EXHIBIT 10.10
PAYMENT IN LIEU OF TAX AGREEMENT
THIS AGREEMENT, dated as of February 1, 1994 by and between ONEIDA COUNTY
INDUSTRIAL DEVELOPMENT AGENCY, a New York public benefit corporation having an
office at Oneida Xxxxxx Xxxxxxx Xxxxxxxx Xxxxxxxx, Xxxxxxxx, Xxx Xxxx 00000 (the
"Agency"), and SPECIAL METALS CORPORATION, having an office at 0000 Xxxxxx
Xxxxxxxxxx Xxxx, Xxx Xxxxxxxx, XX 00000 (the "Company").
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 the Enabling Act being 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 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 "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 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, the Agency has indicated a reluctance for the taxing authorities
(the "Authorities" or an "Authority") to lose all tax revenues from the Exempt
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 that the last day during which such
payments may be made without penalty.
2. The Company shall pay to each Authority 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.
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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 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 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
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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 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
Xxxxxx Xxxxxx Xxxxxxx Xxxxxxxx Xxxxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Chairman
WITH A COPY TO:
Groben, Gilroy, Oster & Xxxxxxxx
000 Xxxxxxx Xxxxxx
X.X. Xxx 000
Xxxxx, XX 00000-0000
Attn: Xxxxx X. Xxxxx, Esq.
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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.
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.
(e) This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
ONEIDA COUNTY INDUSTRIAL
DEVELOPMENT AGENCY
By: _____________________________
Xxxx X. XxXxxxx,
Chairman
SPECIAL METALS CORPORATION
By: _____________________________
Xxxxxx X. Xxxxxx,
President
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STATE OF NEW YORK )
) ss.:
COUNTY OF ONEIDA )
On this 1st day of February, 1994, before me personally came Xxxx X.
XxXxxxx, to me known, who being by me duly sworn did depose and say that he
resides at Sauquoit, New York, that he is Chairman of the ONEIDA COUNTY
INDUSTRIAL DEVELOPMENT AGENCY, the public benefit corporation described in the
above instrument, and acknowledged that he executed the same by order of the
members of such public benefit corporation.
s/Xxxxx X. Xxxxx
-----------------------------
Notary Public
STATE OF NEW YORK )
) ss.:
COUNTY OF ONEIDA )
On this 2nd day of February, 1994, before me personally came Xxxxxx X.
Xxxxxx, to me known, who being by me duly sworn did depose and say that he
resides at Clinton, New York, that he is President of Special Metals Corporation
the corporation described in the above instrument, and acknowledged that he
executed the same by order of the Board of Directors of such corporation.
s/Xxxxx X. Xxxxx
-----------------------------
Notary Public
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