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HomeMy WebLinkAbout2025-09-01-R RESOLUTION NO. 2Q. _C -( '-)-Q`-IP_ A RESOLUTION AUTHORIZING THE ACCEPTANCE OF A LOAN AGREEMENT FOR THE EXPAlvTSION AND IMPROVEMENT i� ti SERiE OF iv10L'i`AI IN BIKE, TRAILS WHEREAS, the City of Batesville, Arkansas (the "City") proposes to acquire, construct, expand,and improve a series of mountain bike trails within the City(the"Project"); and WHEREAS, the City proposes to obtain funds to accomplish the Project from the proceeds of a Grant from the Arkansas Department of Parks, Heritage, and Tourism; and WHEREAS, the Walton Family Foundation has generously agreed to match the state Grant funds in the form of a loan. NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Batesville,Arkansas: Section 1. The City hereby authorizes the Mayor to enter into the Loan Agreement and Promissory Note attached hereto as Exhibit"L" PASSED AND APPROVED this 2``' day of September, 2025. APPROVED: BY: X" Mayor P6 El ATTESTED: AMO(Ar4-�� Jessica Davis, C i ty Clerk LOAN AGREEMENT This Loan Agreement(the"Agreement")is entered into as of September 30, 2025 (the "Effective Date"), between THE WALTON FAMILY FOUNDATION, INC., a Delaware nonprofit,nonstock corporation(the"Lender")and THE CITY OF BATESVILLE,ARKANSAS, a municipal corporation organized and duly existing under the laws of the State of Arkansas(the "Borrower"). RECITALS WHEREAS,the Borrower is a municipal corporation organized and duly existing under the laws of the State of Arkansas and is authorized by Amendment No. 78 to the Arkansas Constitution("Amendment No. 78") and Title 14, Chapter 78 of the Arkansas Code of 1987 Annotated to borrow money and enter into loan agreements with private parties for the purpose of financing the acquisition, construction, installation and other costs associated with buildings, structures,equipment and improvements to be used for governmental purposes of the Borrower; WHEREAS,the Borrower desires to make improvements to city-owned property for the purpose of constructing bicycle trails to promote public recreation and tourism(the"Project"); WHEREAS,the Borrower is applying for matching funds from the State of Arkansas for the Project in an amount equal to Five-Hundred Thousand Dollars(the"Match"); WHEREAS,Lender desires to make a loan to Borrower in the amount of Five-Hundred Thousand Dollars ($500,000.00) (the "Loan") on the terms and conditions set forth in this, Agreement to facilitate the construction by Borrower of the Project and the improvement, maintenance and operation of the Project,and Borrower desires to accept the Loan; WHEREAS,the Lender and the Borrower intend that the transactions provided for in this Agreement constitute a"program related investment"of the Lender within the meaning of Section 4944(c)of the Internal Revenue Code of 1986,as amended(the"Code")and Treasury Regulations Section 53.4944-3;and WHEREAS,Lender desires to make the Loan in furtherance of its charitable mission to create positive change for people and communities in Arkansas and is willing to make such Loan to the Borrower upon the terms and subject to the conditions hereinafter set forth. NOW,THEREFORE,in consideration of the foregoing premises,and for other good and valuable consideration,the receipt and sufficiency of which are hereby acknowledged,the parties hereto agree as follows: ARTICLE I THE LOAN AND ITS PURPOSE Section 1.1 The Loan and the Closing;Loan Disbursements. (a) In accordance with the provisions of this Agreement and subject to the conditions precedent set forth in Section 3.1, 1 the Lender agrees to make a loan to the Borrower in the aggregate principal amount of Five- Hundred Thousand Dollars($500,000.00)(the"Loan"). The closing of the Loan(the"Closing") shall occur on the date that is five(5)business days after the satisfaction of all conditions set forth in Section 3 1(the Closing Date"),provided,that in no event shall the Closing Date be later than the date that is er the Effective Date(the"Outside Date"). If the conditions to Closing - j Commented[MP1]:April 3,2026.allowing ample time for set forth in Section 3.1 are not satisfied by the Outside Date,this Agreement shall terminate as of l stagy to announce a"af&_ _ the Outside Date and the parties shall have no further rights or obligations hereunder. (b) Subject to satisfaction of all of the conditions set forth in Section 3.1,Lender will make the Loan to Borrower in a single disbursement of the Loan on the Closing Date. Section 1.2 The Note and Repayment of the Loan. (a) The Loan shall be evidenced by a promissory note made by the Borrower(the"Note"),substantially in the form attached hereto as Exhibit A,duly executed on behalf of the Borrower by its authorized representatives and dated the Closing Date. The Borrower hereby irrevocably authorizes the Lender to make(or cause to be made)appropriate notations on the schedule attached to the Note(or at the Lender's option,in its records),which notations,if made,shall evidence the date and outstanding principal balance of the Loan evidenced thereby and the date and amount of each payment thereon. Such notations shall be presumptive evidence of the subject matter thereof absent manifest error,provide however, that the failure to make any such notations shall not limit or otherwise affect the Loan or any of Borrower's obligations under this Agreement or the Note. (b) The Loan shall bear interest at the rate of zero percent per annum from the Closing Date. (c) Borrower shall make principal payments to Lender in the amounts set forth below on the dates set forth opposite each such principal payment: Amount of Principal Payment Date of