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2363 RESOLUTION NO. 2363 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST MEMPHIS,ARKANSAS, • EXPRESSING THE INTENT OF THE CITY TO ISSUE, IN ONE OR MORE SERIES FROM TIME TO TIME, ITS INDUSTRIAL DEVELOPMENT REVENUE BONDS UNDER THE MUNICIPALITIES AND COUNTIES INDUSTRIAL DEVELOPMENT REVENUE BOND LAW, • ACT NO.9 OF THE FIRST EXTRAORDINARY SESSION OF THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS OF 1960,AS AMENDED, IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO.EXCEED $30,000,000,000, TO FINANCE. ENERGY AND DIGITAL INFRASTRUCTURE FACILITIES FOR HYPERCITY WEST MEMPHIS LLC AND ITS AFFILIATES;DECLARING OFFICIAL INTENT WITH RESPECT TO REIMBURSEMENT OF PROJECT EXPENDITURES; AUTHORIZING THE NEGOTIATION OF RELATED AGREEMENTS;AND PRESCRIBING OTHER MATTERS RELATING THERETO. .. WHEREAS,the Municipalities and Counties Industrial Development Revenue Bond Law,Act No.9 of the First Extraordinary Session of the General Assembly of the State of Arkansas of 1960,as amended, codified at Ark.Code Ann. § 14-164-201 et seq.(the "Act"), authorizes municipalities to issue revenue bonds and to use the proceeds thereof to finance the acquisition, construction, and equipping of lands, buildings,and facilities for the securing and developing of industry within or near such municipalities;and WHEREAS,HyperCity West Memphis LLC,for itself and on behalf of(i)its direct and indirect parent, subsidiary,and affiliated entities;(ii)any special-purpose project entity,equipment or asset holding entity, land holding entity,or development entity now existing or hereafter formed or designated for any phase or component of the Project;and(iii)any successor or assignee of any of the foregoing designated in writing to the City byHyperCityWestMemphis LLC(collectively,the"Company"),is developing aphasedenergy and digital infrastructure program within and near the City of West Memphis,Arkansas(the"City"),in partnership with the City and West Memphis Utilities pursuant to that certain Memorandum of Understanding executed in May 2026, such program being more particularly described in Exhibit A attached hereto and incorporated herein (the "Project");and WHEREAS,the Company has requested that the City express its intent to issue its industrial development revenue bonds under the Act,in one or more series from time to time,in an aggregate principal amount not to exceed$30,000,000,000,to finance the Project;and WHEREAS,the aggregate capital cost of the currently planned phases of the Project is presently estimated at approximately$12,000,000,000, and the requested authorization exceeds that estimate in order to accommodate the phased issuance of multiple series over the life of the Project,the financing of multiple Project components,potential future phases of generation,storage, and digital infrastructure, costs of issuance,funded reserves, capitalized interest where applicable, contingencies, and future qualifying improvements to the Project, consistent with the City's established practice of authorizing aggregate ceilings for major multi-phase industrial programs,it being understood that no single issuance of the full authorized amount is contemplated and that each series will be sized to the Project phase it finances; and WHEREAS,the Project will secure and develop industry,expand employment opportunities,enhance the reliability of electric service,enlarge the revenue base available to the City,the County, Mae C' Cler d ffi 7 at me By 7 Draft prepared for review by the City Attorney—Page 1 districts through negotiated payments in lieu of taxes and related agreements,and otherwise advance the economic welfare of the City and its residents; and WHEREAS,bonds issued under the Act are special, limited obligations payable solely from revenues derived from the Project;are not debt of the City;do not pledge the faith,credit,or taxing power of the City or any of its tax revenues or general funds; and may be issued without an election; NOW, THEREFORE,BE IT RESOLVED by the City Council of the City of West Memphis, Arkansas: Section 1. Findings. The City Council finds and determines that the Project constitutes lands,building, and facilities for the securing and developing of industry within the meaning of the Act, and that the financing of the Project through the issuance of industrial development revenue bonds under the Act will promote the public purposes of the Act and substantially benefit the City and its residents. Section 2. Expression of Intent;Authorization Ceiling. The City Council expresses its intent to issue industrial development revenue bonds of the City under the Act,in one or more series from time to time, taxable or tax-exempt as applicable law permits, in an aggregate principal amount not to. exceed $30,000,000,000(the"Bonds"),of which not to exceed$8,000,000,000 is allocated to the financing of real property costs of the Project and not to exceed$22,000,000,000 is allocated to the financing of personal property costs of the Project,in each case including costs of issuance, funded reserves, and capitalized interest where applicable.The authorized amount is an aggregate ceiling across all series and all phases of the Project, established to accommodate phased issuance,multiple Project components, and future qualifying improvements; it is not an amount to be issued at one time. The principal amount,terms, structure,and security of each series shall be established by separate approval of the City Council at the time of issuance of that series. Section 3. Declaration ofOfficiallntent This Resolution constitutes official action of the City evidencing its intent under the Act, and its declaration of official intent for purposes of applicable United States Treasury Regulations,that expenditures for costs of the Project paid or incurred by or on behalf of the Company on or after the date of adoption of this Resolution shall be eligible for financing, or for reimbursement from the proceeds of the Bonds,upon the issuance thereof. Section 4. Special,Limited Obligations;No Pledge of City Credit. The Bonds,if and when issued,shall be special,limited obligations of the City payable solely from revenues derived from the leasing or sale of the Project or from other payments made by or on behalf of the Company.The Bonds shall not constitute an indebtedness of the City within the meaning of any constitutional or statutory provision;shall not pledge the faith, credit, or taxing power of the City; and shall not be payable from any tax revenues, general revenues,or other funds of the City.No holder of any Bond shall have any right to compel the exercise of the taxing power of the City. Section 5. Authorization to Negotiate The Mayor and the City Attorney are authorized and directed,on behalf of the City,to negotiate with the Company the terms of one or more lease agreements,agreements for payments in lieu of taxes,and such other agreements and instruments as may be neces saryor appropriate to the issuance of the Bonds;to coordinate with Crittenden County,Arkansas with respect to a parallel expression of intent for Project facilities located outside the corporate limits of the City;and to consult with Draft prepared for review by the City Attorney—Page 2 7 • the affected school districts with respect to payment-in-lieu-of-taxes arrangements.No such agreement or instrument shall bind the City unless and until approved by the City Council. Section 6. Costs. All costs and expenses incurred by the City in connection with the Bonds,including the fees and expenses of bond counsel and of counsel to the City,shall be paid or reimbursed by the Company, or paid from the proceeds of the Bonds,at or before the issuance of the first series of Bonds.No funds of the City shall be required for such purposes. Section 7. Limited Effect of this Resolution. This Resolution is an expression of present intent and a declaration of official intent only.It does not issue any Bonds;does not authorize the construction of any facilities;does not obligate the City to issue any Bonds or to expend any City funds;and does not bind this or any future City Council to approve any series of Bonds or any related agreement.Each series of Bonds shall be subject in all respects to the separate approval by the City Council of its definitive terms and documents. Section 8. Multiple Entities. The benefits of this Resolution,including the declaration of official intent in Section 3,extend to Project costs paid or incurred by any entity comprising the Company,and the leases, agreements,and instruments contemplated hereby may be entered into with one or more such entities as lessee or counterparty, as designated by HyperCity West Memphis LLC. Section 9. Effective Date. This Resolution shall be in full force and effect from and after its adoption. ADOPTED this tP day of 4IJ� 4 ,2026. ATTEST: CITY OF WEST MEMPHIS,ARKANSAS 9 City Clerk Ma co McClendon,Mayor Draft prepared for review by the City Attorney—Page 3 EXHIBIT A DESCRIPTION OF THE PROJECT The Project consists of a phased program of energy and digital infrastructure facilities to be acquired, constructed,and equipped within and near the City of West Memphis, Crittenden County,Arkansas, constituting lands,buildings,and facilities for the securing and developing of industry within the meaning of the Act, and comprising the following categories of real and personal property: 1. Electric generation and storage facilities,including a first phase of approximately 600 megawatts of natural gas-fired simple-cycle generation,at an estimated capital cost of approximately$2 billion;a second phase of approximately 2,600 megawatts of natural gas-fired combined-cycle generation,at an estimated capital cost of approximately$9 to $10 billion;battery energy storage systems;and,in each case,sites, foundations, structures,balance-of-plant systems, and appurtenant facilities; 2. Fuel supply and gas infrastructure,including a natural gas pipeline lateral with a design capacity of approximately 0.75 - 1.25 billion cubic feet per day interconnecting with interstate pipeline facilities, together with metering, compression, fuel conditioning and treatment, fuel storage, and appurtenant facilities; 3. Electric transmission and interconnection facilities, including high-voltage transmission lines, substations,switchyards,transmission interconnections,utility control systems,and appurtenant facilities; 4. Water and wastewater infrastructure,including water supply,treatment,storage,and distribution facilities and wastewater collection and treatment facilities serving the Project; 5. Digital infrastructure facilities,including data processing and computing facilities,communications infrastructure, fiber optic facilities, and related buildings, equipment, and improvements; and 6. Supporting and development infrastructure,including roads and site access improvements,security systems,utility operations and maintenance facilities,engineering and administrative facilities,and other lands,buildings,facilities,and improvements necessary or convenient to the development,c onstruction, operation, or maintenance of the Project. The aggregate capital cost of the currently planned phases of the Project is presently estimated at approximately$12 billion,exclusive of capitalized interest,funded reserves,and costs of issuance.The Project will be developed in phases,and individual series of Bonds are expected to be issued as phases of the Project reach financing. Draft prepared for review by the City Attorney—Page 4 HYPERCITY WEST MEMPHIS— ACT 9 BOND INDUCEMENT— COUNCIL MEMBER QUICK REFERENCE WHAT IS BEFORE COUNCIL? A resolution expressing the City's intentto issue industrial development revenue bonds underArkansas Act 9 of 1960,in phases over time,up to an aggregate ceiling of$30 billion,to finance the HyperOty energy and digital infrastructure program being developed with the City and West Memphis Utilities under the May 2026 Memorandum of Understanding.The resolution is the established first step in the Act 9 process. It issues no bonds,spends no money,and authorizes no construction —each future bond series returns to the Council for its own approval. WHAT THIS DOES DO. WHAT THIS DOES NOT DO • Expresses the City's intent to consider Act 9 financing • Does not issue any bonds. for the project. • Does not obligate taxpayers or pledge City taxes, • Begins the'statutory process and establishes the •revenues,or credit. official-action date. • Does not increase City debt or affect City debt limits. • Preserves financing flexibility for a phased,multi-year • Does not authorize construction. program. • Does notcommitthis or any future Council to approve . • Authorizes the Mayor and City Attorney to negotiate any financing. ' related agreements for later Council approval. • •.Supports economicdevelopmentat no cost to the City. • PUBLIC BENEFITS Approximately$12 billion of private capital investment in generation,gas,transmission,water,and digital infrastructure; long- term employment in construction and operations;enhanced electric reliability for the region; negotiated payments in lieu of taxes expanding the revenue base available to the county,city, and school districts;funding for community development commitments;and a materially stronger competitive position for West Memphis in attracting additional major employers. LIKELY QUESTIONS Is this City debt?'No.Act 9 bonds are payable solely from project revenues and Company payments.They are not debt of the City,pledge no taxes,and cannot.reach City funds. • Why is the authorization largerthan the$12 billion estimate? The$30 billion is a ceiling across all phases and series,covering financing costs,reserves,capitalized interest,contingencies,and future qualifying improvements.No single issuance of that amount is contemplated. Who pays the bonds? The Company and its private capital partners.The bonds are privately placed with investors the Company designates;they are not offered publicly on the City's name. Will Council vote again? Yes. Every series of bonds,and every lease and payment-in-lieu-of-taxes agreement,returns to the Council for separate approval. What happens next? The City Attorney completes review;Crittenden County considers a parallel resolution;agreements are • negotiated with the Company,West Memphis Utilities,and the school districts;and the first bond series would come back to Council only when the first phase reaches financing. ECEIVED • Ci ler ' I J, • t e By 77m Prepared for members of the City Council ;HyperCity West Memphis LLC "