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HomeMy WebLinkAbout8018RESOLUTION NO. 8,018 RESOLUTION APPROVING AN ASSIGNMENT AND ASSUMPTION AGREEMENT AND AN ACKNOWLEDGMENT AND CONSENT AGREEMENT WITH RESPECT TO THE PURCHASE BY BOB L. GADDY OF CERTAIN PROPERTY FINANCED WITH INDUSTRIAL DEVELOPMENT BONDS ISSUED BY THE CITY OF LITTLE ROCK, ARKANSAS. WHEREAS, the City of Little Rock, Arkansas (the "City "), issued its industrial development revenue bonds under the provisions of Act No. 9 of the First Extraordinary Session of the Sixty- Second General Assembly of the State of Arkansas, approved January 21, 1960, as amended (the "Act "), in the principal amount of Two Million Dollars ($2,000,000.00) designated "Industrial Development Revenue Bonds - North American Project, Series A ", dated November 1, 1977 (the "North American Bonds "); and WHEREAS, the proceeds derived from the sale of the North American Bonds were applied to the acquisition of real property, the construction of buildings and improvements thereon, and the acquisition and installation of certain machinery and equipment (the "North American Project "), which Project was leased to and operated by North American Metals, Inc., an Arkansas corporation (the !Company"), pursuant to the provisions of a Lease and Agreement dated as of November 1, 1977, wherein the City is Lessor and the Company is Lessee, which Lease and Agreement was recorded in the Office of the 37i 2 -3) 0 -8 3 7.2 Circuit Clerk and Ex- Officio Recorder of Pulaski County, Arkansas, on November 1, 1977, as Instrument No. 77 -04583 (the "Lease "), and which Lease covers certain real property situated in Pulaski County, Arkansas; and WHEREAS, the Company and Hoover Universal, Inc., a Michigan corporation ( "Hoover "), entered into an Asset Purchase Agreement dated as of November 13, 1981, wherein the parties agreed for the Company to sell and transfer to Hoover and Hoover to purchase from the Company certain assets of the Company, including all rights of the Company under the Lease; and WHEREAS, the Company, Hoover, the City, and Worthen Bank and Trust Company, N.A., as trustee (the "Trustee ") entered into an Assignment and Assumption Agreement on January 15, 1982, which agreement was recorded in the Office of the Circuit Clerk and Ex- Officio Recorder of Pulaski County, Arkansas, on February 18, 1982, as Instrument No. 82 -5332, whereby the Company transferred certain of its rights under the Lease and Hoover expressly assumed certain obligations of the Company under the Lease, Guaranty Agreement, and Agreement for Payments in Lieu of Taxes; and WHEREAS, the City issued its industrial development revenue bonds under the Act in the principal amount of Two Million Five Hundred Thousand Dollars ($2,500,000.00) designated "Industrial Development Revenue Bonds (Hoover Universal, Inc. Project) ", dated December 1, 1982 (the "Hoover Bonds "); and -2- 0091C 091288 Mm MOM= 373 WHEREAS, the proceeds derived from the sale of the Hoover Bonds were applied to the acquisition and improvement of certain real property located in Pulaski County, Arkansas pursuant to an Installment Sale Agreement dated December 1, 1982; and WHEREAS, Hoover and Universal Die Casting, Inc., a Maryland corporation ( "Universal ") entered into a Purchase Agreement dated January 19, 1984, wherein the parties agreed for Hoover to sell and transfer to Universal and Universal to purchase from Hoover certain assets of Hoover, including all rights of Hoover under the Lease; and WHEREAS, Hoover, Universal, the City and Trustee entered into an Assignment and Assumption Agreement on March 7, 1984, which agreement was recorded in the Office of the Circuit Clerk and Ex- Officio Recorder of Pulaski County, Arkansas on May 10, 1984, as Instrument No. 84- 29079,, whereby Hoover transferred certain of its rights under the Lease and Universal expressly assumed certain obligations of Hoover under the Lease, Guaranty Agreement and the Agreement for Payments in Lieu of •Taxes; and WHEREAS, Universal and Bob L. Gaddy ( "Gaddy ") have entered into a Purchase Agreement as of September , 1988, wherein the parties have agreed for Universal to sell and transfer to Gaddy and Gaddy to purchase from Universal certain assets of Universal, including all rights of Universal under the Lease; and -3- 00910 091288 374 WHEREAS, under the terms of the documents relating to the North American Bonds and the Hoover Bonds, the consent and approval of the City for the purchase by Gaddy of the assets of Universal which are subject to the liens of the bonds is required to be obtained, which consent and approval has been requested by Gaddy and Universal and which consent and approval the City wishes to grant; and WHEREAS, Gaddy subsequently intends to assign his interest in the assets to Precision Industries, Inc. ( "Precision ") which subsequent assignment shall also be subject to the lien