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HomeMy WebLinkAboutResolution - 2007-R0551 - Tax Abatement Agreement - Molinos Anahuac Inc. - 12/06/2007Resolution No. 2007—RO551 December 6, 2007 Item No. 5.5 RESOLUTION IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the Mayor of the City of Lubbock BE and is hereby authorized and directed to execute for and on behalf of the City of Lubbock a Tax Abatement Agreement with Molinos Anahuac, Inc. and all related documents. Said Agreement is attached hereto and incorporated in this Resolution as if fully set forth herein and shall be included in the minutes of the Council. Passed by the City Council this 6th day of December , 2007. DAVID A. MILLER, MAYOR ATTEST: 4e 4Z - Rebecca Garza, City Secret APPROVED ASAO CONTENT: Robison; AstitaaMity Manager Development Services APPROVED AS TO FORM: Linda L. Chamales, Senior Attorney Office Practice Section LC: cityatt / Linda / Res -Tax Abatement-Molinos Anahuac November 26, 2007 AGREEMENT STATE OF TEXAS § COUNTY OF LUBBOCK § Resolution No. 2007-RO551 This Agreement made this 6th day of December , 2007, by and between the City of Lubbock, Texas, a home rule municipality of the State of Texas (hereinafter called "City"), and Molinos Anahuac, Inc. (hereinafter called "Company"); WITNESSETH: WHEREAS, City did receive from Company on the 2n'd day of May, 2007 an application for tax abatement for improvements to real property and tangible personal property at 301 Insurance Street, Tract A, Railport Addition to the City of Lubbock, Lubbock County, Texas which is further described in Exhibit "A"; and WHEREAS, upon review of the above application it was determined that the facility and real property is located in the Reinvestment Zone designated by the City in Ordinance No. 2006-000108 covering the above described property; and WHEREAS, the Guidelines and Criteria Governing Tax Abatement For Industrial Projects in the City of Lubbock was heretofore adopted by Resolution No. 2007-120514 of the City Council of the City of Lubbock. A copy of the Guidelines and Criteria Governing Tax Abatement for Industrial Projects in the City of Lubbock is attached as Exhibit "B" and incorporated herein as if fully set forth; and WHEREAS, the City did comply with all the requirements set forth in V.T.C.A., Tax Code, Section 312.201; and WHEREAS, the City did comply with all the criteria and guidelines as set forth in the Guidelines and Criteria Governing Tax Abatement for Industrial Projects in the City of Lubbock, said guidelines having been adopted by Resolution No. 2007-RO5 l4 of the City on November 8, 2007; and WHEREAS, the City did pass Ordinance No. 2006-00108 creating a reinvestment zone for commercial and industrial tax abatement, said zone including the area which is described in the attached Exhibit "A"; and WHEREAS, the application received by City from Company is an application for the construction of a new facility; and AGREEMENT - MOLINOS ANAHUAC, INC. PAGE 1 WHEREAS, V.A.T.C., Tax Code, Sec. 312.002 specifically states that such a purpose is to be included in the guidelines for tax abatement and to be eligible for such treatment; and WHEREAS, Section IV of the Guidelines and Criteria governing Tax Abatement for Industrial Projects in the City of Lubbock adopted by the City Council by Resolution No. 2007-RO514, does recognize construction of a new facility as being eligible for tax abatement status; and WHEREAS, the City Council does hereby find that all of the Guidelines and Criteria Governing Tax Abatement, as adopted by Resolution No. 2007-R0514 have been met by Company; and WHEREAS, the location of the facility and surrounding real property, which are to be the subject matter of this Agreement, are attached hereto as Exhibit "A" and made a part of this Agreement for all purposes; and NOW THEREFORE, for and in consideration of the premises and of the mutual terms, covenants and conditions herein contained the City and Company do hereby agree as follows: SECTION 1. Term. This Agreement shall remain in force and effect for a period of five (5) years from January I of the tax year after the required improvements are substantially completed and shall expire and be of no further force and effect after said date. SECTION 2. Base Year. The base year applicable to real property, which is the subject of this Agreement, shall be 2007, and the assessed value of the real property shall be the assessed value applicable to such property for said year. SECTION 3. Base Year Taxes. The taxes upon the real property shall be paid in accordance with the assessed value of such property for the base year. Base year taxes upon the real property are thus not abated. SECTION 4. Abatement of Increase in Base Year Tax. In accordance with V.A.T.C., Tax Code, Section 312.204 real property taxes applicable to the real property subject to this Agreement shall be abated only to the extent said value for any given year within the term of this Agreement exceeds the base year taxes hereinabove set forth. SECTION 5. Property Ineligible for Tax Abatement. The property described and set forth in Section IV(6) of the Guidelines and Criteria Governing Tax Abatement for Industrial Projects in the City of Lubbock and