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HomeMy WebLinkAboutVarious Purposes 1 REGISTRATION CERTIFICATE It is hereby certified that the within Note has been registered as follows: Date of Registration Name of Registered Holder Registered by I + 1 Y, I CERTIFICATE OF DETERMINATION BY THE SUPERVISOR RELATIVE TO AUTHORIZATION, SALE, ISSUANCE, FORM AND CONTENTS OF A $2,044,000 BOND ANTICIPATION NOTE FOR VARIOUS PURPOSES-2014 OF THE TOWN OF SOUTHOLD, IN THE COUNTY OF SUFFOLK,NEW YORK a 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 the paragraphs below 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$9,000 shall be issued to renew, in part, the $12,000 bond anticipation note dated August 29, 2013, maturing August 29, 2014, 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 17, 2007, ratifying the appropriation,of $30,000 to finance a part of the cost of construction of improvements to certain highways in the Hamlet of Orient, known as Ryder Farm Lane and Park View Lane; stating the estimated maximum cost thereof is $180,000,with $150,000 of said cost expected to be paid;from other sources; and authorizing the issuance of $30,000 serial bonds of said Town to finance said$30,000 appropriation," duly adopted by the Town Board on the date therein referred to, and the Certificate of Determination executed by the Supervisor on August 29,;2013, the redemption of said $12,000 bond anticipation note having been heretofore provided to the extent of$3,000 from a source other than the proceeds of serial bonds. 2. A bond anticipation note of the Town in the principal amount of$110,000 shall be issued to renew, in part, the $220,000 bond anticipation note dated August 29, 20139 maturing August 29, 2014, 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 June 15, 2010 and amended May 4, 2010,;appropriating $700,000 for the improvement of facilities of the Southold Town Wastewater Disposal District, and authorizing the issuance of $700,000 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 August 29, 2013, the redemption of 2365862.1038723 CLD 1 I said $220,000 bond anticipation note having been heretofore provided to the extent of$110,000 from a source other than the proceeds of serial bonds. 3. A bond anticipation note of the Town in the principal amount of$89,000 shall be issued to renew, in part, the $139,000 bond anticipation note dated August 29, 2013, maturing August 29, 2014, and heretofore issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: I "Bond Resolution of'the Town of Southold,New York, adopted June 21, 2011, authorizing the acquisition of equipment for use by the Highway Department, stating the ,estimated maximum cost thereof is $250,000, appropriating said amount for such purpose, and authorizing the issuance of$250,000 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 August 29, 2013,the redemption of said $139,000 bond anticipation note having been heretofore provided to the extent of$50,000 from a source other than the proceeds of serial bonds. 4. A bond anticipation note of the Town in the principal amount of$26,000 shall be issued to renew, in part, the $94,000 bond anticipation note dated August 29, 2013, maturing August 29, 2014, 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 June 19, 2012, authorizing the construction of various improvements to Town-owned facilities located at the Town's Highway Department yard, at the estimated maximum cost of $106,000 and to the Town's Police Department headquarters building, at the estimated maximum cost of$14,000, stating the estimated total cost thereof is $120,000, appropriating said amount for such purposes, and authorizing the issuance of $120,000 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 August 29,' 2013, the redemption of said $94,000 bond anticipation note having been heretofore provided to the extent of$26,000 from a source other than the proceeds of serial bonds. 5. �A bond anticipation note of the Town in the principal amount of$185,000 shall be 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 June 17, 2014, authorizing the acquisition of a combination dump/plow/sanding truck for use by the Highway Department, 2365862.1 038723 CLD o ' I stating the estimated maximum cost thereof is $185,000, appropriating said amount for such purpose; and authorizing the issuance of bonds in the principal amount of not to exceed $185,000 to finance said appropriation," duly adopted by the Town Board on the date therein referred to. I 6. A bond anticipation note of the Town in the principal amount of$800,000 shall be issued in anticipation of the sale of the serial bonds authorized pursuant to the bond resolution entitled: i "Bond Resolution of the Town of Southold;New York, adopted June 17, 2014, authorizing the replacement of the Bay Avenue Bridge, stating the estimated maximum cost thereof is $800,000, appropriating said amount for such purpose, and authorizing the issuance of bonds in the principal amount of not to exceed $800,000 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$825,000 shall be,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 September 10, 2013, authorizing the construction of improvements to Town highway facilities,istating the estimated maximum cost thereof is $3,500,000, appropriating said amount for such purpose, and authorizing the issuance of bonds in the principal amount of$3,500,000 to finance said appropriation," duly adopted by the Town Board on the date therein referred to. 8. Said $9,000 note, said $110,000 note, said $89,000 note, said $26,000 note, said $185,000 note, said $800,000 note and -said ,$825,000 note shall be combined for purposes of sale into a single note issue in the aggregate principal amount of $2,044,000 (hereinafter referred to as the"Note"). i 9. The terms, form and details of said Note shall be as follows: i Amount and Title: $2,044,000 Bond Anticipation Note for Various Purposes- 2014 Dated: August 28,2014 I Matures: August 28,2015 I I 2365862.1 038723 CLD V I I, I Number and Denomination: Number 7R-1, at$2,044,000 Interest Rate per annum: 0.73% 10. The amount of bond anticipation notes and serial bonds originally issued pursuant to the bond resolution referred to in paragraphs l;to 7, inclusive,hereof, is (1) $30,000, (2) $700,000, (3) $250,000, (4) $120,000, (5) $185,000, (6) $800,000 and (7) $825,000. The amount of bond anticipation notes which will be outstanding after the issuance of the Note, including said Note,will be(1) $9,000, (2) $110,000, (3) $,89,000, (4) $26,000, (5) $185,000, (6) $800,000 and(7) $825,000. 11. The serial bonds authorized pursuant to the resolutions referred to in paragraphs 1 and 2 hereof, are for improvements which are assessable, and the serial bonds authorized pursuant to the resolutions referred to in paragraphs 3 to 7, inclusive, hereof, are for improvements which are non-assessable. h 12. 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$2,044,000.00, plus accrued interest,-if any, from the date of said Note to the date of delivery thereof, payable to Bridgehampton National Bank, as registered owner, and I FURTHER DETERMINE that said Note shall be payable as to both principal and interest at Bridgehampton National Bank,Bridgehampton,New York and shall bear interest at the rate of seventy-three hundredths of one per centum (0.73%)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 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 ii ll force and effect and have not been modified, amended or revoked. IN WITNESS WHEREOF, I have hereunto set my hand as of the 28th day of August,2014. Supervisor 2365862.1 038723 CLD i - I 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 August 28, 2014, and j 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 hof said Town as of the 28th day of August,2014: I (SEAL) Town Clerk I I I f I I -i i i I I 2365862.1 038723 CLD i �v. 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 28, 2014, we officially signed and properly executed by manual signature the $2,044,000 Bond Anticipation Note for Various Purposes-2014 (the "Note") of the Town, payable to Bridgehampton National Bank, Bridgehampton, New York, as registered owner, and otherwise described as set forth in Schedule A annexed hereto and by this reference made a part hereof, and that at the time of such signing and execution and on the date hereof we were and are the duly chosen, qualified and acting officers of the Town authorized to execute the Note and holding the offices indicated by the 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, Scott A. Russell, Supervisor, HEREBY FURTHER CERTIFY that on August 28, 2014, I delivered or caused said Note to be delivered to Bridgehampton National Bank, Bridgehampton, 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.....................................................................$2,044,000 Interest on said Note accrued to the date of such delivery............................................... -0- Amount Received.................................................$2,044,000 2365862.1038723 CLD r IN WITNESS WHEREOF, we have hereunto set our hands and said corporate seal has hereunto been affixed as of the 28th day of August,2014. Term of Office Signature Expires Title jux December 31,2015 Supervisor & December 31,2013 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 sign es., John Cushman Town Comptroller 2365862.1 038723 CLD CERTIFICATE OF TOWN ATTORNEY I, Martin D. Finnegan, Esq., HEREBY CERTIFY that I am a licensed attorney at law of the State of New York and am the duly chosen, qualified and acting Town Attorney of the Town of Southold,New York, 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 the Note of the Town, payable to Bridgehampton National Bank, Bridgehampton, New York, 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. IN WITNESS WHEREOF, I have hereunto set my hand this 28th day of August,2014. wn Attorney 2365862.1 038723 CLD r SCHEDULE A Amount and Title: $2,044,000 Bond Anticipation Note for Various Purposes-2014 Dated: August 28,2014 Maturity: August 28,2015 Number No. 7R-1, at$2,044,000 and Denomination: Interest Rate 0.73% per annum: 2365862.1 038723 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 elected, 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 the 28th day of August, 2014, 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 2Pb-day of August,2014. Notary Public, State of New York 'JOHN A CUSHMAN Notary Public,hate of New York }y; Qualified IC06174322 c Co Suffolk County` - mmission Expires September 12;`2Oj� 2365862.1 038723 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 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. 2365862.1 038723 CLD DELAFIELD&WOOD LLP RO.4 S TIf� PHO E( I +� IJ ll FAX '( Y2 344-6258 IRSM I WKINSCOM SEP - 8 2014 / TOIV OF SOUTHOLD OUP;` G!, Ih'ANCE DEPT. /'� � s/�/lq ONE CHASE MANHATTAN PLAZA NEW YORK, NY I0005 WVNN.HAWKINS.COM NEW YORK NEW YORK LOS ANGELES WASHINGTON ONE CHASE MANHATTAN PLAZA 633 WEST FIFTH STREET NEWARK NEW YORK,NY 10005 LOS ANGELES,CA 90071 HARTFORD LOS ANGELES WASHINGTON SACRAMENTO SACRAMENTO 601 THIRTEENTH ST.,N.W. 1415 L STREET SAN FRANCISCO WASHINGTON,DC 20005 SACRAMENTO,CA 95814 WWW.HAWKINS.COM NEWARK SAN FRANCISCO ONE GATEWAY CENTER ONE EMBARCADERO CENTER NEWARK,NJ 07102 SAN FRANCISCO,CA 94111 HARTFORD 185 ASYLUM STREET HARTFORD,CT 06103 TAX CERTIFICATE I, SCOTT A. RUSSELL, Supervisor of the Town of Southold, in the County of Suffolk, New York (the "Issuer"), HEREBY CERTIFY and reasonably expect with respect to the issuance on August 28, 2014 (the"Issue Date") of the Issuer's $2,044,000 Bond Anticipation Note for Various Purposes-2014 (the"Obligations')_ as follows in this Tax Certificate (the "Tax Certificate"). Unless the context clearly requires otherwise, all capitalized terms not otherwise defined herein shall have the meanings set forth in Exhibit A or in the Certificate of Determination(as defined below),the Code or the Treasury Regulations. ARTICLE I GENERAL 1.1. Authority ng atbry. I am an officer of the Issuer charged with the responsibility for the execution, delivery, and issuance of the Obligations and I am authorized to act and I am acting for and on behalf of the Issuer in signing this Tax Certificate. 1.2. Authorization. The Obligations are authorized to be issued pursuant to applicable provisions of the laws of the State of New York, the Local Finance Law, the Town Law, and various bond resolutions duly adopted by the Town Board on their respective dates (collectively, the "Resolution"), as referred to in the Certificate of Determination executed as of August 28, 2014 (the"Certificate of Determination"). 1.3. Description of Obligations. The Issuer represents that the Obligations are described as set forth in the Certificate of Determination. 1.4. Purpose of Tax Certificate. This Tax Certificate is made and delivered 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 Obligations. It is intended and may be relied upon for purposes of Code §103 and Code §§141 through 150, and as a certification of expectations described in Treasury Regulations §1.148-2(b)(2). This Tax Certificate is executed and delivered as part of the record of proceedings in connection with the issuance of the Obligations. 1.5. No Hedge Bonds. As described in Article II hereof, the proceeds of the Obligations will be used for both"new money"and refunding purposes. (a) As of the Issue Date the Issuer reasonably expects that (i) at least eighty-five percent (85%) of the spendable proceeds of the Non-Refunding Portion of the Obligations (as defined below) will be used to carry out the governmental purposes of the Obligations within three (3) years of the Issue Date and (ii)not more than fifty percent (50%) of the spendable proceeds of the Non-Refunding Portion of the Obligations will be invested in investment property which would be acquired with the amounts received as a result of investing original proceeds of the Obligations and would have a substantially guaranteed yield for four (4) years or more. 1 2366379 1 038723 TAGMT i (b) The Issuer certifies that (i) as of the issue date of the Prior Obligations (as defined below), (a) the Issuer reasonably expected that at least eighty-five percent (85%) of the spendable proceeds of the Prior Obligations would be used to carry out the governmental purposes of such issue within three (3) years of the issue date thereof and(ii)not more than fifty percent (50%) of the spendable proceeds of the Prior Obligations was invested in investment property which (1) was acquired with the amounts received as a result of investing original proceeds of such issue and (2) had a substantially guaranteed yield for four (4) years or more. For purposes of the preceding sentence, the Prior Obligations includes, as applicable, each issue of obligations refunded by the Prior Obligations. 1.6. Reasonable Expectations. This Tax 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 Obligations will not be used in a manner that would cause the Obligations to be "arbitrage bonds" under Code §148 or "private activity bonds" under Code §§103 and 141. 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. 1.7. Sale of the Obligations. The Obligations were sold to Bridgehampton National Bank, Bridgehampton, New York (the "Purchaser") on August 19, 2014. The Obligations are being purchased by the Purchaser in a direct, private placement transaction and the terms of the sale and purchase have been established through negotiations between the Purchaser and the Issuer in an arm's-length transaction. The Purchaser will not receive a fee in connection with its purchase of the Obligations. The Purchaser has advised the Issuer that it is purchasing the Obligations for its own account and not for the purpose of resale to the general public or otherwise. The Purchaser is delivering good funds in exchange for the Obligations on the date hereof. 1.8.- No Composite Issue. All the Obligations were sold at the same time, pursuant to the same plan of financing, and are reasonably expected to be paid from substantially the same source of funds. No other tax-exempt obligations have been or will be sold within fifteen (15) days of the sale of the Obligations pursuant to the same plan of financing as the Obligations that are reasonably expected to be paid from substantially the same source of funds as the Obligations. Accordingly, the Obligations are treated as a single issue of obligations for federal income tax purposes and no other tax-exempt obligations of the Issuer will be treated as _ part of the same issue as the Obligations for purposes of complying with federal tax law requirements. For purposes of this Section, obligations are considered sold on the earlier of the date a commitment letter, bond purchase agreement or contract of purchase is executed. 1.9. No Federal Guarantee. The Issuer represents that, except for the Gross Proceeds of the Obligations which are (a) invested during the temporary periods referred to in Article IV, (b) held in any refunding escrow, or (c) invested in obligations of the United States Treasury or in obligations issued pursuant to Section 2113(d)(3) of the federal Home Loan Bank Act, as amended by Section 511(a) of the Financial Institutions Reform, Recovery and Enforcement Act of 1989, or any successor provision to Section 21B(d)(3) of the federal Home Loan Bank Act, as amended: 2 2366379.1 038723 TAGMT y , (a) No portion of the payment of principal of or interest on the Obligations is or will be guaranteed directly or indirectly by the United States or any agency or instrumentality thereof(herein"federally guaranteed"); and (b) No portion of the Gross Proceeds of the Obligations in excess of five percent (5%) of such Gross Proceeds is or will be (i)used in making loans with respect to which the payment of principal or interest with is to be federally guaranteed, or(ii) invested directly or indirectly in federally insured deposits or accounts. For purposes of this Tax Certificate, generally, Gross Proceeds consist of Sale Proceeds, Transferred Proceeds, if any, Investment Proceeds and Replacement Proceeds, if any, of the Obligations. 1.10. Tax Representation. The Issuer will comply with all the procedures and provisions set forth herein, and will do and perform all acts and things necessary and within its reasonable control in order to assure that interest paid on the Obligations shall be excluded from gross income of the owners thereof for the purpose of federal income taxation. 1.11. Additional Information. The Issuer will provide such other information as may be required to assure the exclusion from gross income of interest on the Obligations for federal income taxation purposes. 1.12. Noncompliance. The Issuer shall perform each of the representations undertaken by it in this Tax Certificate unless, in the written opinion of Bond Counsel, noncompliance therewith will not cause interest on the Obligations to be included in gross income for purposes of federal income taxation. 1.13. Reliance by Bond Counsel.- The representations and certifications of the Issuer expressed in this Tax Certificate may be relied upon by Bond Counsel in connection with the rendering of any opinion with respect to the Obligations. 1.14. Reliance on Other Parties. In making its representations and certifications in this Tax Certificate and in establishing its expectations regarding uses of Gross Proceeds of the Obligations to assure compliance with Code §§103 and 141 through 150 generally,the Issuer has relied on representations and certifications of other parties referenced in this Tax Certificate and the Exhibits hereto with respect to the certified matters. Based on the various roles and responsibilities of such other parties with respect to the certified matters, the Issuer believes that such reliance is reasonable and prudent. The Issuer is unaware of any fact or circumstance that would cause it to question the accuracy or reasonableness of any such certification. These certifications include, without limitation: (i) the certificate of the Underwriter relating to the issue price of the Bonds, attached hereto as Exhibit E, and (ii) financing schedules (the "Financing Schedules")which are attached hereto as Exhibit F. 1.15. IRS Form 8038-G. Certain information provided by the Purchaser has been provided to the Issuer and Bond Counsel for the purpose of completing the IRS From 8038-G. The Issuer represents that the information contained in the IRS Form 8038-G is consistent with the computations, schedules and information provided by the Purchaser. The r Issuer has reviewed the IRS Form 8038-G with respect to the Obligations and to the best of its 3 2366379.1 038723 TAGMT knowledge the information contained therein is true, accurate and complete. The Issuer acknowledges that Bond Counsel prepared the IRS Form 8038-G on behalf of the Issuer based solely on the information contained in this Tax Certificate and information provided by the Purchaser. The Issuer will arrange for the filing of IRS Form 8038-G with respect to the Obligations by the 15th day of the second month after the calendar quarter in which the Obligations are issued. 1.16. Multipurpose Issue. The Issuer hereby elects, pursuant to Treasury Regulations §§1.148-9(h) and 1.150-1(c)(3), to treat the portion of the Obligations allocable to the refunding of the Refunded Obligations (referred to herein as the "Refunding Portion of the Obligations") and the portion of the Obligations allocable to the costs of the Projects (referred to herein as the "Non-Refunding Portion of the Obligations") as separate issues solely for certain federal tax purposes. ARTICLE H USE OF PROCEEDS 2.1. Purposes) of the Obligations. The proceeds of the Obligations, together with funds of the Issuer,will be used for the following purposes: (a) to provide moneys for the original financing of various purposes ($1,810,000) (the "New Money Projects'), as more fully described in the Certificate of Determination and summarized in Exhibit C attached hereto; and (b) to redeem, in part, the Issuer's $234,000 bond anticipation notes maturing on August 29, 2014, (the "Prior Obligations"), the proceeds of which were used to finance or refinance various capital improvements in and for the Issuer (the "Refunded Projects" and together with the New Money Project, the "Projects"), as more fully described in the Certificate of Determination and summarized in Exhibit C attached hereto; and (c) to pay a portion of the costs of issuing the Obligations. The Prior Obligations to be current refunded with the proceeds of the Refunding Portion of the Obligations are referred to herein as the"Refunded Obligations.' 2.2. Proceeds of Prior Obligations. The proceeds of the Prior Obligations were used to: (a) finance or refinance all or a portion of the costs of the Refunded Projects and(b)pay costs of issuing the Prior Obligations. Several of the Refunded Obligations were originally issued in 2010. Accordingly, pursuant to Section 56(g)(4)(B)(iv) of the Code, the Obligations shall be treated as issued in 2010 for purposes of determining the exclusion of interest on the Obligations from the adjusted current earnings of certain corporations for purposes of calculating the alternative minimum tax imposed on such corporations. 4 2366379.1 038723 TAGMT r ` It, The Issuer represents that Private Use (as defined herein), if any, with respect to the proceeds of the Prior Obligations as certified in the tax certificate executed with respect to the Prior Obligations has not changed since the date of issue thereof. 