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HomeMy WebLinkAboutVarious Purposes !=@ i" .c.~ ~oo "j; rnN ro < ro ~ UNITED STATES OF AMERICA STATE OF NEW YORK COUNTY OF SUFFOLK TOWN OF SOUTHOLD BOND ANTICIPATION NOTE FOR VARIOUS PURPOSES-2005ey The Town of Southold, in the County of Suffolk, a municipal corporation of the State of ew 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, hereof, the sum of ONE MILLION SEVEN HUNDRED THOUSAND DOLLARS ($1,700,000) on the 8th day of September, 2006, together with interest thereon from the date hereof at the rate of three and five hundredths per centum (3.05%) 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 Bridgehampton National Bank, Bridgehampton, New York. At the request ofthe 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 writteu 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 the only Note of an authorized renewal issue, the principal amount of which is $1,700,000. This Note is issued pursuant to the provisions ofthe Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, various bond IpOlutions adopted by the Town Board on their respective dates, authorizing the issuance of serial bonds for various pmposes, and the Certificate of Detennination executed by the Supervisor on September 9, 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 of South old 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 of Southold, is within every debt aud other limit prescribed by the Constitution and laws of such State. IN WITNESS WHEREOF, the Town of Southold has caused this Note to be signed by its Supervisor, and its corporate seal (or a facsimile thereof) to be affixed, impressed, imprinted, or otherwise reproduced hereon and attested by its Towa Clerk and this Note to be dated as of the 9th day of September, 2005. A(!}jT: d1 ~ . :y 21.0 '.. '" lit , Towa C k . . ~ q)eIajteId &: 11/004 JXY? 67 WALL STREET NEW YORK, NY 10005 ININW.HDW.COM April 22, 2005 The Town Board of the Town of Southold, in the County of Suffolk, New York Ladies and Gentlemen: We have examined the record of proceedings relating to the issuance of the $7,175,000 Bond Anticipation Note for Various Purposes-2005 of the Town of Southold, in the County of Suffolk, a municipal corporation of the State of New York $3,285,000 principal amount of said Note are renewal notes and $3,890,000 principal amount of said Note will provide initial funds for two new projects. The Note is dated April 22, 2005, matures April 21, 2006, is payable to Fleet National Bank, a Bank of America Company, the registered owner, is a single note in the denomination of $7,175,000, is numbered 8R-I, bears interest at the rate of 2.64% 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, seven (7) bond resolutions duly adopted by the Town Board on their respective dates, authorizing the issuance of serial bonds for various purposes in and for the Town and the Certificate of Determination executed by the Supervisor on April 22, 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 such 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. In our opinion, the interest on said 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 said Note and we express no opinion with respect to any such financial or other information or the accuracy or sufficiency thereof The form of said 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, ~ fJilJliJJt.J-~ . . ~ 9lJeIajieId & ft/0<Jd HfP 67 WALL STREET NEW YORK, NY 10005 INW'W.HDW.COM April 22, 2005 The Town Board of the Town of Southold, in the County of Suffolk, New York Ladies and Gentlemen: We have examined the record of proceedings relating to the issuance of the $7,175,000 Bond Anticipation Note for Various Purposes-2005 of the Town of Southold, in the County of Suffolk, a municipal corporation of the State of New York $3,285,000 principal amount of said Note are renewal notes and $3,890,000 principal amount of said Note will provide initial funds for two new projects. The Note is dated April 22, 2005, matures April 21, 2006, is payable to Fleet National Bank, a Bank of America Company, the registered owner, is a single note in the denomination of $7,175,000, is numbered 8R-I, bears interest at the rate of 2.64% 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, seven (7) bond resolutions duly adopted by the Town Board on their respective dates, authorizing the issuance of serial bonds for various purposes in and for the Town and the Certificate of Determination executed by the Supervisor on April 22, 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 such 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 In our opinion, the interest on said 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 said Note and we express no opinion with respect to any such financial or other information or the accuracy or sufficiency thereof The form of said 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, ~j}f4#.cJJJw No.SR-1 UNITED STATES OF AMERICA STATE OF NEW YORK COUNTY OF SUFFOLK TOWN OF SOUTHOLD BOND ANTICIPATION NOTE FOR VARIOUS PURPOSES-2005 The Town of SouthoJd, 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 Fleet National Bank, a Bank of America Company, the registered owner hereof, the sum of SEVEN MILLION ONE HUNDRED SEVENTY-FIVE THOUSAND DOLLARS ($7,175,000) on the 21st day of April, 2006, together with interest thereon from the date hereof at the rate of two and sixty-four hundredths per centum (2.64%) 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 the Town of South old, Town Hall, 53095, Main Road, Southold, New York. 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 be transferable only upon presentation to the 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 or her 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 the one of an authorized new and renewal note issue, the principal amount of which is $7,175,000, consisting of $3,285,000 principal amount to renew bond anticipation notes maturing on April 22, 2005 and $3,890,000 principal amount to fund two new projects. 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, eight (8) bond resolutions duly adopted by the Town Board on their respective dates, authorizing various purposes in and for the Town and the Certificate of Determination executed by the Supervisor on April 22, 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 of Southold 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 of Southold, 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 hy its Supervisor, and its corporate seal (or a facsimile thereof) to be affixed, impressed, imprinted or otherwise reproduced hereon and attested by its Deputy Town Clerk and this Note to be dated as of the 22nd day of April, 2005. (SEAL) ATTEST: D~f~ . . CERTIFICATE OF DETERMINATION BY THE SUPERVISOR RELATNE TO AUTHORIZATION, SALE, ISSUANCE, FORM AND CONTENTS OF THE $7,175,000 BOND ANTICIPATION NOTE FOR VARIOUS PURPOSES-20OS OF THE TOWN OF SOUTHOLD, NEW YORK. 1, Joshua Y. Horton, Supervisor of the Town of Southold, New York (herein called the "Town"), HEREBY CERTIFY that pursuant to the powers and duties delegated to me as the chief fiscal officer of the Town, by the Town Board of the Town, pursuant to the bond resolutions duly adopted and as referred to in paragraphs 1 to 7 inclusive, hereof, and subject