HomeMy WebLinkAboutVarious PurposesNo. 9R-1
$715,000
PRINCIPAL SUM:
INTEREST RATE:
DATE OF ISSUE:
MATURITY DATE:
UNITED STATES OF AMERICA
STATE OF NEW YORK
COUNTY OF SUFFOLK
TOWN OF SOUTHOLD
VARIOUS PURPOSES BOND ANTICIPATION NOTE-2012
SEVEN HUNDRED FIFTEEN THOUSAND DOLLARS ($715,000)
forty hundredths of one per centum (0.40%) per annum
April 12, 2012
April I1, 2013
The Town of Southold, in the County of Suffolk, a municipal corporation of the State of New York, hereby
acknowledges itself indebted and for value received promises to pay to Suffolk County National Bank, Riverhead, New York,
the registered owner hereof, the PRINCIPAL SUM (stated above) on the MATURITY DATE (stated above), together with
interest thereon from the DATE OF ISSUE (stated above) at the INTEREST RATE (mated above), payable at maturity. Both
principal of and interest on this Note will be paid in lawful money of the United States of America, at Suffolk County National
Bank, Riverhead, New York.
Both principal of and interest on this Note shall be payable only to the registered owner, his legal representatives,
successors or transferees. This Note shall be transferable only upon presentation to such registered owner with a written transfer
of title and such Town Clerk shall thereupon register this Note in the name of the transferee in his books and shall endorse a
certificate of such registration hereon. Such transfer shall be dated, and signed by the registered owner, or his legal
representatives, and it shall be duly acknowledged or proved, or in the alternative the signature thereto shall be certified as to its
genuineness by an officer ora 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 $715,000.
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, three bond resolutions duly adopted by the Town Board on their respective dates, authorizing the
issuance of serial bonds for various purposas in and for the Town, and the Certificate of Determination executed by the
Supervisor on April 12, 2012.
This Note has been designated by the Town as a qualified tax-exempt obligation pursuant to the provisions of
Section 265 of the Internal Revenue Code of 1986, as amended.
The faith and credit of such Town are hereby irrevocably pledged for the punctual payment of the principal of and
interest on this Note according to its terms. It is hereby certified and recited that all conditions, acts and things required by the
Constitution and statutes of the State of New York to exist, to have happened and to have been performed precedent to and in the
issuance of this Note, exist, have happened and have been performed, and that this Note, together with all other indebtedness of
such Town, is within every debt and other limit prescribed by the Constitution 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 artested by its
Town Clerk and this Note to be dated as of the DATE OF ISSUE.
(SEAL)
ATTEST:
Supervisor
CERTIFICATE OF DETERMINATION BY THE SUPERVISOR
RELATWE TO AUTHORIZATION, SALE, ISSUANCE, FORM
AND CONTENTS OF A $715,000 VARIOUS PURPOSES
BOND ANTICIPATION NOTE-2012 OF THE TOWN OF
SOUTHOLD, IN THE COUNTY OF SUFFOLK, NEW YORK
I, Scott A. Russell, Supervisor of the Town of Southold, in the County of Suffolk,
New York (herein called the "Town"), HEREBY CERTIFY that pursuant to the powers and
duties delegated to me, the chief fiscal officer of the Town, by the Town Board of the Town,
pursuant to the bond resolutions duly adopted and amended and as referred to in paragraphs 1 to
3, 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 $550,000
shall be issued to renew, in part, the $650,000 bond anticipation note dated June 3, 2011,
maturing April 12, 2012, 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 and amended October 21, 2003, appropriating the amount of
$10,500,000, including the amounts of any grants that may be received
from the United States and the State of New York for the increase and
improvement of the facilities of the Fishers Island Ferry District, in
said Town and authorizing the issuance of serial bonds of said Town in
the principal amount of not to exceed $4,800,000 to finance that
portion of said appropriation for which such grants are not available,"
duly adopted and amended by the Town Board on the dates therein referred to, and the
Certificate of Determination executed by the Supervisor on June 3,2011, the redemption of said
$650,000 note having been provided to the extent of $100,000 from a source other than the
proceeds of serial bonds.
