Note are issued: (i) the Issuer was a governmental unit with general taxing powers; (ii) the Prior Issue did not constitute a "private activity bond" as that term is defined in Section 141 of the Code; (iii) ninety-five percent or more of the net proceeds of the sale of the Prior Issue was used for local governmental activities of the Issuer; and (iv) the Issuer (including all agencies, instrumentalities and political subdivisions of the Issuer) reasonably expected that the aggregate face amount of all tax-exempt bonds issued by the Issuer during the calendar year in which the Prior Issue was issued would not exceed $5,000,000. 507022.1 022471 CERT For purposes of such determination, no tax-exempt obligation was taken into account if it was a current refunding obligation issued in the calendar year in which the Prior Issue was being issued which does not exceed the outstanding (redeemed) principal amount of the obligation to be refunded. (b) The Note is not subject to the rebate requirement imposed by Section 148 of the Code because all ofthe proceeds of such Note will be expended to pay the Prior Issue within 90 days of the date hereof and will, therefore, qualify for the six-month expenditure exception to rebate. 3.3. No Excess Proceeds. The total proceeds of sale of all obligations issued to date for the Project do not exceed the total cost of the Project. 3.4. Source of Repavment Funds. The Note will be paid from taxes and the proceeds of other obligations of the Issuer issued to fund the Note. 3.5 Debt Service Fund. The taxes used to pay principal and interest on the Note, whether or not deposited in a debt service fund, will be expended within I3 months of the date of deposit in such fund, or the date of their accumulation, in the payment of debt service on the Note. Any amounts received from the investment of such deposit or accumulation will be expended within one year of receipt. The debt service fund, if any, will be used to achieve a proper matching of revenues and debt service and will be depleted at least annually except for a reasonable carryover amount which will not exceed the greater of the earnings on such fund for the immediately preceding year or one-twelfth of the debt service on the Bonds for the immediately preceding year. 3.6. Sinking Funds. Except for the debt service fund described herein the Issuer has not created or established, and does not expect to create or establish, any sinking fund or other similar fund which the Issuer reasonably expects to use to pay principal or interest on the Note. ARTICLE IV Bank Oualification 4.1. Designation. The Note is hereby designated as a "qualified tax-exempt obligation" pursuant to the provisions of Section 265 of the Code. In making such designation it has been determined that: (i) the Note currently refunds the Prior Issue; (ii) the Prior Issue was designated as a "qualified tax-exempt obligation"; (iii) the aggregate face amount of the Note does not exceed $10,000,000; (iv) the Prior Issue had a weighted average maturity of3 years or less; 507022.] 022471 CERT (SEAL) (v) the maturity date of the Note, as measured from the original date of issuance of the notes issued pursuant to the Resolution, in renewal of which such Note is being issued, does not exceed 30 years; and (vi) not more than $10,000,000 of obligations issued by the Issuer during the calendar year in which the Prior Issue was issued were designated by the Issuer as "qualified tax-exempt obligations." IN WITNESS WHEREOF, I have hereunto set my hand and affixed the corporate seal ofthe Town of Southold on this 25th day of August, 2006. ~~.aH Supervisor 507022.1 022471 CERT CERTIFICATE OF DETERMINATION BY THE SUPERVISOR RELATIVE TO AUTHORIZATION, SALE, ISSUANCE, FORM AND CONTENTS OF THE $560,000 BOND ANTICIPATION NOTE FOR FISHERS ISLAND GARBAGE AND REFUSE DISTRICT-2006 OF THE TOWN OF SOUTHOLD, NEW YORK. I, Scott A. Russell, Supervisor of the Town of South old, New York (herein called the "Town"), HEREBY CERTIFY that pursuant to the powers and duties delegated to me, the chief fiscal officer of the Town, by the Town Board of the Town, pursuant to the bond resolution duly adopted and as referred to in paragraph 1 hereof, and subject to the limitations prescribed in said bond resolution, I have made the following determinations: 1. A bond anticipation note (hereinafter referred to as the "Note") of the Town in the principal amount of $560,000 shall be issued to renew, in part, a bond anticipation note in the principal amount of$I,120,000 heretofore issued in anticipation ofthe sale of the serial bonds authorized pursuant to the resolution entitled: "Bond Resolution of the Town of South old, New York, adopted September 12, 2000, appropriating the amount of$2,500,000 for the improvement offacilities ofthe Fishers Island Garbage and Refuse District, in said Town, and authorizing the issuance of $2,500,000 serial bonds of said Town to finance said appropriation" duly adopted by the Town Board on the date therein referred to, and the Certificate of Determination executed by the Supervisor on August 26, 2005; the redemption of said $1,120,000 bond anticipation note having been heretofore provided to the extent of $560,000 from a source other than the proceeds of serial bonds. 2. The terms, form and details of said Note shall be as follows: Amount and Title: $560,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2006 Dated: August 25, 2006 Matures: August 24, 2007, subject to prior redemption Number and Denomination: No. 3R-l, at $560,000 Interest Rate per annum: 3.76% 507022.1022471 CERT Form of Note: Substantially in accordance with form prescribed by Schedule B,2 of the Local Finance Law of the State of New York. 3. The amount ofbond anticipation notes originally issued in anticipation of the issuance of the serial bonds authorized pursuant to the resolution referred to in paragraph I, hereof, including the Note, is $1,170,000, and the amount ofbond anticipation notes which will be outstanding after the issuance of the Note, including the Note, will be $560,000. 4. The serial bonds authorized pursuant to the resolution referred to in paragraph I, hereof, are for improvements which are assessable. 5. Pursuant to said powers and duties delegated to me, I DO HEREBY AWARD AND SELL said Note to Suffolk County National Bank, Riverhead, New York, for the purchase price of $560,000, plus accrued interest, if any, from the date of said Note to the date of delivery thereof, and I FURTHER DETERMINE that said Note shall be payable as to both principal and interest at Suffolk County National Bank, Riverhead, New York, at maturity or prior redemption. 6. The Note shall be executed in the name of the Town by the manual signature of its Supervisor and the corporate seal of the Town will be affixed, imprinted, impressed or otherwise reproduced thereon and attested by its Town Clerk. I HEREBY FURTHER CERTIFY that the powers and duties delegated to me to issue and sell the Note hereinabove referred to are in full force and effect and have not been modified, amended or revoked. IN WITNESS WHEREOF, I have hereunto set my hand this 25th day of August, 2006. ~d~ Supervisor 507022.1 022471 CERT , CLERK'S CERTIFICATE I, Elizabeth A. Neville, Town Clerk of the Town of Southold, in the County of Suffolk, New York, HEREBY CERTIFY that I have compared the foregoing copy of the Certificate of Determination executed by the Supervisor and the same is a true and complete copy of the Certificate filed with said Town in my office as Town Clerk on or before the 25th day of August, 2006, and I FURTHER CERTIFY that no resolution electing to reassume any of the powers or duties mentioned in said Certificate and delegated to the Supervisor by the resolution cited in said Certificate has been adopted by said Town Board. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the corporate seal of said Town this 25th day of August, 2006 (SEAL) gab4fort~ Town Clerk 507022.1022471 CERT AFFIDAVIT AS TO NO CONFLICT OF INTEREST STATE OF NEW YORK ) :ss: COUNTY OF SUFFOLK ) Elizabeth A. Neville, being duly sworn upon her oath deposes and says: 1. I am the duly appointed, qualified and acting Town Clerk of the Town of Southold, in the County of Suffolk, New York (herein and in Schedule A annexed hereto called "Town"); 2. That with respect to the contract of sale of the Note of the Town described in the Certificate of Determination executed by the Supervisor on the 25th day of August, 2006, to the financial institution indicated in such Certificate, I have made a careful inquiry of each officer and employee of the Town having the power or duty to (a) negotiate, prepare, authorize or approve the contract or authorize or approve payment thereunder, (b) audit bills or claims under the contract, or (c) appoint an officer or employee who has any of the powers or duties set forth above, as to whether or not such officer or employee has an interest (as defined pursuant to Article 18 of the General Municipal Law) in such contract; 3. That upon information and belief, as a result of such inquiry, no such officer or employee has any such interest in said contract unless otherwise noted in Schedule A annexed hereto and by this reference made a part hereof. t?jdill;Ja~,tiju Town Clerk Subscribed and sworn to before me this 25th day of August, 2006. , ~~~ Notary Public, State of New York LINDA J <.-GUt.co. NOTARY PUBLIC, State of New Yo,; NO. 01 C04822563, Suffolk Couruov. Term Expires December 31 20 Off- , - 507022.1 022471 CERT SCHEDULE A 1. , is a stockholder of the Purchaser owning or controlling, directly or indirectly, less than five per centum (5%) of the outstanding stock thereof but no disclosure of such interest by said officer is required pursuant to said Law. 2. , has an interest in the Purchaser solely by reason of employment as an officer or employee thereof, but the remuneration of such employment will not be directly affected as a result of said contract and the duties of such employment do not directly involve the procurement, preparation or performance of any such part of such contract 3. , has publicly disclosed the nature and extent of such interest in writing to the governing board of the Town. Such written disclosure has been made a part of and set forth in the official record of proceedings of the Town. 507022.1 022471 CERT CERTIFICATES AS TO SIGNATURES, LITIGATION, AND DELIVERY AND PAYMENT WE, the undersigned officers of the Town of Southold, in the County of Suffolk, a municipal corporation of the State of New York and herein referred to as the "Town", HEREBY CERTIFY that on or before August 25, 2006, we officially signed and properly executed by manual signatures the $560,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2006 (the "Note") of the Town, payable to bearer, and described in Schedule A annexed hereto and by this reference made a part hereof, and that at the time of such signing and execution and on the date hereof we were and are the duly chosen, qualified and acting officers ofthe Town authorized to execute the Note and holding the respective offices indicated by the respective titles set opposite our signatures hereto for term expiring on the respective dates set opposite such titles. WE FURTHER CERTIFY that no litigation of any nature is now pending or threatened restraining or enjoining the issuance or delivery of the Note or the levy or collection of any taxes to pay the interest on or principal of the Note, or in any manner questioning the authority or proceedings for the issuance ofthe Note or for the levy or collection of said taxes, or relating to the Note or affecting the validity thereof or the levy or collection of said taxes, that neither the corporate existence or boundaries of the Town nor the title of any of the present officers thereof to their respective offices is being contested, and that no authority or proceedings for the issuance of the Note has or have been repealed, revoked or rescinded. WE FURTHER CERTIFY that the seal which is impressed upon this certificate (or a facsimile thereot) has been affixed, impressed, imprinted or otherwise reproduced upon the Note and is the legally adopted, proper and only official corporate seal of the Town. And I, Scott A. Russell, Supervisor, HEREBY FURTHER CERTIFY that on August 25, 2006, I delivered or caused the delivery of the Note to Suffolk County National Bank, Riverhead, New York, the purchaser thereof, and that at the time of such delivery of said Note, the Town received from said purchaser the amount hereinbelow stated, in full payment for said Note, computed as follows: Price. ... $560,000.00 Interest on said Note accrued to the date of such delivery.. -0- Amount Received.. ... . .... $560,000.00 (SEAL) 507022.1 022471 CERT IN WITNESS WHEREOF, we have hereunto set our hands and said corporate seal has hereunto been affixed this 25th day of August, 2006. Term of Office Expires Title December 31, 200 Z Supervisor December 31, 2001 Town Clerk I HEREBY CERTIFY that the signatures of the officers of the above-named Town, which appear above, are true and genuine and that I know said officers and know them to hold respective offices set opposite their signatures. Arf?1 !/k/ltLt7 C~ Jill t t~-I/ti/J.Ij' (Title) / (Name of Bank) 507022.1022471 CERT ATTORNEY'S CERTIFICATE I, Kieran Corcoran, HEREBY CERTIFY that I am a licensed attorney at law of the State of New York, having offices at 53095 Main Road, Southold, New York, and am the duly chosen, qualified and acting Deputy Town Attorney of the Town of South old, in the County of Suffolk, a municipal corporation of the State of New York and herein referred to as the "Town", that no litigation of any nature is now pending or threatened restraining or enjoining the issuance or delivery of the Note ofthe Town, said Note to be payable to Suffolk County National Bank, Riverhead, New York, and otherwise described as set forth in Schedule A annexed hereto and by this reference made a part hereof, or the levy or collection of any taxes to pay the interest on or principal of the Note, or in any manner questioning the authority or proceedings for the issuance of the Note or for the levy or collection of said taxes, or relating to the Note or affecting the validity thereof or the levy or collection of said taxes, that neither the corporate existence or boundaries of the Town nor the title of any of the present officers thereof to their respective offices is being contested, and that no authority or proceedings for the issuance of the Note has or have been repealed, revoked or rescinded. IN WITNESS WHEREOF, Iffave hereunto set my hand this 25th day of rrgUst, 2006. I' 0 Deputy Town Attorney 507022.1 022471 CERT Amount and Title: Dated: Matures: Number and Denomination: Interest Rate per annum: Form of Note: SCHEDULE A $560,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2006 August 25, 2006 August 24, 2007, subject to prior redemption No. 3R-l, at $560,000 3.76% Substantially in accordance with form prescribed by Schedule B,2 ofthe Local Finance Law of the State of New York. 507022.1 022471 CERT . . . ~ ~eIafUd & pt/cxxf HPJJ , 67 WALL STREET NEW YORK, NY 10005 WWW.HAWKINS.COM August 26, 2005 The Town Board of the Town of Southold, in the County of Suffolk, New York Ladies and Gentlemen: We have examined a record of proceedings relating to the issuance of the $1,120,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2005 (the "Note") of the Town of Southold, in the County of Suffolk, a municipal corporation of the State of New York. The Note is dated August 26, 2005, matures August 25, 2006, subject to prior redemption, is a single note in the denomination of$I,120,000, is numbered 2R-I, bears interest at the rate of 3.06% per annum, is issued pursuant to the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, the bond resolution adopted by the Town Board on September 12, 