to the limitations prescribed in said bond resolutions, I have made the following determinations: 1. A bond anticipation note of the Town in the principal amount of $32,000 shall be issued to renew, in part, the $81,000 bond anticipation note dated April 23, 2004, maturing April 22 2005, and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution ofthe Town of Southold, New York, adopted March 27, 2001, authorizing the acquisition and installation of a computer system network, including hardware, software and appurtenant equipment, machinery, apparatus and furnishings, in the Town Clerk's office at the estimated maximum cost of $184,000 and the Tax Receiver's Office at the estimated maximum cost of $38,000; stating the estimated total cost thereof, including preliminary costs and costs incidental thereto in the amount of $8,000, is $230,000; appropriating said amount therefor and authorizing the issuance of $230,000 serial bonds of said Town to finance the said appropriation," duly adopted by the Town Board on the date therein referred to, and the Certificate of Determination executed by the Supervisor on April 23, 2004, the redemption of said $81,000 bond anticipation note having been heretofore provided to the extent of $49,000 from a source other than the proceeds of serial bonds. 2. A bond anticipation note of the Town in the principal amount of $2,240,000 shall be issued to renew, in part, the $2,324,000 bond anticipation note dated April 23, 2004, maturing April 22 2005 and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted March 13, 2001, appropriating the amount of $2,600,000 for the increase and improvement of facilities of the Southold Solid Waste Management District, in said Town, and authorizing the issuance of $2,600,000 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 April 23, 2004, the redemption of said $2,324,000 473160.1023580 CERT . . bond anticipation note having been heretofore provided to the extent of $84,000 from a source other than the sale of serial bonds, including unexpended proceeds of said $2,324,000 bond anticipation note maturing on Apriln, 2005. 3. A bond anticipation note of the Town in the principal amount of $670,000 shall be issued to renew, in part, the $705,000 bond anticipation note dated April 23, 2004, maturing April 22, 2005 and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted November 19,2002, appropriating the amount of $750,000 in addition to the amount of $2,600,000 heretofore appropriated for the increase and improvement of facilities of the Southold Solid Waste Management District, in said Town, stating the estimated maximum cost of said increase and improvement of facilities, including said additional appropriation, is $3,350,000 and authorizing the issuance of $750,000 Serial Bonds to finance said additional appropriation, said bond being in addition to the $2,600,000 Serial Bonds of said Town heretofore authorized," duly adopted by the Town Board on the date therein referred to and the Certificate of Determination executed by the Supervisor on April 23, 2004, the redemption of said $705,000 bond anticipation note having been heretofore provided to the extent of $35,000 from a source other than the proceeds of the serial bonds, including unexpended proceeds of said $705,000 bond anticipation note maturing on April 22, 2005. 4. A bond anticipation note of the Town in the principal amount of $138,000 shall be issued to renew, in part, the $184,000 bond anticipation note dated April 23, 2004, maturing April 22, 2005 and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York ("Town"), adopted October 22, 2002, authorizing the Town to (a) acquire a leasehold interest, for a term of 20 years, in the certain piece or parcel of land in Cutchoque, situate on Griffing Street, North of Main Road (Route 25), containing 38,250 square feet, more or less, as the site of a public parking area, and (b) construct a public parking area on said site (collectively, the "Project"); appropriating $230,000 for said construction; authorizing the issuance of $230,000 Serial Bonds to finance said appropriation; stating that the Town Board, as lead agency, has determined that the project is an unlisted action having no significant effect on the environment and that a negative declaration has been issued and filed; stating the plan of financing of said construction is the issuance of said serial bonds to finance said appropriation and the levy and collection of taxes to pay the principal of and interest on said bonds", 473160.1023580 CERT . . duly adopted by the Town Board on the date therein referred to and the Certificate of Determination executed by the Supervisor on April 23, 2004, the redemption of said $184,000 bond anticipation note having been heretofore provided to the extent of $46,000 from a source other than the sale of serial bonds. 5. A bond anticipation note of the Town in the principal amount of $205,000 shall be issued to renew, in part, the $310,000 bond anticipation note dated April 23, 2004, maturing April 22, 2005 and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted March 9, 2004, authorizing the acquisition of equipment for the use by the Town Highway Department as follows: (I) a Street Sweeper, a the estimated maximum costs of $170,000, and (2) a Payloader, at the estimated maximum cost of $140,000 stating the estimated total cost thereto is $310,000; appropriating said amount therefore and authorizing the issuance of $310,000 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 April 23, 2004, the redemption of said $310,000 bond anticipation note having been heretofore provided to the extent of $105,000 from a source other than the sale of serial bonds, including unexpended proceeds of said $310,000 bond anticipation note maturing on April 22, 2005. 6. shall be issued in resolution entitled: A bond anticipation note of the Town in the principal amount of $640,000 anticipation of the sale of serial bonds authorized pursuant to the bond Bond Resolution of the Town of Southold, New York, adopted September 7, 2004, authorizing the payment of $818,630.10 to settle the claim of the State of New York in the matter of the "State of New York v. Town of Southold" (Index No. 1436-92); relating to Spill Number 85-1219; stating the estimated maximum cost thereof, including preliminary costs, legal costs and costs incidental thereto and the financing thereof in the amount of $6,369.90, is $825,000; appropriating said amount therefor and authorizing the issuance of $825,000 bonds of said Town to finance said appropriation. duly adopted by the Town Board on the date therein referred to. 7. A bond anticipation note of the Town in the principal amount of $3,250,000 shall be issued in anticipation of the sale of serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted November 16,2004, appropriating $3,250,000 for the increase and improvement of the facilities of the Southold Solid Waste 473160.1023580CERT . . Management District, in said Town; authorizing the issuance of $3,250,000 serial bonds of said Town to finance said appropriation; and authorizing any funds to be received from the United States of America and/or the State of New York by grant or any other sources to be expended towards the cost of said object or purpose or redemption of the Town's obligations issued therefor, or to be budgeted as an offset to the taxes for the payment of the principal of and interest on said obligations," duly adopted by the Town Board on the date therein referred to. 8. Said $32,000 note, said $2,240,000, said $670,000 note, said $138,000 note, said $205,000 note, said $640,000 note, and said $3,250,000, shall be combined for the purpose of sale into a single note issue in the aggregate principal amount of $7,175,000 (hereinafter referred to as the "Note"). 