heretofore adopted by the City Council by Resolution No. 2007 -ROS 14 is incorporated by reference herein as if fully set out in this Agreement and fully describes the property ineligible for tax abatement. AGREEMENT —MOLINOS ANAHUAC, INC. PAGE 2 SECTION 6. Exemption from Tax. The City covenants and agrees to exempt from taxation, in accordance with Section 4 above, the following properties: (a) All proposed new improvements to be placed upon the property which is described in Exhibit "A". (b) All eligible tangible personal property, owned by Company, placed in or upon the property set forth in Exhibit "A", which does not include any equipment and personal property owned by Company and already located in a existing facility. (c) It is further understood that all items affixed to the new improvements placed upon the real property identified in Exhibit "A", including machinery and equipment shall be considered part of the real property improvement and taxes thereon shall be abated in accordance with the provisions of subparagraph (a) above set forth. SECTION 7. Economic Qualifications. Company agrees to expend funds necessary to qualify for tax abatement by constructing a new facility, as set forth in Section IV(3)(a) of the Guidelines and Criteria Governing Tax Abatement for Industrial Projects in the City of Lubbock (Exhibit "B") on the property described in Exhibit "A". A description of the kind, number and location of all proposed improvements is attached in Company's application, Exhibit "C" and incorporated herein as if fully set forth. SECTION 8 Job Creation Qualifications. It is hereby found by the City that Company will create and retain 12 new full-time permanent positions within one year of completion of improvements. A description of the number and location of all proposed jobs is attached in Company application, Exhibit "C" and incorporated herein as if fully set forth. SECTION 9. Value of Improvements. In accordance with V.A.T.C., Tax Code, Section 312.204(a), which requires the Owner of the property to make specific improvements or repairs to the property in order to be eligible for tax abatement, Company will expend one million ($1,000,000) for the construction of a new facility and one million six hundred fifty eight thousand ($1,658,000) on new equipment to be located within the reinvestment zone created by Ordinance No. 2006-00108. SECTION 10. City Access to Property. Company covenants and agrees that City shall have access to the property, which are the subject matter of this Agreement, upon reasonable notice and during normal business hours, and that municipal employees shall be able to inspect the property to insure compliance with the terms and conditions of Company's application for tax abatement, attached as Exhibit "C", and this Agreement. SECTION 11. Portion of Tax Abated. City agrees, during the term of this Agreement, to abate taxes on eligible property according to the following schedule. AGREEMENT - MOLINOS ANAHUAC, INC. PAGE 3 Year 1: 100% Year 2: 80% Year 3: 60% Year 4: 40% Year 5: 20% SECTION 12. Commencement Date. This Agreement shall commence January 1 of the tax year after the required improvements are substantially completed and shall expire five (5) years after such date. SECTION 13. Type of Improvements. Company proposes to construct a new facility as described in Exhibit "C". Company further states that the proposed improvements to the property above mentioned shall commence on the 6th day of Au ust, 2007, and shall be completed within approximately five (5) months from said date. Company may request an extension of the above date from City in the event circumstances beyond the control of Company necessitates additional time for completion of such improvements and such consent shall not unreasonably be withheld. Company shall provide a copy of the certificate of occupancy or other proof of completion within ten days of completion of improvements. SECTION 14. Limitation on Use. Company agrees to limit the use of the property set forth in Exhibit "A" to commercial and/or industrial uses as those terms are defined in the zoning ordinances of the City of Lubbock and to limit the uses of the property to uses consistent with the general purpose of encouraging development of the enterprise zone during the term of this agreement. SECTION 15. Recapture. Company agrees to be bound by and comply with all the terms and provisions for recapture of abated taxes in the event of default by Company pursuant to law and as set forth in Guidelines and Criteria for Tax Abatement adopted by Resolution No. 2007-RO514 of the City Council of the City of Lubbock. SECTION 16. Certification. Company agrees to certify annually in writing to the governing body of each taxing unit that the owner is in compliance with the terms of the Agreement. SECTION 17. Compliance. The City may cancel or modify this Agreement if Company fails to comply with the Agreement. AGREEMENT - MOLINOS ANAHUAC, INC. PAGE 4 SECTION 18. Notices. Notices required to be given by this Agreement shall be mailed, certified mail return receipt requested, to the following addresses: CITY OF LUBBOCK MOLINOS ANAHUAC, INC. Assistant City Manager Sergio Rascon Development Services Attn: Rodolfo Mata