2000, authorizing the issuance of $2,500,000 serial bonds for the increase and improvement of facilities of the Fishers Island Garbage and Refuse District, in said Town, and the Certificate of Determination executed by the Supervisor on August 26, 2005. · Said Bond Anticipation Note is a temporary obligation issued in anticipation of the sale of permanent serial bonds. In our opinion, the Note is a valid and legally binding general obligation of the Town for which the Town has validly pledged its faith and credit and, unless paid from other sources, all the taxable real property within the Town is subject to the levy of ad valorem real estate taxes to pay the Note and interest thereon without limitation of rate or amount. The enforceability of rights or remedies with respect to the Note may be limited by bankruptcy, insolvency, or other laws affecting creditors' rights or remedies heretofore or hereafter enacted. The Internal Revenue Code of 1986, as amended (the "Code"), establishes certain requirements that must be met subsequent to the issuance and delivery of the Note in order that interest on the Note be and remain excludable from gross income under Section 103 of the Code. The Supervisor of the Town, in executing the Arbitrage and Use of Proceeds Certificate, has certified to the effect that the Town will comply with the provisions and procedures set forth therein and that it will do and perform all acts and things necessary or desirable to assure that interest paid on the Note is excludable from gross income under Section 103 of the Code. We have examined such Arbitrage and Use of Proceeds Certificate of the Town delivered concurrently with the delivery of the Note, and, in our opinion, such certificate contains provisions and procedures under which such requirements can be met. 481831.1 022471 CERT . . . . In our opinion, the interest on the Note is excludable under existing statutes and court decisions from the gross income of the recipients thereof for federal income tax purposes pursuant to Section 103 of the Code, and under existing statutes interest on the Note will not be treated as a preference item in calculating the alternative minimum tax that may be imposed under the Code with respect to individuals and corporations. In rendering the foregoing opinion we have assumed the Town's compliance with the Arbitrage and Use of Proceeds Certificate. Further, in our opinion, under existing statutes, interest on the Note is exempt from New York State and New York City personal income taxes. Other than such record of proceedings, we have not been requested to examine or review and have not examined or reviewed the accuracy or sufficiency of any additional proceedings, reports, correspondence, financial statements or other documents, containing financial or other information relative to the Town, which have been or may hereafter be furnished or disclosed to purchasers of the Note and we express no opinion with respect to any such financial or other information or the accuracy or sufficiency thereof The form of the Note is prescribed by Schedule B, 2 of the Local Finance Law of the State of New York, but we have not examined the executed Note. Very truly yours, "'~/ . ~A~~~~ 481831.1 022471 CERT . _ North Fork Ba n k . September 6, 2005 Mr. Martin Sidor Deputy Supervisor Town of South old 53095 Main Road P.O. Box 1179 Southold, NY 11971 Dear Mr. Sidor: Enclosed for your files please find matured Bond Anticipation Note for the Town of Southold. This $1,170,000 Bond Anticipation Note was dated August 27, 2004 and matured on August 26, 2005. Should you need any further information, please feel free to contact me at (631) 844-1121. KB:bjk Enclosure 275 BROADHOLLOW ROAD, p.o. Box 8914, MELVILLE, NY 11747, 631 8441000, FAX 631 6941536 ~@ :DOl <c'~ ~Ul ~~ *~ . < . ~ No.R-1 $1,170,000 UNITED STATES OF AMERICA STATE OF NEW YORK COUNTY OF SUFFOLK TOWN OF SOUTHOLD BOND ANTICIPATION NOTE FOR FISHERS ISLAND GARBAGE AND REFUSE DISTRICT-2004 The Town of South old, in the County of Suffolk, a municipal corporation of the State of New York, hereby acknowledges itself indebted and for value received promises to pay to the bearer of this Note, or if it be registered, to the registeredheldllt;tlfe sum ..E MILLION ONE HUNDRED SEVENTY THOUSAND DOLLARS ($1,170,000) on the 46fhday of August, 2005, to 'ether with interest thereon from the date hereof at the rate of one and thirty-five hundt-ed.t.lt~er ~entum 0) per annum, payable at maturity. Both principal of and interest on this Note will be paid in lawful money of"the-United States of America, at North Fork Bank, South old, New York. At the request of the holder, the Town Clerk shall convert this Note into a registered Note by registering it in the name of the holder in the books of the Town kept in the office of such Town Clerk and endorsing a certificate of such registration hereon, after which both principal of and interest on this Note shall be payable only to the registered holder, his legal representatives, successors or transferees. This Note shall then be transferable only upon presentation to such Town Clerk with a written transfer oftitle and such Town Clerk shall thereupon register this Note in the name of the transferee in his books and shall endorse a certificate of such registration hereon. Such transfer shall be dated, and signed by the registered holder, or his legal representatives, and it shall be duly acknowledged or proved, or in the alternative the signature thereto shall be certified as to its genuineness by an officer of a bank or trust company located and authorized to do business in this State. This Note is one of an authorized issue, the principal amount of which is $1,170,000. This Note may he called for redemption, after the giving of at least five (5) days' written notice of the date of redemption by mailing of written notice to the original purchaser, or ifthis Note be registered to the registered holder, and interest shall cease to be paid hereon after such date of redemption. This Note is issued pursuant to the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, the bond resolution adopted by the Town Board on September 12, 2000, authorizing the issuance of$2,500,000 serial bonds for the improvement of the facilities of the Fishers Island Garbage and Refuse District, in said Town, and the Certificate of Determination executed by the Deputy Supervisor on August 27, 2004. This Note has been designated by the Town as a qualified tax-exempt obligation pursuant to the provisions of Section 265 of the Internal Revenue Code of 1986, as amended. The faith and credit of such Town are hereby irrevocably pledged for the punctual payment of the principal of and interest on this Note according to its terms. It is hereby certified and recited that all conditions, acts and things required by the Constitution and statutes of the State of New York to exist, to have happened and to have been performed precedent to and in the issuance of this Note, exist, have happened and have been performed, and that this Note, together with all other indebtedness of such Town, is within every debt and other limit prescrihed hy the Constitution and laws of sllch State. IN WITNESS WHEREOF, the Town of South old has caused this Note to be executed in its name by its Deputy Supervisor, and its corporate seal (or a facsimile thereof) to be affixed, imprinted or otherwise reproduced hereon and attested by its Deputy Town Clerk and this Note to be dated as of the 27th day of August, 2004. TOWN OF SOUTI10LD BY~~ &J.A Deputy sup~ (SEAL) . . ATTEST: ~.