9. The terms, form and details of said Note shall be as follows: Amount and Title: $7,175,000 Bond Anticipation Note for Various Purposes- 2005 Dated: April 22 2005 April 21, 2006 Matures: Number and Denomination: No. 8R-I, at $7,175,000 Interest Rate per annum: 2.64% Form of Note: Substantially in accordance with form prescribed by Schedule B, 2 of the Local Finance Law of the State of New York. 10. The amount of bond anticipation notes originally issued in anticipation of the issuance of the serial bonds authorized pursuant to the resolutions referred to in paragraphs 1 to 8, inclusive, hereof, including the Note, (1) $230,000, (2) $2,600,000, (3) $750,000, (4) $250,000, (5) $310,000, (6) $640,000, and (7) $3,250,000, respectively, and the amount of bond anticipation notes which will be outstanding after the issuance of the Note, including said Note, will be (1) $32,000, (2) $2,240,000, (3) $670,000, (4) $138,000, (5) $205,000, (6) $640,000, and (7) $3,250,000, respectively. 11. The serial bonds authorized pursuant to the bond resolutions referred to in paragraphs I, 4, 5, and 6 hereof are for improvements which are non-assessable. The serial bonds authorized pursuant to the bond resolutions referred to in paragraphs 2, 3, and 7 hereof are for improvements which are assessable. 473160.1 0235S0 CERT . . 12. Pursuant to said powers and duties delegated to me, 1 DO HEREBY AWARD AND SELL said Note to Fleet National Bank, a Bank of America Company, Boston, Massachusetts, for the purchase price of $7,175,000, 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 Fleet National Bank, a Bank of America Company, 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 York, and shall bear interest at the rate of two and sixty-four per centum (2.64%) per annum, payable at maturity. 13. Said Note shall be executed in the name of the Town by its Supervisor and the corporate seal of the Town (or a facsimile thereof) shall be affixed, impressed, imprinted or otherwise reproduced thereon and attested by its Deputy 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 22nd day of April, 2005. 473160.1023580 CERT . . CLERK'S CERTIFICATE I, Linda Cooper, Deputy 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 the office of the Town Clerk on the 22nd day of April, 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 bond resolutions cited in said Certificate has been adopted by the Town Board of the Town. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the corporate seal of said Town this 22nd day of April, 2005. (SEAL) ~(j~ , Deputy Town Clerk 473160.1023580 CERT > . . ARBITRAGE AND USE OF PROCEEDS CERTIFICATE I, Joshua Y. Horton, Supervisor of the Town of Southold (the "Issuer"), in the County of Suffolk, State of New York, HEREBY CERTIFY with respect to the Issuer's $7,175,000 Bond Anticipation Note for Various Purposes-2005 (the "Note") dated and issued on April 22, 2005, as follows: Unless the context clearly requires otherwise, all capitalized terms not otherwise defined herein shall have the meanings set forth below 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 1.148-2(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. 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 ofthe 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 Treasury or in obligations issued pursuant to Section 2IB(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: 473160.1023580 CERT . . (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-Pumose 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 of Project and Proceeds 2.1. Authorization. (a) The Note are authorized to be issued pursuant to applicable provisions of the laws of the State of New York and eight (8) bond resolutions adopted by the Town Board on their respective dates (the "Resolutions"), as referred to in the Certificate of Determination executed by the Supervisor on April 22, 2005 (the "Certificate"). (b) For purposes of this Article II the term "proceeds" means the net amount (after payment of all costs and expenses associated with issuing the Note) received by the Issuer from the sale of the Note, excluding accrued interest. 2.2. Purpose of Issue. The Note is being issued to provide funds for various purposes III and for the Town (collectively, "the Project"), as further described in the Resolutions. 2.3. Use of Proceeds. The proceeds of sale of the Note in the amount of $3,285,000 (the "Current Refunding Note") will be used, together with other available funds in 473160.1023580 CERT . . the amount of $434,000, to redeem a prior issue of bond anticipation notes which mature on April 22, 2005, in the principal amount of $3,719,000 (the "Prior Issue"), heretofore issued to finance the Project. The balance of the proceeds of sale of the Note in the amount of $3,890,000 will be used to provide funds for a new 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% ofthe 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 Sections 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 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: 473160.1023580 CERT . . (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 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 ofthis 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 150 ofthe 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 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. 473160.1023580CERT . . 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 Arbitrage/Rebate Exemption 3.1. Temporarv Period-Refunding. With respect to the proceeds of the sale of the Current Refunding Note representing proceeds allocable to the Prior Issue: (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 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 ofthe date hereof, and may be invested during such time without restriction as to yield. 