P.O. Box 2000 1112 Montana Lubbock, Texas 79457 El Paso, TX 79902 Phone: 915.613.0780 Fax: 915.351.4494 ! AGREEMENT - MOLINOS ANAHUAC, INC. PAGE 5 SECTION 19. Effective Date. Notwithstanding anything contained herein to the contrary, this Agreement shall not be effective until such time as it has been finally passed and approved. EXECUTED this 5th day of AGREEMENT - MOL[NOS ANAHUAC, INC. December .2007. CITY OF LUBBOCK A Municipaltion �Q DAVID MILLER, MAYOR ATTEST: ` I Re ecca Garza City Secretary APPROVED AS T CONTENT: Rob Allison -, t C--it-Manager Development Services APPROVED AS TO FORM: i Linda L. Chamales, Senior Attorney Office Practice Section PACE 6 Exhibit A Resolution No, 2007-RO551 KEY NOTES NOTES Gesbr9id Grd9 wise C..AdW I, LM. MIDI Skoal Ia9rire K lam 79424 936798.7242 Legal B WWw &iieaaPA- -R*W wiAx b 9v Cky0 LikbeRF Section 3e ebd 0 Lakkock C.1y T.- Trad A teg Ams Btg LI. Procsafin9 Feclly m 6 Ld She', ftd 3d16,080 el Advkkkatm14 aM2 d SrWWA.396A e+ Tdd &a9 wee 39.13311 Tdd W vee 784.369 x9160 F1aek U*v L-* W,'9a1-120.930 9P8 a175 pvv T -I& Sewer -63A00 epd F 4' cervix 9nn Gar - 21,524 mhh C—I & 34,500 mm UII-W M aP. Fk1d.-1239a 277"V, 3 p Twfapdmne - Yee Celia -Yes y�=J:7�Ik2�JY'wi. Paoxp Td#Peq*W Partki9 by U. 26 nd T.W RephM Acce WSFs- 4w Tdd PvWg AeAkd- 39 cam I LEGEND 0 a� nw is �° .ewa+.n+no•irea+.n �° �kaweo rot.ou1w39 �n.� SItFEi m�eamo�dei wr.ra ori 0.0 ��rotw:a.9 B15.rt azwwor rtaa W � 5+1•r. s Exhibit"B" Resolution No. 2007—R0551 Guidelines and Criteria Governing Tax Abatement For Industrial Projects In The City of Lubbock SECTION I. General Purpose: The City of Lubbock is committed to the promotion of high quality development in all parts of the City of Lubbock, Texas; and to an ongoing improvement in the quality of life for the citizens residing within the Affected Jurisdiction, The Affected Jurisdiction recognize that these objectives are generally served by enhancement and expansion of the local economy. The Affected Jurisdiction will, on a case by case basis, give consideration to providing tax abatement, as authorized by V.T.C.A., Tax Code, Chapter 312, as stimulation for economic development within the Affected Jurisdiction. It is the policy of the Affected Jurisdiction that said consideration will be provided in accordance with the guidelines and criteria herein set forth and in conformity with the Tax Code. Nothing contained herein shall imply, suggest or be understood to mean THAT the Affected Jurisdiction is under any obligation to provide tax abatement to any applicant and attention is called to V.T.C.A., Tax Code, Section 312.002(d). With the above rights reserved all applications for tax abatement will be considered on a case by case basis. SECTION 11. Definitions: As used within these guidelines and criteria, the following words or phrases shall have the following meaning: 1. Abatement of Taxes: To exempt from ad valorem taxation all or part of the value of certain Improvements placed on land located in a reinvestment zone designated for economic development purposes as of the date specified in the Tax Abatement Agreement for a period of time not to exceed ten (10) years. 2. Affected Jurisdiction: City of Lubbock. 3. Abatement Agreement: (1) A contract between a property owner and an Affected Jurisdiction for the abatement of taxes on qualified property located within a reinvestment zone; or, (2) a contract for the abatement of taxes between an Affected Jurisdiction and a certified air carrier who owns or leases Real Property located within the reinvestment zone or Personal Property or both as authorized by V.T.C.A., Tax Code, Section 312.204(e) 4. Advanced Technologies: advanced manufacturing which requires higher skills and results in higher wages and investment. 5. Base Year Value: The assessed value of property eligible for tax abatement as of January 1 preceding the execution of an Abatement Agreement as herein defined. 6. Distribution Center Facility: A building or structure including Tangible Personal Property used or to be used primarily to receive, store, service or distribute goods or materials. 7. Expansion of Existing Facilities or Structures: The addition of buildings, structures, machinery or equipment to a Facility. 8. Existing Facility or Structure: A facility as of the date of execution of the Tax Abatement Agreement, located in or on Real Property eligible for tax abatement. 2007 Industrial Tax Abatement Guidelines November 8, 2007 9. Facility: The improvements made to Real Property eligible for tax abatement and including the building or structure erected on such Real Property and/or any Tangible Personal Property to be located in or on such property. 14. Information and Data Center: Facility used to house computer systems and associated components, such as telecommunications and storage systems. The main purpose of the facility is running applications that handle the core business and operational data of organizations, off-site backups and other informational operations. 11. Improvements to Real Property or Improvements: Shall mean the construction, addition to, structural upgrading of, replacement of, or completion of any facility located upon, or to be located upon, Real Property, as herein defined, or any Tangible Personal Property placed in or on said Real Property. 