Exhibit 10.2
AMENDED AND RESTATED
PAYMENT IN LIEU OF TAX AGREEMENT
THIS AGREEMENT, dated as of February 28, 1997 by and between ONEIDA
COUNTY INDUSTRIAL DEVELOPMENT AGENCY, a New York public benefit corporation
having an office at 000 Xxxxxx Xxxx, Xxxx, Xxx Xxxx 00000 (the "Agency"), and
SPECIAL METALS CORPORATION, having an office at 0000 Xxxxxx Xxxxxxxxxx Xxxx, Xxx
Xxxxxxxx, XX 00000 (the "Company").
RECITALS
1. The Agency and the Company entered into a Payment in Lieu of Tax Agreement
(the "Original Agreement") dated as of February 1, 1994.
2. The Company has requested that the Original Agreement be extended for a term
of ten years.
3. The Agency by resolution adopted on October 3, 1996 approved the extension of
the Original Agreement for a term of ten years subject to certain conditions as
hereinafter stated.
NOW, THEREFORE, the Original Agreement is hereby amended and restated
to read as follows:
WHEREAS, the Agency is authorized and empowered by the provisions of
Title 1 of Article 18-A of the General Municipal Law, Chapter 24 of the
Consolidated Laws of New York, as amended (the "Enabling Act"), and Chapter 372
of the 1970 Laws of New York, as amended, constituting Section 901 of said
General Municipal Law (said Chapter and Enabling Act hereinafter collectively
referred to as the "Act") to promote, develop, encourage and assist in the
acquiring, constructing, reconstructing, improving, maintaining, equipping and
furnishing of, among others, industrial facilities for the purpose of promoting,
attracting and developing economically sound commerce and industry in order to
advance the job opportunities, health, general prosperity and economic welfare
of the people of the State of New York, to improve their prosperity and standard
of living, and to prevent unemployment and economic deterioration; and
WHEREAS, by resolution adopted June 1, 1993 (the "Resolution"), the
Agency indicated its intent: (i) to acquire the Project Facility described in
the following paragraph and (ii) to lease (with an obligation to purchase) the
Project Facility to the Company or such other person as may be designated by the
Company and agreed upon by the Agency; and
WHEREAS, the Project Facility consists of the acquisition of land (the
"Land") located in the Town of New Hartford County of Oneida, State of New York,
and described on attached Exhibit A, buildings (the "Facility") on the Land, and
certain
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equipment (the "Equipment") (the Land, the Facility and the Equipment being
hereinafter referred to as the "Project Facility"), all for the use as a
manufacturing facility; and
WHEREAS, the Agency has agreed to accept title to the Project Facility
pursuant to a deed and xxxx of sale of even date herewith;
WHEREAS, the Agency will simultaneously lease the Project Facility to
the Company pursuant to a lease agreement (the "Original Lease") dated the date
hereof by and between the Agency and the Company; and
WHEREAS, the Agency has agreed to accept title to, and execute the
Original Lease of, the Project Facility in order to advance the job
opportunities, health, general prosperity and economic welfare of the people of
the State of New York.