3.2. Temporary Period-New Monev. With respect to the New Money Note: (a) The Issuer has entered into or will enter into within six months from the date of this certificate, binding cornmitment( s) for the acquisition, construction or accomplishment of the Project cited in Section 2.2 hereof, and the amount of such commitment(s) with respect to such Project will or do exceed the amount equal to 5% of $3,890,000, being the aggregate amount of obligations currently issued for such Project. (b) Such Project has been completed, or, if such Project has not been completed, work on the acquisition, construction or accomplishment of such Project will proceed or is proceeding with due diligence to completion. (c) It is reasonably expected that at least 85 percent of the net sale proceeds of such New Money Note will be expended within three years from the date of this Certificate. No more than 50 percent of the proceeds of the Note will be invested in nonpurpose investments with a term of four years or more. 3.3. Rebate. (a) Neither the Prior Issue nor the New Money Note was or is subject to the rebate requirement imposed by Section 148 of the Code because, with respect to each: (i) the Issuer was or is a governmental unit with general taxing powers; 473160.1023580 CERT . . (ii) the Prior Issue/New Money Note did not or does 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/New Money Note was or is to be used for local governmental activities of the Issuer; and (iv) the Issuer (including all agencIes, instrumentalities and political subdivisions of the Issuer) reasonably expected or expects 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 and the current calendar year would not or will not exceed $5,000,000. For purposes of such determination, no tax-exempt obligation was or shall be taken into account if it was or is a current refunding obligation issued in the calendar year in which the Prior Issue/New Money Note (as applicable) was or is being issued which does not exceed the outstanding (redeemed) principal amount of the obligation to be refunded. (b) The Current Refunding Note is not subject to the rebate requirement imposed by Section 148 of the Code because all of the Gross Proceeds of such Current Refunding 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. 3.4. No Excess Proceeds. The total proceeds of sale of all bond anticipation notes issued to date for the Project do not exceed the total cost of the Project. 3.5. 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. 3.6. 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 ammally except for a reasonable carryover amount 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 Note. 3.7. 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. 473160.1023580 CERT . . ARTICLE N Bank Qualification 4.1. Designation. The Note are hereby designated as "qualified tax-exempt obligations" pursuant to the provisions of Section 265 of the Code. (a) In making such designation it has been determined with respect to the Current Refunding Note that: (i) the Note currently refund 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; (v) the maturity date of the Note, as measured from the original date of issuance of the notes issued pursuant to the Ordinance, in renewal of which such Note are 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." (b) In making such designation it has been determined with respect to the New Money Note that: (i) the Issuer does not reasonably anticipate that the amount of "qualified tax- exempt obligations" to be issued by the Issuer during the current calendar year will exceed $10,000,000; and (ii) the amount of "qualified tax-exempt obligations" issued by the Issuer during the current calendar year does not as of this date, and including this issue, exceed $10,000,000. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the corporate seal of the Town of Southold this 22nd day of April, 2005. -rrl Supervisor 473160.1023580CERT . # . . AFFIDAVIT AS TO NO CONFLICT OF INTEREST STATE OF NEW YORK ) :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 ofthe Note of the Town described in the Certificate of Determination executed by the Supervisor on the 22nd day of April, 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. ~Q~ Deputf" Town Clerk Subscribed and sworn to before me this 22nd day of April, 2005. \~ BONNIE J. DOROSKI Notary Public, State Of New York No. 01006095328, Suffolk County Term Expires July 7, 20J:Lf- 473160.1023580 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. 473160.1023580 CERT A I . . 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 April 23, 2004, we officially signed and properly executed by manual signatures the $7,175,000 Bond Anticipation Note for Various Purposes-2005(the "Note") of the Town, said Note to be payable to Fleet National Bank, a Bank of America Company, and otherwise 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 said Note and holding the offices indicated by the respective titles set opposite our signatures hereto for terms expiring on the 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 said Note or the levy or collection of any taxes to pay the interest on or principal of said Note, or in any manner questioning the authority or proceedings for the issuance of said Note or for the levy or collection of said taxes, or relating to said 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 said Note has or have been repealed, revoked or rescinded. WE FURTHER CERTIFY that the seal which is impressed upon this certificate has been affixed, impressed, imprinted or otherwise reproduced upon said 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 April 22, 2005, I delivered or caused the delivery of said Note to Fleet National Bank, a Bank of America Company, Boston, Massachusetts, the purchaser thereof, and that at the time of such delivery of said Note, I received from said purchaser the amount hereinbelow stated, in full payment for said Note, computed as follows: Price ...............................................................$7,175,000 Interest on said Note accrued to the date of such delivery ...................................... -0- Amount Received........ ... .................. .... ... ..... ..$7,175,000 473160.1023580CERT l . . IN WITNESS WHEREOF, we have hereunto set our hands and said corporate seal has hereunto been affixed this 22nd day of April, 2005. Term of Office Expires Title December 31, 2005 Supervisor ~r; 0u~ d)h .:1 I ';zooS- Deputy Town Clerk (SEAL) 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 the respective offices set opposite their signatures. L/llUk ~ature) I/!Jf ~ II-Jf (Title) of ~f~ 473160.1 023580 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 Town Hall, 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 Fleet National Bank, a Bank of America Company, 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 said Note, or in any manner questioning the authority or proceedings for the issuance of said Note or for the levy or collection of said taxes, or relating to said 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 said Note has or have been repealed, revoked or rescinded. IN WITNESS WHEREOF, I have hereunto set my hand this 22nd day of April, 2005 473160.1023580 CERT . . SCHEDULE A Amount and Title: $7,175,000 Bond Anticipation Note for Various Purposes-2005 Dated: April 22, 2005 Mature: April 21, 2006 Number, Denomination and Interest Rate: No. 8R-1, at $7,175,000, bearing interest at 2.64% per annum 473160.1023580 CERT . . ~ q)eIu/teId & 1f/rxx/ Hg; 67 WALL STREET NEW YORK, NY 10005 WWW.HAWKINS.COM September 9, 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 $1,700,000 Bond Anticipation Note for Various Purposes-2005 of the Town of Southold, in the County of Suffolk, a municipal corporation of the State of New York. Said Note is a renewal Note, is dated September 9,2005, matures September 8, 2006, is numbered 7R-I, bears interest at the rate of three and five hundredths per centum (3.05%) per annum, payable at maturity, is of the denomination of $1,700,000, is payable to bearer without coupons and registrable as to both principal and interest and issued pursuant to the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, various bond resolutions adopted by the Town Board on their respective dates, authorizing the issuance of serial bonds for various purposes, and the Certificate of Determination executed by the Supervisor on September 9, 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 such 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 482443.1 026311 CERT . . 