2.3. Amount and Application of Sale Proceeds of the Obligations. The Sale Proceeds will be applied as follows: Sources Bond Proceeds Par Amount $2,044,000.0 Premium 0.0 Total Sources SMA-4.000.0 Uses Refunding Prior Obligations $234,000.0 Project Expenditures 1,805,000.0 Costs of Issuance 5,000.0 Capitalized Interest/Additional Proceeds 0.0 Total Uses $2,044,000.0 2.4. Excess or Unused Sale Proceeds of the Obligations. The Issuer expects the costs of the Projects and the redemption of the Refunded Obligations to be not less than $2,044,000 (including costs of issuance/issuer's compensation) in the aggregate. To the extent not used for the above-described purposes, such proceeds will be (i)used to pay capitalized interest on the Non-Refunding Portion of the Obligations; (ii)applied to the next payment of principal of or interest on the Obligations, or (iii) used for such other purpose as is approved in writing by Bond Counsel. ARTICLE III USE OF PROJECTS AND LIMITATIONS ON PRIVATE ACTIVITY 3.1. Ownership/Lease/Sale. While the Obligations remain outstanding, all of the Projects will be owned by the Issuer or another Governmental Unit and will not be owned by or leased to any person who is not a Governmental Unit. The Projects will not (except to the extent that any portion of the Projects were financed with grants, if any) 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, and minor parts or portions as may be disposed of in the ordinary course of business due to normal wear and tear, obsolescence or depreciation or similar purposes, prior to the final maturity date of the Obligations. 3.2. No Private Loans. While the Obligations remain outstanding, none of the proceeds of the Obligations are being or will be used, directly or indirectly, to make loans to persons other than a Governmental Unit while the Obligations remain outstanding. The Issuer 5 2366379.1 038723 TAGMT f will not make any private loans from the proceeds of the Obligations after the Issue Date unless the Issuer has received a written opinion of Bond Counsel that such private loan will not adversely affect the exclusion of the interest on the Obligations from gross income for purposes of federal income taxation. 3.3. Limitations on Private Use. At all times while the Obligations remain outstanding, less than the lesser of$15,000,000 or ten percent (10%) of either: (a)the aggregate amount of the proceeds of the Obligations are used or expected to be used, directly or indirectly, in a trade or business carried on by a person other than a Governmental Unit ("Private Use") or (b)the aggregate present value of the debt service on the Obligations during the term thereof is expected to be, under the terms of the Obligations or any underlying arrangement, directly or indirectly, secured by any interest in property used or to be used for Private Use or in payments in respect of property used or to be used for 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 Private Use. Payments by a person for use of proceeds do not include the portion of any payment that is properly allocable to the payment of ordinary and necessary expenses(as defined under Code §162) directly attributable to the operation and maintenance of the financed property used by that person. For this purpose, general overhead and administrative expenses are not directly attributable to those operations and maintenance. 3.4. Unrelated/Related Disproportionate Use. At all times while the Obligations remain outstanding, less than the lesser of $15,000,000 or five, percent (5010) of either: (a) the proceeds of the Obligations 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 Projects, including any private loan financing described in Section 3.2 hereof which meets this test or (b) the aggregate present value of the debt service on the Obligations during the term thereof is expected to be, under the terms of the Obligations or any underlying arrangement, directly or indirectly, secured by any interest in property used or to be used for Private Use or in payments in respect of property used or to be used for 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 Private Use. Payments by a person for use of proceeds do not include the portion of any payment that is properly allocable to the payment of ordinary and necessary expenses (as defined under Code §162) directly attributable to the operation and maintenance of the financed property used by that person. For this purpose, general overhead and administrative expenses are not directly attributable to those operations and maintenance. For purposes of this Tax Certificate, proceeds of the Obligations are allocable to a disproportionate related Private Use to the extent that the proceeds of the Obligations 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 exceeds the proceeds of the Obligations which are to be used for the governmental use to which such Private Use relates. 3.5. Private Use Defined (a) For purposes of Sections 3.3 and 3.4 hereof, Private Use consists of any agreement, contract or other arrangement including, without limitation, leases, management contracts, guarantee contracts, take or pay contracts, put or pay contracts, output contracts or research contracts which provides for use of any portion of the Projects by a person(s) who is not a Governmental Unit on a basis different than the general public. The Issuer will not enter into any such contract or arrangement unless the Issuer has 6 2366379.1 038723 TAGMT a obtained an opinion from Bond Counsel that such contract or arrangement does not adversely affect the exclusion of interest on the Obligations from gross income for purposes of federal income taxation. None of the Projects were financed or are being financed or refinanced for use by any specific user(other than the Issuer). (b) Use by State or Local Governmental Units. The Projects, including service or capacity from the Projects, if any, may be used by or on behalf of a Governmental Unit provided that there is no transfer or flow-through of such use to any person or entity carrying on any trade or business that does not constitute General Public Use (as defined in subsection(c)below). (c) General Public Use. The Projects, including service or capacity from the Projects, if any, may be used by any person or entity, including any person or entity carrying on any trade or business without any Private Use arising therefrom, if such use constitutes General Public Use. "General Public Use" is any arrangement providing for use that is available to the general public at either(i)no charge, or(ii) on the basis of rates that are generally applicable and uniformly applied. For this purpose, rates may be treated as generally applicable and uniformly applied even if(i)different rates apply to different classes of users, such as volume purchasers, if the differences in rates are customary and reasonable, or (ii) a specially negotiated rate arrangement is entered into, but only if the user is prohibited by federal law from paying the generally applicable rates, and the rates established are as comparable as reasonably possible to the generally applicable rates. The Issuer imposes generally applicable and uniform rates and charges, if any, on all users of the facilities, service or capacity of the Projects pursuant to the schedules of rates and charges adopted by the Issuer from time to time. (d) No Priority Rights or Other Preferential Benefits. The Projects, including service or capacity from the Projects, if any, will not be used by any person or entity under any arrangement that conveys priority rights or other preferential benefits except as may be permitted by subsection(b) above. (e) 200 Days General Public Use Arrangements. The Projects, including service or capacity from the Projects, if any, may be used by any person or entity under any arrangement that is available to members of the general public and that does not otherwise convey priority rights or other preferential benefits is treated, nevertheless, as General Public Use if the term of the use under the arrangement, including all renewal options, is not greater than two hundred (200) days. For this purpose, a right of first refusal to renew use under the arrangement is not treated as a renewal option if (i) the compensation for the use under the arrangement is redetermined at generally applicable, fair market value rates that are in effect at the time of renewal, and (ii) the use of the financed property under the same or similar arrangements is predominantly by natural persons who are not engaged in a trade or business. (f) 100 Days Limited General Public Use Arrangements. The Projects, including service or capacity from the Projects, if any,may be used by any person or entity under any arrangement for use (other than as an owner) for a term (including renewal options) of not longer than one hundred (100) days,provided that the arrangement would be General Public Use except that it is not available on the same basis for use by natural persons because generally applicable and uniformly applied rates are not reasonably available to natural persons_not 7 2366379.1 038723 TAGMT engaged in a trade or business and the Projects are not financed for the principal purpose of such Private Use. (g) 50 Days Negotiated Arm's-Length Use Arrangements. The Projects, including service or capacity from the Projects, if any,may be used by any person or entity under any arrangement (other than as an owner) for a term (including renewal options)not longer than fifty (50) days, provided the arrangement is negotiated at arm's-length, the compensation paid for the use is at fair market value and the Projects are not financed for the principal purpose of such Private Use. The term limits described in each of the three foregoing contractual arrangements (Le., paragraphs (e), (f) and (g) above) are not required to relate to consecutive days (e.g., if the contract provides for use of a bond-financed facility for ten (10) days per year for six (6) years, the contract could not comply with the requirements applicable to contractual arrangements set forth in paragraph(g)above,because the term of the contract would exceed fifty(50)days.) (h) Incidental Use Arrangements. The Projects may be used by any person or entity where the use is incidental if, except for vending machines, pay telephones, kiosks and similar uses, the use does not involve the transfer of possession and control of space separated from other areas of the facility by walls,partitions, barriers and the like,the nonpossessory use is not functionally related to any other use of such portion of the Project by the same person(other than a different nonpossessory use) and all nonpossessory uses do not in the aggregate exceed 2.5% of the Projects or such facility. 3.6. Management and Operations Contracts. The Issuer manages and operates all of the Projects. The Issuer has not been a party to any management contract or operating agreement with any person or entity for management services or operating activities to be provided to the Issuer at or with respect to the Projects. The Issuer will not enter into any such contract or arrangement with any person or entity while the Obligations remain outstanding, except: (a) with respect to contracts or arrangements which do not constitute Private Use of the Projects under Code §141(b), (b) with respect to contracts or arrangements which satisfy the "safe harbors" set forth in IRS Rev. Proc. 97-13, 1997-1 C.B. 632, as amended or supplemented from time to time (each a "Safe Harbor Management Contract") as summarized in Exhibit D attached hereto, (c) with respect to contracts or arrangements that do not give rise to use of Bond-financed property by a non-Governmental Unit of more than the amount of such non- qualified use permitted by the Code, as measured in the aggregate, or (d) in the event that the Issuer receive an opinion of Bond Counsel that such contracts or arrangements will not adversely affect the exclusion of the interest on the Obligations from gross income for federal income taxation purposes. 3.7. Monitoring and Measurement of Private Activity. (a) The Issuer represents that it will monitor the amount of Private Use of the Projects to ensure that the aggregate amount of such use of the Projects will not exceed the applicable limits described in this Article. The Issuer has established or will establish procedures for monitoring the amount of Private Use at the Projects. The Issuer will consult with Bond Counsel and other legal counsel and advisers as necessary to determine whether, and to what extent, if as a result of any Private 8 2366379.1 038723 TAGMT Use of the financed or refinanced facilities any remedial action is required under Treasury Regulation §1.141-12. (b) The amount of Private Use of a Project is determined according to the average percentage of Private Use of such Project during the measurement period. To the extent that the Projects are owned by the Issuer, the measurement period with respect to a Project (i)begins on the later of the Issue Date of the Obligations or the placed-in-service date of the Project, and (ii) ends on the earlier of the expiration date of the economic life of the Project or the last maturity of the Obligations. The average percentage of Private Use is the average of the percentages of Private Use during the one-year periods within the measurement period and is to be determined,with appropriate adjustments, as provided in the Treasury Regulations. (c) The Issuer also agrees to monitor the amount of private payments and private security at each Project to ensure that the present value of the aggregate amount of private payments and private security at the Projects financed with the proceeds of the Obligations will not exceed: (i) five percent (5%) with respect to unrelated or related and disproportionate Private Use described in Section 3.4 above, and (ii) ten percent (10%) with respect to total Private Use described in Section 3.3 above, of the present value of the aggregate debt service on the Obligations. Such present values are to be determined, with appropriate adjustments, as provided in the Treasury Regulations. (d) The Issuer will advise Bond Counsel not less than annually of any change in the amount of: (i) unrelated or related and disproportionate Private Use described in Section 3.4 above, (ii) Private Use described in Section 3.3 above, and (iii) the corresponding amount of private payments and private security arising from any contract or other arrangement including, without limitation, ownership, leases, management and operation contracts, research agreements, guarantee contracts, take or pay contracts, put or pay contracts, or other output contracts or any other action or event described in this Article. 3.8. No Pooled Loan Financings. None of the proceeds of the Obligations will be used directly or indirectly to make or finance loans to two or more ultimate borrowers (including loans referred to in Section 3.2 hereof and loans to Governmental Units). ARTICLE IV ARBITRAGE 4.1. Purchase Price. The Obligations are being purchased in a direct, private placement transaction. The purchase price being paid by the Purchaser is equal to $2,044,000 (which represents the aggregate stated principal amount of the Obligations). 4.2. Note Yield and Investment Yield. (a) When used in this Tax Certificate, the term "old" refers to yield computed by the actuarial or present value method using a 360-day year and semiannual compounding, and means that discount rate which, when used in computing the present value of all payments of principal and interest to be paid on an obligation, produces an amount equal to the Issue Price thereof in the case of the Obligations and, the purchase price in the case of investments purchased with Gross Proceeds of the Obligations. 9 2366379.1 038723 TAGMT (b) The Obligations constitute a Fixed Yield Issue. The yield on the Obligations has been computed in compliance with Treasury Regulations §1.148-4, to be 0.728673% (the "Note Yield"). The Note Yield will not be affected by subsequent unexpected events, except to the extent provided in Treasury Regulations §1.148 4(h) when and if the Issuer enters into a Qualified Hedge or into any transaction transferring,waiving or modifying any right that is part of the terms of the Obligations. The Issuer will consult with Bond Counsel prior to entering into any of the foregoing transactions. (c) None of the Obligations are subject to mandatory, contingent or optional redemption. (d) The Issuer has not entered into any Qualified Hedge with respect to the Obligations. (e) No amount has been or will be paid by or on behalf of the Issuer to any entity as a payment for a Qualified Guarantee with respect to the Obligations. 4.3. Temporary Periods. The Issuer will not invest the Gross Proceeds of the Obligations in Investments at yields that are materially higher, as that term is defined in Treasury Regulations §1.148-2(d) ("Materially Higher'), than the Note Yield except as set forth in this Section or Article VI below. (a) Temporary Period for Bond Proceeds Used for Capital Projects. The Issuer reasonably expects that, as of the date hereof. (i) the Issuer will enter into within Six (6) months after the date hereof a substantial binding obligation to a third party to expend at least five percent (5%) of the Net Sale Proceeds of the Non-Refunding Portion of the Obligations on the Projects; (ii) the completion of the Projects and use of Net Sale Proceeds of the Non- Refunding Portion of the Obligations will proceed with due diligence to completion; and (iii) at least eighty-five percent (85%) of the Net Sale Proceeds of the Non-Refunding Portion of the Obligations will be spent on the Projects within three (3) years of the date hereof. As a result, proceeds of the Non-Refunding Portion of the Obligations used to finance the costs of the Projects may be invested without Yield Restriction for a period not to exceed three (3) years from the date hereof and, thereafter, shall be invested at a Yield not in excess of the Yield on the Obligations plus one-eighth of one percentage point (1/8%). Investment earnings on obligations acquired with such proceeds may be invested without Yield Restriction for a period not exceeding three (3) years from the date hereof or one (1) year from the receipt thereof, whichever is longer, and, thereafter, shall be invested at a Yield not in excess of the Yield on the Obligations plus one-eighth of one percentage point (b) Temporary Period for Current Refunding. Proceeds of the Refunding Portion of the Obligations used to current refund the Refunded Obligations may be invested without Yield Restriction for a period not to exceed ninety (90) days from the date hereof and, thereafter, shall be invested at a Yield not in excess of the Yield on the Obligations plus one- eighth of one percentage point(1/8%). (c) Temporary Period for Investment Earnings. Except as otherwise provided in this Section, investment earnings and all amounts received by the Issuer from the investment 10 2366379.1 038723 TAGMT t of Gross Proceeds of the Obligations may be invested without Yield Restriction for a one (1) year period beginning on the date of receipt but in no event longer than the temporary period applicable to the source of such investment. (d) Temporary Period for Costs of Issuance. Proceeds of the Obligations used to pay costs of issuance of the Obligations may be invested without Yield Restriction for a temporary period not to exceed thirteen (13) months from the Issue Date and will be subject to rebate. (e) Temporary Period for Bona Fide Debt Service Fund As further discussed in Section 7.2 below, amounts deposited in a Bona Fide Debt Service Fund may be invested without Yield Restriction for a period of thirteen (13) months from the date of deposit in such fund. (f) Minor Portion. A minor portion of the Gross Proceeds of the Obligations may be invested without Yield Restriction in an amount not exceeding the lesser of(i) $100,000 or(ii)five percent(5%) of the Sale Proceeds. 4.4. Transferred Proceeds. None of the proceeds of the Prior Obligations remain unexpended as of the Issue Date. 4.5. Escrow Deposit Fund. [Intentionally Omitted] 4.6. Current Refunding and Redemption Date. The proceeds of the Obligations will be spent within ninety (90) days after the Issue Date to retire or pay debt service and redemption premium, if any, on the Refunded Obligations. The redemption date of the Prior Obligations is August 29,2014. 4.7. Yield Reduction Payments. Notwithstanding any of the provisions in this Tax Certificate that require Sale Proceeds of the Obligations and investment earnings thereon to be invested at a yield not in excess of the Note Yield, the yield on certain investments acquired with proceeds of the Obligations will not be considered to be higher than the applicable yield limitation described herein if the Issuer makes or causes to be made Yield Reduction Payments to the United States Treasury at the time and in the amounts described in Treasury Regulations §1.148-5(c). The Issuer will consult with Bond Counsel prior to making any investments in reliance on its eligibility to make Yield Reduction Payments. 4.8. Yield Restricted Money. Amounts that must be Yield Restricted, if any, will be invested in either: (i) Nonpurpose Investments at a fair market price which produces a yield not Materially Higher than the Note Yield, (ii) SLGS which produce yield not Materially Higher than the Note Yield, or(iii) Tax-Exempt Obligations. 4.9. Universal Cap. (a) On each Valuation Date, the Issuer shall value the Universal Cap and the Nonpurpose Investments allocable to the Obligations thereunder. Nonpurpose Investments in a Bona Fide Debt Service Fund do not reduce the aggregate value of Nonpurpose Investments that may be allocated to the Obligations under the Universal Cap. Nonpurpose Investments cease to be allocated to the Obligations to the extent such Nonpurpose Investments have been expended for the governmental purpose of the issue, or to the extent the 11 2366379.1 038723 TAGMT value thereof exceeds the value permitted to be allocated to the Obligations under the Universal Cap. To the extent Nonpurpose investments cease to be allocated to issue tmarm and tyle value of Clic Universal Cap exceeds the value of the remaining Nonpurpose Investments allocated to such issue, other Nonpurpose Investments may become allocated to the issue, provided that such Nonpurpose Investments are not already properly allocated to another issue and that such allocation does not cause the value of Nonpurpose Investments allocated to the Obligations to exceed the Universal Cap. Generally, if Gross Proceeds of the Obligations invested in Nonpurpose Investments exceed the Universal Cap on a Valuation Date, such Nonpurpose Investments cease to be allocated to the Obligations in the following order: (i) amounts allocable to Replacement Proceeds, (ii) amounts allocable to Transferred Proceeds, (iii) amounts allocable to Sale Proceeds and Investment Proceeds. (b) Amounts are allocable to only one issue at a time as Gross Proceeds. Amounts that are original proceeds or transferred proceeds allocable to an issue must be so allocated to that issue and may not be allocated instead as replacement proceeds to another issue. Amounts cease to be original proceeds or transferred proceeds allocated to an issue only when they are properly allocated to an expenditure for a governmental purpose, when they become transferred proceeds of another issue or when they cease to be allocated to an issue by operation of the Universal Cap. Where a Nonpurpose Investment ceases to be allocated to the Obligations, such Nonpurpose Investment is subject to re-allocation under the Universal Cap calculated with respect to another bond issue. A Nonpurpose Investment which is reallocated to another bond issue may be valued under the same valuation method pursuant to which it was valued for purposes of applying the Universal Cap with respect to the Obligations. (c) Notwithstanding anything herein to the contrary, the failure to perform the determination of Nonpurpose Investments allocable to the Obligations as of a Valuation Date shall not be considered a violation of this provision if the value of Nonpurpose Investments allocated to the Obligations did not exceed the value of the Obligations outstanding on such date. 4.10. No Prohibited Pam. The Issuer has not entered into and will not enter into any transaction to reduce the Yield on the Investment of the Gross Proceeds of the Obligations in such a manner that the amount to be rebated to the federal government is less than it would have been had the transaction been at arm's-length and the Note Yield had not been relevant to either party. 