Principal Payment $125,000.00 10/1/2027 $125,000.00 10/1/2028 $125,000.00 10/1/2029 $125,000.00 10/1/2030 All payments hereunder shall be made by check or wire transfer to the Lender in the lawful money of the United States. If a payment is due on a day that is not a business day(which shall be any day other than a Saturday or Sunday that the Lender is open for business and banks are not authorized or required to be closed under the laws of the State of Arkansas),such payment may be made on the next succeeding business day. The Borrower shall make all payments to the Lender's account set forth on Schedule II to this Agreement, or such other account as the Lender shall designate in writing to the Borrower not less than ten(10)days before a payment is due. 2 (d) The Borrower may prepay all or any part of the Loan at any time without premium or penalty.Amounts repaid may not be reborrowed. (e) If any payment of principal is not paid within ten(10)days after the due date,then such overdue amount shall,without limiting the rights of the Lender,bear interest at the rate of the lesser of twelve percent (12%) per annum or the maximum rate permitted under applicable law,which shall accrue from the due date until paid. (f) Notwithstanding anything to the contrary contained in this Agreement,the entire outstanding principal balance of the Loan,and all interest accrued thereon,shall be payable on fifth anniversary of the Closing Date. Section 1.3 Purpose of the Loan. The purpose of the Loan is to facilitate the acquisition by Borrower of the Project and the improvement, maintenance and operation of the Project by Borrower. Section 1.4 Use of Proceeds. Unless alternative use of funds is approved in writing by the Lender,the Borrower shall use the proceeds of the Loan and any investment income derived therefrom(the"Loan Proceeds")exclusively for the purposes set forth in Section 1.3. Section 1.5 Program Related Investment. Consistent with Code Section 4944(c) and Treasury Regulations Section 53.4944-3: (a) The primary purpose of the Loan is to accomplish one or more of the purposes of the Lender described in Code Section 170(c)(2)(B); (b) No significant purpose of the Loan is the production of income or the appreciation of property;and (c) No purpose of the Loan is to accomplish one or more of the purposes described in Code Section 170(c)(2)(D). It is intended that the Loan will significantly further the accomplishment of the Lender's exempt purposes.The Lender would not make the Loan but for this relationship between the Loan and the accomplishment of the Lender's exempt purposes. ARTICLE II REPRESENTATIONS AND WARRANTIES The Borrower represents and warrants to the Lender as of the Closing Date that: Section 2.1 Organization and Powers. (a)The Borrower is a municipal corporation, duly created and validly existing,in good standing pursuant to the constitution and statutes of the State of Arkansas. (b) The Borrower has full corporate power and authority and all necessary licenses and permits required as of the date hereof to own and operate its properties,to carry on its activities,to enter into this Agreement,to acquire,own and operate the Project,and to carry out and consummate all of its obligations under this Agreement.The Borrower has the full corporate 3 power and authority to execute and deliver this Agreement and the Note and to perform its obligations thereunder. (c) The proceedings of the City Council of Batesville,Arkansas approving this Agreement and the Note and authorizing their execution and delivery on behalf of the Borrower and authorizing the Borrower to acquire and operate the Project been duly and lawfully adopted at a meeting or meetings duly called and held at which quorums were present and acting throughout and such meeting or meetings were duly called pursuant to necessary public notice and held in accordance with all applicable law. (d) The Borrower has taken all necessary actions to ensure that sufficient funds have been appropriated and are available for the current fiscal year to permit the repayment of all amounts due and payable by Borrower under this Agreement and the Note.The Borrower further represents and warrants that such appropriations have been duly approved and are in compliance with all applicable laws and regulations governing the Borrower's budgetary and appropriations processes. (e) The Borrower represents and warrants that it has included all payments required to be made by Borrower under this Agreement in its annual budget for the current fiscal year,and that such budget has been duly adopted and is in full force and effect. Section 2.2 Authorization, Binding Agreement. The execution, delivery and performance by the Borrower of this Agreement and the Note, and the borrowing of the Loan hereunder, have been duly authorized by all requisite corporate action of Borrower. This Agreement and the Note have been duly executed and delivered by authorized officers of the Borrower. Upon execution and delivery of each of them by the Borrower,this Agreement and the Note (the "Loan Documents") will constitute the legal, valid, and binding obligations of the Borrower,enforceable in accordance with their terms,except to the extent that enforceability may be limited by applicable bankruptcy, insolvency or other similar laws of general application or equitable principles relating to or affecting the enforcement of creditors'rights from time to time in effect. Section 2.3 Liti ag tion. There is no action,suit or proceeding at law or in equity pending or threatened before any court or governmental or administrative body or regulatory authority or agency which,individually or in the aggregate,could