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. In our opinion, the interest on said 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 said Note and we express no opinion with respect to any such financial or other information or the accuracy or sufficiency thereof. The form of said 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, F) A -Mt,~...,~ ~ /(,tIr#t..LP 482443.1 026311 CERT . . ~ 9lJe!ajidd & 11/004 HPJ5 67 WALL STREET NEW YORK, NY 10005 WWW.HAWKINS.COM September 9, 2005 The Town Board of the Town of South old, in the County of Suffolk, New York Ladies and Gentlemen We have examined a record of proceedings relating to the issuance of the $1,700,000 Bond Anticipation Note for Various Purposes-2005 of the Town of Southold, in the County of Suffolk, a municipal corporation of the State of New York. Said Note is a renewal Note, is dated September 9,2005, matures September 8, 2006, is numbered 7R-I, bears interest at the rate of three and five hundredths per centum (3.05%) per annum, payable at maturity, is of the denomination of $1,700,000, is payable to bearer without coupons and registrable as to both principal and interest and issued pursuant to the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York, various bond resolutions adopted by the Town Board on their respective dates, authorizing the issuance of serial bonds for various purposes, and the Certificate of Determination executed by the Supervisor on September 9, 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 such 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 482443.1026311 CERT . . 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. In our opinion, the interest on said 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 said Note and we express no opinion with respect to any such financial or other information or the accuracy or sufficiency thereof The form of said 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. (~:~I~f!~llP 482443.1 026311 CERT $1,700,000 UNITED STATES OF AMERICA STATE OF NEW YORK COUNTY OF SUFFOLK TOWN OF SOUTHOLD BOND ANTICIPATION NOTE FOR VARIOUS PURPOSES-2ooS The Town of Southold, in the County of Suffolk, a municipal cOlporation 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, hereof, the sum of ONE MILliON SEVEN HUNDRED THOUSAND DOLLARS ($1,700,000) on the 8th day of September, 2006, together with interest thereon from the date hereof at the rate of three and five hundredths per centum (3.05%) 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 Bridgehampton National Bank, Bridgehampton, 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. TIris 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 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 the only Note of an authorized renewal issue, the principal amount of which is $1,700,000. This Note is issued pursuant to the provisions ofllie Local Finance Law, constituting Chapter 33-3 of the Consolidated Laws of the State of New York, various bond resolutions adopted by the Town Board on their respective dates, authorizing the issuance of serial bonds for various purposes, and the Certificate of Determination executed by the Supervisor on September 9, 2005. Tbis 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 of Southold 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 Yark to exist, to have happened and to have been perfonned 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 of Southold, 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 signed by its Supervisor, and its corporate seal (or a facsimile thereot) to be affixed, impressed, imprinted, or otherwise reproduced hereon and attested by its Town Clerk and this Note to be dated as of the 9th day of September, 2005. I Ar:JT: ~fd' Yifd < u<.M, Town C k I I I I .. . . 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 $1,700,000 Bond Anticipation Note for Various Purposes-2005, (herein referred to as the "Note" or "Notes"), dated September 9, 2005, maturing September 8, 2006, as follows: Unless the context clearly requires otherwise, all capitalized terms used but not otherwise defined herein shall have the meanings set forth in Article II hereof or in the Resolutions, the Code or the Regulations (each as defined below). ARTICLE I General 1.1. Authoritv of Signatory. I am an officer of the Issuer charged with the responsibility for the execution, delivery, and issuance of the Notes and am acting for and on behalf of the Issuer in signing this Arbitrage and Use of Proceeds Certificate (the "Certificate"). 1.2 Description of Notes The Issuer represents that the Notes are sold at the aggregate Issue Price and are further described as set forth in the Certificate of Determination of the Issuer and on the cover of the Official Statement. 1.3. Purpose of Certificate. This Certificate is made for the purpose of establishing evidence of the expectations of the Issuer as of the Issue Date as to future events regarding the amount and use of proceeds of the Notes. It is intended and may be relied upon for purposes of Sections 103 and 141 through 150 of the Code, and as a certification described in Section 11 48-2(b )(2) of the Regulations. This Certificate is executed and delivered as part of the record of proceedings in connection with the issuance of the Notes. The provisions of this Certificate constitute a contractual obligation of the Issuer in consideration for the purchase of and payment for the Notes by the purchaser(s) thereof. 1.4. No Hedge Bonds. The Issuer reasonably expects that 85% of the Spendable Proceeds of the Notes will be expended for governmental purposes within 3 years of the Issue Date. In addition, not more than 50% of the Proceeds of the Notes are being invested in investments not acquired to carry out the governmental purposes of the issue at a guaranteed yield for 4 years or more. With respect to the Prior Issue, the Issuer reasonably expected as of the issue date of the Prior Issue that 85% of the spendable proceeds of the Prior Issue would be expended for governmental purposes within 3 years of such issue date, and, in addition, not more than 50% of the proceeds of the Prior Issue were invested in investments not acquired to carry out the governmental purposes of the issue at a guaranteed yield for 4 years or more. . . 15 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 Notes will not be used in a manner that would cause the Notes to be Arbitrage Bonds under Section 148 of the Code or Private Activity Bonds 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. 1.6. No Composite Issue. No other tax-exempt 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 Notes, pursuant to the same plan of financing which are expected to be paid from substantially the same source of funds as the Notes. 