~,,u ep y Town 'led, . . Date of Registration . . . REGISTRATION CERTIFICATE . It is hereby certified that the within Note has been registered as follows: Name of Registered Holder . . . . Registered by . . No.2R-1 $1,120,000 UNITED STATES OF AMERICA STATE OF NEW YORK COUNTY OF SUFFOLK TOWN OF SOUTHOLD BOND ANTICIPATION NOTE FOR FISHERS ISLAND GARBAGE AND REFUSE D1STRlCT-2005 The Town of Southold, in the County of Suffolk, a municipal corporation ofthe State of New York, hereby acknowledges itself indebted and for value received promises to pay to the Bank of America, N.A., Boston, Massachusetts, the registered owner hereof, the sum of ONE MILLION ONE HUNDRED TWENTY THOUSAND DOLLARS (51,120,000) on the 25tb day of August, 2006, together with interest thereon from the date hereof at the rate oftbree and six hundredths per centum (3.06%) per annum, payable at maturity or prior redemption. Both principal of and interest on this Note will be paid in lawful money of the United States of America, at the Town of South old, Town Hall, 53095. Main Road, Southold, New York. Both principal of and interest on this Note shaH be payable only to the registered owner, his legal representatives, successors or transferees. This Note shall then be transferable only upon presentation to such Town Clerk with a written transfer of title and such Town Clerk shall thereupon register this Note in the name of the transferee in his books and shall endorse a certificate of such registration hereon. Such transfer shall be dated, and signed by the registered owner, or his legal representatives, and it shall be duly acknowledged or proved, or in the alternative the signature thereto shall be certified as to its genuineness by an officer of a bank or bust company located and authorized to do business in this State. This Note is one ofan authorized issue, the principal amount of which is $1,120,000. This Note may be called for redemption, after the giving of at least five (5) days' written notice of the date of redemption by mailing of written notice to the original purchaser, or if this Note be registered to the registered holder, and interest shall cease to be paid bereon after such date of redemption. This Note is issued pursuant to the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, the bond resolution adopted by the Town Board on September 12,2000, authorizing the issuance of $2,500,000 serial bonds for the improvement of the facilities of the Fishers Island Garbage and Refuse District, in said Town, and the Certificate of Determination executed by the Supervisor on August 26, 2005. This Note has been designated by the Town as a qualified tax-exempt obligation pursuant to the provisions of Section 265 of the Internal Revenue Code of 1986, as amended. The faith and credit of such Town are hereby irrevocably pledged for the punctual payment of the principal of and interest on this Note according to its terms. It is hereby certified and recited that ail conditions, acts and things required by the Constitution and statutes of the State of New York to exist, to have happened and to have been performed precedent to and in the issuance of this Note, exist, have happened and have been performed, and that this Note, together with all other indebtedness of such Town, is within every debt and other limit prescribed by the Constitution and laws of such State. IN WITNESS WHEREOF. the Town of Soutbold has caused this Note to be executed in its name by its Deputy Supervisor, and its corporate seal (or a facsimile thereof) to be affixed, imprinted or otherwise reproduced hereon and attested by its Deputy Town Clerk and this Note to be dated as of the 26th day of August, 2005. (SEAL) TOWN OF SOUTHOLD By '71\~u~~or ATTEST: ~ ~ ~ : -1/1#/-, -V puty Town C erk .. . . ARBITRAGE AND USE OF PROCEEDS CERTIFICATE I, Joshua Y. Horton, Supervisor of the Town of Southold, in the County of Suffolk, New York (the "Issuer"), HEREBY CERTIFY and reasonably expect with respect to the issuance of the Issuer's $1,120,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2005 (hereinafter referred to as the "Note"), dated August 26, 2005, and maturing on August 25, 2006, as follows: Unless the context clearly requires otherwise, all capitalized terms used but not otherwise defined herein shall have the meanings set forth herein or in the Resolutions, the Code or the Regulations (each as defined below). ARTICLE I General 1.1. Authority of Signatory. I am an officer of the Issuer, charged with the responsibility for the execution, delivery, and issuance of the Note and am acting for and on behalf of the Issuer in signing this certificate. 12. Puroose of Certificate. This certificate is made for the purpose of establishing evidence of the expectations of the Issuer as of the date hereof as to future events regarding the amount and use of proceeds of the Note. It is intended and may be relied upon for purposes of Sections 103 and 148 of the Internal Revenue Code of 1986, as amended (the "Code"), and as a certification described in Section 1.148-2(b)(2) of the Treasury Regulations (the "Regulations"). This certificate is executed and delivered as part of the record of proceedings in connection with the issuance of the Note. The provisions of this certificate constitute a contractual obligation of the Issuer in consideration for the purchase of and payment for the Note by the purchaser(s) thereof 1.3. Reasonable Expectations. This certificate sets forth the facts, estimates and circumstances now in existence which form the basis for the Issuer's expectation that the proceeds of the Note will not be used in a manner that would cause the Note to be an arbitrage bond under Section 148 of the Code or a private activity bond under Sections 103 and 141 of the Code. To the best of my knowledge and belief, such expectation is reasonable and there are no other facts, estimates or circumstances that would materially change that expectation. 1.4. No Comoosite Issue. No other governmental obligations have been sold fewer than IS days prior to, or will be sold fewer than IS days after, the sale date of the Note, pursuant to a common plan of financing which are expected to be paid from substantially the same source of funds as the Note. 1.5 No Federal Guarantee. The Issuer represents and covenants that, except for the gross proceeds of the Note which are: (a) invested during the temporary period referred to in Article III, (b) held in any refunding escrow or (c) invested in obligations of the United States 481831.1 022471 CERT - . . Treasury or in obligations issued pursuant to Section 21B(d)(3) of the Federal Home Loan Bank Act, as amended by Section 511 (a) of the Financial Institutions Reform, Recovery and Enforcement Act of 1989, or any successor provision to Section 2IB( d)(3) of the Federal Home Loan Bank Act, as amended: (i) No portion of the payment of principal or interest with respect to the Note is or will be guaranteed directly or indirectly by the United States or any agency or instrumentality thereof (herein "federally guaranteed"); and (ii) No portion ofthe gross proceeds of the Note in excess of five percent of such gross proceeds is or will be (A) used in making loans the payment of principal or interest with respect to which is to be federally guaranteed, or (B) invested directly or indirectly in federally insured deposits or accounts. 1.6. Tax Representation. The Issuer expects to be able to and will comply with all the procedures and provisions set forth herein, and will do and perform all acts and things necessary and desirable within its reasonable control in order to assure that interest paid on the Note shall be excluded from gross income of the owners thereof for the purpose of federal income taxation. 1.7. Additional Information. The Issuer will provide such other information as may be required to assure the exclusion from gross income of interest on the Note for federal income taxation purposes. 1.8. Non-Purpose Investments. Not more than 50% of the proceeds of the Note are being invested in investments not acquired to carry out the governmental purposes of the issue at a guaranteed yield and having a term of 4 years or more. 1. 