2. A bond anticipation note of the Town in the principal amount of $21,000
shall be issued to renew, in part, the $48,000 bond anticipation note dated April 14, 2011,
maturing April 12, 2012, 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
January 15, 2008, authorizing the acquisition of a dump truck at
the estimated maximum cost of $110,000, appropriating said
amount therefor, and authorizing the issuance of bonds in the
principal amount of $110,000 to finance such appropriation,"
duly adopted by the Town Board on the date therein referred to, and the Certificate of
Determination executed by the Supervisor on April 14, 2011, the redemption of said $48,000
bond anticipation note having been heretofore provided to the extent of $27,000 from a source
other than the proceeds of serial bonds.
1149223.1 034513 CLD
3. A bond anticipation note of the Town in the principal amount of $144,000
shall be issued to renew, in part, the $180,000 bond anticipation note dated April 14, 2011,
maturing April 12, 2012, 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, 2010, authorizing the acquisition and installation of
equipment for the fuel management system, stating the estimated
maximum cost thereof is $230,000, appropriating said amount for
such purpose, and authorizing the issuance of $230,000 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 14, 2011, the redemption of said $180,000
bond anticipation note having been heretofore provided to the extent of $36,000 from a source
other than the proceeds of serial bonds.
4. Said $550,000 note, said $21,000 note and said $144,000 note shall be
combined for purposes of sale into a single note issue in the aggregate principal amount of
$715,000 (hereinafter referred to as the "Note").
5. The terms, form and details of said Note shall be as follows:
Amount and Title:
$715,000 Various Purposes Bond Anticipation Note-
2012
Dated: April 12, 2012
Matures: April 11, 2013
Number and
Denomination:
Number 9R-l, at $715,000
Interest Rate
per annum: 0.40%
6. The amount of bond anticipation notes and serial bonds originally issued
pursuant to the bond resolution referred to in paragraphs 1 to 3, inclusive, hereof, is (1)
$4,800,000, (2) $110,000 and (3) $180,000 The amount of bond anticipation notes which will be
outstanding after the issuance of the Note, including said Note, will be (1) $550,000, (2) $21,000
and (3) $144,000.
7. The serial bonds authorized pursuant to the resolution referred to in
paragraph 1, hereof, are for improvements which are assessable. The serial bonds authorized
pursuant to the resolution referred to in paragraphs 2 and 3, hereof, are for improvements which
are non-assessable.
1149223.1 034513 CLD
8. Pursuant to said powers and duties delegated to me, I DO HEREBY
AWARD AND SELL said Note to Suffolk County National Bank, Riverhead, New York, for
the purchase price of $715,000.00, plus accrued interest, if any, from the date of said Note to the
date of delivery thereof, payable to Suffolk County National Bank, as registered owner, and I
FURTHER DETERMiNE that said Note shall be payable as to both principal and interest at
Suffolk County National Bank, Riverhead, New York and shall bear interest at the rate of
forty hundredths of one per centum (0.40%) per annum, payable at maturity.
9. 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 the 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 12th day of April,
2012.
Supervisor
1149223.1 034513 CLD
CLERK'S CERTIFICATE
I, Elizabeth A. Neville, Town Clerk of the Town of Southold, in the County of
Suffolk, New York, HEREBY CERTIFY that I have compared the foregoing copy of the
Certificate of Determination executed by the Supervisor and the same is a true and complete
copy of the Certificate filed with said Town in my office as Town Clerk on or before April 12,
2012, 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.
1N WITNESS WHEREOF, I have hereunto set my hand and affixed the
corporate seal of said Town this 12th day of April,
2012.
(SEAL)
1149223.1 034513 CLD
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
the "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 April 12, 2012, 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.
Town Clerk
Subscribed and sworn to before me
this/o'"~day of April, 2012.
//~otary Public, State of New York
JOHN A CUSHiVlAN
Notary Public, State of New York
NO. 0LCU6174322
qu~llfled ih Surfak County
Commission Expires S~otember 17, 20/~*"
1149223.1 034513 CLD
SCHEDULE A
1. , is a stockholder of the Purchaser owning or
controlling, directly or indirectly, less than five per centum (5%) of the outstanding stock thereof
but no disclosure of such interest by said officer is required pursuant to said Law.