1.7. Registration. The Notes will be issued in bearer form 1.8. No Federal Guarantee. The Issuer represents and covenants that, except for the gross proceeds of the Notes 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 Treasury or in obligations issued pursuant to Section 2IB(d)(3) of the Federal Home Loan Bank Act, as amended by Section SII(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 Notes is or will be guaranteed directly or indirectly by the United States or any agency or instrumentality thereof (in this Certificate "federally guaranteed"); and (ii) No portion of the Gross Proceeds of the Notes 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. 1.9. Tax Representation. The Issuer expects to be able to and will comply with all the procedures and provisions set forth in this Certificate, 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 Notes will be excluded from gross income of the owners of the Notes for the purpose of federal income taxation. 1.10. Noncompliance. The Issuer shall perform each of the obligations undertaken by it in this Certificate unless, in the written opinion of Bond Counsel, noncompliance with such obligations will not cause interest on the Notes to be included in gross income for purposes of Federal income taxation 1.11. Reliance by Bond Counsel. The representations of the Issuer expressed in this Certificate may be relied upon by Bond Counsel in connection with the rendering of any opinion with respect to the Notes. . . 112. IRS Form 8038-G. The Issuer will file IRS Form 8038-G, included as part of the record of proceedings for the issuance of the Notes, by the 15th day of the second month after the calendar quarter in which the Notes are issued. 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 resolutions adopted by the Town Board on their respective dates, (the "Resolutions"), as referred to in the Certificate of Determination executed by the Supervisor on September 9, 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 2.2. Purpose of Issue. The Notes are being issued for various purposes (the "Projects") in, and for, the Town. 2.3. Use of Original Proceeds. The proceeds of sale of the Note in the amount of $1,700,000 (the "Note"), together with $1,311,600 in funds available therefor, will be used to redeem a prior issue of bond anticipation notes currently outstanding in the principal amount of $3,011,600 (the "Prior Issue"), heretofore issued to finance the Projects. 2.4. Ownership/Lease/Sale. The Projects 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 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. 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 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 Projects 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 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 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 ofthe 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 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 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 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 Resolutions, 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. 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 Projects do not exceed the total cost of the Projects. 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 oD 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 Resolutions, 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, as of the 9th day of September, 2005. (SEAL) ; . . 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 9th day of September, 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 c:!.I{J-'/-dIO Wh_j~ Town Clerk Subscribed and sworn to before me this k day of September, 2005. ~ ^ IJ. '1 d..' L L/(JL{ iA....l Notary' uhlic, St~e ofNew~rk LINDA J COOPER NOTARY PUBLIC, Slale of New York NO. 01C04822563, Suffolk Cou t Term Expires December 31, 20'JJ!f 482443,1 026311 CERT . . SCHEDULE A ] . 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 wntmg 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. 482443.1026311 CERT } < . . CERTIFICATE OF DETERMINATION BY THE SUPERVISOR RELATIVE TO AUTHORIZATION, SALE, ISSUANCE, FORM AND CONTENTS OF THE $1,700,000 BOND ANTICIPATION NOTE FOR VARIOUS PURPOSES-2005 OF THE TOWN OF SOUTHOLD, NEW YORK I, Joshua Y. Horton, Supervisor of the Town of Southold, New Yark (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 resolutions duly adopted and amended and as referred to in paragraphs 1 to 11, inclusive, hereof, and subject to the limitations prescribed in said bond resolutions, I have made the following determinations: 1. A bond anticipation note of the Town in the principal amount of$14,000 shall be issued to renew, in part, the $32,000 bond anticipation note dated September 10, 2004, maturing September 9,2005, and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted May 8, 2001, authorizing the purchase of a catamaran patrol vessel to be used by the Marine Division of the Town Police Department, stating the estimated maximum cost thereof is $90,000, appropriating said amount therefor and authorizing the issuance of $90,000 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 September 10, 2004, the redemption of said $32,000 bond anticipation note having been heretofore provided to the extent of $18,000 from a source other than the proceeds of serial bonds. 2. A bond anticipation note of the Town in the principal amount of $56,000 shall be issued to renew, in part, the $112,000 bond anticipation note dated September 10, 2004, maturing September 9,2005, and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted July 31, 2001, authorizing the second phase of the original improvement and embellishment of the new public park and recreational area on the land containing 13.85 acres, more or less, on the west side of Peconic Lane, heretofore acquired and now owned by and situate in, said Town; stating the estimated maximum cost thereof is $280,000, including preliminary costs and costs incidental thereto and to the financing thereof; appropriating said amount therefor and authorizing the issuance of $280,000 serial bonds of said Town to finance said appropriation," 482443.1026311 CERT . . duly adopted by the Town Board on the date therein referred to, and the Certificate of Determination executed by the Supervisor on September 10, 2004, the redemption of said $112,000 bond anticipation note having been heretofore provided to the extent of $56,000 from a source other than the proceeds of serial bonds 3. A bond anticipation note of the Town in the principal amount of $59,000 shall be issued to renew, in part, the $125,000 bond anticipation note dated September 10, 2004, maturing September 9, 2005, and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted July 31, 2001, appropriating $330,000 to defray costs and expenses of the Suffolk County Water Authority associated with the extension of Authority water mains into a portion of Cutchogue, in the Town, stating the estimated maximum cost thereof is $330,000 and authorizing the issuance of $330,000 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 September 10, 2004, the redemption of said $125,000 bond anticipation note having been heretofore provided to the extent of$66,000 from a source other than the proceeds of serial bonds. 