of the bonds and will in no way affect Gaddy's obligations or liabilities assumed pursuant to the Assignment and Assumption Agreement and the City wishes to grant its approval to such subsequent assignment from Gaddy to Precision. NOW, THEREFORE, be it resolved by the City of Little Rock, Arkansas, that: Section 1. The Acknowledgment and Consent which is is hereby approved in substantially the form attached as Exhibit "All Section 2. The Assignment and Assumption Agreement is hereby approved in substantially the form attached as Exhibit Section 3. The subsequent assignment from Gaddy to precision is hereby approved provided that the assets remain subject to the lien of the bonds and that such assignment does not discharge Gaddy from his obligations and liabilities under the Assignment and Assumption Agreement. -4- 00910 092088 A r �■ MOM W r 96-M W M M Section 4. The Mayor and City Clerk are hereby authorized to execute both the Acknowledgment and Consent and the Assignment and Assumption Agreement on behalf of the City of Little Rock, Arkansas. Section 5. This Resolution shall be effective immediately. PASSED: September 20 OF U.-F. ATTEST: CITY OF LITTLE 4ehA , ARKANSAS d By: Cit Clerk Jan Czech ay Lott ack ford -5- 0091C 091288 375 EXHIBIT "A" ACKNOWLEDGMENT AND CONSENT The City of Little Rock, Arkansas (the "City "), lessor under that certain Lease and Agreement, dated as of November 1, 1977 (the "Lease "), by and between the City and Universal Die Casting Co., Inc., a Maryland corporation ( "Universal "), which is the assignee of Hoover Universal, Inc., a Michigan corporation, which is assignee of North American Metals, Inc., an Arkansas corporation, as lessee and Seller under that certain Installment Sale Agreement, dated December 1, 1982, by and between the City and Universal (the "Sale Agreement "), (1) does hereby represent that the Lease and the Sale Agreement are in full force and effect on this date, (2) does hereby represent that the City is not aware of any default that is continuing by either the City or Universal under the Lease or the Sale Agreement, (3) without releasing Universal or any predecessor of its liabilities under the Lease and the Sale Agreement, does hereby acknowledge and consent to the assignment by Universal of its right, title and interest in and to the Lease and the Sale Agreement to Bob L. Gaddy ( "Gaddy "), and (4) further, without releasing Universal, Gaddy or any predecessor of its liabilities under the Lease and Sale Agreement, does hereby acknowledge and consent to the 0 376 assignment by Gaddy of his right, title and interest in and to the Lease and the Sale Agreement to Precision Industries, Inc., an Arkansas corporation ( "Precision "). ATTEST: City Clerk CITY OF LITTLE ROCK, ARKANSAS By: -2- 0091C 091288 3'7'7 ACKNOWLEDGMENT STATE OF ARKANSAS COUNTY OF PULASKI On this day of 1988, before me, a Notary Public duly commissioned, qualified and acting within and for the State and County aforesaid, appearing in person the within named and , Mayor and City Clerk, respectively, of the City of Little Rock, Arkansas, a municipality of the State of Arkansas, to me personally known, who stated that they were duly authorized in their respective capacities to execute the foregoing instrument entitled Acknowledgment and Consent for and in the name of the municipality, and further stated and acknowledged that they had signed, executed and delivered the foregoing instrument for the consideration, uses and purposes therein mentioned and set forth. IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal this day of 1988. My commission expires: Notary Public -3- 00910 091288 373 aft nol 379 EXHIBIT "B" ASSIGNMENT AND ASSUMPTION AGREEMENT WHEREAS, the City of Little Rock, Arkansas (the "City "), issued its industrial development revenue bonds under the provisions of Act 9 of the First Extraordinary Session of the Sixty- Second General Assembly of the State of Arkansas, approved January 21, 1960, as amended, in the principal amount of Two Million Dollars ($2,000,000.00) designated "Industrial Development Revenue Bonds - North American Project, Series A ", dated November 1, 1977 (the "Bonds "), and WHEREAS, the proceeds derived from the sale of the Bonds were applied to the acquisition of real property, the construction of buildings and improvements thereon, and the acquisition and installation of certain machinery and equipment (the "Project "), which Project was leased to and operated by North American Metals, Inc., an Arkansas corporation (the "Company "), pursuant to the provisions of a Lease and Agreement dated as of November 1, 1977, wherein the City is Lessor and the Company is Lessee, which Lease and Agreement was"recorded in the Office of the Circuit Clerk and Ex- Officio Recorder of Pulaski County, Arkansas, on November 1, 1977, as Instrument No. 77 -04583 (the "Lease "), and which Lease covers the