2. , has an interest in the Purchaser solely by
reason of employment as an officer or employee thereof, but the remuneration of such
employment will not be directly affected as a result of said contract and the duties of such
employment do not directly involve the procurement, preparation or performance of any such
part of such contract.
3. , has publicly disclosed the nature and extent
of such interest in writing to the goveming 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.
1149223.1 034513 CLD
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 (herein referred to as the "Town") HEREBY
CERTIFY that on or before April 12, 2012, we officially signed and properly executed by
manual signatures a $715,000 Various Purposes Bond Anticipation Note-2012 (the "Note") of
the Town, payable to Suffolk County National Bank, as registered owner, and otherwise
described in Schednle A annexed hereto and by this reference made a part hereof, and that at the
time of such signing and execution and on the date hereof we were and are the duly chosen,
qualified and acting officers of the Town authorized to execute the Note and holding the offices
indicated by the title set opposite our signatures hereto for term expiring on the date 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, Scott A. Russell, Supervisor, HEREBY FURTHER CERTIFY that on
April 12, 2012, I delivered or caused said Note to be delivered to Suffolk County National
Bank, Riverhead, New York, the purchaser thereof, and that at the time of such delivery, the
Town received from said purchaser the amount hereinbelow stated, in full payment for said Note,
computed as follows:
Price ......................................................................................... $715,000.00
Interest on said Note accrued to the
date of such delivery ...........................................................
-0-
Amount Received ..................................................................... $715,000.00
1149223.1034513 CLD
(SEAL)
IN WITNESS WHEREOF, we have hereunto set our hands and said corporate
seal has hereunto been affixed this 12th day of April, 2012.
~. S' ature .
Term of Office Expires
December 31, 201 _a""
December 31, 2013
Title
Supervisor
Town Clerk
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.
John Cushman
Town Comptroller
1149223,1 034513 CLD
ATTORNEY'S CERTIFICATE
I, Jennifer Andalaro, Esq., HEREBY CERTIFY that I am a licensed attomey at
law of the State of New York, and am the duly chosen, qualified and acting Assistant Town
Attorney of the Town of Southold, in the County of Suffolk, a municipal corporation of the State
of New York (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 a $715,000 Various Purposes
Bond Anticipation Note-2012 (the "Note") of the Town, payable to Suffolk County National
Bank, as registered owner, 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.
1N WITNESS WHEREOF,
I have hereunto set my hand this 12th day of April,
2012.
A~sistant own Attomey
Amount and Title:
Dated:
Matures:
Number:
Interest Rate
per annum:
SCHEDULE A
$715,000 Various Purposes Bond Anticipation Note-2012
April 12, 2012
April 11, 2013
9R-1
0.40%
1149223.1 034513 CLD
ARBITRAGE AND USE OF PROCEEDS CERTIFICATE
I, Scott A. Russell, Supervisor of the Town of Southold (the "Issuer"), in the
County of Suffolk, New York, HEREBY CERTIFY and reasonably expect with respect to the
Issuer's $715,000 Various Purposes Bond Anticipation Note-2012 (herein referred to as the
"Note"), dated and issued on April 12, 2012, 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 Resolution, the Code or the
Regulations (each as defined below):
ARTICLE I
General
Section 1.1. Authority of Signatory_. I am an officer of the Issuer charged with
the responsibility for the execution, delivery, and issuance of the Note and am acting for and on
behalf of the Issuer in signing this certificate.
Section 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) thereofi
Section 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.
Section 1.4. No Composite Issue. No other governmental obligations have
been sold fewer than 15 days prior to, or will be sold fewer than 15 days after, the sale date of
the Note, pursuant to a common plan of financing which are expected to be paid from
substantially the same source of funds as the Note.
Section 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 2lB(d)(3) of the Federal
Home Loan Bank Act, as amended by Section 511(a) of the Financial Institutions Reform,
1149223.1 034513 CLD
Recovery and Enfomement Act of 1989, or any successor provision to Section 21B(d)(3) of the
Federal Home Loan Bank Act, as amended:
(i)
No portion of the payment of principal or interest with respect to the Note
is or will be guaranteed directly or indirectly by the United States or any
agency or instrumentality thereof (herein "federally guaranteed"); and
(ii)
No portion of the gross proceeds 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.