4.11. No Overissuance. The proceeds of the Obligations, including investment proceeds, will not exceed the amount necessary for the purpose(s)of the Obligations. 4.12. Disposition Receipts. The Issuer will consult with Bond Counsel as to how to invest and dispose of any amounts received from the condemnation, insurance, or disposition of any part of the Projects. 12 2366379.1 038723 TAGMT 4.13. No Replacement Proceeds. No Replacement Proceeds (as defined in Treasury Regulations §1.148-1(c)) are expected to be created as a result of issuing the Obligations, as the weighted average maturity of the Obligations as set forth in Exhibit F attached hereto does not exceed one hundred twenty percent (120%) of the remaining weighted average economic life of the Projects as set forth in Exhibit C attached hereto. The average economic life of the Projects are assumed to have been assigned the "period of probable use" as defined under the State of New York Local Finance laws. The Issuer confirms that the Obligations are outstanding for a period that is reasonably required to accomplish the governmental purpose of financing the Projects with the proceeds of the Obligations. 4.14. Fair Market Value. The Issuer will not acquire Nonpurpose Investments at other than an arm's-length,Fair Market Value price. ARTICLE V REBATE 5.1. Rebate Compliance. The Issuer understands that the continued exclusion of interest on the Obligations from gross income for purposes of federal income taxation depends, in part, upon compliance with the arbitrage limitations imposed by Code §148, including the rebate requirements described in this Article. The Issuer shall do and perform all acts and things necessary in order to assure that the arbitrage and rebate requirements of Code §148 are met. 5.2. Calculation of Rebate Amount Code §148(f) requires the payment to the United States of the excess of the amount earned on the investment of Gross Proceeds of the Obligations in Nonpurpose Investments over the amount that would have been earned had the amount so invested been invested at a rate equal to the Bond Yield, together with any income attributable to such excess. Except as provided below, all Gross Proceeds of the Obligations are subject to this requirement. In order to meet the rebate requirement of the Code, the Issuer will take the following actions: (a) Record of Investments. The Issuer will record the date of receipt, amount and source of any Gross Proceeds of the Obligations, e.g., Sale Proceeds,Replacement Proceeds, loan repayments, investment earnings. For each Nonpurpose Investment acquired with or allocated to Gross Proceeds of the Obligations, the Issuer will record the purchase date or allocation date of such investment, its purchase price (excluding any broker or dealer's commission or discount), or, if not acquired directly with Gross Proceeds of the Obligations, its Value on the date the Nonpurpose Investment is allocated to Gross Proceeds of the Obligations, accrued interest due on its purchase date or allocation date, its face amount, its coupon rate, its yield, the frequency of its interest payment, its disposition price (excluding any broker or dealer's commission or discount), the accrued interest due on its disposition date and its disposition date. In addition,the Issuer will record the date and amount of all expenditures made with Gross Proceeds of the Obligations, including the payment of any Rebate Amount (as defined below). 13 2366379.1 038723 TAGMT (b) Method for Computing Yield For each Computation Period, the Issuer shall determine, if required, the Bond Yield computed as required by Treasury Regulations §1.148-4(b). When expressed as a decimal, yield will be accurate to at least four (4) decimal places. (c) Eli igibility of Qualified Guarantee. Payments for a Qualified Guarantee will be eligible to be taken into account as Issue Payments for purposes of computing the Bond Yield only if the payment for the guarantee represents a reasonable payment for a Qualified Guarantee. (d) Computation of Rebate Amount Subject to the special rules set forth in paragraph (e) of this Section,the Issuer will determine the Rebate Amount on each Computation Date. The "Rebate Amount"as of any Computation Date is the excess of the Future Value of all receipts with respect to Nonpurpose Investments over the Future Value of all payments with respect to the purchase of Nonpurpose Investments or the allocation of such investments to the proceeds of the Obligations, determined as of each Computation Date. To the extent amounts received from investments are reinvested, these amounts may be netted against each other and not taken into account in the Computation of the Rebate Amount. The Issuer shall determine the nonpurpose receipts and nonpurpose payments as described below. (i) Receipts. Receipts with respect to Nonpurpose Investments include (A) actual receipts, amounts actually or constructively received with respect to an investment, reduced by Qualified Administrative Expenses (B) disposition receipts, the Fair Market Value of investments deemed to be sold on the date the Investment ceases to be allocated to the issue, (except that Present Value may be substituted for Fair Market Value with respect to fixed yield investments, investments required to be Yield Restricted, and investments transferring by virtue of the universal cap or transferred proceeds rules) and (C) Computation Date Receipts, the Market Value (Present Value, in the case of Investment Contracts and fixed rate investments) of all Nonpurpose Investments allocated to the issue at the close of business on a Computation Date; and (D)rebate receipts, any recovery of an overpayment of rebate. (ii) Payments. Payments with respect to Nonpurpose Investments include (A)direct payments, the amount of Gross Proceeds_of the issue directly used to purchase the investment, including Qualified Administrative Expenses (B)constructive payments, the Value of an investment allocated to (but not directly purchased with) Gross Proceeds on the date so allocated; (C)Nonpurpose Investments allocated to an issue at the end of the preceding Computation Period, at the value of the investments at the beginning of the computation period; (D)rebate payments, payments of rebate amounts when due and Yield Reduction Payments on Nonpurpose Investments and (E)the Computation Date Credit. (e) Rebate Exceptions. In connection with the rebate requirement the following exceptions shall apply to the Obligations. Under Treasury Regulations §1.148-7(b)(2), the exceptions to rebate set forth in Subsections 5.2(e)(i), (ii) and (iii) above shall apply separately to the Non-Refunding Portion of the Obligations and the Refunding Portion of the Obligations. 14 2366379.1 038723 TAGMT r (i) $100,000 Bona Fide Debt Service Fund Gross Earnings Exception to Rebate. Notwithstanding anything in this Section 5.2 to the contrary, if the gross earnings from the investments held in a Bona Fide Debt Service Fund for the bond year in question, as determined under paragraph (c) above, are less than $100,000 then any amount earned on such Bona Fide Debt Service Fund shall not be taken into account in determining the Rebate Amount. In this regard, the $100,000 earnings limitation is deemed satisfied if the annual debt service on the issue does not exceed$2,500,000. For purposes of this paragraph,the term"gross earnings"means the aggregate amount earned on the Nonpurpose Investment in which the Gross Proceeds deposited to a Bona Fide Debt Service Fund are invested, including amounts earned on such amounts if allocated to a Bona Fide Debt Service Fund. (ii) Bona Fide Debt Service Fund Exception to Rebate. The average maturity of the Obligations is not more than five (5) years and, as a result, the Obligations do not qualify for the Bona Fide Debt Service Fund to rebate. (iii) Six-Month Spending xception to Rebate. Notwithstanding anything in this Section to the contrary, if all of the Gross Proceeds of the Obligations held in any fund or account(other than the Gross Proceeds held in a Bona Fide Debt Service Fund or any reasonably required reserve fund), including investment earnings received with respect to such Gross Proceeds but excluding investment earnings received with respect to such Gross Proceeds held in the Bona Fide Debt Service Fund, have been expended for the governmental purpose of the Obligations within six (6)months (or ninety-five percent (95%) within six (6) months and one hundred percent (100%) within one year) after the Issue Date, then the only Nonpurpose Investments to be taken into account in the calculation of the Rebate Amount are Nonpurpose Investments acquired with or allocated to Gross Proceeds of the Obligations held in any reasonably required reserve fund and to any Gross Proceeds of the Obligations arising after such six (6) months which were not reasonably anticipated as of the Issue Date. The existence of sinking fund or pledged fund proceeds or the expectation that such proceeds will arise within six (6) months of the Issue Date will make the six-month spending exception to rebate inapplicable. For purposes of this exception, Gross Proceeds used to pay principal of the Obligations are not treated as expended on the governmental purpose of the Obligations. This exception is available for the Gross Proceeds of the Obligations and the Issuer expects the requirements of this exception to rebate to be met with respect to the Gross Proceeds of the Obligations. (iv) Eighteen-Month Spending Exception to Rebate. The Obligations are treated as meeting the rebate requirement if Gross Proceeds of the Non-Refunding Portion of the Obligations qualify for the initial temporary period under Treasury Regulations §1.148-2(e)(2) and if the Gross Proceeds of the Non-Refunding Portion of the Obligations (other than the Gross Proceeds held in a Bona Fide Debt Service Fund or any reasonably required reserve fund and any Gross Proceeds of the Obligations arising after eighteen (18) months after the Issue Date which were not reasonably anticipated as of the Issue Date), including investment earnings received with respect to such Gross Proceeds but excluding investment earnings received with respect to such Gross Proceeds held in a debt service fund, have been expended for the governmental purpose of the 15 2366379.1 038723 TAGMT Obligations in accordance with the following schedule measured from the Issue Date: (i) at least fifteen percent (15%) within six (6) months; (ii) at least sixty percent (60%) within twelve (12) months; and (iii) one hundred percent (100%) within eighteen (18) months;then the only Nonpurpose Investments to be taken into account in the calculation of the Rebate Amount with respect to the Obligations are Nonpurpose Investments acquired with or allocated to Gross Proceeds of the Obligations held in any reasonably required reserve fund (there are none with respect to the Obligations), and to any Gross Proceeds of the Obligations arising after such eighteen (18) months which were not reasonably anticipated as of the Issue Date. This eighteen month spending exception to rebate may not be used if Gross Proceeds of the Obligations are held in any fund such as a sinking fund or pledged fund (other than a Bona Fide Debt Service Fund or any reasonably required reserve fund) as of the Issue Date or if such Gross Proceeds of the Obligations are expected to arise within eighteen (18) months of the Issue Date. For purposes of this exception, Gross Proceeds of the Obligations used to pay principal of the Obligations are not treated as expended on the governmental purpose of the Obligations. For purposes of determining compliance with the first two spending periods, the amount of Investment Proceeds included in Gross Proceeds of the Obligations is determined based on the Issuer's reasonable expectations on the Issue Date. The spending requirement for the third spending period is nevertheless satisfied if the Reasonable Retainage is allocated to expenditures within thirty(30)months of the Issue Date. (v) Two-Year Construction Bond Exception to Rebate. (A) A Construction Issue is treated as meeting the rebate requirement for Available Construction Proceeds of the Non-Refunding Portion of the Obligations if those proceeds are allocated to expenditures for governmental purposes of the Non-Refunding Portion of the Obligations in accordance with the following schedule, measured from the Issue Date of the Obligations: (i) ten percent (10%) within six (6) months; (ii) forty-five percent (45%) within twelve (12) months; (iii) seventy-five percent (75%) within eighteen(18) months; and (iv) one hundred percent (100%) within twenty-four (24) months. The two-tear construction bond exception to rebate is deemed satisfied if the unexpended amount does not exceed the lesser of three percent (3%) of the Issue Price of the Obligations or $250,000. The fourth spending requirement is considered satisfied if the unexpended amount is attributable to a Reasonable Retainage and if such amount is allocated to expenditures within three (3) years of the Issue Date. Expenditures for the governmental purpose of an issue include payments for interest, but not principal, on the issue, and for principal or interest on another issue of obligations,unless those payments cause the issue to be a refunding issue. For purposes of determining compliance with the spending requirements as of the close of each of the first three (3) spending periods, Available Construction Proceeds include the amount of future earnings that the Issuer reasonably expected as of the Issue Date of the Obligations. The spending requirement with respect to the fourth and final spending period is measured by reference to actual earnings. (B) In the event the Issuer fails to expend the Available Construction Proceeds in accordance with the schedule set forth in (A) above, unless an election has been made to pay the one and one half percent (1'/2%) penalty and/or the three percent (39/o) penalty, all Gross Proceeds of the Obligations, not otherwise exempted from the calculation of the Rebate Amount, will be taken into account in the calculation of the 16 2366379.1 038723 TAGMT Rebate Amount starting from the Issue Date. If an election has been made to bifurcate the issue into a Construction Issue and a non-Construction Issue,the two (2)portions will be treated as separate issues for purposes of computing the Rebate Amount as provided in Section 5.2 hereof. An issue may not be bifurcated into a Construction Issue and an issue which satisfies the eighteen month spending exception to rebate. In addition, an issue may not be bifurcated to include Construction Expenditures in the non-Construction Issue. An issue which comprises both refunding Obligations and new money Obligations is considered to be bifurcated by operation of law. (C) In connection with the two-year construction bond exception to rebate, the Issuer hereby makes the following elections: (a) the Issuer reasonably expects that at least seventy-five percent (75%) of the Available Construction Proceeds will be applied in respect of Construction Expenditures for property which is owned by a Governmental Unit or a Tax-Exempt Organization; (b) the Issuer does not elect to bifurcate the Obligations into a Construction Issue and a non-Construction Issue; (c) the Issuer does not elect to pay the one and one-half percent (1%2%) penalty or the three percent(3%)penalty at the close of each semi-annual spending period in respect of which the spending requirement has not been satisfied; (d)the Issuer does not elect to include in the two-year expenditure requirement investment earnings on any reserve fund as there'is no such reserve fund with respect to the Obligations; (e) the Issuer elects to include in Available Construction Proceeds the amount of earnings reasonably expected as of the Issue Date of the Obligations to be received for the entire two-year period, for purpose of calculating whether the relevant semi-annual expenditure requirements have been satisfied; and (f)the Issuer elects to measure Available Construction Proceeds, for purposes of meeting the spending requirements for the first three spending periods set forth above, by reference to the amount of earnings the Issuer reasonably expects as of the Issue Date of the Obligations for the entire two-year spending period, in lieu of actual earnings and expected earnings as of the end of each spending period. (D) The Issuer acknowledges that it may only avail itself of one of the exceptions to rebate set forth in Subsections 5.3(e)(iv) and(v) above. 5.3. Rebate Options. With respect to the investment of the proceeds of the Obligations,the Issuer will: (a) comply with the requirements of the six-month spending exception to rebate, the eighteen-month spending exception to rebate or the two-year construction bond exception to rebate, and if it is unable to comply with any of such requirements, rebate arbitrage earnings in accordance with the provisions of this Article; (b) invest all Gross Proceeds of the Obligations at all times from the Issue Date until expended in investments not constituting investment property for purposes of Code §148 of the Code, such as obligations of a state or of a political subdivision of a state the interest on which is excluded from gross income for purposes of federal income taxation under Code §103 and is not a preference item for purposes of the alternative minimum tax imposed by Code §55; 17 2366379.1 038723 TAGMT (c) invest all Gross Proceeds of the Obligations in obligations having a yield that does not exceed the Bond Yield; or (d) comply with the rebate provisions described in this Article. 5.4. Payment to the United States. (a) Unless the Obligations are redeemed prior to such time, the Issuer will pay to the United States, not later than sixty (60) days after each Installment Computation Date, an amount which, when added to previous rebate payments made with respect to the Obligations, is equal to not less than ninety percent(90%) of the Rebate Amount. The Issuer will pay to the United States, not later than sixty (60) days after the Obligations are fully paid or redeemed, one hundred percent (100%) of the Rebate Amount. If the final rebate payment is not made within sixty (60) days after the Final Computation Date, interest on the Rebate Amount will be deemed to accrue at the underpayment rate under Code §6621, beginning on the date the Rebate Amount is due and ending on the date ten (10) days before it is paid. (b) The Issuer will mail each payment to the Internal Revenue Service Center, Ogden, Utah 84201 or such other address as the Treasury Regulations may require. Each payment shall be accompanied by the Form 8038-T (or other prescribed form) and such information and documents as the Treasury Regulations may require. 5.5. Rebate Regarding Prior Issue. The Issuer understands that it must make a final rebate accounting and submit a Form 8038-T, if applicable, to the Internal Revenue Service with any required rebate or penalty payments within sixty(60) days of the final redemption date of each issue of the Prior Obligations being refunded with proceeds of the Obligations. 5.6. Engagement of Experts. The Issuer shall, before the date which is the earlier of(i) the fifth (5h) anniversary of the Issue Date or (ii) the date of the last redemption of the Obligations, engage Hawkins Delafield & Wood LLP or another firm nationally recognized in the calculation of rebate to perform the calculations necessary to comply with the rebate requirements of the Code with respect to the Obligations, including any exceptions thereto. ARTICLE VI ACCOUNTING FOR EXPENDITURES 6.1. Tax Accounting for Expenditures of Bond Proceeds. In general, any reasonable, consistently applied accounting method may be used to account for expenditures of proceeds of the Obligations for arbitrage and private activity bond compliance purposes under Treasury Regulations §§1.148-6(d) and 1.141-6. Allocations for these two purposes must be consistent with each other. Reasonable accounting methods for allocating funds from different sources to expenditures for the same governmental purpose include any of the following methods if consistently applied: a specific tracing method; a gross proceeds spent first method; a first-in, first-out method; or a ratable allocation method. Subject to more restrictive special rules that may apply to proceeds of the Obligations, such as the more restrictive special rules applicable to expenditures of proceeds for Restricted Working Capital Expenditures (see, Bond-Proceeds- Spent-Last Accounting Method), and except as otherwise noted in the immediately succeeding 18 2366379.1 038723 TAGMT sentence, the Issuer will use a specific tracing method, consistently applied, to account for expenditures of proceeds of the Obligations for purposes of Code §§148 and 141. The expenditure of money deposited to the Bona Fide Debt Service Fund shall be accounted for on the basis of the first-in,first-out method of accounting. (a) Extraordinary Working Capital Items. Gross Proceeds of an issue used for expenditures for extraordinary,non-recurring items that are not customarily payable from current revenues, such as casualty losses or extraordinary legal judgments in amounts in excess of reasonable insurance coverage, or the payments of Extraordinary Working Capital Expenditure. The exception set forth in the preceding sentence shall apply only if the Issuer or a related party does not otherwise maintain a reserve for such items or set aside other available amounts for such expenses. No portion of the proceeds of the Obligations will be used to pay Extraordinary Working Capital Items. (b) Grants. Gross Proceeds of an issue used to make a grant(Le., a transfer of money by the Issuer to a transferee that is neither a member of the Issuer's Controlled Group nor an agent of the Issuer) that imposes on the transferee no obligation or condition to repay any amount to the Issuer. In this regard, obligations or conditions intended solely to assure the expenditure of transferred money in accordance with the governmental purpose of the transfer do not prevent a transfer from qualifying as a grant. The Issuer understands that in the unexpected event that a repayment is made with respect to a bond-financed grant, the repaid amount is treated as unspent proceeds of the Obligations as of the repayment date unless expended within sixty(60) days of the repayment. The amount of grants not meeting the definition above will not be considered expended until expended by the ultimate recipient. No portion of the proceeds of the Obligations will be applied to finance a grant. (c) Costs of Issuance and De Minimis Working Capital Items. Gross Proceeds of an issue used for costs of issuance, administrative costs; qualified guarantees or hedges; payments of interest on the issue for a period commencing the date hereof and ending on the later of three (3) years from the date hereof or one (1) year after the date the Projects are placed in service; rebate or penalty or yield reduction payments;payments of principal or interest on an issue paid from unexpected excess sale or investment proceeds; and principal or interest on an issue paid from investment earnings on a reserve or replacement fund that are deposited in a Bona Fide Debt Service Fund, and Gross Proceeds of an issue used for working capital not in excess of five percent(5%) of the Sale Proceeds of the Obligations that are directly related to the Capital Expenditures financed by the Obligations may be considered spent for arbitrage purposes on a specific tracing accounting method. (d) Exception for Commingled Investment Proceeds. Investment proceeds of the Obligations that are deposited into the Issuer's General Fund or other funds and that are commingled with substantial tax or other revenues from the governmental operations of the Issuer may be treated as allocated to expenditures for a governmental purpose if such Investment Proceeds are expected to be spent within six(6)months from the date of commingling. (e) Allocations of Proceeds to Expenditures. It is understood that any allocations of the proceeds of the Obligations to expenditures herein are preliminary. Pursuant to Treasury Regulations §§1.141-6(a) and 1.148-6(d)(1)(iii), within eighteen (18) months after the 19 2366379.1 038723 TAGMT later of the date on which an expenditure of proceeds of the Obligations is made or, if later in the case of an expenditure for a Capital Project, if any, the Capital Project is placed in service, the Issuer will make a final allocation of the actual amount of proceeds used for that expenditure by the Issuer. In any event, such allocation must be made by the date sixty (60) days after the fifth (5t') anniversary of the Issue Date or the date sixty (60) days after the retirement of the Obligations, if earlier. The Issuer reserves the authority to change any allocation of proceeds to expenditures and the authority to change the method of accounting of proceeds for the entire period permitted under Treasury Regulations §§1.141-6 and 1.148-6 and other applicable Treasury Regulations. 