following described real property situated in Pulaski County, Arkansas, to -wit: 38G A tract of land situated in the North Half of the Northeast Quarter of Section 21, Township 1 North, Range 11 West, in the City of Little Rock, in Pulaski County, Arkansas, more particularly described as follows: commencing at the Northeast corner of said Section 21; thence North 88 degrees 47' 31" West 388.47 feet along the centerline of Frazier Pike; thence South 01 degrees 33' 10" West, 60 feet to the South right -of -way line of Frazier Pike and the point of beginning; thence South 01 degrees 33' 10" West, 294.00 feet; thence North 88 degrees 47' 31" West, 900.46 feet to the East right -of -way line of Fourche Dam Pike; thence along said East right -of -way line North 01 degrees 33' 10" East, 244.29 feet; thence continuing along the street right -of -way along a curve to the right having a radius of 50.0 feet and a chord bearing North 46 degrees 22' 50" East, 70.50 feet to the South right -of -way line of Frazier Pike; thence South 88 degrees 47'31" East, 850.75 feet to the point of beginning; ALSO KNOWN AS Tract A, Area 103, a replat of part of Area 103, LITTLE ROCK PORT INDUSTRIAL PARK as shown on plat dated September 30, 1977, prepared by Garver & Garver, Inc., Engineers; and WHEREAS, payment of the principal of, premium, if any, and interest on the Bonds was guaranteed by the Company pursuant to a Bond Guaranty Agreement dated as of November 1, 1977 between Worthen Bank & Trust Company, N.A., as trustee, the Company, as corporate guarantor, and certain individual guarantors (the "Guaranty Agreement "); and WHEREAS, in connection with the issuance of the Bonds, the Company obligated itself to make payments in lieu of ad valorem taxes to the City under the terms of a Letter Agreement dated as of November 1, 1977 (the "Agreement for Payments in Lieu of Taxes "); and WHEREAS, the Company and Hoover Universal, Inc., a Michigan corporation ( "Hoover "), entered into an Asset Purchase -2- 0091C 091288 38 Agreement dated as of November 13, 1981, wherein the parties have agreed for the Company to sell and transfer to Hoover and Hoover to purchase from the Company certain assets of the Company, including all rights of the Company under the Lease; and WHEREAS, the Company, Hoover, the City and Worthen Bank and Trust Company, N.A., as trustee (the "Trustee ") entered into an Assignment and Assumption Agreement on January 15, 1982, which agreement was recorded in the Office of the Circuit Clerk and Ex- Officio Recorder of Pulaski County, Arkansas, on February 18, 1982, as Instrument No. 82 -5332, whereby the Company transferred certain of its rights under the Lease and Hoover expressly assumed certain obligations of the Company under the Lease, Guaranty Agreement, and the Agreement for Payments in Lieu of Taxes; and WHEREAS, Hoover and Universal,Die Casting, Inc., a Maryland corporation ( "Universal ") entered into a Purchase Agreement dated as of January 19, 1984, wherein the parties agreed for Hoover to sell and transfer to Universal and Universal to purchase from Hoover certain assets of Hoover, including all rights of Hoover under the Lease, and WHEREAS, Hoover, Universal, the City and Trustee entered into an Assignment and Assumption Agreement on March 7, 1984, which agreement was recorded in the Office of the Circuit Clerk and Ex- Officio Recorder of Pulaski County, Arkansas, on May 10, -3- 0091c 091288 382 1982, as Instrument No. 84- 29079, whereby Hoover transferred certain of its rights under the Lease and Universal expressly assumed certain obligations of Hoover undr the Lease, Guaranty Agreement and the Agreement for Payments in Lieu of Taxes; and WHEREAS, Universal and Bob L. Gaddy or his nominee ( "Gaddy ") have entered into a Purchase Agreement dated September , 1988, wherein the parties have agreed for Universal to sell and transfer to Gaddy and Gaddy to purchase from Universal certain assets of Universal, including all rights of Universal under the Lease; and NOW, THEREFORE, for valuable consideration, the sufficiency and receipt of which are hereby acknowledged, Gaddy and Universal agree as follows: (1) Pursuant to the Purchase Agreement, Universal does hereby transfer, assign, negotiate and set over to Gaddy all of its right, title and interest as Lessee under the Lease. (2) Gaddy expressly assumes: (a) Pursuant to Section 1601 of the Lease, all of the obligations of the Company, Hoover, and Universal as Lessee under the Lease. (b) Pursuant to Section 2.6 of the Guaranty Agreement, all of the obligations of the Company and as guarantor under the Guaranty Agreement; and -4- 00910 091288 380 (c) All obligations of the Company, Hoover and Universal under the Agreement for Payments in Lieu of Taxes. (3) Gaddy represents and warrants that he has the ability to repay the interest and principal on the North American Bonds as those payments become