12. Manufacturing Facility: A Facility which is or will be used for the primary purpose of the production of goods or materials or the processing or change of goods or materials to a fmished product. 13. Medical Services: Facilities such as hospitals, specialty hospitals and other like facilities that are classified under North American Industrial Classification System Code 622. 14. Modern ization/Renovation of Existing Facilities: The replacement or upgrading of existing facilities. 15. New Facility: The construction of a Facility on previously undeveloped real property eligible for tax abatement. 16. New Permanent Job: A new employment position created by a business that has provided employment to an employee of at least 1,820 hours annually and intended to be an employment position that exists during the life of the abatement. 17. Other Basic Industry: A Facility other than a distribution center facility, a research facility, a regional service facility or a manufacturing facility which produces goods or services or which creates new or expanded job opportunities and services a market of which 50% of revenues come from outside of Lubbock County, Texas. 18. Owner: The record title owner of Real Property or the legal owner of Tangible Personal Property. In the case of land leased from an Affected Jurisdiction or buildings leased from a private party or tax exempt property, the lessee shall be deemed the owner of such leased property together with all improvements and Tangible Personal Property located thereon. 19. Productive Life: The number of years a Facility is expected to be in service. 20. Real Property: Land on which Improvements are to be made or fixtures placed. 21. Regional Services Facility: A Facility, the primary purpose of which is to service or repair goods or materials and which creates job opportunities within the Affected Jurisdictions. 22. Reinvestment Zone: Real Property designated as a Reinvestment Zone under the provisions of V.T.C.A., Tax Code, Section 312.202. 2007 Industrial Tax Abatement Guidelines November 8, 2007 23. Research Facility: A Facility used or to be used primarily for research or experimentation to improve or develop new goods and/or services or to improve or develop the production process for such goods and/or services. 24. Tangible Personal Property: Any Personal Property, not otherwise defined herein and which is necessary for the proper operation of any type of Facility. SECTION III. Intent of Criteria and Guidelines: The Intent of the criteria and guidelines, as herein set forth, is to establish the minimum standards which an applicant for tax abatement must meet in order to be considered for such status by the Affected Jurisdiction. SECTION IV. Criteria and Guidelines for Tax Abatement: Any type of Facility will be eligible for tax abatement consideration provided such Facility meets the following guidelines and criteria: 1. To qualify for Tax Abatement, the company must meetboth of the following criteria: a) The modernization or expansion of an existing facility of any type as herein defined or construction of a new facility of any type as herein defined. b) Producer„ manufacturer or distributor of goods and services of which 50 percent or more are distributed outside of Lubbock County. 2. In addition to the aforementioned, the taxing jurisdiction will consider abatement only if the company meets one of the following criteria: a) One of the following target industries: i) Advanced Technologies and Manufacturing ii) Value-added Agricultural Production including Food Processing and Machinery iii) Research and Development iv) Medical Services (as defined in Section Il Definitions) v) Warehouse/Distribution vi) Corporate Headquarters of a Regional/National Service Center vii) Information and Data Centers b) The project is not included as a target industry, but has the potential of generating additional significant economic development opportunities to Lubbock 3. The company must meet one of the following criteria: a) The project will add at least $1 million in real property improvements, or $2 2007 Industrial Tax Abatement Guidelines November 8, 2007 million in new personal property , or 25 new permanent jobs if the facility is a new company to Lubbock. b) The project will add at least $500,000 in real property improvements, or $1 million in new personal property, or 15 new permanent jobs if the facility is an existing company. 4. New or existing faciiities,of any type herein defined, located in a reinvestment zone or upon Real Property eligible for such status will be eligible for consideration for tax abatement status provided that all other criteria and guidelines are satisfied 5. Improvements to Real Property are eligible for tax abatement status. 6. The following types of Property shall be ineligible for tax abatement status and shall be fully taxed. a) Real Property; b) inventories or supplies; C) tools; d) furnishings and other forms of movable personal property; e) vehicles; f) aircraft; g) housing; h) boats; i) hotel accommodations; j) motel accommodations; k) retail businesses; 1) property owned by the State of Texas or any State agency; and, m) property owned or leased by a member of the affected Jurisdiction that did not have an active tax abatement in place before they became a member of the governing body or commission. 