6.2. Related Parties and Expenditures. In general, for purposes of tracking investments and expenditures of Gross Proceeds of the Obligations to ensure compliance with the arbitrage restrictions under Code §148 and the Treasury Regulations,the Issuer will continue to track investments of proceeds of the Obligations and expenditures of the proceeds of the Obligations until paid to parties that are not Related Parties. The Issuer understands that, for arbitrage purposes under Treasury Regulations §1.148-6(d)(7), unless otherwise within Section 6.3 of this Tax Certificate, any payment of Gross Proceeds of the Obligations to a Related Party of the payer is not an expenditure of those Gross Proceeds for arbitrage investment tracking purposes. Further in-this regard, for purposes of determining whether the Issuer and another entity are Related Parties, a special rule under Treasury Regulations §1.150-1(e)(3)provides that a general purpose governmental entity with its own substantial taxing, eminent domain, and police powers is an uncontrolled entity(e.g., a city possessing substantial amounts of each of the referenced sovereign powers is not a controlled entity of a state). 6.3. Expenditures on a Reimbursement Basis of Eligible Original Expenditures Paid Before Issue Date. A portion of the proceeds of the Obligations, in the amount of$115,455.00, will be used to reimburse the Issuer for expenditures incurred and paid thereby with respect to the Projects in anticipation of the issuance of the Obligations. Treasury Regulations §1.150-2 provides that proceeds of Tax-Exempt Obligations may be spent on a "reimbursement" basis to reimburse certain eligible types of original expenditures originally paid before the date of issuance of Obligations from other funds. To qualify for reimbursement, the following requirements must be satisfied: (a) Official Intent. Not later than sixty(60) days after payment of the original expenditure, the Issuer must adopt an "official intent" that satisfies the reimbursement rules (a "Declaration of Official Intent"). The Declaration of Official Intent may be made in any reasonable form, including a resolution, an action by an appropriate representative of the Issuer (e.g., a person authorized or designated to declare official intent on behalf of the Issuer), or specific legislative authorization for the issuance of the Obligations for a particular project. The Declaration of Official Intent generally must describe the project for which the original expenditure is paid and state the maximum principal amount of the Obligations to be issued for that-project. A project includes any property,project, or program(e.g., building construction). (b) Reimbursement Period. Any reimbursement of original expenditures from proceeds of the Obligations must be made not later than eighteen(18)months after the later of(i) the date the original expenditure is paid; or (ii) the date, the project is placed in service or abandoned,but in no event later than three(3)years after the original expenditure is paid. 20 2366379.1 038723 TAGMT (c) Eligible Types of Reimbursement Expenditures. Types of expenditures eligible for reimbursement include expenditures for a Capital Project, De Minimis Working Capital Items, Extraordinary Working Capital Items and Grants (but not Restricted Working Capital Expenditures). (d) Exception for De Minimis Amounts. Proceeds of the Obligations in an amount not to exceed the lesser of$100,000 or five percent(5%) may be used to reimburse costs of the Projects,notwithstanding the limitations set forth in Section 6.3(a) and(b). (e) _Preliminary Expenditures. Treasury Regulations §1.150-2(f)(2)provides a special exception to the official intent requirement for reimbursing certain prescribed "preliminary expenditures." Preliminary expenditures include architectural, engineering, surveying, soil testing, reimbursement bond issuance, and similar costs that are incurred prior to commencement of acquisition, construction, or rehabilitation of a Capital Project, but preliminary expenditures do not include land acquisition, site preparation, and similar costs incident to commencement of construction. Eligible preliminary expenditures cannot exceed twenty percent(20%) of the Issue Price of the Obligations. (f) Anti-Abuse Rules. None of the proceeds of the Obligations are being used in a manner that employs an abusive arbitrage device under Treasury Regulations §1.148-10 to avoid the arbitrage restrictions or to avoid the restriction under Code §§142 through 147. No portion of the reimbursed funds may be used by the Issuer or any Related Party thereto, within one (1)year of the reimbursement allocation,to create Replacement Proceeds for any tax-exempt obligations of the Issuer(e.g.,the Issuer cannot deposit the reimbursement amounts in a"sinking fund"or"pledged fund"for any outstanding bond issue). 6.4. Seaeaated Accounts, Investment Records and Documentation of Expenditures. The Issuer will segregate or cause the segregation of all proceeds in one or more segregated accounts and will maintain necessary investment and expenditure records in order to assure compliance with the federal tax requirements for the Obligations and will segregate or cause the segregation of proceeds prior to expenditures for governmental purposes in segregated accounts and will maintain necessary investment and expenditure records for such purposes, including, without limitation,the following: (a) investment records necessary to show compliance with any applicable restrictions as to Yield, to compute the Rebate Amount, and to demonstrate compliance with any applicable spending exceptions or other requirements under Code §148; and (b) expenditure records necessary to show the times, amounts and purposes for which the proceeds are spent on Capital Projects for governmental purposes or otherwise. 21 2366379.1 038723 TAGMT s ' ARTICLE VII DEBT SERVICE 7.1. Source of Repayment of Obligations. The principal of and interest on the Obligations (to the extent not paid from proceeds of other Tax-Exempt Obligations of the Issuer) will be paid from the Issuer's taxes and revenues. 7.2. Debt Service Fund The taxes and revenues used to pay principal and interest on the Obligations,,whether or not deposited in a Bona Fide Debt Service Fund, will be' expended within thirteen (13) months of the date of deposit in such fund, or the date of their accumulation. Any amounts received from the investment of such deposit or accumulation will be expended within one (1) year of receipt. The Bona Fide 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 bond year or one-twelfth of the debt service on the Obligations for the immediately preceding bond year. So long as the foregoing conditions are satisfied, amounts in the Bona Fide Debt Service Fund may be invested until expended without Yield Restriction. 7.3. Sinking Funds. Except for the Bona Fide Debt Service Fund described herein, the Issuer has not created or established, and does not expect to create or establish, any sinking fund, debt service reserve fund, pledged fund or other similar fund which the Issuer reasonably expects to use to pay principal or interest on the Obligations, including without limitation, any arrangement under which money, securities or obligations pledged directly or indirectly to secure the Obligations or any contract securing the Obligations or any arrangement providing for compensating balances to be maintained by the Issuer with any holder of the Obligations. 7.4. No Negative Pledges. There are no amounts held under any agreement to maintain amounts at a particular level for the direct or indirect benefit of the holders of the Obligations or guarantor of the Obligations, if any, excluding for this purpose amounts in which the Issuer (or a substantial beneficiary) may grant rights that are superior to the rights of the holders of the Obligations or guarantor of the Obligations,if any, and amounts that do not exceed reasonable needs for which they are maintained and as to which the required level is tested no more frequently than every six (6) months and that may be spent without any substantial restriction other than a requirement to replenish the amount by the next testing date. ARTICLE VIII MISCELLANEOUS 8.1. Recordkegping. The Issuer shall maintain records to support the representations, certifications and expectations set forth in this Tax Certificate until the later of the date three (3) years after the Obligations are retired or if the Obligations are refunded with proceeds of Tax-Exempt Obligations, the date three (3) years after the last of such refunding 22 2366379.1 038723 TAGMT Tax-Exempt Obligations are retired. The records the Issuer will retain include, but are not limited to: (a) basic records and documents related to the Obligations, including the Certificate of Determination,this Tax Certificate and the opinion of Bond Counsel, (b) documentation evidencing the expenditure of the proceeds of the Obligations, (c) documentation evidencing all sources of payment or security for the Obligations, (d) documentation pertaining to any investment of the Gross Proceeds of the Obligations, including the purchase and sale of securities, SLGS subscriptions, yield calculations for each class of investment of the proceeds of the Obligations and guaranteed investment contracts, (e) documentation evidencing determinations made pursuant to Articles IV and V hereof and records of all amounts paid to the United States pursuant to Sections 4.7, 5.4 and 5.5 hereof,and (f) documentation evidencing determinations made pursuant to Article III hereof as to the use of the Projects. ARTICLE IX POST ISSUANCE TAX COMPLIANCE 9.1. Post-Issuance Written Compliance Policies and Procedures. The Issuer represents that it has adopted written post-issuance tax compliance policies and procedures to ensure compliance with applicable requirements of federal tax law with respect to the Obligations. Such policies and, procedures include, among other things, procedures for instituting remedial actions in the event of any failure to comply with Code §141 relating to "private activity" and Code §148 relating to arbitrage, yield restriction and rebate, and designation of the official responsible for monitoring compliance with such requirements and to act as its compliance officer. See Exhibit G attached hereto. [Signature page follows.] 23 2366379.1 038723 TAGMT IN WITNESS WHEREOF, I have hereunto set my hand on the 28th day of August, 201 . Name: Scott A. Russell Title: Supervisor 2366379 1 038723 TAGMT Table of Exhibits Exhibit A - Definitions Exhibit B - Form 8038-G Exhibit C - Economic Lives and Private Use of Projects Financed with Proceeds of the Obligations Exhibit D - Safe Harbor Management Contracts Guidelines Exhibit E - Certificate of the Purchaser Exhibit F - Financing Schedules Exhibit G - Post-Issuance Tax Compliance Procedures Exhibit H - Reimbursement Resolutions Exhibit I - Summary of Reimbursement Expenditures 2366379.1 038723 TAGMT EXHIBIT A DEFIMTIONS "Available Construction Proceeds" means the issue price of the Obligations (i)plus earnings on the issue price and on amounts in any reserve fund not funded from bond proceeds, and earnings on such earnings and (ii) less the amount of the issue price representing a reasonably required reserve or replacement fund and costs of issuance funded with proceeds received from the sale of the Obligations. For purposes of this definition earnings include earnings on any Tax-Exempt Obligation. If only a portion of the Obligations constitutes a Construction Issue, a pro-rata portion of the above-described amount will constitute Available Construction Proceeds. Pre-issuance accrued interest and earnings thereon may be disregarded. "Bona Fide Debt Service Fund"means a fund, which may include proceeds of an issue, that is used primarily to achieve a proper matching of revenues with principal and interest payments within each Bond Year and is depleted at least once each Bond Year except for a reasonable carry over amount (not in excess of the earnings on the fund for the immediately preceding Bond Year or one-twelfth of the principal and interest payments on the issue for the immediately preceding Bond Year). "Bond Counsel" means Hawkins Delafield & Wood LLP, or any nationally recognized attorney or firm of attorneys knowledgeable in the requirements of the Code and the Treasury Regulations and retained by the Issuer. "Bond-Proceeds-Spent-Last Accounting Method" shall mean the required accounting method for spending proceeds of an issue on Restricted Working Capital Expenditures under, Treasury Regulations §1.148-6(d)(3), which treats proceeds as spent on a date only to the extent that the Working Capital Expenditures exceed available amounts, taking into account the treatment of a reasonable working capital reserve as unavailable, with the determination of available amounts and reasonable working capital reserves being made in the manner set forth in the Treasury Regulations. "Bond Year" means each one (1)year period that ends on the day selected by the Issuer. The first Bond Year and the last Bond Year may be short periods. If the Issuer has not selected a day before the earlier of the final maturity date of the issue or five (5) years after the Issue Date, Bond Year shall mean any year ending on the anniversary of the Issue Date and on the final maturity date. "Bond Yield" means the yield on the Obligations as defined in Section 4.2 of this Tax Certificate. "Capital Expenditure" means any cost of a type that is property chargeable to the capital account (or would be so chargeable with a proper election or with the application of the definition of placed in service under Treasury Regulations §1.150-2(c)) under general federal income tax principles. Capital Expenditures include amounts used for construction, reconstruction or rehabilitation of buildings or other inherently permanent structures, including items that are structural components of such buildings or structures, and architectural and A-1 2366379.1038723 TAGMT engineering fees, site survey fees, legal expenses, insurance premiums and development fees to the extent such fees and expenses directly relate to other construction costs. "Capital Project" shall mean all Capital Expenditures, plus related working capital expenditures to which the de minimis rule under Treasury Regulations §1.148-6(d)(3)(ii)(A) applies,that carry out the governmental purposes of an issue. "Code"means the Internal Revenue Code of 1986, as amended. "Computation Date" means each Installment Computation Date and the Final Computation Date. "Computation Date Credit"means, for any issue of obligations, an amount equal to the Future Value of $1,620 for each Bond Year during which there are gross proceeds of the Obligations on a Computation Date other than the Final Computation Date, and $1,620 on the Final Computation Date. The foregoing computation credit is subject to an annual inflation- based adjustment announced by the IRS. "Computation Period" shall mean the period between Computation Dates. The first Computation Period begins on the Issue Date and ends on the first Computation Date; each succeeding Computation Period begins on the date immediately following the Computation Date and ends on the next Computation Date. "Construction Expenditures" shall mean, except as otherwise provided, Capital Expenditures allocable to the cost of real property or constructed personal property. Construction Expenditures do not include expenditures for acquisitions of interests in land or other existing real property, unless the contract between the seller and the Issuer requires the seller to build or install the property (e.g., a "turnkey contract"), but only to the extent that the property has not been built or installed at the time the parties enter into the contract. For purposes of this definition "constructed personal property" means tangible personal property (or, if acquired pursuant to a single acquisition contract, properties) or so-called "specially developed computer software" if. (A) a substantial portion of the property or properties is completed more than six (6) months after the earlier of the date construction or rehabilitation commenced or the date the Issuer entered into an acquisition contract; (B)based on reasonable expectations of the'Issuer, if any, or representations of the person constructing the property, with the exercise of due diligence, completion of construction or rehabilitation (and delivery to the Issuer) could not have occurred within that six (6) month period; and (C) if the Issuer itself builds or rehabilitates the property, not more than seventy-five percent (75%) of the capitalizable cost is attributable to property acquired by the Issuer (e.g., components, raw materials, and other supplies). "Specially developed computer software"means any programs or routines used to cause a computer to perform a desired task or set of tasks, and the documentation required to describe and maintain those programs, provided that the software is specially developed and is functionally related and subordinate to the real property or other constructed personal property. A-2 2366379.1 038723 TAGMT o For purposes of this definition "real property" means land and improvements to land, such as buildings or other inherently permanent structures, including interests in real property; e.g., "real property" includes wiring in a building, plumbing systems, central heating or air- conditioning systems, pipes or ducts, elevators, escalators installed in a building, paved parking areas,roads,wharves and docks,bridges and sewage lines. For purposes of this definition "tangible personal property" means any tangible property other than real property, including interests in tangible personal property; e.g., "tangible personal property" includes machinery that is not a structural component of a building, subway cars, fire trucks, automobiles, office equipment,testing equipment, and furnishings. "Construction Issue" means for purposes of the two-year construction bond exception to rebate, any issue (or portion thereof)that is not a refunding issue in which all of the bonds are either (i) Governmental Bonds; (ii) Qualified 501(c)(3) Bonds, or (iii) Qualified Private Activity Bonds to finance property owned by a Governmental Unit or a 501(c)(3) organization, if at least seventy-five percent (75%) of the net proceeds of the issue are to be used for expenditures for construction, reconstruction and rehabilitation of property which is owned by a Governmental Unit or a 501(c)(3) organization. "Controlled Group" means a group of entities controlled directly or indirectly by the same entity or group of entities. In general, "direct control" exists while a controlling entity possesses either of the following rights or powers and such rights or powers are discretionary and non-ministerial: the right or power (i) both to approve and to remove without cause a controlling portion of the governing body of the controlled entity, or (ii)to require the use of funds or assets of the controlled entity for any purpose of the controlling entity. If one entity (the "Controlling Enti ") directly controls another(the "Controlled Entity'),then the Controlling Entity indirectly controls any entity controlled directly or indirectly by such Controlled Entity. However, an entity is not a Controlled Entity if it possesses substantial taxing, eminent domain and police powers. "De Minimis Amount" shall mean: (a) in reference to original issue discount (as defined in Code §1273(a)(1)) or premium on an obligation: (i) an amount that does not exceed two percent (2%) multiplied by the stated redemption price at maturity; plus (ii) any original issue premium that is attributable exclusively to reasonable underwriters' compensation; and (b) in reference to market discount (as defined in Code §1278(a)(2)(A)) or premium on an obligation, an amount that does not exceed two percent (2%) multiplied by the stated redemption price at maturity. "De Minimis Working Capital Items" shall mean Working Capital Expenditures eligible for the de minimis exception to the Bond-Proceeds-Spent-Last Accounting Method in Treasury Regulations §1.148-6(d)(3)(ii)(A),and includes: (a) issuance costs of an issue and Qualified Administrative Costs; (b) Qualified Guarantee fees and Qualified Hedge payments; A-3 2366379.1 038723 TAGMT r , (c) interest on an issue for a period starting on the Issue Date and ending on the date that is the later of three (3) years from the Issue Date or one (1) year after the date on which any financed Capital Project is placed in service; (d) certain Rebate Amounts and Yield Reduction Payments; (e) other costs that do not exceed five percent (5%) of the Sale Proceeds of an issue and that are directly related to any Capital Expenditures financed with the issue; (f) principal or interest on an issue paid from unexpected excess Sale Proceeds or Investment Proceeds; or (g) principal or