WHEREAS, it is the intention of, and anticipated by, the Agency and the
Company that the Project Facility will be exempt from real property taxes,
general property taxes, general school district taxes, general assessments,
service charges or other governmental charges of a similar nature levied and/or
assessed upon the Project Facility or the interest therein of the Company or the
occupancy thereof by the Company (the "Exempt Taxes"), commencing March 1, 1994,
because the Project Facility is, or will be, under the jurisdiction, supervision
and/or control of the Agency and used for a purpose within the meaning of the
applicable Constitutional and statutory provisions, including Section 874 of the
New York State Industrial Development Agency Act, Title 1 of Article 18-A of the
General Municipal Law, Chapter 24 of the Consolidated Laws of the State of New
York, as amended (the "Enabling Act"), provided, however, such exemption will
not extend to special assessments or ad valorem levies; and
WHEREAS, the Company understands that it, as lessee of the Project
Facility leased by the Agency, will, in fact, have no Exempt Taxes to pay under
the provisions of the Lease from March 1, 1994 through the term of the Lease
(the "Exemption Term") (each year measured by the twelve month period commencing
with March 1, 1994, herein referred to as an "Exemption Year"); and
WHEREAS, by resolution adopted October 3, 1996 (the "Extension
Resolution"), the Agency indicated its intent to extend the Original Agreement
subject to certain conditions; and
WHEREAS, pursuant to the Extension Resolution the Agency indicated it
intends to extend the Original Lease subject to certain conditions; and
WHEREAS, the Agency and the Company are entering into a Lease Amendment
and Extension Agreement (the "Amendment") dated December 1, 1996 (the Original
Lease and the Amendment being the "Lease"); and
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WHEREAS, the Agency has indicated a reluctance for the taxing
authorities (the "Authorities" or an "Authority") to lose all tax revenues from
the Exemption Taxes during the Exemption Term which would otherwise be received
by the Authorities if the Project Facility were owned by the Company.
NOW, THEREFORE, to provide for certain payments to the Authorities, and
for other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto agree as follows:
1. The Company shall pay to each Authority all special assessments and
ad valorem taxes coming due and payable during the term of the Lease for which
the Project Facility is not exempt, no later than the last day during which such
payments may be made without penalty.
2. The Company shall pay to each Authority as set forth on Exhibit B
attached hereto and made a part hereof, an amount in lieu of the Exempt Taxes
(the "Pilot Payments") during each Exemption Year equal to one third (1/3) of
such taxes that would be payable to each such Authority as if the Company, and
not the Agency, owned the Project Facility, for each Exemption Year through the
Exemption Year ending February 28, 2007; and one hundred (100%) percent of such
taxes for each Exemption Year thereafter.
Anything herein to the contrary notwithstanding, if the Company (i)
fails to continue to maintain the operation of the Project Facility in the
County of Oneida, State of New York, or (ii) fails to maintain an employment
level of not less than 390 full time employees at all times, then thereafter the
Company shall pay to each Authority an amount of Pilot Payments during each
Exemption Year equal to one hundred percent (100%) of such taxes that would be
payable to each such Authority as if the Company, and not the Agency, owned the
Project Facility.
Anything herein to the contrary notwithstanding, upon the failure of
the Company in making any payment when due hereunder and upon failure to cure
such default within thirty (30) days of receipt of notice as herein provided,
the Company shall henceforth pay as Pilot Payments one hundred (100%) percent of
the Exempt Taxes together with interest at the rate of nine (9%) percent per
annum on all delinquent payments, together with expenses of collection,
including but not limited to, payment of attorneys' fees; provided, however,
nothing herein contained shall be deemed to limit any other rights and remedies
the Agency may have hereunder or under the Lease.
Anything herein to the contrary notwithstanding, this Agreement shall
terminate on the date on which the Lease shall terminate and the Agency shall
reconvey title to the Project Facility to the Company pursuant to the Lease.
3. The Company will make Pilot Payments to each Authority hereunder
for each Exemption Year by making the required payment to such Authority no
later than
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the last day during which such Exempt Taxes could otherwise be made without
penalty as if the Project Facility was owned by the Company.
4. The Pilot Payments to be made by the Company pursuant to this
Agreement are intended to be in lieu of all Exempt Taxes that would have to be
paid on the Project Facility leased to the Company by the Lease.
5. If by reason of a change in the Constitution or laws of the State of
New York, or an interpretation of the Constitution or laws of the State of New
York by the Court of Appeals (or such lower court from which the time to appeal
has expired) of the State of New York, or for any other reason, the Company is
required to pay any tax which the payments specified herein are intended to be
in lieu of, the Company may deduct the aggregate of any such payments made by it
from the amount herein agreed to be paid in lieu of such taxes and need only pay
the difference. Furthermore, inasmuch as the Pilot Payments herein agreed to be
made by the Company are intended to be in lieu of all Exempt Taxes, it is agreed
that said payments shall not, as to any year, be in an amount greater than would
be payable for such year for such Exempt Taxes, in the aggregate, by a private
corporation on account of its ownership of the Project Facility.