9 IRS Information Reporting. The Issuer will make a timely filing of the appropriate IRS Form 8038-G or 8038-GC. ARTICLE II Use ofProiect and Proceeds 2.1. Authorization. (a) The Note is authorized to be issued pursuant to applicable provisions of the laws of the State of New York and the bond resolution adopted by the Town Board on September 12, 2000, (the "Resolution"), as referred to in the Certificate of Determination executed by the Supervisor on August 26, 2005. (b) For purposes of this Article II, the term "Original Proceeds" means the Sale Proceeds received (or deemed to be received) by the Issuer from the sale of the Notes net of the amount used or to be used for the payment of all costs and expenses associated with issuing the Notes, and excluding accrued interest. 481831.1 022471 CERT . . 2.2. Purpose of Issue. The Notes are being issued for the increase and improvement of the facilities of the Fishers Island Garbage and Refuse District (the "Project), in said Town. 2.3. Use of Original Proceeds. The proceeds of sale of the Note in the amount of $1,120,000 (the "Note") together with $50,000 in available funds will be used to redeem a prior issue of bond anticipation notes in the amount of $1,170,000,000, which will be redeemed prior to maturity in accordance with its terms on August 26, 2005 (the "Prior Issue"), heretofore issued to finance the Proj ect. 2.4. Ownership/Lease/Sale. The Project will be owned by the Issuer or another state or local governmental unit and will not be leased to any person who is not a state or local governmental unit. It will not (except to the extent that any of the projects financed involve grants) be sold or otherwise disposed of, in whole or in part, except for incidental sales of surplus items the proceeds of which will not constitute net operating profits or net capital profits to the Issuer, prior to the maturity date of the Note. 2.5. Private Loans. Not more than the lesser of 5 percent or $5,000,000 of the proceeds of the Note will be used directly or indirectly to make loans to persons other than a governmental unit. 2.6. Private Use. The aggregate amount of proceeds of the Note used directly or indirectly in a trade or business carried on by a person other than a state or local governmental unit ("Private Use"), will not exceed 10% of such proceeds in the event that more than 10% of the principal or 10% of the interest due on the Note during the term thereof is, under the terms of the Note or any underlying arrangement, directly or indirectly, secured by any interest in property used or to be used for a Private Use or in payments in respect of property used or to be used for a Private Use or is to be derived from payments, whether or not to the Issuer, in respect of property or borrowed money used or to be used for a Private Use. 2.7. Unrelated/Related Disproportionate Use. No more than 5% of the proceeds of the Note will be used directly or indirectly in the trade or business of a person other than a governmental unit that is unrelated or related and disproportionate to the governmental use of the property being financed, including any private loan financing described in Section 2.5 which meets this test. For purposes of this Arbitrage and Use of Proceeds Certificate, proceeds of the Note are allocable to an unrelated Private Use if such use is neither directly nor operationally related to a governmental use and proceeds of the Note are allocable to a disproportionate related Private Use to the extent that the proceeds of the Note which are to be used to finance property used by a nongovernmental person in a trade or business which is related to the governmental use of the property referred to in Section 2.6 above, exceeds the proceeds of the Note which are to be used for the governmental use to which such Private Use relates. 2.8. Other Private Uses Defined. For purposes of Section 2.6 and 2.7, a Private Use consists of any contract or other arrangement including, without limitation, leases, management contracts, guarantee contracts, take or pay contracts, or put or pay contracts, which 481831.1 022471 CERT . . provides for a use of the Project by a person or persons who are not State or local governments on a basis different than the general public. Any management, or operations contract or agreement which provides for nongovernmental use will provide for reasonable compensation which is in no part based on net profits aod will satisfy the provisions of (a), (b) or (c) below: (a) for contracts which provide compensation for each annual period based on a periodic fixed fee, a capitation fee or combination thereof, (i) the contract has a term (including renewal options) not exceeding five years; (ii) the issuer may terminate the contract, without penalty, at the end of any three year period, aod (iii) at least 50% of the compensation paid is on a periodic, fixed fee basis; (b) for contracts entered into or materially modified (other than pursuant to a renewal option) after March 15, 1993, which provide compensation based on a per unit fee or a combination per unit and periodic fixed fee, (i) the contract has a term (including renewal options) not exceeding three years; (ii) the issuer may terminate such contract (without penalty) at the end ofthe second year of the term, and (iii) the amount of the per unit fee is specified in the contract or otherwise limited by the qualified user or a third party; (c) for contracts entered into or materially modified (otherthao pursuant to a renewal option) after March 15, 1993, which provide compensation based on a percentage offees charged, (i) the contract has a term (including renewal options) not exceeding two years, (ii) the issuer may terminate the contract (without penalty) at the end of the first year, and (iii) the service provider primarily provides services to third parties or the contract involves a facility during an initial start-up period; (d) For purposes of this Section 2.8: (i) "capitation fee" means a fixed periodic amount paid under a management contract or agreement for each person for whom the service provider assumes the responsibility to provide all needed services for a specified period, provided the quantity and type of services actually provided vary substaotially; (ii) "periodic fixed fee" means a stated dollar amount for services rendered during a specified period of time (i.e. $XX per month) which amount may automatically increase according to a specified, objective, external standard; and (iii) "per unit fee" means a stated dollar amount for each unit of service provided (i.e. $XX per medical procedure). 2.9. Pooled Loan Financings. To the extent the amount of proceeds of the Note to be used to make loans to any borrowers (including loans referred to in Section 2.5 above and loans to state or local governmental units) exceeds $5,000,000, at least 95% of the net proceeds of the issue (as defined in Section 150 of the Code but without including proceeds used to 481831.1 022471 CERT . . finance costs of issuance or capitalized interest) that are to be used to make loans, will have been used within 3 years of the date hereof to make such loans. The payment of legal and underwriting costs is not contingent and at least 95% of the reasonably expected legal and underwriting costs associated with issuance will be paid within 180 days of the date hereof 2.10. Output Facilities. No more than 5% of the proceeds of the Note are to be used with respect to any output facility (other than a facility for the furnishing of water). No more than the lesser of $5,000,000 or 5% of the proceeds of the Note are to be used (directly or indirectly) for the acquisition of a nongovernmental output facility. ARTICLE III ArbitrageIRebate Exemption 3.1. Temporary Period-Refunding. With respect to the proceeds of the Note allocable to the Prior Issue, such proceeds may be invested without restriction as to yield during the three-year temporary period commencing on the date hereof, because: (a) All of the proceeds ofthe Prior Issue have been expended, or any such proceeds which have not been expended as ofthe date hereof, shall become transferred proceeds of this issue. Such transferred proceeds may be invested without restriction as to yield until three years after the date of original issuance of the Prior Issue. If any transferred proceeds remain unexpended after three years after the date of original issuance of the Prior Issue, such proceeds will be invested at a yield not in excess of the yield on the Note. (b) The proceeds of the Note will be used to refund the Prior Issue within 90 days of the date hereof, and may be invested during such time without restriction as to yield. 