interest on an issue paid from investment earnings on a reserve or replacement fund that are deposited in a Bona Fide Debt Service Fund. "Extraordinary Working Capital Item" shall mean Working Capital Expenditures eligible for the exception to the Bond-Proceeds-Spent-Last Accounting Method in Treasury Regulations §1.148-6(d)(3)(ii), which covers extraordinary, nonrecurring items that are not customarily payable from current revenues, such as casualty losses or extraordinary legal judgments in amounts in excess-of reasonable insurance coverage, and for which no reserve has been maintained. "Fair Market Value" of an Investment shall have the following meanings: (a) In General. Except as elsewhere specifically stated below,the Fair Market Value of an Investment is the price at which a willing buyer would purchase the Investment from a willing seller in a bona fide, arm's-length transaction. (b) United States Treasury Obligation The Fair Market Value of a United States Treasury Obligation that is purchased directly from the United States Treasury is its purchase price. (c) Certificate of Deposit The Fair Market Value of a certificate of deposit with a fixed interest rate, a fixed payment schedule, and a substantial penalty for early withdrawal is its purchase price provided the yield on the certificate of deposit is not less than(i)the yield on reasonably comparable direct obligations of the United States and(ii) the highest yield published by the provider and currently available from the provider on reasonably comparable certificates of deposit offered to the public. (d) Guaranteed Investment Contracts and Yield Restricted Defeasance Escrows. The Fair Market Value of a guaranteed investment contract or an investment purchased for a yield restricted defeasance escrow is its purchase price, provided the issuer of the Obligations makes a bona fide solicitation for such contract that satisfies all of the following requirements: (i) The bid specifications are in writing and are timely forwarded to potential providers. A-4 2366379.1 038723 TAGMT (ii) The bid specifications include all material terms of the bid; material terms are defined as terms that may directly or indirectly affect the yield or cost of the investment. (iii) The bid specifications include a statement notifying potential providers that submission of a bid is a representation that the potential provider did not consult with any other potential provider about its bid,that the bid was determined without regard to any other formal or informal agreement that the potential provider has with the issuer or any other person (whether or not in connection with the bond issue), and that the bid is not being submitted solely as a courtesy to the issuer or any other person for purposes of satisfying the requirements of the applicable provisions of the Treasury Regulations. (iv) The terms of the bid specifications are commercially reasonable, i.e., there is a legitimate business purpose for the term other than to increase the purchase price or reduce the yield of the investment (for example, for solicitations of investments for a yield restricted defeasance escrow, the hold firm period must be no longer than the issuer reasonably requires). (v) With respect to purchases of guaranteed investment contracts only, the terms of the solicitation take into account the issuer's reasonably expected deposit and drawdown schedule for the amounts to be invested. (vi) All potential providers have an equal opportunity to bid, for example, no potential provider is given the opportunity to review other bids (i.e., a"last look")before providing a bid. (vii) At least three reasonably competitive providers are solicited for bids; reasonably competitive provider is a provider that has an established industry reputation as a competitive provider of the investments being purchased. The bids received must meet all of the following requirements: (i) The issuer receives at least three bids from providers that the issuer solicited under a bona fide solicitation, which bids meet the requirements set forth immediately above and that do not have a material financial interest in the issue. A lead underwriter in a negotiated underwriting transaction is deemed to have a material financial interest in the issue until fifteen (15) days after the Issue Date. In addition, any entity acting as financial advisor with respect to the purchase of the investment at the time the bid specifications are forwarded to potential providers has a material financial interest in the issue. A provider that is a related party to a person that has a material financial interest in the issue is deemed to have a material financial interest in the issue. A-5 2366379.1 038723 TAGMT (ii) At least one of the three bids received is from a reasonably competitive provider of such types of investments, as described in paragraph (vii) above. (iii) If the issuer uses an agent to conduct the bidding process,the agent did not bid to provide the investment. The winning bid must be: (i) In the context of a guaranteed investment contract, the highest yielding bona fide bid(determined net of any broker's fees). (ii) In the context of investments other than guaranteed investment contracts, the lowest cost bona fide bid (including any broker's fees). The lowest cost bid is either the lowest cost bid for the portfolio or if the issuer compares the bids on an investment by investment basis, the aggregate cost of a portfolio comprised of the lowest cost for each investment. Any payment received by the issuer from a provider at the time the investment is purchased (e.g., an escrow float contract) for a yield restricted defeasance escrow under a bidding procedure meeting the requirements of this definition is taken into account in determining the lowest cost bid. In general, the lowest cost bona fide bid (including any broker's fee) may not be greater than the cost of the most efficient portfolio comprised exclusively of SLGS available for purchase from the Bureau of Public Debt. The cost of the most efficient portfolio of SLGS is to be determined at the time that bids are required to be submitted pursuant to-the terms of the bid specifications. This requirement to compare to the most efficient SLGS portfolio does not apply if SLGS are not available for purchase on the date that bids are required to be submitted because sales of those securities have been suspended. The provider of the investments or the obligor on the guaranteed investment contract certifies the administrative costs,that it pays (or expects to pay), if any, to third parties in connection with supplying the investment. The issuer must retain the following records with the bond documents until three years after the last outstanding bond is redeemed: (i) For guaranteed investment contracts, a copy of the contract, and for other types of purchases,the purchase agreement or confirmation. (ii) The receipt or other record of the amount actually paid by the issuer for the investment, including a record of any administrative costs paid by the issuer to third parties and the certification of such costs. (iii) For each bid that is submitted, the name of the person and entity submitting the bid,the time and date of the bid and the bid results. A-6 2366379.1 038723 TAGMT (iv) The bid solicitation form and, if the terms of the purchase agreement or the guaranteed investment contract deviated from the bid solicitation form or a submitted bid is modified, a brief statement explaining the deviation and stating the purpose of the deviation. If the issuer replaces an investment in the winning bid portfolio with another investment, the purchase price of the investment must be bid under a bidding procedure meeting the requirements of this definition. (v) For purchases of investments other than guaranteed investment contracts, the most efficient portfolio of SLGS, determined at the time that the bids were required to be submitted pursuant to the terms of the bid specifications. "Final Computation Date" means the day the last obligation that is part of the Obligations is discharged. "Fixed Yield Bond" means any obligation whose yield is fixed and determinable on its issue date using the assumptions and rules set forth in Treasury Regulations §1.148-4(b). "Fixed Yield Investment" shall mean any Investment, the Yield on which is fixed and determinable on its Issue Date. "Fixed Yield Issue" means any issue at any time that each bond included in it and still outstanding is a Fixed Yield Bond. "Future Value" or "FV" of a payment or receipt means the amount, determined by using the economic accrual method (the method of computing yield based on the compounding of interest at the end of each compounding period), equal to the value of such payment or receipt at the time it is paid or received (or treated as paid or received), plus interest assumed to be earned and compounded over the period at a rate equal to the yield on the bonds,using the same compounding interval and financial conventions used to compute yield. "Governmental Bonds" mean bonds issued as part of an issue the interest on which is excluded from gross income for federal income tax purposes under Code §103(a) and which are not Qualified Private Activity Bonds or Qualified 501(c)(3)Bonds. "Governmental Unit" means a state or local governmental unit as defined in Treasury Regulations §1.103-1 or any instrumentality thereof, excluding the United States or any agency or instrumentality thereof. "Gross Proceeds" shall mean Sale Proceeds, Investment Proceeds, Transferred Proceeds and Replacement Proceeds. The term "Gross Proceeds" does not include Qualified Administrative Costs, nor does it include amounts properly within the applicable yield allowance for acquired purpose investments (one-eighth of one percentage point (V8%)) or for acquired program investments(one-and-one-half percentage points(1%2%)). A-7 2366379.1 038723 TAGMT "Higher Yielding Investment" shall mean a Nonpurpose Investment, the Yield on which exceeds the yield on the Obligations by more than the spread permitted by the Code and Treasury Regulations. "Installment Computation Date" shall mean any date with respect to a Fixed Yield Bond Issue; with respect to a Variable Yield Bond Issue,the Issuer may treat the last day of any Bond Year ending on or before the latest date as of which the first Rebate Amount is required to be paid (i.e., as of not later than the fifth anniversary date of the date of issuance of the Obligations) as a Computation Date, but may not change that treatment after the first payment date; and, after the first required payment date,the Issuer must consistently treat either the end of each Bond Year or the end of each fifth Bond Year as a Computation Date and may not change these Computation Dates after the first required payment date. Notwithstanding any of the foregoing, the first rebate installment payment must be made on a Computation Date that is not later than five (5) years after the Issue Date. Subsequent rebate installment payments must be made for a Computation Date that is not later than five (5) years after the previous Computation Date for which an installment payment was made (until and excluding the Final Computation Date). The references herein to the date on which rebate is required to be paid allude to the actual date as of which the Rebate Amount is required to be calculated and not the 60-day grace period following such date during which the Rebate Amount, if any, is to be paid. "Investment" means (i) any security (within the meaning of Code §165(g)(2)(A) or (B), (ii) any obligation (other than Tax-Exempt Obligations which are not "specified private activity bonds" within the meaning of Code §57(a)(5)(C)), (iii) any annuity contract within the meaning of Code §72, (iv) any residential real property for family units not located within the jurisdiction of the Issuer and which is not required to implement a court-ordered or approved housing desegregation plan or (v) any investment-type property that is held as a passive vehicle for the production of income, including any prepayment for property or services if a principal purpose of prepayment is to receive an investment return from the time the prepayment is made until the time payment would otherwise have been made. "Investment Proceeds" means any amounts actually or constructively received from investing proceeds of the Obligations. "Issue Price" shall mean the initial offering price to the public at which price a substantial amount of each maturity of the Obligations was sold. �Ten percent (10%) is a substantial amount. For this purpose, the term "the public' does not include bond houses, brokers, or similar Persons or organizations acting in the capacity of underwriters or wholesalers. The Issue Price generally is the first price at which the Obligations were sold to the public and the Issue Price will not change if part of the issue is subsequently sold at a different price. The Issue Price of Obligations that are not substantially identical is determined separately. The Issue Price of a bond issue for which a bona fide public offering is made is determined as of the sale date based on reasonable expectations regarding the initial public offering price. The Issue Price of the Obligations may not exceed their Fair Market Value as of their sale date. If the obligations are privately placed,the Issue Price is the price paid for them by the first buyer. "Multipurpose Issue" means an issue the proceeds of which are used for two or more separate purposes determined in accordance with Treasury Regulations §1.148-9(h). A-8 2366379.1 038723 TAGMT "Net Sale Proceeds" means sale proceeds less the portion of those sale proceeds invested in a reasonably required reserve or replacement fund or as part of a minor portion. "Nonpurpose Investment" means any Investment in which Gross Proceeds are invested and which is not acquired to carry out the governmental purpose of the issue. "Nonpurpose Receipt" shall mean those receipts of moneys as described in Subsection 5.2(d)of this Tax Certificate. "Official Statement" means the Official Statement, if any, of the Issuer relating to the Obligations. "Person" means any individual, corporation, partnership,joint venture, association,joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. "Plain Par Bond"means a qualified tender bond or a bond that(i) is issued with original issue discount equal to not more than two percent (2%) of the stated redemption price at maturity plus the amount of original issue premium attributable exclusively to underwriters' compensation, (ii) is issued for a price that does not include pre-issuance accrued interest, (iii)bears interest from the issue date at a single stated fixed rate or is a variable rate obligation under Code §1275, in either case, that pays interest unconditionally payable at least annually, and (iv)has a lowest stated redemption price not less than its outstanding stated principal amount. "Plain Par Investment" means an investment that is an obligation that (i) is issued with original issue discount (or if acquired on a date other than the issue date, acquired with market discount or premium) equal to not more than two percent of the stated redemption price at maturity, (ii)is issued for a price that does not include pre-issuance accrued interest, (iii)bears interest from the issue date at a single stated fixed rate or is a variable rate obligation under Code §1275 that pays interest unconditionally payable at least annually, and (iv) has a lowest stated redemption price not less than its outstanding stated principal amount. "Present Value"or 11PV"means the amount determined by using the following formula: FV PV= (1+i)n where i equals the discount rate divided by the number of compounding intervals in a year and n equals the sum of (i) the number of whole compounding intervals for the period beginning on the date as of which Present Value is computed and ending on the date the amount is to be received or paid or on a Computation Date and (ii) a fraction the numerator of which is the length of any short compounding interval during such period and the denominator of which is the length of a whole compounding interval. "Private Activity Bonds" means a bond which meets the definition contained in Code §141(a) and that is not a"qualified bond" as defined in Code §141(e). A-9 2366379.1 038723 TAGMT "Qualified 501(c)(3)Bond" means a bond which meets the definition contained in Code §145. "Qualified Administrative Costs"mean: (i) In General. All reasonable, direct administrative costs, other than carrying costs, such as separately stated brokerage or selling commissions, but not legal and accounting fees, record keeping, custody, and similar costs. General overhead costs and similar indirect costs of the Issuer such as employee salaries and office expenses and costs associated with computing the Rebate Amount are not qualified administrative costs. In general, administrative costs are not reasonable unless they are comparable to administrative costs that would be charged for the same investment or a reasonably comparable investment if acquired with a source of funds other than gross proceeds of Tax-Exempt Obligations. (ii) Regulated Investment Companies and External Commingled Funds. For publicly offered regulated investment companies (as defined in Code §67(c)(2)(B)) and commingled funds in which the Issuer and any Controlled Entity do not own more than ten percent (10%) of the beneficial interest in the fund, Qualified Administrative Costs are all reasonable administrative costs, without regard to the limitation on indirect costs described in the preceding paragraph. (iii) GICs and Investments Purchased for a Yield Restricted Defeasance Escrow. An amount paid for a broker's commission or similar fee paid with respect to a guaranteed investment contract or investments purchased for a yield restricted defeasance escrow will be considered reasonable if(i) the fee does not exceed the lesser of$38,000 or 0.2 percent of the "computational base", or, if more, $4,000, where "computational base" means (A) for a guaranteed investment contract, the amount reasonably expected, as of the date the contract is acquired, to be deposited in the guaranteed investment contract over the term of the contract and (B) for yield restricted defeasance escrows, the amount of proceeds initially invested in those investments; and (ii) for any issue, the fees paid, do not exceed $108,000 in the aggregate. In the case of a calendar year after 2014, each of the dollar amounts set forth above shall be increased by an amount equal to such dollar amount multiplied by the cost of living adjustment for such calendar year as described in Treasury Regulations §1.148-5(e)(2)(iii)(B). (iv) Purpose Investments. Qualified Administrative Costs include costs or expenses paid, directly or indirectly, to purchase, carry, sell, or retire the investment, costs of issuing, carrying, or repaying the issue, and any underwriters' discount, any of which are paid by the conduit borrower, even if such payments merely reimburse the Issuer, but only to the extent the Present Value of those payments does not exceed the Present Value of the reasonable administrative costs paid by the Issuer using the Bond Yield as the discount rate. (v) Program Investments. Qualified Administrative Costs include only costs of issuing, carrying, or repaying the issue, and any underwriters' discount, subject to the limitation contained in the preceding paragraph. A-10 2366379.1 038723 TAGMT "Qualified Guarantee" means, with respect to a bond, an unconditional transfer, in any form, of substantially all of the credit risk for all or part of the payments, such as payments for principal and interest, redemption prices or tender prices, on the guaranteed bonds. The guarantor must not expect to make any payments other than those pursuant to a direct-pay letter of credit or similar arrangement for which the guarantor will be immediately reimbursed. Reasonable procedural or administrative requirements or, in the case of a guarantee against failure to remarket a qualified tender bond, commercially reasonable limitations based on credit risk, will not cause the guarantee to be conditional. The guarantor may not be a co-obligor, nor may the obligor and any related parties combined use more than ten percent of proceeds of the guaranteed portion of the bonds. The guaranteeTee must not exceed a reasonable arm's-length charge solely for the transfer of the credit risk. A guarantee will not be qualified unless, as of the date the guarantee is obtained,the Issuer reasonably expects that the present value of all fees for the guarantee will be less than the present value of the expected interest savings on the issue as a result of the guarantee. For this purpose, present value is computed using the yield on the issue, determined with regard to the guarantee fees, as the discount rate. "Qualified Hedge" means, with respect to the Obligations, a contract between the Issuer and any unrelated party entered into to modify the Issuer's risk of interest rate changes with respect to the Obligations that meets the requirements of Treasury Regulations §1.148-4(h). The contract may be an interest rate swap, an interest rate cap, a futures contract, a forward contract, an option or may take another form. "Rebate Amount" means with respect to the Obligations, the amount computed as described in Section 5.2(d) of this Tax Certificate. "Replacement'Proceeds" means amounts which have a sufficiently direct nexus to the issue or the governmental purpose of the issue to conclude that the amounts would have been used for that governmental purpose if the proceeds of the issue were not used for that governmental purpose. The governmental purpose of a bond issue includes the expected use of amounts for the payment of debt service on a particular date. For this purpose, the mere availability or preliminary earmarking of amounts for a purpose does not in and of itself establish a sufficient nexus to cause those amounts to be Replacement Proceeds. Replacement Proceeds include funds and amounts held by the Issuer including: (i) sinking funds, such as debt service funds,redemption funds,reserve funds, replacement funds, or any other fund, to the extent reasonably expected to be used directly or indirectly to pay principal or interest on the Obligations; (ii) pledged funds, any amount directly or indirectly pledged to pay principal or interest on`the Obligations, cast in any form but providing reasonable assurance that such amount will be available to pay principal or interest on the Obligations, even if the Issuer encounters financial difficulty; (iii) negative pledges, amounts held under an agreement to maintain such amount at a particular level for the direct or indirect benefit of holders or a guarantor of the Obligations, excluding amounts the Issuer, or, a Controlled Entity of the Issuer may grant rights in superior to the rights of the bondholders or the guarantor and amounts not A-11 2366379.1 038723 TAGMT in excess of the reasonable needs for which it is maintained,the required level of which is tested no more frequently than every six(6)months and which may be spent without any substantial restriction other than a requirement to replenish such amount by the next testing date; and (iv) other replacement proceeds, including amounts arising during a period that the Obligations, to the extent reasonably expected by the Issuer as of the issue date, remain outstanding longer than necessary and amounts arising to the extent proceeds of the Obligations are used to