reasonably be expected to result in a material adverse change in the activities,operations,assets or properties or in the condition,financial or otherwise, of the Borrower, or materially to impair the ability of the Borrower to perform its obligations under this Agreement and the Note. The Borrower is not in default with respect to any judgment, writ, injunction, decree, rule or regulation of any court or any governmental or administrative body or agency. Section 2.4 No Conflicts:No Government Consents. (a)The execution, delivery and performance by the Borrower of this Agreement and the Note and the borrowing hereunder will not violate any provision of law,any order,writ,injunction,decree,rule or regulation of any court or governmental or administrative body or regulatory authority or agency,the charter or Bylaws of the Borrower or any indenture,agreement or instrument to which the Borrower is a party or by which the Borrower or its assets or properties are bound,or conflict with,result in a breach of or constitute(with due notice or lapse of time or both)a default under any such indenture,agreement 4 or instrument,or result in the creation or imposition of any lien,charge or encumbrance of any nature whatsoever upon any of the assets or properties of the Borrower. (b) No consent,approval or authorization of,or declaration or filing with,any governmental or administrative body or agency on the part of the Borrower is required for the valid execution and delivery of this Agreement and the Note and the performance by the Borrower of its obligations thereunder. Section 2.5 No Default. The Borrower is in compliance with all of the terms and provisions set forth in the Loan Documents on its part to be observed or performed,and no Event of Default(as defined in Article VI hereof),or any event that,with notice or lapse of time or both, would constitute any such Event of Default,has occurred and is continuing. Section 2.6 Financial Condition. The financial statements, including balance sheets, and any other written statement furnished by the Borrower to the Lender do not and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements contained therein or herein not misleading. There is no fact known to the Borrower which the Borrower has not disclosed to the Lender in writing which materially adversely affects or is likely to materially adversely affect the financial condition of the Borrower,its ability to own and operate its property in the manner such property is currently operated or its ability to perform its obligations and make payments under this Agreement and the Note when and as the same become due and payable. Section 2.7 Compliance with Existing Laws and Aereements. The execution and delivery of this Agreement by the Borrower,the performance by the Borrower of its obligations hereunder,and the consummation of the transactions provided for in this Loan Agreement and the Note and compliance by the Borrower with the provisions of this Loan Agreement and the Note and the undertaking and completion of the Project (i) are within the municipal powers of the Borrower and have been duly and effectively authorized by all necessary action on the part of the Borrower and(ii) do not and will not result in any breach of any of the terms, conditions, or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Borrower pursuant to any existing bond ordinance,resolution,trust agreement,indenture,mortgage,deed of trust,loan agreement or other instrument(other than this Loan Agreement)to which the Borrower is a party or by which the Borrower or any of its property may be bound,nor will such action result in any violation of the provisions of the charter or other document pursuant to which the Borrower was established or any laws, resolutions, ordinances, governmental rules, regulations or court orders to which the Borrower or its properties or operations is subject. Section 2.8 Disqualified Persons. Neither the Borrower, nor any employee of the Borrower, is a"disqualified person"with respect to the Lender within the meaning of Section 4946(a)of the Code. Section 2.9 Insurance Coveraee. The Borrower has insurance coverage in full force and effect, against such risks and in such amounts as is customarily maintained by municipal corporations in the State of Arkansas. 5 Section 2.10 Title to Properties. Borrower has good title to its assets and properties free and clear of any mortgage,deed of trust,pledge,security interest,lien,charge or encumbrance of any nature(each,a"Lien"). Section 2.11 Solvency. The Borrower is not contemplating the commencement of insolvency,bankruptcy,litigation or consolidation proceedings or the appointment of a receiver, liquidator,custodian,trustee or similar official in respect of the Borrower or any of its property or assets. Section 2.12 Indebtedness. Except as set forth in the Disclosure Schedule attached hereto as Schedule I, Borrower has no outstanding Indebtedness and no Indebtedness is secured by or otherwise benefits from any Lien on or with respect to the whole or any part of Borrower's properties or assets,present or future. For purposes of this Agreement,"Indebtedness"shall be defined as:(i)liabilities,including but not limited to recoverable grants,for borrowed money or for the deferred purchase price of property or services other than(a)wages,(b)lease payments other than capital lease payments, and(c)trade accounts payable that provide for the payment thereof within ninety (90)days of the incurrence thereof, in each case incurred in the ordinary course of business;(ii)liabilities secured by any Lien existing on real or personal property owned or leased(whether or not the