3.2. Rebate. (a) The Prior Issue was not subject to the rebate requirement imposed by Section 148 of the Code because at the time of original issuance of the first note or notes issued pursuant to the Resolution, in renewal of which the Prior Issue and/or the Note are issued: (i) the Issuer was a governmental unit with general taxing powers; (ii) the Prior Issue did not constitute a "private activity bond" as that term is defined in Section 141 of the Code; (iii) ninety-five percent or more of the net proceeds of the sale of the Prior Issue was used for local governmental activities of the Issuer; and (iv) the Issuer (including all agencies, instrumentalities and political subdivisions of the Issuer) reasonably expected that the aggregate face amount of all tax-exempt bonds issued by the Issuer during the calendar 481831.1 02247] CERT . . year in which the Prior Issue was issued would not exceed $5,000,000. For purposes of such determination, no tax-exempt obligation was taken into account if it was a current refunding obligation issued in the calendar year in which the Prior Issue was being issued which does not exceed the outstanding (redeemed) principal amount of the obligation to be refunded. (b) The Note is not subject to the rebate requirement imposed by Section 148 of the Code because all of the proceeds of such Note will be expended to pay the Prior Issue within 90 days of the date hereof and will, therefore, qualify for the six-month expenditure exception to rebate. 3.3. No Excess Proceeds. The total proceeds of sale of all obligations issued to date for the Project do not exceed the total cost of the Project. 3.4. Source of Repavment Funds. The Note will be paid from taxes and the proceeds of other obligations of the Issuer issued to fund the Note. 3.5. Debt Service Fund. The taxes used to pay principal and interest on the Note, whether or not deposited in a debt service fund, will be expended within 13 months of the date of deposit in such fund, or the date of their accumulation, in the payment of debt service on the Note. Any amounts received from the investment of such deposit or accumulation will be expended within one year of receipt. The debt service fund, if any, will be used to achieve a proper matching of revenues and debt service and will be depleted at least annually except for a reasonable carryover amount which will not exceed the greater of the earnings on such fund for the immediately preceding year or one-twelfth of the debt service on the Bonds for the immediately preceding year. 3.6. Sinking Funds. Except for the debt service fund described herein the Issuer has not created or established, and does not expect to create or establish, any sinking fund or other similar fund which the Issuer reasonably expects to use to pay principal or interest on the Note. ARTICLE IV Bank Qualification 4.1. Designation. The Note is hereby designated as a "qualified tax-exempt obligation" pursuant to the provisions of Section 265 ofthe Code. In making such designation it has been determined that: (i) the Note currently refunds the Prior Issue; (ii) the Prior Issue was designated as a "qualified tax-exempt obligation"; (iii) the aggregate face amount of the Note does not exceed $10,000,000; 481831.1 022471 CERT (SEAL) . . (iv) the Prior Issue had a weighted average maturity of3 years or less; (v) the maturity date of the Note, as measured from the original date of issuance of the notes issued pursuant to the Resolution, in renewal of which such Note is being issued, does not exceed 30 years; and (vi) not more than $10,000,000 of obligations issued by the Issuer during the calendar year in which the Prior Issue was issued were designated by the Issuer as "qualified tax-exempt obligations." IN WITNESS WHEREOF, I have hereunto set my hand and affixed the corporate seal of the Town of Southold on this 26th day of August, 2005. 481831.1 022471 CERT . . CERTIFICATE OF DETERMINATION BY THE SUPERVISOR RELATIVE TO AUTHORIZATION, SALE, ISSUANCE, FORM AND CONTENTS OF THE $1,120,000 BOND ANTICIPATION NOTE FOR FISHERS ISLAND GARBAGE AND REFUSE DISTRICT-2005 OF THE TOWN OF SOUTHOLD, NEW YORK. I, Joshua Y. Horton, Supervisor ofthe Town of South old, New York (herein called the "Town"), HEREBY CERTIFY that pursuant to the powers and duties delegated to me, the chief fiscal officer of the Town, by the Town Board ofthe Town, pursuant to the bond resolution duly adopted and as referred to in paragraph I hereof, and subject to the limitations prescribed in said bond resolution, I have made the following determinations: 1. A bond anticipation note (hereinafter referred to as the "Note") of the Town in the principal amount of$I,120,000 shall be issued to renew, in part, a bond anticipation note in the principal amount of$I,170,000 heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the resolution entitled: "Bond Resolution of the Town of South old, New York, adopted September 12, 2000, appropriating the amount of$2,500,000 for the improvement of facilities of the Fishers Island Garbage and Refuse District, in said Town, and authorizing the issuance of $2,500,000 serial bonds of said Town to finance said appropriation" duly adopted by the Town Board on the date therein referred to, and the Certificate of Determination executed by the Deputy Supervisor on August 27, 2004; the redemption of said $1,170,000 bond anticipation note having been heretofore provided to the extent of$50,000 from a source other than the proceeds of serial bonds. 2. The terms, form and details of said Note shall be as follows: Amount and Title: $1,120,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2005 Dated: August 26, 2005 Matures: August 25,2006, subject to prior redemption Number and Denomination: No. 2R-I, at $1,120,000 Interest Rate 3.06% 481831.1022471 CERT . . Form of Note: Substantially in accordance with form prescribed by Schedule B, 2 of the Local Finance Law of the State of New York. 3. The amount of bond anticipation notes originally issued in anticipation of the issuance of the serial bonds authorized pursuant to the resolution referred to in paragraph 1, hereof, including the Note, is $1,170,000, and the amount of bond anticipation notes which will be outstanding after the issuance of the Note, including the Note, will be $1,120,000. 4. The serial bonds authorized pursuant to the resolution referred to in paragraph I, hereof, are for improvements which are assessable. 5. Pursuant to said powers and duties delegated to me, I DO HEREBY A WARD AND SELL said Note to Bank of America, N.A., Boston, Massachusetts, for the purchase price of$I,120,000, plus accrued interest, if any, from the date of said Note to the date of delivery thereof and payment thereto, said note to be payable to Bank of America, N.A., as registered owner, and I FURTHER DETERMINE that said Note shall be payable as to both principal and interest at Town of Southold, Town Hall, 53095, Main Road, Southold, New Yark, at maturity or prior redemption. 6. The Note shall be executed in the name of the Town by the manual signature of its Deputy Supervisor and the corporate seal ofthe Town will be affixed, imprinted, impressed or otherwise reproduced thereon and attested by its Deputy Clerk. I HEREBY FURTHER CERTIFY that the powers and duties delegated to me to issue and sell the Note hereinabove referred to are in full force and effect and have not been modified, amended or revoked. IN WITNESS WHEREOF, I have hereunto set my hand this 26th day of August, 2005. /L.:;!