finance a working capital reserve unless all of the Net Sale Proceeds of the Obligations are spent within six (6) months of their issue date, or meet the "small governmental issuer" exception to rebate or the Issuer traditionally maintained a working capital reserve. The amount of the working capital reserve maintained is the average amount so maintained during annual periods of at least one year, the last of which ends within a year of the issue date. "Restricted Working Capital Expenditures" means Working Capital Expenditures subject to the Bond-Proceeds-Spent-Last Accounting Method in Treasury Regulations §1.148-6(d)(3)(i) and that are ineligible for any exception to that rule. "Sale Proceeds" means any amounts actually or constructively received from the sale of the Obligations, including amounts used to pay underwriters' discount or compensation, accrued interest other than pre-issuance accrued interest, or derived from the sale of a right associated with a bond as further described in Treasury Regulations §1.148-4(b)(4). "SLGS" means U.S. Treasury Book Entry Securities, State and Local Government SSuffolks. "Tax Certificate" shall mean this Tax Certificate, as the same may be amended, modified or supplemented from time to time in accordance with the terms hereof. "Tax-Exempt Obligation" shall mean any obligation described in Code §103(a) the interest on which is excluded from the federal gross income of-the owners thereof and which is not a"specified private activity bond"as defined in Code §57(a)(5)(C). "Tax-Exempt Organization" shall mean an entity organized under the laws of the United States of America or any state thereof which is an organization described in Code §501(c)(3) and exempt from federal income taxes under Code §501(a), or corresponding provisions of federal income tax laws from time to time in effect. "TRAM Expenditure Safe Harbor" means the safe harbor set forth in Code §148(f)(B)(iii) pursuant to which proceeds of issues of tax or revenue anticipation notes ("TRANs") and that meet the conditions described in Subsection 5.2(e)(iii)(A) hereof are deemed spent within six(6)months of the date of issue of the TRANs. "Transferred Proceeds" means unexpended original or investment proceeds of a refunded issue which transfer and become proceeds of the refunding issue when proceeds of the refunding issue are applied to pay principal of the refunded issue. A-12 2366379.1 038723 TAGMT "Treasury"means the United States Department of Treasury. "Treasury Regulations" means the Income Tax Regulations promulgated under Code §§103 and Code §§141 through 150 and related provisions of the Code applicable to Tax-Exempt Obligations, as amended from time to time, and any applicable predecessor provisions of the Code,as amended from time to time. "Universal Cap" means the maximum value of Nonpurpose Investments which may be allocated to the Obligations and is determined by reference to the Value of all outstanding Obligations of the issue. Nonpurpose Investments shall be taken into account as Nonpurpose Receipts at their Value on a Valuation Date. "Valuation Date" means the date on which the value of the Universal Cap and the Nonpurpose Investments allocable to the Obligations thereunder are determined. With respect to new money issues, the first Valuation Date shall be the second year anniversary date of the Issue Date of the Obligations; thereafter, the first day of each Bond Year shall constitute a Valuation Date. With respect to a refunding issue, each date on which proceeds of the refunded issue would become transferred proceeds of the refunding issue, e.g., each date on which principal of the refunded issue is paid with proceeds of the refunding Obligations, shall constitute a Valuation Date. In addition,the first date of each Bond Year shall also be a Valuation Date. "Value" means, in the case of a bond, the Value of the bond and in the case of an Investment,the Value of the Investment. "Value of a Bond" means, in the case of a Plain Par Bond, its outstanding stated principal amount, plus accrued unpaid interest or in the case of a Plain Par Bond actually redeemed, or treated as redeemed, its stated redemption price on the redemption date plus accrued'unpaid interest. In the case of a bond other than a Plain Par Bond,the value on a date of such a bond is its Present Value on that date, using the yield on the issue of which the bonds are a part as the discount factor. In determining the Present Value of a variable rate bond, the initial interest rate on the bond established by the index or other rate setting mechanism is used to determine the interest payments on that bond. "Value of an Investment" means, on any date means, as permitted or required, the Present Value or the Fair Market Value of the Investment or its outstanding principal amount. Paragraphs (a) through (f) below specify the valuation methods required or permitted to be used for the Investments listed: (a) Fixed Rate Investments. A Fixed Rate Investment may be valued at its Present Value or at its Fair Market Value on any date unless it is required to be invested at a restricted yield. (b) Plain Par Investments. A Plain Par Investment may be valued at its outstanding stated principal amount on any date (plus interest accrued but unpaid on that date)unless it is required to be invested at a restricted yield. (c) Any Investment Any Investment may be valued at its Fair Market Value on any date unless it is required to be invested at a restricted yield. A-13 2366379.1038723 TAGMT (d) Yield Restricted Investments. An Investment required to be invested at a restricted yield (for example, an Investment held after the expiration of the applicable investment temporary period) must be valued at its Present Value as of any date unless the Investment is required to be valued at Fair Market Value as provided in paragraph (e) below. (e) Mandatory Valuation at Fair Market Value. Subject to paragraph (d) above, Investments deemed to be acquired or disposed of with respect to Obligations (as a result; for example, of sinking fund deposits or withdrawals) must be valued on the deemed acquisition or disposition date at Fair Market Value unless (i)the Investment was allocated from one issue of Tax-Exempt Obligations to another as Transferred Proceeds or as a result of the application of the Universal Cap rule in which case it may be valued at Present Value or (ii) the Investment is held in a commingled fund (other than a bona fide debt service fund or a commingled fund that operates exclusively as a reserve fund, sinking fund or replacement fund for two or more issues of the Issuer) unless it is an investment being initially deposited in or withdrawn from a commingled fund. (f) Special Rule for Transferred Proceeds. Notwithstanding any matter stated above, the Value of any Nonpurpose Investment allocable to Transferred Proceeds of an issue of refunding obligations may not exceed the Value of that Investment used for purposes of applying the arbitrage restrictions to the refunded obligations on the date proceeds of the refunding obligations are used to redeem the refunded obligations. "Working Capital Expenditure" means any cost of a type that does not constitute a Capital Expenditure. "Yield" means, as of any Computation Date, the yield computed on an issue of obligations under Treasury Regulations §1.148-4 and on an Investment under Treasury Regulations §1.148-5 in either case by compounding interest at the end of each compounding interval as further described in paragraphs (a) and(b)below: (a) When used with respect to a Fixed Yield Issue, yield means that discount rate that, when used in computing the Present Value of (i) all unconditionally payable payments of principal and interest of or on the bonds included in such Fixed Yield Issue, (ii) all unconditionally payable fees for Qualified Guarantees and Qualified Hedges on such bonds and (iii) all fees expected to be paid for Qualified Guarantees and Qualified Hedges,produces an amount equal to the sum of the Present Value of the aggregate issue prices of the bonds comprising the issue (determined using the same discount rate used to determine the Present Value of payments for principal, interest and Qualified Hedges and Qualified Guarantees). The yield is computed as of the issue date of the Fixed Yield Issue by treating each bond included in the issue that is either subject to mandatory or contingent early redemption or to certain optional redemption provisions as being redeemed on its expected early redemption date for an amount equal to its Value on that date. If a Fixed Yield Bonds (i)is subject to optional redemptions within five years of its issue date and the yield not taking into account the optional redemption is more than one- eighth of one percent (0.125%) above its yield assuming the early redemption, (ii)is issued at an issue price that exceeds the stated redemption price at maturity by more than A-14 2366379.1 038723 TAGMT r one-quarter of one percent (0.25%) multiplied by the product of the stated redemption price to maturity and the number of complete years to the first optional redemption date for the bond, or (iii)bears interest at increasing interest rates, the yield on the issue including such Fixed Yield Bonds is computed by treating the Fixed Yield Bonds as redeemed at its stated redemption price on the optional redemption date that produces the lowest yield on the issue. No adjustment will be made on any Computation Date to the yield on a Fixed Yield Issue as computed on its issue date unless redemption rights are subsequently transferred to a third party or termination payments are received with respect to Qualified Hedges. The yield on a Fixed Yield Bonds is calculated in the same manner as yield on a Fixed Yield Issue. (b) When used with respect to any Investment allocated to an Issue, yield means the yield on the Investment computed using the same compounding interval and financial conventions used to calculate the yield on the issue of obligations to whicl�it is allocated. The yield on an Investment allocated to an issue is the discount rate that,when used on the date the Investment is first purchased with Gross Proceeds or allocated to Gross Proceeds of the issue to compute the Present Value on that date of all unconditionally payable Nonpurpose Receipts from the Investment, produces an amount equal to the Present Value on that date of all unconditionally payable Nonpurpose Payments for the Investment. "Yield Reduction Payments" means periodic payments made on Installment Computation Dates with respect to certain Investments subject to yield restriction which are treated as a payment for such Investments that reduces the Yield on such Investment,made to the United States under Treasury Regulations §1.148-5(c). Yield reduction payments may be made with respect to (a) Investments allocable to proceeds eligible for a temporary period after such temporary period has expired, (b) investments allocable to a Variable Yield Issue during any Computation Period in which at least five percent of the issue is represented by variable yield bonds, (c) Nonpurpose Investments allocable to Transferred Proceeds of a current refunding issue to the extent necessary to satisfy yield restriction or of an advance refunding to the extent that investment in zero yielding Nonpurpose Investments fails to properly restrict the Yield, (d)purpose investments allocable to certain qualified student loans, (e) Nonpurpose Investments allocable to a reasonably required reserve or replacement fund that but for its size would be treated as a reasonably required reserve or replacement fund, to the extent that certain other size constraints are satisfied, (f) Nonpurpose Investments allocable to Replacement Proceeds by virtue of the Universal Cap, and(g) amounts eligible for transitional relief. "Yield Restricted" or "Yield Restriction" shall mean required to be invested at a yield that is not materially higher than the Yield on the Obligations of the applicable issue under Code §148 and Treasury Regulations '§1.148-2. A-15 2366379.1038723 TAGMT EXHIBIT B FORM 8038-G (see attached) 2366379.1 038723 TAGMT • Form 8038-G Information Return for Tax-Exempt Governmental Obligations I (Rev.September 2011) Do-Under Internal Revenue Code section 149(e) OMB No.1545-0720 Department of the Treasury I►See separate instructions. Internal Revenue Service Caution:If the issue price is under$100,000,use Form 8038-GC. If Reporting Authority If Amended Return, check here ► ❑ 1 Issuer's name 2 Issuer's employer identification number(EIN) Town of Southold 11-6001939 3a Name of person(other than issuer)with whom the IRS may communicate about this return(see instructions) 3b Telephone number of other person shown on 3a 4 Number and street(or P.O.box if mail is not delivered to street address) Room/suite 5 Report number(For IRS Use Only) 53095 Main Road 3 6 City,town,or post office,state,and ZIP code 7 Date of issue Southold,New York 11971 08/28/2014 8 Name of issue 9 CUSIP number $2,044,000 Various Purposes Bond Anticipation Note-2014 None 10a Name and title of officer or other employee of the issuer whom the IRS may call for more information(see 10b Telephone number of officer or other instructions) employee shown on 10a Scott A.Russell,Supervisor 631 765-1889 Type of Issue(enter the issue price).See the instructions and attach schedule. 11 Education . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 12 Health and hospital . . . . . . . . . . . . . . . . . . . . . . . . . . 12 13 Transportation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 14 Public safety . . . . . . . . . . . . . . . 14 15 Environment(including sewage bonds) . . . . . . . . . . . . . . . . . . . . 15 16 Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 17 Utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 18 Other. Describe ► Various Purposes 18 2,044,000.00 19 If obligations are TANS or RANs, check only box 19a . . . . . . . . . . . . . ► ❑ ;:;. : , n;i If obligations are BANS,check only box 19b . . . . . . . . . . . . . . ► .;:' ;" -' .r.= ;;; 20 If obligations are in the form of a lease or installment sale,check box . . . . . . . ► ❑ ;- 9" 5m" ':` `." , SM I LiM Ll Description of Obligations. Complete for the entire issue for which this form is being filed. (a)Final maturity date (b)Issue price (c)Stated redemption (d)Weighted price at maturity average maturity (e)Yield 21 08/28/2015 $ 2,044,000.00 $ 2,044,000.00 1.0000 years 0.7286 Uses of Proceeds of Bond Issue(including underwriters' discount) 22 Proceeds used for accrued interest . . . . . . . . . . . . . . . . . . . . . 22 0.00 23 Issue price of entire issue(enter amount from line 21,column(b)) . . . . . . . 23 21044,000.00 24 Proceeds used for bond issuance costs(including underwriters'discount). 24 5,000.00 25 Proceeds used for credit enhancement . . . . . . . . . . . . 25 0.00` , ­ 26 Proceeds allocated to reasonably required reserve or replacement fund 26 0.00 27 Proceeds used to currently refund prior issues . . . . . . . . . 27 234 000.00 28 Proceeds used to advance refund prior issues . . . . . . . . . 28 0.00 29 Total(add lines 24 through 28) . . . . . . . . . . . . . . . . . . . . . . . 29 239,000.00 30 Nonrefunding proceeds of the issue(subtract line 29 from line 23 and enter amount here) . . . 30 1,805,000.00 LjEMT Description of Refunded Bonds. Complete this part only for refunding bonds. 31 Enter the remaining weighted average maturity of the bonds to be currently refunded . . . . ► 0.0027 years 32 Enter the remaining weighted average maturity of the bonds to be advance refunded . . . . ► N/A years 33 Enter the last date on which the refunded bonds will be called(MM/DDNYYY) . . . . . . ► 08/29/2014 34 Enter the date(s)the refunded bonds were issued►(MM/DDNYYY) 08/29/2013 For Paperwork Reduction Act Notice,see separate instructions. Form 8038-G(Rev.9-2011) ISA r • r • Form 8038-G(Rev.9-2011) Page 2 FOMWR Miscellaneous 35 Enter the amount of the state volume cap allocated to the issue under section 141(b)(5) . . . . 35 36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract yak` (GIC)(see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . 36a b Enter the final maturity date of the GIC► c Enter the name of the GIC provider► x: 37 Pooled financings: Enter the amount of the proceeds of this issue that are to be used to make loans -� to other governmental units . . . . . . . . . . . . . . . . . . . . . . . . 37 38a If this issue is a loan made from the proceeds of another tax-exempt issue, check box► ❑and enter the following information: b Enter the date of the master pool obligation► c Enter the EIN of the issuer of the master pool obligation Po- d d Enter the name of the issuer of the master pool obligation Op- 39 39 If the issuer has designated the issue under section 265(b)(3)(131)(i)(III)(small issuer exception),check box . . . . ► 40 If the issuer has elected to pay a penalty in lieu of arbitrage rebate,check box . . . . . . . . . . . . . ► ❑ 41a If the issuer has identified a hedge,check here► ❑ and enter the following information: b Name of hedge provider► c Type of hedge► d Term of hedge► 42 If the issuer has superintegrated the hedge, check box . . . . . . . . . . . . . . . . . . . . . ► ❑ 43 If the issuer has established written procedures to ensure that all nonqualified bonds of this issue are remediated according to the requirements under the Code and Regulations(see instructions),check box . . . . . . . . IN- 44 44 If the issuer has established written procedures to monitor the requirements of section 148, check box . . . . . ► 45a If some portion of the proceeds was used to reimburse expenditures check here► X and enter the amount of reimbursement . . . . . . . . . ► $115,455.00 115,455.00 b Enter the date the official intent was adopted► 9/1'0/13and 6/17/14 Under penalties of perjury,I de that I have examined this return and accompanying schedules and statements,and to the best of my knowledge Signature and belief,they are true,co ct, d complete.I further declare that I consent to the IRS's disclosure of the issuer's return information,as necessary to and process this return,to the ers that I have au zed above. Consent ' 'Scott A.Russell,Supervisor Signature of issuers authorized representative Date Type or print name and title Paid Print/Type preparer's name Preparer's signature Date PTIN Check❑ if Preparer Robert P.Smith self-employed IP01085234 Use Only Firm's name ►Hawkins Delafield&Wood LLP Firm's EIN lo-13-55133990 Firm's address ►One Chase Manhattan Plaza,NY NY 10005 Phone no. 212 820-9400 Form 8038-G(Rev.9-2011) EXHIBIT C Economic Lives and Private Use of Proiects Financed with Proceeds of the Obligations (see attached) 2366379.1 038723 TAGMT EXHIBIT C , Town of Southold,New York—Various Purposes Bond Anticipation Nate-2014 (1) Coat oflirojectessets to be refinanced with proceeds ofthe Bonds S 2,044,00000 (2) Face Amount of Bonds S 2,044,00000 A B , C D E F Q H I I K L M Ratio of Financed Cost of Note Proceeds Acquisition or Each Asset(B)to Total Allocable to Asset(C) Period in Construction Cost of Each Project Cost of All Financed x Face Amount of Tax Economic Service Prior Period Following Adjusted Economic Remaining Private Activity Refinanced with Assets Notes PPU Life'(m Life" Bms of to Issue Date Issue Date Life Weighted We Private Amount Proiects Notes (from Item(1)1 (from Item(2)) yrs) (Myrs) Determination (in vis)"' (m vial (F-H or F+I) (D x Il Activsy% (Bx L) Hiahwav Improvements 9,00000 00044 9.00000 1000 1000 Town Estimate 7.00 000 300 27,000 00 0 00% - Wastewater Disposal District 110,000 00 00538 110,000.00 40.00 4000 Town Estimate 400 000 36 00 3,960,000 00 000% Acquisition of Highway Equipment 89,000.00 00435 89,000.00 1500 1500 Town Estimate 300 0.00 12.00 1.068.000.00 0 00% hnprovements Town-owned Facilities 26,000 00 00127 26,000 00 5.00 5 00 Town Estimate 200 000 300 78,000 00 0,00% - Acquisition Highway Department Track 185.000 00 00905 185,000 00 500 5 00 Town Estimate 000 000 500 925,000 00 000% Bay Avenue Bridge $800,00000 03914 800,000 00 2000 2000 Town Habitude 0 00 000 2000 16,000,000 00 0 00% Town Highway Facilities 825.000 00 04036 825000 2000 20.00 Town Estimate 000 000 2000 16.500.000 00 000% Total S 2,044,000 00 10000 S 2.044,000 00 38.558,000 00 •Asset life allowed under State Finance Law. '•Asset life allowed for tax purposes pursuant to bond coursers analysis _Based on Bond Resolution Average Economic Life= Total K 1886 yews Aggregate Private = Total M = 0 000°/ Doc 2367559 Total D Activity Totsl B-1 Page t of t Useful Life Spreadsheet c EXHIBIT D SAFE-HARBOR MANAGEMENT CONTRACT GUIDELINES REV.PROC. 97-13 General Rule. A contract between a state or local governmental unit or a Section 501(c)(3) organization (a"Qualified User") and a non-exempt provider(a"Provider) for the management of, or services rendered at, or incentive payment in respect of, a tax-exempt bond-financed facility that meets the safe-harbor guidelines of Rev. Proc. 97-13 as summarized below and does not otherwise give the Provider an ownership or leasehold interest in bond-financed property for federal income tax purposes is treated as not creating any private business use under Sections 141(b) or 145(a)(2)(B) of the Internal Revenue Code (the "Code"). In addition, if the guidelines are met, the burden to prove that the contract creates impermissible private activity would shift to the Internal Revenue Service ("IRS") in a tax court proceeding. All contracts must be reviewed on a case-by-case basis. General Requirements. 1. Reasonable Compensation and No Net Profits. The compensation must be reasonable and no portion of the compensation paid to the Provider may in any event be based on net profits derived from the bond-financed facility. However, a compensation that is based on a percentage either of gross revenues or of expenses (but not both) is permitted. Reimbursement for actual and direct expenses paid by the Provider to unrelated persons is not by itself treated as compensation. 2. No Penalty if Required to be Cancelable. Whenever a contract is required to be cancelable as described below, it must be possible to cancel it without penalty imposed on the Qualified User. A "penalty" means: (a) any limitation on the Qualified User's right to compete with the Provider; (b) any requirement that the Qualified User purchase equipment, goods or services from the Provider; or (c) any requirement that the Qualified User pay liquidated damages for cancellation of the contract. A requirement that the Qualified User reimburse ordinary and necessary expenses of the Provider or a restriction against hiring key personnel of the Provider is nota penalty. A penalty may exist where provisions of another contract between the Provider and Qualified User (e.g., a loan or guarantee) impair the practical ability of the Qualified User to terminate the service contract for example by automatically terminating when the service contract terminates. 