2758 RESOLUTION NO. 2,758
A RESOLUTION ACCEPTING AN AGREEMENT BY JACUZZI
BROTHERS, INC. FOR THE PAYMENT TO THE CITY OF
LITTLE ROCK IN LIEU OF TAXES; AND FOR OTHER
PURPOSES.
BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE CITY OF LITTLE
ARKANSAS :
SECTION 1. The letter agreement concerning payment in
lieu of taxes tendered to the City of Little Rock by Jacuzzi
Brothers, Inc. , under date of August 1, 1961, which letter
agreement is in words and form as follows, is hereby approved
and accepted by the City of Little Rock:
"LETTER AGREEMENT CONCERNING PAYMENT
IN LIEU OF TAXES
August 1, 1961
City of Little Rock
City Hall
Little Rock, Arkansas
Gentlemen:
The City of Little Rock, Arkansas (hereinafter some-
times referred to as the 'City' ) proposes to issue Industrial
Development Revenue Bonds under the provisions of Act No. 9
of the First Extraordinary Session of the 62nd General As-
sembly of the State of Arkansas, approved January 21, 1960,
as amended by Act No. 48 of the General Assembly of the State
of Arkansas for the year 1961 (hereinafter sometimes referred
to as 'Act No. 9 ' ) in the amount of One Million Four Hundred
Thousand Dollars (51,400,000) (hereinafter sometimes referred
to as the 'bonds ' ) , for the purpose of financing the cost
of the acquisition of lands and the construction of a manu-
facturing building and facilities thereon (hereinafter some-
times ref erred to as the 'lroject ' ) . The Project has been
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leased by the City to the undersigned by a Lease and Agree-
ment dated as of the 1st day of August, 1961, which is
recorded in the office of the Circuit Clerk and Ex officio
recorder of Pulaski County, Arkansas (herein called 'Lease
and Agreement ' ). The bonds of the City are secured by a
pledge of all revenues derived from the Project including
particularly the lease rentals paid under the Lease and
Agreement between the City and the undersigned and are
secured by a mortgage lien on the Project.
Article III of the Lease and Agreement between the
City and the undersigned provides that the undersigned is
obligated to pay all taxes and assessments, general and
special, levied and assessed on the Project during the
term, and all water and sewer charges, assessments and other
governmental charges anu impositions whatsoever, all of
which are therein designated as 'impositions. ' The under-
signed is informed and understands, that notwithstanding
the said provisions of Article III of the said Lease and
Agreement, under the decision of the Supreme Court of the
State of Arkansas in the case of Wayland v. Snapp,
Ark. , 334 S. W. 2d 633, the Project will be exempt
from ad valorem taxes because owned by the City and used for
a public purpose within the meaning of the applicable Con-
stitutional provision affording the exemption. Thus, the
undersigned understands that it, as Lessee of the Project
owned by the City, will, in fact, have no ad valorem taxes
to pay under the provisions of Article III of the said
Lease and Agreement. The City has indicated a reluctance
for the authorities to lose all tax revenues which would
otherwise be received by the authorities if the properties
involved were privately owned. Therefore, to induce the
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City to proceec with the issuance of the bonus for the
purposes indicated, which will inure to the benefit of
the unuersigned, and for other valuable considerations, the
receipt of which is hereby acknowledged by the City, the
undersigned agrees with the City as follows:
1 1. The undersigned will pay to the City the sum of
Five Thousand Dollars 05,000) annually with the first such
payment to be made on June 1, 1962, ano with payments in
1
saia amount to be made on each June 1 during the initial
and any renewal term of the Lease and Agreement, and with
such payments being a required business expense of the under-
signed. The undersigned reserves the right to make monthly,
rather than annual, payments and if the undersigned elects
to make monthly payments it agrees to pay one-twelfth (1/12)
of the specified annual payment on the first business day
of each month.
2. The saia annual payments to be made by the unuer-
1
signed, pursuant to this instrument as aforesaid, are intended
to be in lieu of all ad valorem taxes that would have to be
paid on the Project leased by the undersigned in said Lease
and Agreement to the state of Arkansas, Pulaski County, the
City, School iistricts and/or other political sub-divisions
of the State of Arkansas if the Project were not exempt from
ad valorem taxes under the provisions of Article 16, Section
5 of the Constitution of the State of Arkansas as interpreted
by the Supreme Court of the State of Arkansas in Wayland v.
Snapp, supra.
3. If by reason of a change in the Constitution, a
change by the Supreme Court of the State of Arkansas in its
interpretation of the Constitution or otherwise, the under-
signee is required to pay any tax which the payments specified
1
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herein are intended to be in lieu of (as defined in para-
graph 2 hereof) , the undersigned may deduct the aggregate
of any such payments made by it from the amount herein
agreed to be paid in lieu of taxes and need only pay the
difference to the City. Furthermore, inasmuch as the
payment herein agreed to be made by the undersigned is
intended to be in lieu of taxes, it is agreed that said
payment shall not as to any year be in an amount greater
than would be payable for such year in ad valorem taxes,
in the aggregate, by a private corporation on account of
its ownership of the rroject.
4. The agreement herein made by the undersigned shall
terminate and be of no further force and effect from and
after the date that the Lease and Agreement shall terminate
for any purpose other than a default on the part of the
undersigned. If such termination shall be at a point con-
stituting a portion of a year, the undersigned shall pay
for the year in which termination occurred that proportion
of the specified annual payment that the number of days in
such year that the undersigned was Lessee prior to the ter-
mination bears to 365 days. The reference to 'year ' shall
mean the fiscal year beginning June 1 of each year and
ending May 31 of the following year.
5. This agreement shall be binding upon the successors
and assigns of the undersigned, but no assignment shall be
effective to relieve the undersigned of any of its obligations
hereunder unless expressly authorized and approved in writing
by the City.
If the foregoing is acceptable, please so indicate by
executing the acceptance set forth below and returning one
copy to the undersigned, whereupon this instrument shall
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constitute a valid and binding contract between the under-
signed and the City.
JACUZZI BROTHERS, INC.
By
resident
ATTEST:
Secretary
(SEAL)
Accepted and agreed to this day of ,
1961.
CITY OF LITTLE ROCK, ARKANSAS
By
Mayor
ATTEST:
City Clerk
(SEAL)
SECTION 2. The Mayor and City Clerk are hereby authorized
and directed to accept said agreement on behalf of the City of
Little Rock.
SECTION 3. This resolution shall be in full force and
effect from and after its adoption.
ADOPTED: November 6, 1961
A`T'TEST: .>> k . , APPROVED:
City Clerk Mayo .