/~ , Supervisor . . . . CLERK'S CERTIFICATE I, Linda Cooper, Deputy Town Clerk of the Town of South old, in the County of Suffolk, New York, HEREBY CERTIFY that I have compared the foregoing copy of the Certificate of Determination executed by the Supervisor and the same is a true and complete copy ofthe Certificate filed with said Town in my office as Deputy Clerk on or before the 26th day of August, 2005, and I FURTHER CERTIFY that no resolution electing to reassume any of the powers or duties mentioned in said Certificate and delegated to the Supervisor by the resolution cited in said Certificate and exercised by the Supervisor has been adopted by said Town Board. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the corporate seal of said Town this 26th day of August, 2005 (SEAL) ~"'h ~- ~~~A:.J eputy Town Clerk 481831.1 022471 CERT . , I . . AFFIDAVIT AS TO NO CONFLICT OF INTEREST STATEOFNEWYORK ) :ss: COUNTY OF SUFFOLK ) Linda Cooper, being duly sworn upon her oath deposes and says: I. I am the duly appointed, qualified and acting Deputy Town Clerk of the Town of Southold, in the County of Suffolk, New York (herein and in Schedule A annexed hereto called "Town"); 2. That with respect to the contract of sale of the Note of the Town described in the Certificate of Determination executed by the Supervisor on the 26th day of August, 2005, to the financial institution indicated in such Certificate, I have made a careful inquiry of each officer and employee of the Town having the power or duty to (a) negotiate, prepare, authorize or approve the contract or authorize or approve payment thereunder, (b) audit bills or claims under the contract, or (c) appoint an officer or employee who has any of the powers or duties set forth above, as to whether or not such officer or employee has an interest (as defined pursuant to Article 18 of the General Municipal Law) in such contract; 3. That upon information and belief, as a result of such inquiry, no such officer or employee has any such interest in said contract unless otherwise noted in Schedule A annexed hereto and by this reference made a part hereof ~L'/,C/' g t.l"-'''1OP/V Deputy T n Clerk Subscribed and sworn to before me this 26th day of August, 2005. ~~-;;:;,~ LYNDA M BOHN 'NOTARY PUBLIC, State of New Yolk NO. 01 B06020932, Suffolk ~ Term Expil8ll Matc118, 2Q2J. 481831.1 022471 CERT . . SCHEDULE A I. , is a stockholder of the Purchaser owning or controlling, directly or indirectly, less than five per centum (5%) of the outstanding stock thereof but no disclosure of such interest by said officer is required pursuant to said Law. 2. , has an interest in the Purchaser solely by reason of employment as an officer or employee thereof, but the remuneration of such employment will not be directly affected as a result of said contract and the duties of such employment do not directly involve the procurement, preparation or performance of any such part of such contract. 3. , has publicly disclosed the nature and extent of such interest in writing to the governing board of the Town. Such written disclosure has been made a part of and set forth in the official record of proceedings of the Town. 48183J.l 022471 CERT . . CERTIFICATES AS TO SIGNATURES, LITIGATION, AND DELIVERY AND PAYMENT WE, the undersigned officers of the Town of South old, in the County of Suffolk, a municipal corporation of the State of New York and herein referred to as the "Town", HEREBY CERTIFY that on or before August 26, 2005, we officially signed and properly executed by manual signatures the $1,120,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2005, payable to Bank of America, N.A., Boston, Massachusetts (the "Note") of the Town, described in Schedule A annexed hereto and by this reference made a part hereof, and that at the time of such signing and execution and on the date hereof we were and are the duly chosen, qualified and acting officers of the Town authorized to execute the Note and holding the respective offices indicated by the respective titles set opposite our signatures hereto for term expiring on the respective dates set opposite such titles. WE FURTHER CERTIFY that no litigation of any nature is now pending or threatened restraining or enjoining the issuance or delivery of the Note or the levy or collection of any taxes to pay the interest on or principal of the Note, or in any manner questioning the authority or proceedings for the issuance of the Note or for the levy or collection of said taxes, or relating to the Note or affecting the validity thereof or the levy or collection of said taxes, that neither the corporate existence or boundaries of the Town nor the title of any of the present officers thereof to their respective offices is being contested, and that no authority or proceedings for the issuance of the Note has or have been repealed, revoked or rescinded. WE FURTHER CERTIFY that the seal which is impressed upon this certificate (or a facsimile thereof) has been affixed, impressed, imprinted or otherwise reproduced upon the Note and is the legally adopted, proper and only official corporate seal of the Town. And, I, Joshua Y. Horton, Supervisor, HEREBY FURTHER CERTIFY that on August 26,2005, I delivered or caused the delivery of the Note to: Bank of America, N.A., Boston, Massachusetts, the purchaser thereof, and that at the time of such delivery of said Note, the Town received from said purchaser the amount hereinbelow stated, in full payment for said Note, computed as follows: Price......... .... ... ... ...... ..... ... ................. ....... ..... ...... ... .... ... ... .....$ 1,120,000.00 Interest on said Note accrued to the date of such delivery ........................................................... -0- Amount Received........ ............ ...... .............. ..... ...... .......... .... .$1,120,000.00 (SEAL) 481831.1 022471 CER T . . IN WITNESS WHEREOF, we have hereunto set our hands and said corporate seal has hereunto been affixed this 26th day of August, 2005. Term of Office Expires Title December 31, 2005 Supervisor (!__~ December31,2005 Deputy Town Clerk I HEREBY CERTIFY that the signatures of the officers ofthe above-named Town, which appear above, are true and genuine and that I know said officers and know them to hold the respective offices set opposite their signatures. .L~ \./ (Signature) AutJL (Title) of ~ 4'l'vL of ~q)/I[c-,^- (Name of Bank) 481831.l 022471 CERT I . . ATTORNEY'S CERTIFICATE I, Patricia A. Finnegan, HEREBY CERTIFY that I am a licensed attorney at law of the State of New York, having offices at 53095 Main Road, Southold, New York, and am the duly chosen, qualified and acting Town Attorney of the Town of Southold, in the County of Suffolk, a municipal corporation ofthe State of New York and herein referred to as the "Town", that no litigation of any nature is now pending or threatened restraining or enjoining the issuance or delivery of the Note of the Town, said Note to be payable to Bank of America, N.A., Boston, Massachusetts, and otherwise described as set forth in Schedule A annexed hereto and by this reference made a part hereof, or the levy or collection of any taxes to pay the interest on or principal of the Note, or in any manner questioning the authority or proceedings for the issuance of the Note or for the levy or collection of said taxes, or relating to the Note or affecting the validity thereof or the levy or collection of said taxes, that neither the corporate existence or boundaries of the Town nor the title of any of the present officers thereof to their respective offices is being contested, and that no authority or proceedings for the issuance of the Note has or have been repealed, revoked or rescinded. IN WITNESS WHEREOF, I have hereunto set my hand this 26th day of A st,2005. 