3. No Role or Relationship between Qualified User and Provider. There must not be any role or relationship between the Qualified User and the Provider that would substantially limit the Qualified User's ability to exercise its rights under the contract, including cancellation rights. !This requirement is considered satisfied if (a) not more than 20 percent of the voting power of the governing board of the Qualified User is vested in the Provider and its directors, officers, shareholders and employees, (b) overlapping board members do not include the chief executive officers of the service provider or its governing body or the Qualified User or its D-1 2366379.1 038723 TAGMT governing body, and (c)the Qualified User and the Provider are not "related persons"within the meaning of Treasury Regulations §1.150-1(b). Permitted Contract Term and Compensation Arrangements. The contract term (which includes renewal options) and the compensation arrangements must meet one of the following five requirements: Contract Maximum Term Limit Permissible Compensation Arrangements 1. Lesser of 15 years (20 years for 1. At least 95% of compensation for each annual period public utility property) or 80% must be based on a periodic fixed fee. A one-time of the reasonably expected productivity award is permitted. useful life of the bond-financed property. No cancellation right required. 2. Lesser of 10 years (20 years for 2. At least 80% of compensation for each annual period public utility property) or 80% must be based on a periodic fixed fee. A one-time of the reasonably expected productivity award is permitted. useful life of the bond-financed property. No cancellation right required. 3. 5 years, cancelable by the 3. At least 50% of compensation for each annual period Qualified User at the end of 3 must be based on a periodic fixed fee or, alternatively, years without penalty. 100% must be based on a capitation fee or any combination of periodic fixed fees and capitation fees. 4. 3 years, cancelable by the 4. 100% of compensation may be based on a per-unit fee Qualified User at the end of 2 stated in the contract or otherwise specifically limited by years without penalty. the governmental service recipient or an independent third party (e.g., Medicare reimbursement formulas). Alternatively, 100% of compensation may be based on any combination of periodic fixed fees and per-unit fees. 5. 2 years, cancelable by the 5. 100% of compensation may be based on a percentage of Qualified User at the end of 1 the fees charged at the bond-fmanced facility except that, year without penalty. during the start-up period of the facility, it may be based on either gross revenues, gross revenues adjusted for bad debt or similar allowances or the expenses of the facility. This compensation arrangement is available only(i)with respect to facilities providing services to third parties (e.g., radiology facilities) or (ii)during an initial start-up period during which operations have been insufficient to permit a reasonable estimate of annual gross revenues. Definitions of Permissible Compensation Arrangements. 1. -Periodic Fixed Fee is a stated dollar amount for services rendered for a specified period of time. The stated dollar amount may automatically increase according to a specified objective external standard that is not linked to the output or efficiency of a facility, D-2 2366379.1 038723 TAGMT d e.g., the Consumer Price Index and similar external indices that track increases in prices in an area or increases in revenues or costs in an industry are objective external standards. 2. Capitation Fee is a fixed periodic amount payable for each person for whom services are provided (e.g., an HMO member) as long as the quantity and type of services actually provided vary substantially from person to person. A capitation fee may include a variable component of up to 20 percent of the total capitation fee designed to protect the Provider against risks such as catastrophic loss. 3. Per-Unit Fee is a stated amount for each unit of services provided (e.g., medical procedure performed, car parked, passenger mile traveled, ton of waste incinerated, unit of landfill capacity consumed). The stated dollar amount may automatically increase according to a specified objective external standard that is not linked to the output or efficiency of a facility, e.g., the Consumer Price Index and similar external indices that track increases in prices in an area or increases in revenues or costs in an industry are objective external standards. 4. Productivity Award is a stated dollar amount of additional compensation based on increases or decreases in gross revenues or reductions in total expense target (but not both)in any annual period during the term of a contract. Revision and Renewal of Management Contract. If the compensation arrangements of a management contract are materially revised, the requirements for compensation arrangements are retested as of the date of the material revision and the management contract is treated as one that was newly entered into as of the date of the material revision. A renewal option is a provision under which the Provider has a legally enforceable right to renew the contract. Thus, for example, a provision under which a contract is automatically renewed for one-year periods absent cancellation by either parry is not a renewal option (even if . it is expected to be renewed). Certain Exceptions. Certain arrangements generally are not treated as management contracts that are subject to the above rules. These include: (a) Contracts for services that are solely incidental to the primary governmental function or functions of a bond-financed facility (e.g., contracts for janitorial, office equipment repair,hospital billing or similar services); (b) The mere granting of admitting privileges by a hospital to a doctor, even if those privileges are conditioned on the provision of de minimis services, if those privileges are available to all qualified physicians in the area, consistent with the size and nature of its facilities; (c) A contract to provide for the operation of a facility or system of facilities that consists predominantly of public utility property (as defined in Code §168(i)(10)), if the only D-3 2366379.1 038723 TAGMT compensation is the reimbursement of actual and direct expenses of the Provider and reasonable administrative overhead expenses of the Provider; and (d) A contract to provide for services, if the only compensation is the reimbursement of the Provider for actual and direct expenses paid by the Provider to unrelated parties. D-4 2366379.1 038723 TAGMT EXHIBIT E CERTIFICATE OF PURCHASER (see attached) 2366379.1 038723 TAGMT I August 28,2014 TOWN OF SOUTHOLD (Issuer) RE: $2,044,000 Bond Anticipation Note for Various Purposes-2014 The undersigned, acting on behalf of Bridgehampton National Bank, Bridgehampton, New York (the "Purchaser'), hereby represents as follows with respect to the above-captioned notes (the"Notes"): (1) On August 19,2014 (the"Sale Date"),the Purchaser purchased the Notes directly from the Issuer. The interest rate on the Notes was the fair market value interest rate as of the Sale Date, given the purchase price for the Notes. The par amount and the stated interest rate for such Notes are listed as follows: Lot Par Amount Stated Interest Rate $2,044,000 0.73% (2) The Notes are being purchased in a direct, private placement transaction and the terms of the sale and purchase have been established through negotiations between the Purchaser and the Issuer in an arm's-length transaction. (3) The purchase price for the Notes is an amount equal to the aggregate principal amount of the Notes (i.e., $2,044,000). The Purchaser acknowledges that such price will be relied on by the Issuer and Hawkins Delafield & Wood LLP, Bond Counsel, as the issue price for establishing the yield on the Notes. (4) The Purchaser is purchasing the Notes for its own account as an investor and/or for deposit into a fund or trust for the purpose of selling interests in the trust. If the Purchaser, or any party related to the Purchaser, transfers or sells the Notes, or any interest in the Notes, to a fund or trust established by the Purchaser or a related party,the beneficial ownership of which is not entirely retained by the Purchaser or related party, or otherwise participates in a reoffering of the Notes or the offering of any derivative product (e.g., a tender option) with respect to the Notes, then either (i) such transfer, sale, reoffering or offering will not occur within 60 days of the date hereof, during which time the Notes will be beneficially owned, directly or indirectly,by the Purchaser or a related party for its exclusive benefit, risk and account, or (ii) both (A) the price at which the Notes is transferred, sold or reoffered and (B), if there be a division and sale of ownership rights in the Notes, the aggregate price at which such rights are sold, will not exceed the par value of the Notes, unless Bond Counsel provides a written opinion that the failure to satisfy this paragraph(4) will not adversely affect the exclusion from gross income of interest on the Notes. (5) The Purchaser will not receive any commission or fee in connection with the purchase of the Notes. We understand that the representations contained herein may be relied upon by the Issuer in making certain of the representations contained in the Tax Certificate executed by the Issuer in connection with the issuance of the Note or Notes, and we further understand that Hawkins Delafield& Wood LLP, Bond Counsel to the Issuer, may rely upon this certificate, among other things,in providing an opinion with respect to the exclusion from gross income of the interest on the Notes pursuant to Section 103 of the Internal Revenue Code of 1986,as amended. The undersigned is authorized to execute this certificate on behalf of the Purchaser, which certifications are not necessarily based on personal knowledge, but may instead be based on either inquiry deemed adequate by the undersigned or institutional knowledge (or both) regarding the matters set forth herein. Bridgehampton National Bank,Bridgehampton, New York By: Name: lai.t," Title: VP--T aUN tonw- EXHIBIT F FINANCING SCHEDULES 2366379.1 038723 TAGMT $2,044,000 Town of Southold, In the County of Suffolk,New York Bond Anticipation Note for Various Purposes-2014 New Structure Summary And Results Dated Date August 28, 2014 Issue Date August 28, 2014 Final Maturity August 28, 2015 Optional Redemptions Call Dates Call Price N/A N/A N/A N/A N/A N/A Arbitrage Yield 0.728673% N.I.C. 0.730000% (Net Interest Cost) W.A.M. 1.0000 Years (Weighted Average Maturity In Years) R.W.A.M. (for refundings only) (Remaining Weighted Average Maturity In Years) Current Refundings 0.0027 Years Arbitrage Yield Target Par Amount + 2,044,000.00 OIP/(OID) + _ Credit Enhancement + _ Accrued Interest + _ Total 2,044,000.00 Adjusted Total for N.I.0 Total Interest Cost + 14,921.20 OIP/(OID) - - Accrued Interest - - Adjusted Total 14,921.20 2366504_1 As 8/21/2014 3 33 PM 1 of 3 $2,044,000 Town of Southold, In the County of Suffolk,New York Bond Anticipation Note for Various Purposes-2014 Arbitrage Yield Analysis Present Value to Maturity Principal Total Annual 08/28/14 Date Amount Coupon Interest* Debt Service Debt Service 0.728673% 08/28/14 08/28/14 08/28/15 2,044,000.00 0.730% 14,921.20 2,058,921.20 2,058,92120 2,044,000.00 Totals 2,044,000.00 14.921.20 2.058.921.20 2.058.921.20 2.044.000.00 Arbitrage Yield Target Par Amount + 2,044,000.00 Target: 2,044,000.00 OIP/(OID) + - Variance: 0.00 Credit Enhancement + - t Accrued Interest + - Total 2,044,000.00 Notes *Interest calculations are based on 30/360 day basis. 2366504_1 As 8/21/2014 3:33 PM 2 of 3 $2,044,000 Town of Southold, In the County of Suffolk,New York Bond Anticipation Note for Various Purposes-2014 Price/Yields,Weighted Average Maturity and Net Interest Cost Maturity Principal Priced Years to Bond Yield To Call Date Amount Coupon Yield Price to— Issue Price Maturity Years Note? 08/28/14 08/28/14 08/28/15 2,044,000 00 0.730% 0.730% 100.000 Maturity 2,044,000.00 1.00 2,044,000 00 Totals 2,044,000.00 2.044.000.00 2,044,000.00 Total Interest Cost + 14,921.20 W.A.M. = 1.0000 OIP/(OID) - - (Weighted Average Maturity) Accrued Interest - N.I.C. = 07300000 Adjusted Total 14,921.20 (Net Interest Cost) 2366504_1.xls 8/21/2014 3:33 PM 3 of 3 EXHIBIT G PROCEDURES FOR POST-ISSUANCE COMPLIANCE WITH FEDERAL TAX LAW Local governments that borrow money on a tax-exempt basis are required to report to the Internal Revenue Service whether they have established written procedures to comply with applicable requirements of federal tax law for all issues of bonds, bond anticipation notes, tax anticipation notes, revenue anticipation notes, financing leases, energy performance contract financings, and any other instruments evidencing the borrowing of money (collectively the "Obligations"). The procedures set forth herein will assist the Town of Southold, in the County of Suffolk,New York(the "Issuer")in meeting the post-issuance requirements of federal tax law necessary to preserve the tax-exempt status of interest on tax-exempt Obligations issued by the Issuer. These procedures address Obligations issued for physical facilities and equipment for the Issuer (the "Capital Obligations") and Obligations issued to finance cash-flow operating requirements of the Issuer(the"Cash-Flow Obligations"). I. GENERAL PROCEDURES A. Responsible Official. The Supervisor of the Issuer (herein referred to as the "Responsible Official") will identify such officers and employee(s), who will be responsible for each of the procedures listed below, and will notify such officers and employee(s) of the responsibilities, and provide those persons with a copy of these procedures. Upon employee transitions, the Responsible Official will advise the new personnel of their responsibilities under these procedures and will ensure they understand the importance of these procedures. If employee positions are restructured or eliminated, the Responsible Official and/or the Town Board of the Issuer will reassign responsibilities as necessary. 2366379.1 038723 TAGMT B. Issuance of Obligations. 1. Bond Counsel. The Issuer will retain a firm of nationally-recognized bond counsel ("Bond Counsel") to deliver a legal opinion in connection with the issuance of all Obligations. The Responsible Official will consult with Bond Counsel and other legal counsel and advisors, as needed, following the issuance of Obligations to ensure that applicable post- issuance requirements are met, so that interest on each issue of Obligations will be excluded from gross income for federal income tax purposes. 2. Documentation of Tax Requirements. The federal tax requirements relating to each issue of Obligations will be set forth in a Tax Certificate (the "Tax Certificate") executed in connection with each issue of Obligations, which will be included in the closing transcript for each issue of Obligations. The Tax Certificate will contain certifications, representations, expectations and factual statements relating to the restriction on use of the facilities financed with Obligations by persons or entities other than the Issuer, changes in use of the facilities financed or refinanced with the proceeds of Obligations, restrictions applicable to the investment of the proceeds of any Obligations and other moneys relating to the Obligations, and arbitrage rebate requirements. The Responsible Official will review the Tax Certificate prior to the date of issue of each issue of Obligations. 3. Information Reporting. In connection with each issue of tax-exempt Obligations, the Issuer is required to file, or shall cause to be filed by Bond Counsel, an IRS Form 8038-G (or, if applicable, IRS Form 8038-GC). Any such IRS Form filed with the IRS, together with a proof of filing, will be included as part of the closing transcript for each issue of Obligations, or kept in the records maintained by Bond Counsel related to the appropriate issue of Obligations. The Responsible Official shall ascertain that such form has been filed in connection with each issue of Obligations. C. Record Retention. 1. General. Copies of all relevant documents and records sufficient to support that the tax requirements relating to all Obligations have been satisfied, including the following documents and records, should be maintained by the Issuer: 2366379.1 038723 TAGMT (a) Closing transcript; (b) All records of investments,arbitrage reports,returns filed with the IRS and underlying documents; (c) Construction contracts,purchase orders,invoices and expenditure and payment records; (d) Documents relating to costs reimbursed with the proceeds of Capital Obligations; (e) All contracts and arrangements involving Private Use of the property financed with Capital Obligations; (f) All reports relating to the allocation of the proceeds of Obligations and Private Use of property financed with Capital Obligations; (g) Itemization of property financed with the proceeds of Capital Obligations; and (h) In connection with Cash-Flow Obligations,information regarding the Issuer's revenue, expenditures and available balances sufficient to support the Issuer's prospective and actual maximum cumulative cash-flow deficit calculations. 2. Duration of Record Retention. All of the foregoing documents and records should be retained for the term of the Obligations, plus three (3) years, or if-the Obligations are refunded with the proceeds of a subsequent Obligation, the date three (3) years after the last of such refunding Obligations are retired. D. Capital Obligations. 1. Timely Expenditure of Proceeds of Capital Obligations. At the time of issuance of Capital Obligations issued to fund original expenditures, the Issuer must reasonably expect to spend at least 85% of all proceeds within three (3) years of the date of issuance of the 2366379.1038723 TAGMT Obligations. In addition, for Capital Obligations, the Issuer must have incurred or expect to incur within six months after issuance original expenditures of not less than 5% of the amount of such proceeds, and must expect to complete the project financed with Capital Obligations (the "Project") and expend the proceeds of such Capital Obligations to pay Project costs with due diligence. Satisfaction of these requirements allows the proceeds of Capital Obligations issued for the Project to be invested at an unrestricted yield for three (3) years. Failure to satisfy these requirements could subject the Issuer to rebate of investment income, and other penalties. The Responsible Official will monitor the appropriate capital project accounts to ensure that the proceeds of Capital Obligations are spent within the time period(s) required under federal tax law. Capital Obligations issued to refinance outstanding Capital Obligations are subject to separate expenditure requirements, which shall be outlined in the Tax Certificate relating to such Obligations. In connection with the issuance of any Capital Obligations issued to refinance outstanding Capital Obligations, the Responsible Official will confirm that any rebate obligation due with respect to the original issue and any subsequent refinancing thereof has been met. 2. Use of Proceeds of Capital Obligations. In general, proceeds (including investment income on original sale proceeds) of Capital Obligations, other than proceeds used to pay costs of issuance, should be spent on capital expenditures. For this purpose, capital expenditures generally mean costs to acquire, construct, or improve property (land,buildings and equipment). Capital Expenditures include design and planning costs related to the Project, and include architectural, engineering, surveying, soil testing, environmental, and other similar costs incurred in the process of acquiring, constructing, improving or adapting the property. Capital Expenditures do not include operating expenses of the Project. 3. Use of Facilities Financed with Capital Obligations. For the life of all Capital,Obligations, the Project must be owned and operated by the Issuer. At all times while Capital Obligations issued for a Project are outstanding, no more than 10% of the proceeds of such Capital Obligations may be used, directly or indirectly, in a trade or business carried on by a person other than a state or local governmental unit ("Private Use"). Generally, Private Use- 2366379.1038723 TAGMT consists of any contract or other arrangement, including leases, management contracts (for example, contracts relating to the operation of a school cafeteria or to food service providers), operating agreements and guarantee contracts which provides for use of the facilities financed with Capital Obligations by a person who is not a state or local government on a basis different than the general public. The Project may be used by any person or entity, including any person or entity carrying on any trade or business, if such use constitutes"General Public Use". General Public Use is any arrangement providing for use that is available to the general public at either no charge or on the basis of rates that are generally applicable and uniformly applied. 4. Management or Operating Agreements for Facilities Financed with Capital Obligations. Any management, operating or service contracts whereby a non-exempt entity is using facilities financed or refinanced with the proceeds of Capital Obligations must, relate to portions of the Project that fit within the above-mentioned 10% allowable Private Use, or the contracts must meet the IRS safe harbor for management contracts (Rev. Proc. 97-13). Any renewals of or changes to such contracts should be reviewed by Bond Counsel. The Responsible Official shall contact Bond Counsel if there may be a lease, sale, disposition or other change in use of facilities financed or refinanced with the proceeds of Capital Obligations. E. Cash-Flow Obligations._ 1. Proper Sizing of Cash-Flow Obligations. (a) If the Issuer is not subject the small issuer exemption from rebate, at the time of issuance of Cash-Flow Obligations, the Issuer must anticipate that it will incur an actual maximum cumulative cash-flow deficit on a date on or before the close of the six-month period commencing on the issue date of the Cash-Flow Obligations equal to at least 90% of the issue price of the Cash-Flow Obligations. (b) If the Issuer is subject to the small issuer exemption from rebate, at the time of issuance of Cash-Flow Obligations, the Issuer must anticipate that it will incur an actual maximum cumulative cash-flow deficit on a date on or before the close of the twelve-month period commencing on the issue date of the Cash-Flow Obligations equal to at least 100% of the 2366379.1 038723 TAGW issue price of the Cash-Flow Obligations (which may include taking into account the Issuer's "reasonably required working capital reserve"). (c) The Responsible Official will determine the appropriate amount of Cash- Flow Obligations to issue. (d) With respect to Issuers not subject to the small issuer exemption from rebate, the Responsible Official shall determine whether or not the Issuer has met its requisite maximum cumulative cash-flow deficit within six months following the date of issuance of the Cash-Flow Obligations, and shall, to the extent necessary, obtain assistance from the Arbitrage Rebate Consultant,referred to below. F. Investment Restrictions:Arbitrage Yield Calculation;Rebate. 1. Investment Restrictions. Investment restrictions relating to the proceeds of Obligations and other moneys relating to the Obligations are set forth in the Tax Certificate. The Responsible Official will monitor the investment of the proceeds of Obligations to ensure compliance with yield restriction rules. 