4. A bond anticipation note of the Town in the principal amount of $248,000 shall be issued to renew, in part, the $620,000 bond anticipation note dated September 10, 2004, maturing September 9, 2005, and heretofore issued in anticipation ofthe sale of the serial bonds authorized pursuant to the bond resolution entitled "Bond Resolution of the Town of Southold, New York, adopted July 30, 2002 and amended December 17, 2002, authorizing the construction of a new bridge on Peconic Bay Boulevard to cross Brushes Creek, in said Town; stating the estimated maximum cost thereof is $650,000; appropriating the said amount therefor, including the appropriation of a grant of $50,000 and such other moneys expected to be received from the State of New York, to reimburse the Town; authorizing the issuance of $650,000 serial bonds of the Town to finance said appropriation and stating the plan of financing includes the issuance of said serial bonds, the application of said state moneys to reimburse the Town and the levy and collection of taxes to pay principal of and interest on said bonds," duly adopted and amended by the Town Board on the dates therein referred to, and the Certificate of Determination executed by the Supervisor on September 10, 2004, the redemption of said $620,000 bond anticipation note having been heretofore provided to the extent of $372,000 from a source other than the proceeds of serial bonds. 482443.1 026311 CERT . . . 5. A bond anticipation note of the Town in the principal amount of $240,000 shall be issued to renew, in part, the $320,000 bond anticipation note dated September 10, 2004, maturing September 9,2005, and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted March 25, 2003, authorizing the acquisition of vehicles and equipment for use by the Town Highway Department as follows: (a) trucks with combination dump bodies, at the estimated maximum cost of $300,000 and (b) paving equipment, consisting of a paver, a roller and a trailer, at the estimated maximum cost of $100,000; stating the estimated total cost thereof is $400,000; appropriating said amount therefor and authorizing the issuance of $400,000 serial bonds of said Town to finance said appropriation," duly adopted and amended by the Town Board on the dates therein referred to, and the Certificate of Determination executed by the Supervisor on September 10, 2004, the redemption of said $320,000 bond anticipation note having been heretofore provided to the extent of $80,000 from a source other than the proceeds of serial bonds. 6. A bond anticipation note of the Town in the principal amount of $35,000 shall be issued to renew, in part, the $50,000 bond anticipation note dated September 10, 2004, maturing September 9,2005, and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted July 8, 2003, authorizing the acquisition and installation of an automated time management system in Town facilities, including personal computer, software, equipment, machinery and appurtenances thereto; stating the estimated maximum cost thereof is $65,000; including preliminary costs and costs incidental thereto and to the financing thereof; appropriating said amount therefor and authorizing the issuance of $65,000 serial bonds of said Town to finance said appropriation," duly adopted and amended by the Town Board on the dates therein referred to, and the Certificate of Determination executed by the Supervisor on September 10, 2004, the redemption of said $50,000 bond anticipation note having been heretofore provided to the extent of $15,000 from a source other than the proceeds of serial bonds. 7. A bond anticipation note of the Town in the principal amount of$100,000 shall be issued to renew, in part, the $140,000 bond anticipation note dated September 10, 2004, maturing September 9,2005, and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted July 8, 2003, authorizing the construction of improvements to the 482443.1026311 CERT . . human resources building located at 750 Pacific Street, in Mattituck; stating the estimated maximum cost thereof is $252,000; appropriating said amount therefor, including the expenditure of approximately $52,000 insurance proceeds and/or other funds to pay a part of said appropriation; and authorizing the issuance of not to exceed $200,000 bonds of said Town to finance the balance of said appropriation," duly adopted and amended by the Town Board on the dates therein referred to, and the Certificate of Determination executed by the Supervisor on September 10, 2004, the redemption of said $140,000 bond anticipation note having been heretofore provided to the extent of $40,000 from a source other than the proceeds of serial bonds. 8. A bond anticipation note of the Town in the principal amount of $120,000 shall be issued to renew, in part, the $160,000 bond anticipation note dated September 10, 2004, maturing September 9, 2005, and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted August 12, 2003, authorizing the construction of various recreational improvements at the Strawberry Fields Fairgrounds, pursuant to the agreement between the Town and the County of Suffolk dated April 29, 2002; stating the estimated maximum cost thereof is $200,000; appropriating said amount therefor, and authorizing the issuance of $200,000 bonds of said Town to finance said appropriation," duly adopted and amended by the Town Board on the dates therein referred to, and the Certificate of Determination executed by the Supervisor on September 10, 2004, the redemption of said $160,000 bond anticipation note having been heretofore provided to the extent of $40,000 from a source other than the proceeds of serial bonds. 9. A bond anticipation note of the Town in the principal amount of $590,000 shall be issued to renew, in part, the $1,051,600 bond anticipation note dated September 10, 2004, maturing September 9,2005, and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted April 20, 2004, appropriating $1,051,600 for the increase and improvement of facilities of the Southold Solid Waste Management District, in said Town; authorizing the issuance of $1,051,600 serial bonds of said Town to finance said appropriation; and authorizing any grant funds to be received from the United States of America, the State of New York or any other sources to be expended towards the cost of said object or purpose or redemption of the Town's obligations issued therefor, or to be 482443.1026311 CERT . . budgeted as an offset to the taxes for the payment of the principal of and interest on said obligations," duly adopted and amended by the Town Board on the dates therein referred to, and the Certificate of Determination executed by the Supervisor on September 10, 2004, the redemption of said $1,051,600 bond anticipation note having been heretofore provided to the extent of $461,600 from a source other than the proceeds of serial bonds. 10. A bond anticipation note of the Town in the principal amount of $110,000 shall be issued to renew, in part, the $150,000 bond anticipation note dated September 10, 2004, maturing September 9,2005, and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted October 9, 2001, authorizing (a) the acquisition of (I) the certain piece or parcel ofland designated as 700 Boisseau Avenue, in said Town, at the estimated maximum cost of $82,000, and (2) the existing building situate thereon, at the estimated maximum cost of $418,000, and (b) the reconstruction, in part, of said building, at the estimated maximum cost of $100,000; stating the estimated total cost thereof is $600,000; appropriating said amount therefor and authorizing the issuance of not to exceed $600,000 serial bonds of said Town to finance said appropriation," duly adopted and amended by the Town Board on the dates therein referred to, and the Certificate of Determination executed by the Supervisor on September 10, 2004, the redemption of said $150,000 bond anticipation note having been heretofore provided to the extent of $40,000 from a source other than the proceeds of serial bonds. 