6. This Agreement shall be binding upon the successors and
assigns of the parties.
7. It is the intent of the parties that the Company will have all of
the rights and remedies of a taxpayer with respect to any real property or other
tax, service charge, special benefit, ad valorem levy, assessment or special
assessment or service charge because of which, or in lieu of which, the Company
is obligated to make a payment hereunder, as if and to the same extent as if the
Company were the owner of the Project Facility. It is the further intent of the
parties that the Company will have all of the rights and remedies of a taxpayer
as if and to the same extent as if the Company were the owner of the Project
Facility with respect to any proposed assessment or change in assessment
concerning the property, or any portion thereof, whether through an assessor,
board of assessment review, court of law, or otherwise and likewise will be
entitled to protest before and be heard by such assessor, board of assessment
review, court of law or otherwise and will be entitled to take any and all
appropriate appeals or initiate any proceedings to review the validity or amount
of any assessment or the validity or amount of any taxes that would have been
payable but for the provisions hereof. In the event, however, that a court of
competent jurisdiction shall enter an order or judgment determining or declaring
that, by reason of the Agency's ownership of the Project Facility, the Company
does not have the right to bring a proceeding to review such assessment under
the Real Property Tax Law or any other law, then the Company shall have the
right to contest such assessment in the name and as agent of the Agency, and the
Agency agrees to cooperate with the Company in all respects in any such
proceeding.
8. All amounts payable by the Company hereunder will be paid to
the respective Authority and will be payable in such lawful money of the United
States of
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America as at the time of payment is legal tender for the payment of public and
private debts, including a check payable in such money.
9. (a) If any term or provision hereof should be for any reason held or
adjudged to be invalid, illegal or unenforceable by any court of competent
jurisdiction, such term or provision will be deemed separate and independent and
the remainder hereof will remain in full force and effect and will not be
invalidated, impaired or otherwise affected by such holding or adjudication.
(b) This Agreement may not be effectively amended, changed, modified,
altered or terminated except by an instrument in writing executed by the parties
hereto.
(c) All notices, certificates or other communications hereunder shall
be in writing and shall be sufficiently given and shall be deemed given when
mailed by United States registered or certified mail, postage prepaid, return
receipt requested, to the Agency or the Company, as the case may be, addressed
as follows:
IF TO THE AGENCY:
Oneida County Industrial Development Agency
000 Xxxxxx Xxxx
Xxxx, Xxx Xxxx 00000
Attention: Chairman
WITH A COPY TO:
Groben, Gilroy, Oster & Xxxxxxxx
000 Xxxxxxx Xxxxxx
X.X. Xxx 000
Xxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxx, Esq.
IF TO THE COMPANY:
Special Metals Corporation
Xxxxxx Xxxxxxxxxx Xxxx
Xxx Xxxxxxxx, XX 00000
Attention: President
WITH A COPY TO:
Bond, Xxxxxxxxx & Xxxx
One Lincoln Center
Syracuse, NY
Attention: Xxxxxx X. Xxxxxx, Esq.
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provided, that the Agency or the Company may, by notice given hereunder to the
other, designate any further or different addresses to which subsequent notices,
certificates or other communications to them shall be sent.
(d) This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
(e) This Agreement shall be effective as of the 1st day of
December, 1996.
(f) This Agreement may be executed in one or more counterparts, each
of which shall be an original and all of which together shall constitute but one
instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
27th day of February, 1997.
ONEIDA COUNTY INDUSTRIAL
DEVELOPMENT AGENCY
By:
Xxxxxx X. Xxxxx
Chairman
SPECIAL METALS CORPORATION
By:
Xxxxxx X. Xxxxxx
President