liabilities have been assumed);(iii)obligations under conditional sales or other title retention agreements;(iv)indebtedness of others that is guaranteed or endorsed by Borrower,or with respect to which Borrower is otherwise contingently liable;(v)obligations as lessee under capital leases, except under non-material capital leases for routine office equipment;and(vi)any other obligations(other than deferred taxes,if any)that are required by generally accepted accounting principles to be shown as liabilities on Borrower's balance sheet. ARTICLE III CLOSING CONDITIONS Section 3.1 Closing Conditions. The obligation of the Lender to make the Loan is subject to the conditions precedent that the Lender shall have received the following: (a) The receipt of this Agreement, duly executed and delivered by the Borrower,in full force and effect; (b) Approval of the Match as evidenced by an award letter provided by the State of Arkansas,or its agencies; (c) The receipt of the Note,duly executed and delivered by the Borrower, in full force and effect; (d) The receipt of an Officer's Certificate of the Borrower,substantially in the form of Exhibit B attached hereto,with appropriate attachments;and (e) Delivery to Lender of certificates from the appropriate governmental authorities certifying that the Borrower is duly formed under the laws of the State of Arkansas and is in good standing under the laws of such jurisdiction. 6 ARTICLE IV AFFIRMATIVE COVENANTS The Borrower covenants and agrees that so long as this Agreement shall remain in effect or the Note shall not have been repaid in full,and unless the Lender shall otherwise consent in writing in advance: Section 4.1 Insurance.The Borrower shall maintain or cause to be maintained,in force, insurance with responsible insurers with policies or self-insurance with respect to its property, insuring against such casualties and contingencies of such types (including public liability insurance)and in such amounts as are customary in the case of persons engaged in the same or similar activity and similarly situated. Section 4.2 The Project. The Project is needed by the Borrower and will not result in an unnecessary duplication of existing facilities. The Project is consistent with the orderly development and provisions of services in the area in which the Borrower is located.The Borrower will proceed with due diligence to complete any improvements needed to place the Project into service. The Borrower will maintain the Project in good condition and make all necessary renewals,replacements,additions,betterments,and improvements thereof and thereto.In the event that Borrower sells or otherwise disposes of the Project, all amounts outstanding under this Agreement and the Note shall immediately be due and payable without presentment, demand, protest, notice or other formalities of any kind, all of which are hereby expressly waived by Borrower. Section 4.3 Information. The Borrower shall,at the reasonable request of the Lender, discuss the Borrower's financial matters with the Lender and provide the Lender with access to and copies of any documents(other than documents the confidentiality of which is protected by law or professional codes of ethics)reasonably requested by the Lender. Section 4.4 Payment of Indebtedness. The Borrower shall pay all of its Indebtedness and obligations promptly and in accordance with the terms thereof,as well as all lawful claims for labor,materials and supplies or otherwise which,if unpaid,might become a lien or charge upon such property,or any part thereof;provided,however,that the Borrower shall not be required to pay and discharge or to cause to be paid and discharged any such Indebtedness,obligation,so long as the validity thereof shall be contested in good faith by appropriate proceedings and adequate reserves therefore shall be set aside. Section 4.5 Financial Statements. The Borrower shall famish,or cause to be furnished, to the Lender,the following reports: (a) Within ninety(90)days after the end of each fiscal year of Borrower and within ninety(90)days after the repayment in full of the Loan,a statement,signed by an authorized officer of the Borrower(i)describing the use of the Loan proceeds during the preceding year,(ii) evaluating the progress of Borrower toward achieving the purposes of the Loan described in Section 1.3 and the contribution of the Loan thereto,and(iii)certifying that all of the requirements set forth in this Agreement were met in all material respects,including,without limitation,those requirements related to maintaining the status of the Loan as a Program Related Investment;and 7 (b) Such other information about the activities,business affairs,and financial condition of the Borrower as the Foundation may from time to time reasonably request. Section 4.6 Notice to the Lender. The Borrower shall advise the Lender, immediately upon any officer of the Borrower becoming aware thereof, of the occurrence of any of the following events: (a) Any proceeding instituted or threatened against the Borrower in or before any court or any governmental or administrative body or agency,which proceeding could have a material adverse effect upon the operations, assets, or properties of the Borrower; or any investigation,adverse regulatory action,or proposed action by any governmental body or agency against the Borrower,which investigation or action is likely to have a material adverse effect upon the operations,assets,or properties of the Borrower; (b) Any act or decision by Borrower to(i)discontinue use of the Project solely as offices in support of Borrower's governmental activities or(ii)make any material change in the use of the Project or(iii)abandon the Project or market the Project for sale (c) Any use of the Loan proceeds for a purpose other than those set forth in Section 1.3; (d) Any material adverse change in the condition, financial or otherwise, or operations of the Borrower;or (e) Any Event of Default or other event that, with notice or lapse of time or both,would constitute an Event of Default. Section 4.7 Appropriations. Until such time as the entire principal balance of the Loan, and all interest accrued thereon and other charges payable by Borrower hereunder and under the Note have been fully repaid,the Borrower shall take all necessary actions to ensure that sufficient funds are appropriated and are available for each fiscal year to permit the repayment of all amounts due and payable by Borrower under this Agreement and the Note during such fiscal year. Section 4.8 Corporate Existence and Properties. The Borrower shall do or cause to be done all things necessary to preserve, renew and keep in full force and effect its corporate existence,and comply in all material respects with all laws and regulations applicable to it. Section 4.9 Books and Records.The Borrower agrees that it shall maintain records of receipts of expenditures of the Loan proceeds made in connection with the Loan for a period of four years after the date the Loan is paid in full. The Borrower shall make such records available to Lender from time to time upon Lender's written request. The obligation in this Section 4.9 shall survive the expiration or termination of this Agreement. Section 4.10 Attorneys'Fees and Other Expenses.The Borrower shall on demand pay to the Lender the reasonable fees and expenses of attorneys and other reasonable expenses including, without limitation,the reasonably allocated costs of in-house counsel and legal staff incurred by Lender in connection with the enforcement of performance of any other obligations of the Borrower following a breach by Borrower of its obligations under this Agreement or the Note. 8 ARTICLE V NEGATIVE COVENANTS The Borrower covenants and agrees that so long as this Agreement shall remain in effect or the Note shall not have been paid in full,and unless the Lender shall otherwise consent in writing in advance: Section 5.1 Legislative and Political Uses of Loan Proceeds. The Borrower shall not use any proceeds of the Loan for any of the purposes described in Section 170(c)(2)(D)of the Code,except as permitted by U.S.Treasury Regulations. The Borrower shall not use any proceeds of the Loan to carry on propaganda or otherwise to attempt to influence legislation(within the meaning of Section 4945(d)(1)of the Code),or to influence the outcome of any specific public election,or to carry on,directly or indirectly,any voter registration drive(within the meaning of Section 4945(dx2)of the Code). Section 5.2 No Material Change. The Borrower shall not make any material change in the nature of its activities as presently conducted that would adversely affect the Borrower's ability to perform under the Loan Documents. Furthermore,the Borrower shall not conduct its activities in a manner that materially departs from the representations made in the documents submitted by Borrower to the Lender in connection with Borrower's request for the Loan. Section 5.3 Governing Document Amendments. The Borrower shall not amend its charter or laws or regulations in any manner that would cause the Borrower to be in violation of any provision of the Loan Documents or which would jeopardize the ability of the Borrower to perform its obligations under the Loan Documents. ARTICLE VI DEFAULT AND REMEDIES Section 6.1 Events of Default. The Borrower shall be deemed to be in default under this Agreement upon the occurrence of any of the following events (each of which is herein sometimes called an"Event of Default"): (a) The Borrower fails to make any payment that is due and payable hereunder or under the Note, and such failure continues unremedied for five (5) days after notice to the Borrower; (b) The Borrower uses any portion of the proceeds of the Loan for a purpose or in a manner other than as specifically authorized by this Agreement; (c) Any material representation or warranty made in the Loan Documents,or in any report, certificate, financial statement, or instrument furnished in connection with this Agreement or the Loan,shall prove to have been false or misleading when made,in any material respect; (d) The Borrower violates or fails to observe or perform any covenant contained in Sections 4.1 or 4_4 or Article V hereof; 9 (e) The Borrower violates or fails to observe or perform any other covenant contained herein, or any agreement on the part of the Borrower to be observed or performed pursuant to the Loan Documents,other than those referred to above in Section 6.1(d)above,and such default shall continue unremedied for thirty (30)days after the earlier of(a)the Borrower obtaining knowledge thereof or(b)the Lender delivers notice thereof to the Borrower; (f) The Borrower shall (i) cease operations; (ii) apply for or consent to the appointment of a custodian,receiver,trustee or liquidator for it or for all or a substantial part of its assets or properties; (iii)generally not pay its debts as they become due or admit in writing its inability to pay its debts as they become due; (iv) default on the payment of Indebtedness for borrowed money or any other monetary obligation,in each case,in respect of an obligation having an aggregate value in excess of$50,000;(v)make an assignment for the benefit of creditors;or (vi)file a petition commencing a voluntary case under any chapter of the Bankruptcy Code, I 1 U.S.C. Section 101 et§2q.or a petition seeking for itself any reorganization or arrangement with creditors or to take advantage of any bankruptcy,insolvency,readjustment of debt,dissolution or liquidation law or statute,or an answer admitting the material allegations of a petition filed against it in any proceeding under any such law,or corporate action shall be taken by the Borrower for the purpose of effecting any of the foregoing; (g) An involuntary proceeding shall be commenced or a petition shall be filed seeking (i) reorganization, arrangement, readjustment, dissolution or liquidation of all or a substantial part of the Borrower's assets or properties, under any federal, state or foreign bankruptcy, insolvency, receivership or similar law, or (ii) the appointment of a custodian, receiver,conservator,trustee or liquidator for the Borrower or for a substantial part of its assets, and,in any such case,such proceeding or petition shall continue undismissed for ninety(90)days or an order or decree approving or ordering any of the foregoing shall be entered;or (h) A judgment or judgments for the payment of money aggregating in excess of$200,000 shall be entered against the Borrower,and the same shall remain unsatisfied and in effect,without stay of execution,for a period of thirty(30)consecutive days. Section 6.2 Remedies. If an Event of Default occurs or is continuing: (a) Lender may,by written notice to the Borrower,declare all amounts under this Agreement and the Note forthwith to be due and payable, whether or not the Indebtedness evidenced by the Note shall be otherwise due and payable and whether or not Lender shall have initiated any other action for the enforcement of the Note,and whereupon the Note shall become immediately due and payable as to principal and any other amounts payable under the Note, without presentment, demand, protest, notice or other formalities of any kind, all of which are expressly waived by the Borrower; (b) Lender may protect and enforce its rights by appropriate judicial proceedings,including,in appropriate cases,an award of specific performance or other equitable remedy in aid of the exercise of power granted in or pursuant to this Agreement;and (c) Upon the occurrence of any Event of Default described in subsections 6.1(f) or! .1 hereof,all amounts outstanding under this Agreement and the Note shall immediately be 10 due and payable without presentment,demand,protest,notice or other formalities of any kind,all of which are hereby expressly waived by Borrower. ARTICLE VII CERTAIN OBLIGATIONS In the event that a judgment,levy,attachment,or other seizure is entered against the Lender arising as a result of acts or omissions of Borrower or any of its officers,employees or agents relating to this Agreement or the Loan, the Borrower shall promptly post any necessary bond to prevent execution against any property of the Lender. In the event that Lender incurs any damages, liabilities or losses or becomes the subject of a third party claim as a result of making the Loan or entering into this Agreement or due to any act or omission of Borrower or any of its officers, employees or agents,Borrower shall be liable to Lender such damages,liabilities,losses or claims. ARTICLE VIII MISCELLANEOUS Section 8.1 Entire Agreement:Amendment. This Agreement and the Exhibits annexed hereto constitute the entire agreement between the parties with respect to the subject matter hereof and supersede all prior agreements or understandings,written or oral,in respect thereof,and shall not be amended or modified in any fashion except by instrument in writing signed by the party charged with such amendment or modification. The Exhibits annexed hereto are incorporated in and made a part of this Agreement. Section 8.2 Notices. Any notice or communication given under this Agreement shall be in writing and delivered by hand or mailed by first class mail,by courier,postage prepaid (mailed notices shall be deemed given three(3)business days after mailing),or by facsimile or e-mail with a hard copy sent by one of the methods identified above,to the following addresses: If to the ,6iio�'!to: -J commented[MP2]:Add City's point of contact information (Mayor's) Mayor Rick Elumbaugh 500 E.Main St. Batesville,AR 72503 If to the Lender,to: Stephanie Cornell,Executive Director The Walton Family Foundation,Inc. 215 NW A Street,Suite 200 Bentonville,AR 72712 479-464-1500,scornell@wffmail.com or to such other address or addresses as hereafter shall be furnished as provided in this Section 8.2 by either of the parties hereto to the other party hereto. Section 8.3 Waiver:Remedies. No delay on the part of either party hereto in exercising any right,power or privilege hereunder shall operate as a waiver thereof,nor shall any waiver on 11 the part of either party hereto of any right,power or privilege hereunder operate as a waiver of any other right, power or privilege hereunder, nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right,power or privilege hereunder. Section 8.4 Assignment. The Lender may assign all or any portion of its rights or obligations under the Loan Documents,and in the event of such assignment,the assignee shall be accorded the full rights of the Lender by the Borrower with respect to such assignment. The Borrower may not assign all or any portion of its rights or obligations under the Loan Documents without the prior written consent of the Lender. Section 8.5 Headings. The headings in the Loan Documents are for convenience of reference only and shall not affect the meaning or interpretation of the Loan Documents. Section 8.6 Variation of Pronouns. All pronouns and all variations thereof shall be deemed to refer to the masculine,feminine or neuter,singular or plural,as the identity of the person or persons may require. Section 8.7 Counterparts. This Agreement may be executed in counterparts, each of which shall constitute an original and all of which, when taken together, shall constitute one agreement, and either party hereto may execute this Agreement by signing one or more counterparts thereof. Section 8.8 Severability. Any provision of this Agreement held to be invalid,illegal or unenforceable in any jurisdiction shall,as to such jurisdiction,be ineffective to the extent of such invalidity,illegality or unenforceability without affecting the validity,legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction. Section 8.9 Governing Law; Jurisdiction; Consent to Service of Process. This Agreement shall be governed by and construed in accordance with the laws of the State of Arkansas applicable to agreements made within such State.The Borrower hereby irrevocably and unconditionally submits, for itself and its property,to the nonexclusive jurisdiction of the state courts of the State of Arkansas and of the United States District Court of the Western District of Arkansas,and any appellate court from any thereof,in any action or proceeding arising out of or relating to this Agreement,or for recognition or enforcement of any judgment,and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such Arkansas State court or,to the extent permitted by law,in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that the Lender may otherwise have to bring any action or proceeding relating to this Agreement against the Borrower or its properties in the courts of any jurisdiction. The Borrower hereby irrevocably and unconditionally waives,to the fullest extent it may legally and effectively do so,any objection which it may now or hereafter have to the laying of venue of any suit,action or proceeding arising out of or relating to this Agreement in any court referred to in this Section. Each of the parties hereto hereby irrevocably waives,to the fullest extent permitted by law,the defense of an inconvenient forum to the maintenance of such action or proceeding in 12 any such court. Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 8.2. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law. Section 8.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES,TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A)CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT,IN THE EVENT OF LITIGATION,SEEK TO ENFORCE THE FOREGOING WAIVER AND(B)ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION. Section 8.11 Other Parties. Nothing in the Loan Documents shall be construed as giving any person, firm, corporation,or other entity other than the parties any right, remedy,or claim under or in respect of the Loan Documents or any provision there Section 8.12 No Lender Representations. The Lender makes no warranty or representation, either express or implied, as to the value, design, condition, merchantability or fitness for particular purpose or fitness of the use of the Project or any portion thereof or any warranty with respect thereto. In no event shall the Lender be liable for any incidental,indirect, special or consequential damage in connection with or arising out of this Agreement or the Note or the existence, furnishing, functioning or the Borrower's use of the Project or any item or products or services provided in this Agreement. [Remainder of page intentionally left blank.] 13 IN WITNESS WHEREOF,the parties'duly authorized representatives have signed this Agreement below,as of the date first written above. LENDER: THE WALTON FAMILY FOUNDATION By: Stephanie Cornell,Executive Director BORROWER: THE CITY OF BATESVILU,ARKANSAS By: Name:Rick Elumbaugh Title:Mayor SCHEDULEI DISCLOSURE SCHEDULE [Borrower to provide] Fxh.A-1 SCHEDULE II LENDER'S WIRE INSTRUCTIONS FOR PAYMENT Organization Name:The Walton Family Foundation Address:215 NW A Street,Suite 200 City,State,Zip:Bentonville,AR,72712 Contact Name:Jenny Tripp Contact email:jtripp@wffinail.com Bank Account Information ABA Routing Number:082900872 Bank Name:Arvest Bank City,State,Zip:Bentonville,AR 72712 Account Number:34127289 Account Type:Checking If you have any questions about the information provided on this form,please contact Jenny Tripp atjtripp@wffinaii.com. Exh.A-2 EXHIBIT A PROMISSORY NOTE September 30,2025: $500,000.00 THE CITY OF BATESVILLE,ARKANSAS,a municipal corporation with offices at 500 E. Main Street, BATESVILLE, AR 72501 (the "Borrower"), for value received, hereby promises to pay to the order of THE WALTON FAMILY FOUNDATION,a Delaware nonprofit,nonstock corporation, (the"Lender"), or holder, at its offices at 215 NW A Street,Suite 200,Bentonville,Arkansas,72712,or at such other place or places in the United States of America as the holder hereof may designate in writing from time to time,the amount of Five-Hundred Thousand Dollars($500,000.00), or such lesser amount as shall be outstanding hereunder,as reflected on Schedule I attached hereto and/or in the Lender's records,together with any unpaid interest thereon. Principal and interest under this Note shall be due and payable at such times as are specified in the Agreement(as defined below),unless earlier repaid pursuant to the provisions set forth in the Loan Agreement. The Lender shall,and is hereby authorized to,make(or cause to be made) appropriate notations on Schedule I attached hereto(or,at its option,in its records),which notations, if made, evidence, inter alia, the date the Loan is disbursed, the outstanding principal balance of the Loan after each payment of principal and the date and amount of each payment of principal. Such notations shall be presumptive evidence of the accuracy of the amount so recorded absent manifest error;provided,however,that the failure of the Lender to make any such notation shall not limit or otherwise affect the Loan or any obligation of Borrower under this Note or the Loan Agreement(hereinafter defined). This Note is the Promissory Note of the Borrower referred to in that certain Loan Agreement dated as of the date hereof(as amended, restated, supplemented or otherwise modified from time to time)(the"Loan Agreement"), between the Borrower and the Lender, and the holder hereof is entitled to the benefits of such Loan Agreement and may enforce the provisions thereof and exercise the remedies provided thereby or otherwise available in respect thereof. Capitalized terms used herein and not otherwise defined are used herein as defined in the Loan Agreement. This Note may be prepaid by the Borrower in whole or in part, without premium or penalty, at any time or from time to time. This Note is an unsecured, full recourse obligation of the Borrower. This Note shall be governed by and construed in accordance with the laws of the State of Arkansas applicable to contracts made entirely within such state. The Borrower hereby irrevocably and unconditionally submits to the nonexclusive jurisdiction of the state courts of the State of Arkansas and of the United States District Court of the Western District of Arkansas, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Note,or for recognition or enforcement of any Exh.A-3 judgment, and Borrower hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such Arkansas State court or,to the extent permitted by law,in such Federal court. Nothing in this Note shall affect any right that the Lender may otherwise have to bring any action or proceeding relating to this Agreement against the Borrower or its properties in the courts of any jurisdiction.The Borrower hereby irrevocably and unconditionally waives,to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement in any court referred to in this Section. Borrower hereby irrevocably waives,to the fullest extent permitted by law,the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court. Borrower irrevocably consents to service of process in the manner provided for notices in Section 8.2 of the Loan Agreement. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law. BORROWER HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS NOTE(WHETHER BASED ON CONTRACT,TORT OR ANY OTHER THEORY). Exh.A-4 IN WITNESS WHEREOF, intending to be legally bound, Borrower has caused this Promissory Note to be executed as of the date first above written. THE CITY OF BATESVILLE, ARKANSAS,a municipal corporation By: Name:Rick Elumbaugh Title:Mayor Exh.A-5 SCHEDULEI DISBURSEMENT OF LOAN AND PAYMENTS OF PRINCIPAL Date Amount of Amount of Unpaid Notation Loan Principal Principal made by Paid Balance Closing $500,000.00 $500,000.00 Date October $125,000.00 $375,000.00 1,2027 October $125,000.00 $250,000.00 1,2028 October $125,000.00 $125,000.00 1,2029 October $125,000.00 $0 1,2030 Exh.A-6 EXHIBIT B OFFICER'S CERTIFICATE This Certificate is being furnished to THE WALTON FAMILY FOUNDATION (the"Lender")pursuant to Section 3.1 of the Loan Agreement dated as of the date hereof (the"Agreement"),between the Lender and THE CITY OF BATESVILLE,ARKANSAS, a municipal corporation (the "Borrower"). Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Agreement. The undersigned,Rick Elumbaugh,certifies that they are the duly elected,qualified and acting Mayor of the Borrower, a municipal corporation organized and duly existing under the laws of the State of Arkansas, and that as Mayor, he/she is familiar with the organizational records and seal,if any,of the Borrower. The undersigned further certifies in their capacity as Mayor of the Borrower: 1. The representations made by the Borrower in the Agreement are true and correct as of the date hereof. 2. No Event of Default or event that with notice or passage of time or both would become an Event of Default has occurred and is continuing. 5. Attached hereto as Attachment A is a true, correct and complete copy of resolutions duly adopted by the City Council of Batesville,Arkansas on ,2025;such resolutions have not been amended,rescinded or revoked,and remain,on the date hereof, in full force and effect as of the date hereof;and the borrowing of the Loan from the Lender contemplated by the Agreement, the Note evidencing the Loan, and the transactions contemplated thereby come within the guidelines set forth in such resolutions IN WITNESS WHEREOF,the undersigned has executed this certificate as of the day of ,2025. By: Title:Mayor The undersigned, Jessica Davis, certifies that they are the duly elected, qualified and acting City Clerk of the Borrower,and that as City Clerk,they are familiar with the organizational records and seal,if any,of the Borrower. The undersigned further certifies in their capacity as City Clerk of the Borrower: The following person: (i) is the duly elected, qualified and acting officer of the Borrower occupying the office set forth opposite their name, and the signature set forth opposite their name is his/her true signature and(ii)is duly authorized to execute,deliver and perform, in the name and on behalf of the Borrower, the Officer's Certificate, the Agreement,the Note,and the transactions contemplated thereby: Name Title Signature Rick Elumbaugh Mayor IN WITNESS WHEREOF,the undersigned has executed this certificate as of the day of ,2025. By: Title:Batesville City Clerk Jessica Davis City Clerk ATTACHMENTS TO OFFICER'S CERTIFICATE Attachment A Resolutions