7. In order for a Facility to qualify for abatement, the following conditions must apply: a) The owner or leaseholder of real property must make eligible improvements to the real property; and, b) In the case of lessees, the leaseholder must have a lease commitment of at least five (5) years. 4 2007 Industrial Tax Abatement Guidelines November 8, 2007 c) It is recommended that facilities located within the certificated territory of the City's municipally owned electric utility, Lubbock Power and light (LP&L) utilize LP&L for electrical services during the term of the abatement. In reinvestment zones, the amount and term of abatement shall be determined on a case by case basis, however, in no event shall taxes be abated for a term in excess of ten (10) years. The amount of the taxable value of Improvements to be abated and the term of the abatement shall be determined by the municipality in all cases where the property for which tax abatement is applied for is within the City limits of the City or by the County of Lubbock in all cases where the property for which tax abatement is applied for is outside of the City limits of a municipality, but within the County of Lubbock, except that a reinvestment zone that is a state enterprise zone is designated for the same period as a state enterprise zone as provided by Chapter 2303, Government Code. The authority of all other taxing units shall be as set forth in V.T.C.A., Tax Code, Section 312.206. In enterprise zones, the governing body of each taxing jurisdiction may execute a written agreement with the owner of the property. The agreement may, but is not required to, contain terms that are identical to those contained in the agreement with the municipality, county, or both, whichever applies, and the only terms for the agreement that may vary are the portion of the property that is to be exempt from taxation under the agreement and the duration of the agreement. 9. No property shall be eligible for tax abatement unless such property is located in a reinvestment zone in accordance with V.T.C.A., Tax Code, Section 312.202 and the tax abatement application is filed with the taxing jurisdiction before construction begins. I0. Notwithstanding any of the requirements set forth in Section IV Subsection 3, the governing body of an Affected Jurisdiction upon the affirmative vote of a three-fourths (314) of its members may vary any of the above requirements when variation is demonstrated by the applicant for Tax Abatement that variation is in the best interest of the Affected Jurisdiction to do so and will enhance the economic development of the Affected Jurisdiction. By way of example only and not by limitation the governing body of an Affected Jurisdiction may consider the following or similar terms in determining whether a variance shall be granted: a) That the increase in productivity of the Facility will be substantial and hence directly benefit the economy. b) That the increase of goods or services produced by the facility will be substantial and directly benefit the economy. c) That the employment maintained at the Facility will be increased. d) That the waiver of the requirement will contribute and provide for the retention of existing jobs within the Affected Jurisdiction. e) Any other evidence tending to show a direct economic benefit to the Affected Jurisdiction. 11. Taxability: a) The portion of the value of Improvements to be abated shall be abated in accordance with the terms and provisions of a Tax Abatement Agreement executed between the Affected Jurisdiction and the owner of the Real Property and/or Tangible Personal Property, 2007 Industrial Tax Abatement Guidelines November 8, 2007 (which agreement shall be) in accord with the provisions of V.T.C.A., Tax Code, Section 312.205. b) All ineligible property, if otherwise taxable as herein described, shall be fully taxed. 12. The governing body of each Affected Jurisdiction shall have total discretion as to whether tax abatement is to be granted. Such discretion, as herein retained, shall be exercised on a case by case basis. The adoption of these guidelines and criteria by the governing body of an Affected Jurisdiction does not: a) Limit the discretion of the governing body to decide whether to enter hto a specific tax abatement agreement; b) Limit the discretion of the governing body to delegate to its employees theauthority to determine whether or not the governing body should consider a particular application or request for tax abatement; or, c) Create any property, contract, or other legal right in any person to have thcgoveming body consider or grant a specific application or request for tax abatement. 13. The burden to demonstrate that an application for tax abatement should be granted shall be upon the applicant. Each Affected Jurisdiction to which the application has been directed shall have full authority to request any additional information from the applicant that the governing body of such Affected Jurisdiction deems necessary to assist it in considering such application. SECTION V. