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2039 RESOLUTION NO. .2039 A RESOLUTION APPROVING MATTERS PERTAINING TO INDUSTRIAL DEVELOPMENT REVENUE BONDS PREVIOUSLY ISSUED. WHEREAS, the City of West Memphis, Arkansas (the "City") has heretofore issued its Taxable Industrial Development Revenue Bonds (S-B Power Tool Project), Series 2000A, in the original aggregate principal amount of $17,000,000 (the "Bonds"), for the purpose of financing the cost of acquiring, constructing and equipping an industrial project (the "Project"), for use by SB West Memphis, L.L.C., a Delaware limited liability company (the "Company"), and paying the expenses of issuing the Bonds; and WHEREAS, the Project has been leased by the City to the Company pursuant to a Lease Agreement dated as of October 1, 2000 (the "Lease Agreement"), between the City and the Company, and has been subleased by the Company to Robert Bosch Tool Corporation, a Delaware corporation and successor to S-B Power Tool Company, a Delaware general partnership ("Bosch Tool"); and WHEREAS, in connection with the issuance of the Bonds the City and the Company entered into an Agreement for Payments in Lieu of Taxes dated October 11, 2000 (the "PILOT Agreement"), pursuant to which the Company agreed to make payments in lieu of ad valorem taxes commencing the 11th calendar year following the year in which the Project was completed, and continuing during the initial and any renewal term of the Lease Agreement; and WHEREAS, Bosch Tool proposes to negotiate with the Company for the purchase of the Company's leasehold interest in the Project which, if accomplished, will result in the assumption by Bosch Tool of the Company's obligations under the Lease Agreement and related Bond documents (including the PILOT Agreement); and WHEREAS, as part of the proposed transaction Bosch Tool has requested that the City waive the payments under the PILOT agreement for the remaining initial term of the Lease Agreement ending on October 1, 2021, and to enter into a supplement to the PILOT Agreement (the "Supplemental PILOT Agreement") setting forth the details thereof; and WHEREAS, the form of the Supplemental PILOT Agreement has been presented to and is before this meeting; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of West Memphis, Arkansas: Section 1. The City Council hereby finds that the assumption of the obligations under the Lease Agreement and related Bond documents by Bosch Tool, if accomplished, will assure the continuation of substantial employment and payrolls provided by the operation of the Project and will thereby secure and develop industry within and near the City. Section 2. The Mayor and City Clerk are hereby authorized and directed, for and on behalf of the City, to do all things, execute all instruments, and otherwise take all action as may be necessary or desirable to facilitate the transaction proposed by Bosch Tool. Section 3. There is hereby authorized the execution and delivery of the Supplemental PILOT Agreement, and the Mayor is hereby authorized to execute and deliver the Supplemental PILOT Agreement for and on behalf of the City. The Supplemental PILOT Agreement is hereby approved in substantially the form submitted to this meeting, and the Mayor is hereby authorized to confer with Bosch Tool and others in order to complete the Supplemental PILOT Agreement in substantially the form submitted to this meeting with such changes as shall be approved by him,his execution to constitute conclusive evidence of such approval. Section 4. This Resolution shall be effective immediately upon its passage. PASSED: November 21, 2013. APPROVED: ATTEST: Pote049 May r City Cl- k (SEAL) RECEIVED City Clerk's Offilte Date/Time r--13 cr By b cer DRAFT Friday,Eldredge & Clark,LLP $17,000,000 City of West Memphis, Arkansas Industrial Development Revenue Bonds (S-B Power Tool Project) Series 2000A SUPPLEMENTAL AGREEMENT FOR PAYMENTS IN LIEU OF TAXES This SUPPLEMENTAL AGREEMENT FOR PAYMENTS IN LIEU OF TAXES, dated as of , 2013 ("Supplemental Agreement"), by and among the CITY OF WEST MEMPHIS, ARKANSAS (the "City"), ROBERT BOSCH TOOL CORPORATION, a Delaware corporation and successor to S-B Power Tool Company, a Delaware general partnership ("Bosch Tool"), and SB WEST MEMPHIS, L.L.C., a Delaware limited liability company (the "Company"). WITNESSETH: WHEREAS, the City has heretofore issued its Taxable Industrial Development Revenue Bonds (S-B Power Tool Project), Series 2000A, in the original aggregate principal amount of $17,000,000 (the "Bonds"), for the purpose of financing the cost of acquiring, constructing and equipping an industrial project (the "Project"), for use by the Company and paying the expenses of issuing the Bonds; and WHEREAS, the Project has been leased by the City to the Company pursuant to a Lease Agreement dated as of October 1, 2000 (the "Lease"), between the City and Company, and has been subleased by the Company to Bosch Tool; and WHEREAS, in connection with the issuance of the Bonds the City and the Company entered into an Agreement for Payments in Lieu of Taxes dated October 11, 2000 (the "PILOT Agreement"), pursuant to which the Company agreed to make payments in lieu of ad valorem taxes commencing the 11th calendar year following the year in which the Project was completed, and continuing during the initial and any renewal term of the Lease Agreement; and WHEREAS, Bosch Tool proposes to negotiate with the Company for the purchase of the Company's leasehold interest in the Project (the "Purchase") which, if accomplished, will result in the assumption by Bosch Tool of the Company's obligations under the Lease Agreement and related Bond documents (including the PILOT Agreement); and WHEREAS, pending such Purchase and as an inducement thereto, the City, Bosch Tool, and the Company have agreed to enter into this Supplemental Agreement to eliminate all or a portion of the payments under the PILOT agreement for the remaining initial term of the Lease; NOW, THEREFORE, for and in consideration of the premises and the mutual covenants herein made, and subject to the conditions herein set forth, the parties hereto agree as follows: 1. Payments in Lieu of Ad Valorem Taxes (a) If the Purchase is consummated prior to December 31, 2014: (i) No payments will be due under Section 1 of the PILOT Agreement through the initial term of the Lease Agreement ending October 1, 2021. (ii) During any renewal term of the Lease, Bosch Tool will pay to the Collector of Crittenden County pursuant to Section 1 of the PILOT Agreement, annually at the times regular ad valorem taxes are payable, an amount equal to the amount of ad valorem taxes that would be payable if the Leased Premises (as defined in the PILOT Agreement) were subject to ad valorem taxes, determined as set forth below. Representatives of the undersigned will meet annually with the Assessor of Crittenden County and determine the assessed valuation of the properties comprising the Leased Premises. The determination shall be made by mutual agreement if possible, and if not shall be made by the Assessor as though the Leased Premises were privately owned. The amount to be paid each year shall be determined by applying the millage of the taxing authorities that would be applicable to the Leased Premises for that year if the Leased Premises were privately owned. The undersigned shall be entitled to any refund occasioned by overpayment or a reduction in millage which requires a refund by the taxing authorities. (b) If the purchase is not consummated on or prior to December 31, 2014: (i) From the date of original issuance of the Bonds through calendar year 2014, no payments will be due under Section 1 of the PILOT Agreement; and (ii) Commencing in calendar year 2015 and continuing thereafter during the initial and any renewal term of the Lease, the Company will pay to the Collector of Crittenden County pursuant to Section 1 of the PILOT Agreement, annually at the times regular ad valorem taxes are payable, an amount equal to the amount of ad valorem taxes that would be payable if the Leased Premises (as defined in the PILOT Agreement) were subject to ad valorem taxes, determined as set forth below. Representatives of the undersigned will meet annually with the Assessor of Crittenden County and determine the assessed valuation of the properties comprising the Leased Premises. The determination shall be made by mutual agreement if possible, and if not shall be made by the Assessor as though the Leased Premises were privately owned. The amount to be paid each year shall be determined by applying the millage of the taxing authorities that would be applicable to the Leased Premises for that year if the Leased Premises were privately owned. The undersigned shall be entitled to any refund occasioned by overpayment or a reduction in millage which requires a refund by the taxing authorities. 2. Continuation of PILOT Agreement. The provisions of the PILOT Agreement, as supplemented by this Supplemental Agreement, shall continue in full force and effect, including, without limitation, the payments to be made to the St. Francis Levee District pursuant to the provisions of Section 2 of the PILOT Agreement. 3. Counterparts. This Supplemental Agreement may be executed simultaneously in several counterparts, each of which shall be deemed an original, and it shall not be necessary in making proof of this Supplemental Agreement to produce or account for more than one such counterpart. 4. Governing Law. This Supplemental Agreement shall be governed by, and interpreted in accordance with, the laws of the State of Arkansas. IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Agreement to be executed by their duly authorized officers as of the day and year first above written. ROBERT BOSCH TOOL CORPORATION By: Title: SB WEST MEMPHIS, L.L.C. BY: H INVESTMENTS LLC, a Delaware limited liability company, its Sole Member By: Title: CITY OF WEST MEMPHIS, ARKANSAS By: Ma r ACKNOWLEDGED AND ACCEPTED: ST. FRANCIS LEVEE DISTRICT By: President RECEIVED City Clerk's Offlee Datefflme By awe. CERTIFICATE The undersigned, City Clerk of the City of West Memphis, Arkansas, hereby certifies that the foregoing is a true and perfect copy of a resolution passed at a regular session of the City Council of the City of West Memphis, Arkansas, held at the regular meeting place of the City on the 21st day of November, 2013 GIVEN under my hand and seal on this 41 day of KM/ , 2013. )aa140z2Thlatit C Clerk (SEAL)