11. A bond anticipation note of the Town in the principal amount of $128,000 shall be issued to renew, in part, the $160,000 bond anticipation note dated September 10, 2004, maturing September 9,2005, and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted August 10, 2004, authorizing the acquisition and installation of an in-car video system in ten (l0) police cars together with a back office solution, including the upgrading of eight (8) cars with new laptops, appurtenances and supporting equipment therefor; stating the estimated maximum cost thereof is $160,000, including preliminary costs and costs incidental thereto and to the financing thereof; appropriating said amount therefor and authorizing the issuance of $160,000 serial bonds of said Town to finance the said appropriation, " duly adopted and amended by the Town Board on the dates therein referred to, and the Certificate of Determination executed by the Supervisor on September 10, 2004, the redemption 482443.1026311 CERT . . of said $160,000 bond anticipation note having been heretofore provided to the extent of$32,000 from a source other than the proceeds of serial bonds 12. Said $14,000 note, said $56,000 note, said $59,000 note, said $248,000 note, said $240,000 note, said $35,000 note, said $100,000 note, said $120,000 note, said $590,000 note, said $110,000 note and said $128,000 note shall be combined for the purpose of sale into a single note issue in the aggregate principal amount of$I,700,000 (hereinafter referred to as the "Note"). 13. The terms, form and details of said Note shall be as follows: Amount and Title $1,700,000 Bond Anticipation Note for Various Purposes-2005 Dated: September 9, 2005 Matures: September 8, 2006 Number and Denomination: Number 7R-l, at $1,700,000 Interest Rate per annum: 3.05% Form of Note: Substantially in accordance with form prescribed by Schedule B,2 of the Local Finance Law of the State of New York 14. The respective amounts of bond anticipation notes originally issued in anticipation of the issuance of the serial bonds authorized pursuant to the bond resolutions referred to in paragraphs 1 to 11, inclusive, hereof, including the Note, are: (1) $90,000, (2) $280,000, (3) $330,000, (4) $650,000 (5) $400,000, (6) $65,000, (7) $200,000 (8) $120,000, (9) $1,051,600, (10) $150,000 and (11) $160,000 and the respective amounts of bond anticipation notes which will be outstanding after the issuance of the Note, including said Note, will be: (1) $14,000, (2) $56,000, (3) $59,000, (4) $248,000, (5) $240,000, (6) $35,000, (7) $100,000 (8) $120,000, (9) $590,000 (10) $110,000 and (11) $128,000. 15. The serial bonds authorized pursuant to the resolution referred to in paragraph 9 hereof, are for improvements which are assessable, and the serial bonds authorized pursuant to the resolutions referred to in paragraphs 1, 2, 3, 4, 5, 6, 7, 8, 10 and 11 hereof, are for improvements which are non-assessable. 16. Pursuant to said powers and duties delegated to me, I DO HEREBY AWARD AND SELL said Note to Bridgehampton National Bank, Bridgehampton, New York, for the purchase price of $1,700,000, 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, Bridgehampton, New York, New 482443.1026311 CERT . . York, and shall bear interest at the rate of three and five hundredths per centum (3.05%) per annum, payable at maturity. 17. Said Note shall be executed in the name of the Town by its Supervisor and the corporate seal of the Town (or a facsimile thereot) shall be affixed, impressed imprinted 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 9th day of September, 2005. 482443.1026311 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 ofthe Certificate filed with said Town in my office as Town Clerk on or before the 9th day of September, 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 resolutions 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 9th day of September, 2005. (SEAL) r'4fLd/Cl ~j6 Town Cl rk 482443.1 026311 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 September 9, 2005, we officially signed and properly executed by manual signatures the $1,700,000 Bond Anticipation Note for Various Purposes- 2005 (the "Note") of the Town, payable to bearer and otherwise 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 said Note and holding the respective offices indicated by the titles set opposite our signatures hereto for terms 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 said Note or the levy or collection of any taxes to pay the interest on or principal of said Note, or in any manner questioning the authority or proceedings for the issuance of said Note or for the levy or collection of said taxes, or relating to said 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 thereofto their respective offices is being contested, and that no authority or proceedings for the issuance of said Note has or have been repealed, revoked or rescinded. WE FURTHER CERTIFY that the seal which is impressed upon this certificate has been affixed, impressed, imprinted or otherwise reproduced upon said 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 September 9, 2005, I delivered, or caused the delivery of said Note to Bridgehampton National Bank, Bridgehampton, New York, the purchaser thereof, and that at the time of such delivery of said Note, I received from said purchaser the amount hereinbelow stated, in full payment for said Note, computed as follows: Price.. . ... ... ...... ... ... Interest on said Note accrued to the date of such delivery Amount Received. . . . ... $1,700,000.00 -0- ... $1,700,000.00 482443.1026311 CERT . . IN WITNESS WHEREOF, we have hereunto set our hands and said corporate seal has hereunto been affixed this 9th day of September, 2005. Term of Office Expires Title December 31, 2006 Supervisor December 31, 2006 Town Clerk (SEAL) 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 the espectiv ffices set opposite their signatures. I!J// ". /J6[ of (Title) I?N~ (Name of Bank) 482443.1 026311 CERT . . 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 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, payable to bearer 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 said Note, or in any manner questioning the authority or proceedings for the issuance of said Note or for the levy or collection of said taxes, or relating to said 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 said Note has or have been repealed, revoked or rescinded IN WITNESS WHEREOF, I have hereunto set my hand this 9th day of September, 2005. Amount and Title: Dated: Matures: Number: Interest Rate per annum: . . SCHEDULE A $1,700,000 Bond Anticipation Note for Various Purposes-2005 September 9, 2005 September 9, 2005 7R-I 3.05%