481831.1 022471 CERT . Amount and Title: Dated: Matures: Number and Denomination: Interest Rate: Form of Note: . . SCHEDULE A $1,120,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2005 August 26, 2005 August 25, 2006, subject to prior redemption No. 2R-l, at $1,120,000 3.06% Substantially in accordance with form prescribed by Schedule B, 2 ofthe Local Finance Law of the State of New York. 481831.1 022471 CERT . . ~ q)~ &1f/oodHf?JJ 67 WALL STREET NEW YORK, NY 10005 WWW.How.COM August 27, 2004 The Town Board of the Town of Southold, in the County of Suffolk, New York Ladies and Gentlemen: We have examined a record of proceedings relating to the issuance of the $1,170,000 Bond Anticipation Note for Fishers Island Garbage and Refuse District-2004 (the "Note") of the Town of Southold, in the County of Suffolk, a municipal corporation of the State of New York The Note is dated August 27,2004, matures August 26, 2005, subject to prior redemption, is a single note in the denomination of $1,170,000, is numbered R-I, bears interest at the rate of 1.35% per annum, is issued pursuant to the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, the bond resolution adopted by the Town Board on September 12, 2000, authorizing the issuance of $2,252,000 serial bonds for the increase and improvement of facilities of the Fishers Island Garbage and Refuse District, in said Town, and the Certificate of Determination executed by the Deputy Supervisor on August 27, 2004. Said Bond Anticipation Note is a temporary obligation issued in anticipation of the sale of permanent serial bonds In our opinion, the Note is a valid and legally binding general obligation of the Town for which the Town has validly pledged its faith and credit and, unless paid from other sources, all the taxable real property within the Town is subject to the levy of ad valorem real estate taxes to pay the Note and interest thereon without limitation of rate or amount. The enforceability of rights or remedies with respect to the Note may be limited by bankruptcy, insolvency, or other laws affecting creditors' rights or remedies heretofore or hereafter enacted. The Internal Revenue Code of 1986, as amended (the "Code"), establishes certain requirements that must be met subsequent to the issuance and delivery of the Note in order that interest on the Note be and remain excludable from gross income under Section 103 of the Code. The Deputy Supervisor of the Town, in executing the Arbitrage and Use of Proceeds Certificate, has certified to the effect that the Town will comply with the provisions and procedures set forth therein and that it will do and perform all acts and things necessary or desirable to assure that interest paid on the Note is excludable from gross income under Section 103 of the Code. We have examined such Arbitrage and Use of Proceeds Certificate of the Town delivered concurrently with the delivery of the Note, and, in our opinion, such certificate contains provisions and procedures under which such requirements can be met. 458535.1 019513 CERT . . In our opinion, the interest on the Note is excludable under existing statutes and court decisions from the gross income of the recipients thereof for federal income tax purposes pursuant to Section 103 of the Code, and under existing statutes interest on the Note will not be treated as a preference item in calculating the alternative minimum tax that may be imposed under the Code with respect to individuals and corporations. In rendering the foregoing opinion we have assumed the Town's compliance with the Arbitrage and Use of Proceeds Certificate. Further, in our opinion, under existing statutes, interest on the Note is exempt from New York State and New York City personal income taxes Other than such record of proceedings, we have not been requested to examine or review and have not examined or reviewed the accuracy or sufficiency of any additional proceedings, reports, correspondence, financial statements or other documents, containing financial or other information relative to the Town, which have been or may hereafter be furnished or disclosed to purchasers of the Note and we express no opinion with respect to any such financial or other information or the accuracy or sufficiency thereof. The form of the Note is prescribed by Schedule B, 2 of the Local Finance Law of the State of New York, but we have not examined the executed Note. fi.r;,~I~{J 458535.1019513 CERT S560,000 UNITED STATES OF AMERICA STATE OF NEW YORK COUNTY OF SUFFOLK TOWN OF SOUlHOLD BOND ANTICIPATION NOTE FOR FISHERS ISLAND GARBAGE AND REFUSE DISTRICT-2006 The Town of Southold, in the County of Suffolk, a municipal corporation of the State of New York, hereby acknowledges itself indebted and for value received promises to pay to the bearer of this Note, or if it be registered, to the registered holder, the swn of FIVE HUNDRED SIXTY lHOUSAND DOLLARS (S560,000) on the 24th day of August, 2007, together with interest thereon from the date hereof at the rate of three and seventy-six hundredths per centum (3.76%) per annum, payable at maturity or prior redemption. Both principal of and interest on this Note will be paid in lawful money of the United States of America, at the Suffolk County National Bank, Riverhead, New York. Both principal of and interest on this Note shall be payable only to the registered owner, his legal representatives, successors or transferees. This Note shall then be transferable only upon presentation to such Town Clerk with a written transfer of title and such Town Clerk shall thereupon register this Note in the name of the transferee in his books and shall endorse a certificate of such registration hereon. Such transfer shall be dated, and signed by the registered owner, or his legal representatives, and it shall be duly acknowledged or proved, or in the alternative the signature thereto shall be certified as to its genuineness by an officer of a bank or trust company located and authorized to do business in this State. This Note is the only note of an authorized issue, the principal amount of which is S560,000. This Note may be called for redemption, after the giving of at least five (5) days' written notice uftbe date of redemption by mailing of written notice to the original purchaser, or if this Note be registered to the registered holder, and interest shall cease to be paid hereon after such date of redemption. This Note is issued prusuant to the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, the bond resolution adopted by the Town Board on September 12,2000, authorizing the issuance ofS2,500,OOO serial bonds for the improvement of the facilities of the Fishers Island Garbage and Refuse District, in said Town, and the Certificate of Determination executed by the Supervisor on August 25, 2006. This Note has been designated by the Town as a qualified tax-exempt obligation pursuant to the provisions of Section 265 of the Internal Revenue Code of 1986, as amended. The faith and credit of such Town are hereby irrevocably pledged for the punctual payment of the principal of and interest on this Note according to its terms. It is hereby certified and recited that all conditions, acts and things reqnired by the Constitution and statutes of the State of New York to exist, to have happened and to have been performed precedent to and in the issuance of this Note, exist, have happened and have been performed, and that this Note, together with all other indebtedness of such Town, is within every debt and other limit prescribed by the Constitution and laws of such State. IN WITNESS WHEREOF, the Town of Southold has caused this Note to be executed in its name by its Supervisor, and its corporate seal (or a facsimile thereof) to be affixed, imprinted or otherwise reproduced hereon and attested by its Town Clerk and this Note to be dated as oflbe 25th day of August, 2006. TOW~F SOUlHOLD (SEAL) By ~~ Supervisor ATTEST: O~/I~~~!f:II~) Town lerk'