Section 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.
Section 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.
Section 1.8. Non-Purpose Investments. Not more than 50% of the proceeds of
the Note are being invested in investments not acquired to carry out the governmental purposes
of the issue at a guaranteed yield and having a term of 4 years or more.
Section 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
Section 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 three bond resolutions duly
adopted and amended by the Town Board on their respective dates (the "Resolutions"), as
referred to in the Certificate of Determination executed by the Supervisor on April 12, 2012.
(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.
Section 2.2. Purpose of Issue The Note is being issued to provide funds for
various purposes in and for the Town (the "Projects"), as further described in the Resolutions.
1149223.1 034513 CLD
Section 2.3. Use of Proceeds. The proceeds of sale of the Note in the amount
of $715,000 will be used together with $163,000 in available funds to redeem bond anticipation
notes in the principal amount of $878,000 (the "Prior Issue"), which mature on April 12, 2012.
Section 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.
Section 2.5. Private Loans. Not mom 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.
Section 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
govern_mental unit ("Private Use"), will not exceed 10% of such proceeds in the event that more
than 10% of the principal or 10% of the interest due on the Note during the term thereof is, under
the terms of the Note or any underlying arrangement, directly or indirectly, secured by any
interest in property used or to be used for a Private Use or in payments in respect of property
used or to be used for a Private Use or is to be derived from payments, whether or not to the
Issuer, in respect of property or borrowed money used or to be used for a Private Use.
Section 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.
Section 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:
1149223.1034513 CLD
(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:
(A)
"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;
(B)
"periodic fixed fee" means a stated dollar amount for services rendered
during a specified period of time (i.e. SXX per month) which amount may
automatically increase according to a specified, objective, external
standard; and
(c)
"per unit fee" means a stated dollar amount for each unit of service
provided (i.e. SXX per medical procedure).
Section 2.9. Pooled Loan Financings. To the extent the amount of proceeds of
the Note to be used to make loans to any borrowers (including loans referred to in Section 2.5
above and loans to state or local governmental units) exceeds $5,000,000, at least 95% of the net
proceeds of the issue (as defined in Section 150 of the Code but without including proceeds used
to finance costs of issuance or capitalized interest) that are to be used to make loans, will have
been 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.
1149223.1 034513 CLD
Section 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
Section 3.1. Temporary Period-Refunding. With respect to the proceeds of the
Note 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 of the date hereof, and may be invested during such time without restriction as to
yield.
Section 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 the original issuance of
the first note or notes issued pursuant to the Resolution, in renewal of which the Note is issued:
(i) the Issuer was a governmental unit with general taxing powers;
(ii)
the Note 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 was 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 that the aggregate face
amount of all tax-exempt bonds issued by the Issuer during the current
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 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
1149223.1 034513 CLD
within 90 days of the date hereof and will, therefore, qualify for the six-month expenditure
exception to rebate.
Section 3.3. No Excess Proceeds. The total proceeds of sale of all bond
anticipation notes issued to date for the Projects do not exceed the total cost of the Projects.
Section 3.4. Source of Repayment Funds. The Note will be paid from taxes
and the proceeds of other obligations of the Issuer issued to fund the Note.
Section 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 Note for the
immediately preceding year.
Section 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 with respect to the Current Refunding Note that:
(a) the Note currently refunds the Prior Issue;
(b) the Prior Issue was designated as a "qualified tax-exempt obligation";
(c) the aggregate face amount of the Note does not exceed $10,000,000;
(d) the Prior Issue had a weighted average maturity of 3 years or less;
(e)
the maturity date of the Note, as measured from the original date of
issuance of the note(s) issued pursuant to the Resolutions, in renewal of
which such Note is being issued, does not exceed 30 years; and
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."
1149223.1034513 CLD
(SEAL)
IN WITNESS WHEREOF,
I have hereunto set my hand and affixed the
corporate seal of the Town of Southold this 12th
day of April, 2012.
1149223.1034513 CLD