2. Arbitrage Yield Calculation. Investment earnings on the proceeds of Obligations should be tracked and monitored to comply with applicable yield restrictions and/or rebate requirements. The Issuer is responsible for calculating (or causing the calculation of) rebate liability for each issue of Obligations, and for making any required rebate payments. Any funds of the Issuer set aside or otherwise pledged or earmarked to pay debt service on the Obligations should be analyzed to assure compliance with the tax law rules on arbitrage, invested sinking funds and pledged funds (including gifts or donations linked to facilities financed with Capital Obligations). The Responsible Official will consult with Bond Counsel to confirm that all relevant arbitrage yield requirements are met. 3. Rebate. On or before the date of any required rebate payment(see below), the Issuer will retain a nationally recognized arbitrage rebate consultant (the "Arbitrage Rebate Consultant") to perform rebate calculations that may be required to be made from time to time with respect to any issue of Obligations. The Responsible Official shall provide the Arbitrage Rebate Consultant with requested documents and information on a prompt basis, reviewing 2366379.1 038723 TAGMT applicable rebate reports and other calculations and generally interacting with the Arbitrage Rebate Consultant to ensure the timely preparation of rebate reports and payment of any rebate. The reports and calculations provided by the Arbitrage Rebate Consultant will assure compliance with rebate requirements, which require the Issuer to make rebate payments, if any, no later than the fifth (5th) anniversary date and each fifth(5th) anniversary date thereafter through the final maturity or redemption date of a Capital Obligation. A final rebate payment, if due, must be made within sixty (60) days of the final maturity or redemption date of all Obligations. Rebate spending exceptions for Capital Obligations are available for periods of 6 months, 18 months and 2 years. The Responsible Oficial will confer and consult with the Arbitrage Rebate Consultant to determine whether any rebate spending exception may be met. In the case of Cash-Flow Obligations, within 60 days of the maturity date of such Cash-Flow Obligations, if there is concern -as to whether the Issuer has met its requisite maximum cumulative cash-flow deficit, a rebate analyst should be promptly engaged to determine whether either the six-month spending exception or the statutory safe harbor exception to the rebate rules was met (in which case no rebate would be owed) or whether the investment income derived from the proceeds of the Cash-Flow Obligations is subject, in whole or in part,to rebate. Copies of all arbitrage rebate reports, related return filings with the IRS (i.e., IRS Form 8038-T), copies of cancelled checks with respect to any rebate payments, and information statements must be retained as described above. The Responsible Official will follow the procedures set forth in the Tax Certificate that relate to compliance with the rebate requirements with respect to any Obligations. II. ADDITIONAL PROCEDURES. A. Periodic Monitoring. The Responsible Official will conduct periodic reviews of compliance with the foregoing procedures to determine whether any violations have occurred so that such violations can be remedied through the "remedial action" regulations (Treas. Reg. Section 1.141-12) or the Voluntary Closing Agreement Program (VCAP) described in IRS 2366379.1 038723 TAGMT Notice 2008-31 (or successor guidance). If any changes to the terms or provisions of any Obligations are contemplated, the Responsible Official will consult with Bond Counsel, because such modifications could jeopardize the tax-exempt status of interest on the Obligations after they are modified. B. Use of Facilities. The Responsible Official will maintain records identifying any Private Use of the facilities or portion of facilities that are financed or refinanced with proceeds of Capital Obligations. Such records may be kept in any combination of paper or electronic form. In the event the use of the proceeds of Capital Obligations of the facilities financed or refinanced with the proceeds of Capital Obligations differs from the representations or factual statements in the Tax Certificate,the Responsible Official will promptly contact and consult with Bond Counsel to ensure that there is no adverse effect on the tax-exempt status of the Capital Obligations and, where appropriate, will remedy any violations through the "remedial action" regulations (Treas. Reg. Section 1.141-12), the Voluntary Closing Agreement Program (VCAP) described in IRS Notice 2008-31 (or successor guidance), or as otherwise prescribed by Bond Counsel. 2366379.1 038723 TAGMT EXHIBIT H REIMBURSEMENT RESOLUTIONS (see attached) 2366379.1 038723 TAGMT BOND RESOLUTION OF THE TOWN OF SOUTHOLD, NEW YORK, ADOPTED JUNE 17, 2014, AUTHORIZING THE REPLACEMENT OF THE BAY AVENUE BRIDGE, STATING THE ESTIMATED MAXIMUM COST THEREOF IS $800,000, APPROPRIATING SAID AMOUNT FOR SUCH PURPOSE, AND AUTHORIZING THE ISSUANCE OF BONDS IN THE PRINCIPAL AMOUNT OF NOT TO EXCEED $800,000 TO FINANCE SAID APPROPRIATION THE TOWN BOARD OF THE TOWN OF SOUTHOLD, IN THE COUNTY OF SUFFOLK, NEW YORK, HEREBY RESOLVES (by the favorable vote of not less than two- thirds of all the members of said Town Board) AS FOLLOWS: Section 1. The Town of Southold, in the County of Suffolk, New York (herein called the "Town"), is hereby authorized to replace the Bay Avenue Bridge. The estimated maximum cost thereof, including preliminary costs and costs incidental thereto and the financing thereof, is $800,000 and said amount is hereby appropriated for such purpose. The plan of financing includes the issuance of not to exceed $800,000 bonds of the Town to finance said appropriation, and the levy and collection of taxes on all the taxable real property in the Town to pay the principal of said bonds and the interest thereon as the same shall become due and payable. Section 2. Bonds of the Town in the principal amount of not to exceed $800,000 are hereby authorized to be issued pursuant to the provisions of the Local Finance Law, 2345660.1 038723 RSIND constituting Chapter 33-a of the Consolidated Laws of the State of New York (herein called the "Law"),to fmance said appropriation. Section 3. The following additional matters are hereby determined and declared: (a) The period of probable usefulness applicable to the objects or purposes for which said bonds are authorized to be issued, within the limitations of Section 11.00 a. 10 of the Law,is twenty(20) years. (b) The proceeds of the bonds herein authorized and any bond anticipation notes issued in anticipation of said bonds may be applied to reimburse the Town for expenditures made after the effective date of this resolution for the purposes for which said bonds are authorized. The foregoing statement of intent with respect to reimbursement is made in conformity with Treasury Regulation Section 1.150-2 of the United States Treasury Department. (c) The proposed maturity of the bonds authorized by this resolution will exceed five (5)years. (d) The Town Board of the Town, acting in the role of Lead Agency pursuant to the provisions of the New York State Environmental Quality Review Act ("SEQRA"), has determined that the project described in Section 1 hereof is a Type II action pursuant to the State Environmental Quality Review Act (SEQRA), constituting Article 8 of the Environmental Conservation Law, and 6 N.Y.C.R.R., Regulations Part 617, and no further environmental review is required pursuant to SEQRA. Section 4. Each of the bonds authorized by this resolution and any bond anticipation notes issued in anticipation of the sale of said bonds shall contain the recital of validity as prescribed by Section 52.00 of the Law and said bonds and any notes issued in 2345660.1 038723 ROO 9 ' anticipation of said bonds shall be general obligations of the Town, payable as to both principal and interest by, general tax upon all the taxable real property within the Town. The faith and credit of the Town are hereby irrevocably pledged to the punctual payment of the principal of and interest on said bonds and any notes issued in anticipation of the sale of said bonds and provision shall be made annually in the budget of the Town by appropriation for (a) the amortization and redemption of the bonds and any notes in anticipation thereof to mature in such year and(b)the payment of interest to be due and payable in such year. Section 5. Subject to the provisions of this resolution and of the Law and pursuant to the provisions of Section 21.00 relative to the authorization of bonds with substantially level or declining annual debt service, Section 30.00 relative to the authorization of the issuance of bond anticipation notes and Section 50.00 and Sections 56.00 to 60.00 and Section 168.00 of the Law,the powers and duties of the Town Board relative to authorizing bond anticipation notes and prescribing the terms, form and contents and as to the sale and issuance of the bonds herein authorized, and of any bond anticipation notes issued in anticipation of said bonds, and the renewals of said bond anticipation notes, and as to the execution of agreements for credit enhancements, are hereby delegated to the Supervisor, the chief fiscal officer of the Town. Section 6. The validity of the bonds authorized by this resolution, and of any notes issued in anticipation of the sale of said bonds,may be contested only if: (a) such obligations are authorized for an object or purpose for which the Town is not authorized to expend money,or (b) the provisions of law which should be complied with at the date of publication of such resolution, or a summary thereof, are not substantially complied with, 2345660.1 038723 MIND and an action, suit or proceeding contesting such validity is commenced within twenty days after the date of such publication, or (c) such obligations are authorized in violation of the provisions of the constitution. Section 7. This bond resolution is subject to a permissive referendum and the Town Clerk is hereby authorized and directed, within ten (10) days after the adoption of this resolution, to cause to be published in "The Suffolk Times," a newspaper having a general circulation within said Town and hereby designated the official newspaper of the Town for such publication and posted on the sign board of the Town maintained pursuant to the Town Law, a Notice in substantially the following form: l 2345660 1 038723 R04D TOWN OF SOUTHOLD,NEW YORK PLEASE TAKE NOTICE that on June 17, 2014, the Town Board of the Town of Southold,in the County of Suffolk,New York, adopted a bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted June 17, 2014, authorizing the replacement of the Bay Avenue Bridge, stating the estimated maximum cost thereof is $800,000, appropriating said amount for such purpose, and authorizing the issuance of bonds in the principal amount of not to exceed$800,000 to finance said appropriation," an abstract of which bond resolution concisely stating the purpose and effect thereof, being as follows: FIRST: AUTHORIZING said Town to replace the Bay Avenue Bridge; STATING the estimated maximum cost thereof, including preliminary costs, and costs incidental thereto and the financing thereof, is $800,000; APPROPRIATING said amount for such purpose; and STATING the plan of financing includes the issuance of not to exceed $800,000 bonds of the Town to finance said appropriation, and the levy of a tax upon all the taxable real property within the Town to pay the principal of said bonds and interest thereon; SECOND: AUTHORIZING the issuance of $800,000 bonds of the Town pursuant to the Local Finance Law of the State of New York to finance said appropriation; THIRD: DETERMINING and STATING that the period of probable usefulness applicable to the purpose for which said bonds are authorized to be issued is twenty (20) years; the proceeds of said bonds and any bond anticipation notes issued in anticipation thereof may be applied to reimburse the Town for expenditures made after the effective date of this bond resolution for the purposes for which said bonds are authorized; and the proposed maturity of said bonds will exceed five (5) years; and STATING that the Town Board, as Lead Agency pursuant to the provisions of the New York State Environmental Quality Review Act ("SEQRA"), has determined that the purpose for which the bonds are authorized is a Type II action and no further environmental review is required; FOURTH: DETERMINING that said bonds and any bond anticipation notes issued in anticipation of said bonds and the renewals of said bond anticipation notes shall be general obligations of the Town; and PLEDGING to their payment the faith and credit of the Town; FIFTH: DELEGATING to the Supervisor the powers and duties as to the issuance of said bonds and any bond anticipation notes issued in anticipation of said bonds, or the renewals thereof; and 2345660.1 038723 RSIND SIXTH: DETERMINING that the bond resolution is subject to a permissive referendum. DATED: June 17,2014 Elizabeth A.Neville Town Clerk 2345660.1 038723 RSIND a Section 8. The Town Clerk is hereby authorized and directed to cause said bond resolution to be published, in summary, in substantially the form set forth in Exhibit A attached hereto and made a part hereof, after said bond resolution shall take effect, in the newspaper referred to in Section 7 hereof, and hereby designated the official newspaper for said publication, together with a Notice in substantially the form as provided by Section 81.00 of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York. 2345660.1 038723 RSIND r , BOND RESOLUTION OF THE TOWN OF SOUTHOLD, NEW YORK, ADOPTED SEPTEMBER 10, 2013, AUTHORIZING THE CONSTRUCTION OF IMPROVEMENTS TO TOWN HIGHWAY FACILITIES, STATING THE ESTIMATED MAXIMUM COST THEREOF IS $3,500,000, APPROPRIATING SAID AMOUNT FOR SUCH PURPOSE, AND AUTHORIZING THE ISSUANCE OF BONDS IN THE PRINCIPAL AMOUNT OF $3,500,000 TO FINANCE SAID APPROPRIATION THE TOWN BOARD OF THE TOWN OF SOUTHOLD, IN THE COUNTY OF SUFFOLK, NEW YORK, HEREBY RESOLVES (by the favorable vote of not less than two- thirds of all the members of said Town Board) AS FOLLOWS: Section 1. The Town of Southold, in the County of Suffolk, New York (herein called the "Town"), is hereby authorized to construct improvements to Town highway facilities, consisting of construction of a pre-engineered metal building containing a welding bay, service bays, toilets and administrative spaces; a pre-engineered pole barn; a consolidated fueling station; an outdoor truck washing area; material storage bins; and demolition of existing fuel storage tanks; all of the foregoing to include site work, installation or extension of necessary utilities and any ancillary work required in connection therewith. The estimated maximum cost thereof, including preliminary costs and costs incidental thereto and the financing thereof, is $3,500,000 and said amount is hereby appropriated for such purpose. The plan of financing includes the issuance of$3,500,000 serial bonds of the Town to finance said appropriation, and 1294375.1 037982 RSIND T a the levy and collection of taxes on all the taxable real property in the Town to pay the principal r of said bonds and the interest thereon as the same shall become due and payable. Section 2. Serial bonds of the Town in the principal amount of$3,500,000 are hereby authorized to be issued pursuant to the provisions of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York (herein called the "Law"), to finance said appropriation. Section 3. The following additional matters are hereby determined and declared: (a) The period of probable usefulness applicable to the objects or purposes for which said bonds are authorized to be issued, within the limitations of Section 11.00 a. 11 (b) of the Law,is twenty(20)years. (b) The proceeds of the bonds herein authorized and any bond anticipation notes issued in anticipation of said bonds may be applied to reimburse the Town for expenditures made after the effective date of this resolution for the purposes for which said bonds are authorized. The foregoing statement of intent with respect to reimbursement is made in conformity with Treasury Regulation Section 1.150-2 of the United States Treasury Department. (c) The proposed maturity of the bonds authorized by this resolution will exceed five(5)years. (d) The Town Board of the Town, acting in the role of Lead Agency pursuant to_the provisions of the New York State Environmental Quality Review Act ("SEQRA"), has determined that the objects or purposes described in Section 1 hereof is an Unlisted Action as defined under SEQRA and the Regulations promulgated thereunder. The Town's Planning Department has completed a Long Environmental Assessment Form which has been reviewed by 1294375.1 037982 RSIND M the Town Board and the Town Board has determined that the project will not have a significant impact on the environment and a Negative Declaration has been issued by the Town Board. Section 4. Each of the bonds authorized by this resolution and any bond anticipation notes issued in anticipation of the sale of said bonds shall contain the recital of validity as prescribed by Section 52.00 of the Law and said bonds and any notes issued in anticipation of said bonds shall be general obligations of the Town, payable as to both principal and interest by general tax upon all the taxable real property within the Town. The faith and credit of the Town are hereby irrevocably pledged to the punctual payment of the principal of and interest on said bonds and any notes issued in anticipation of the sale of said bonds and provision shall be made annually in the budget of the Town by appropriation for (a) the amortization and redemption of the bonds and any notes in anticipation thereof to mature in such year and(b)the payment of interest to be due and payable in such year. Section 5. Subject to the provisions of this resolution and of the Law and pursuant to the provisions of Section 21.00 relative to the authorization of bonds with substantially level or declining annual debt service, Section 30.00 relative to the authorization of the issuance of bond anticipation notes and Section 50.00 and Sections 56.00 to 60.00 and Section 168.00 of the Law,the powers and duties of the Town Board relative to authorizing bond anticipation notes and prescribing the terms, form and contents and as to the sale and issuance of the bonds herein authorized, and of any bond anticipation notes issued in anticipation of said bonds, and the renewals of said bond anticipation notes, and as to the execution of agreements for credit enhancements, are hereby delegated to the Supervisor, the chief fiscal officer of the Town. 1294375.1 037982 MIND i Section 6. The validity of the bonds authorized by this resolution, and of any notes issued in anticipation of the sale of said bonds,may be contested only if: (a) such obligations are authorized for an object or purpose for which the Town is not authorized to expend money,or (b) the provisions of law which should be complied with at the date of publication of such resolution, or a summary thereof, are not substantially complied with, and an action, suit or proceeding contesting such validity is commenced within twenty days after the date of such publication, or (c) such obligations are authorized in violation of the provisions of the constitution. Section 7. This bond resolution is subject to a permissive referendum and the Town Clerk is hereby authorized and directed, within ten (10) days after the adoption of this resolution, to cause to be published in "The Suffolk Times," a newspaper having a general circulation within said Town and hereby designated the official newspaper of the Town for such publication and posted on the sign board of the Town maintained pursuant to the Town Law, a Notice in substantially the following form: 1294375.1 037982 RSIND 6 TOWN OF SOUTHOLD,NEW YORK PLEASE TAKE NOTICE that on September 10, 2013, the Town Board of the Town of Southold,in the County of Suffolk,New York,adopted a bond resolution entitled: "Bond Resolution of the Town of Southold, New York, adopted September 10, 2013, authorizing the construction of improvements to Town highway facilities, stating the estimated maximum cost thereof is $3,500,000, appropriating said amount for such purpose, and authorizing the issuance of bonds in the principal amount of $3,500,000 to finance said appropriation," an abstract of which bond resolution concisely stating the purpose and effect thereof, being as follows: FIRST: AUTHORIZING said Town to construct improvements to Town highway facilities, consisting of construction of a pre-engineered metal building containing a welding bay, service bays, toilets and administrative spaces; a pre-engineered pole barn; a consolidated fueling station; an outdoor truck washing area; material storage bins; and demolition of existing fuel storage tanks; all of the foregoing to include site work, installation or extension of necessary utilities and any ancillary work required in connection therewith; STATING the estimated maximum cost thereof, including preliminary costs, and costs incidental thereto and the financing thereof, is $3,500,000; APPROPRIATING said amount for such purpose; and STATING the plan of financing includes the issuance of$3,500,000 serial bonds of the Town to finance said appropriation, and the levy of a tax upon all the taxable real property within the Town to pay the principal of said bonds and interest thereon; SECOND: AUTHORIZING the issuance of$3,500,000 serial bonds of the Town pursuant to the Local Finance Law of the State of New York to finance said appropriation; THIRD: DETERMINING and STATING that the period of probable usefulness applicable to the purpose for which said serial bonds are authorized to be issued is twenty (20) years; the proceeds of said bonds and any bond anticipation notes issued in anticipation thereof may be applied to reimburse the Town for expenditures made after the effective date of this bond resolution for the purposes for which said bonds are authorized; and the proposed maturity of said serial bonds will exceed five (5) years; and STATING that the Town Board, as Lead Agency pursuant to the provisions of the New York State Environmental Quality Review Act ("SEQRA"), has determined that the purpose for which the bonds are authorized is an Unlisted Action and a Negative Declaration has been issued; FOURTH: DETERMINING that said bonds and any bond anticipation notes issued in anticipation of said bonds and the renewals of said bond anticipation notes shall be 1294375.1 037982 RSIND r • general obligations of the Town; and PLEDGING to their payment the faith and credit of the Town; FIFTH: DELEGATING to the Supervisor the powers and duties as to the issuance of said bonds and any bond anticipation notes issued in anticipation of said bonds, or the renewals thereof; and SIXTH: DETERMINING that the bond resolution is subject to a permissive referendum. DATED: September 10, 2013 Elizabeth A.Neville Town Clerk 1294375.1 037982 RSIND a • Section 8. The Town Clerk is hereby authorized and directed to cause said bond resolution to be published, in summary, in substantially the form set forth in Exhibit A attached hereto and made a part hereof, after said bond resolution shall take effect, in the newspaper referred to in Section 7 hereof, and hereby designated the official newspaper for said publication, together with a Notice in substantially the form as provided by Section 81.00 of the Local Finance Law, constituting Chapter 33-a of the Consolidated Laws of the State of New York. 1294375.1 037982 MIND s i 0 EXHIBIT I SUMMARY OF REIMBURSEMENT EXPENDITURES (see attached) 2366379.1 038723 TAGMT n Reimbursement Expenditures Date Project Amount $ June 2014 Bay Avenue Bridge -Engineering 54,324.00 and Design January 2014 Highway Facility Improvements- 61,131.00 Engineering and Design $115,455.00 2369118.1 038723 CHT