due. (4) Gaddy agrees to indemnify and save Universal harmless against and from all claims by or on behalf of any person, firm or corporation arising from the conduct of management of, or from any work or thing done on, the Leased Premises (as defined in the Lease) during the term from (i) any condition of the Leased Premises; (ii) any breach or default on the part of Gaddy in the performance of any of his obligations under the Lease; (iii) any act or negligence of Gaddy or any of his agents, contractors, servants, employees or licensees; or (iv) any act or negligence of any assignee or sublessee of Gaddy or any of his agents, contractors, servants, employees or licensee of any assignee or sublessee of Gaddy. Gaddy shall indemnify and save Universal harmless from and against all costs and expenses incurred in or in connection with any such claim arising as aforesaid, or in connection with any action or proceeding brought thereon, and upon notice from Universal, Gaddy shall defend Universal in any such action or proceeding. 6. The Trustee hereby agrees to give notice to Universal in the event of default under the Lease as soon as practicable after the Trustee has actual notice of such default. -5- 0091C 091288 7. All parties to this Assignment and Assumption Agreement hereby certify that they have no knowledge of any event of default as defined under the Trust Indenture, Guaranty Agreement or Lease. All parties also certify they have no knowledge of any occurrence which, with the passage of time, would constitute such an event of default. 8. The Trustee, the City and Hoover, hereby acknowledge due notification of the assignment by Universal of its rights under the Lease to Gaddy and, to the extent required by the Lease, consent to such assignment. Furthermore, the Trustee, the City and Hoover also acknowledge notification by Gaddy of his intention to assign his rights under the Lease to Precision Industries, Inc., and to the extent required by the Lease consent to such subsequent assignment provided that such assignment shall not in any way affect or limit Gaddy's obligations as assumed hereunder. IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the day of , 1988. UNIVERSAL DIE CASTING, INC., a Maryland corporation By Title Bob L. Gaddy 0091C 092088 334 mob-=== mm HOOVER UNIVERSAL, INC., a Michigan corporation By: ATTEST: Title Title The City of Little Rock, Arkansas, as Lessor in the within - described Lease, hereby consents to the execution of this Assignment and Assumption Agreement. Dated: ATTEST: City Clerk CITY OF LITTLE ROCK, ARKANSAS Mayor Worthen Bank and Trust Company, N.A., as Trustee, hereby consents to the execution of this Assignment and Assumption Agreement. Dated: ATTEST: WORTHEN BANK AND TRUST COMPANY, N.A., TRUSTEE By: Title -7- Title 0091C 092088 335 STATE OF ARKANSAS COUNTY OF PULASKI On this day of 1988, before me, a Notary Public, duly commissioned, qualified and acting, within and for the State and County aforesaid, appeared in person the within named and and and , respectively of Hoover Universal, Inc., to me personally known who stated that they were duly authorized in their respective capacities to execute the foregoing instrument and in the name of said corporation, and further stated and acknowledged that they had signed, executed and delivered the foregoing instrument for the consideration, uses and purposes therein mentioned and set forth. IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal on the date and year first written above. My commission expires: Notary Public -B- 00910 091288 386 STATE OF ARKANSAS COUNTY OF PULASKI ACKNOWLEDGMENT On this day of , 1988, before.me, a Notary Public, duly commissioned, qualified and acting, within and for the State and County aforesaid, appeared in person the within named and and and , respectively of Universal Die Casting, Inc., to me personally known who stated that they were duly authorized in their respective capacities to execute the foregoing instrument and in the name of said corporation, and further stated and acknowledged that they had signed, executed and delivered the foregoing instrument for the consideration, uses and purposes therein mentioned and set forth. IN TESTIMONY WHEREOF, I have,hereunto set my hand and official seal on the date and year first written above. Notary Public My commission expires: -9- 0091c 091288 ,387 STATE OF ARKANSAS COUNTY OF PULASKI F,TWM#1A On this day of 1988, before me, a Notary Public,.duly commissioned, qualified and acting within and for the State and County aforesaid, appeared in person, Bob L. Gaddy, to me personally known, and stated that he had executed the foregoing instrument for the consideration and purposes therein mentioned and set forth. IN.TESTIMONY WHEREOF, I have hereunto set my hand and official seal on the date and year first written above. My Commission Expires: Notary Public 0 -10- 00910 091288 380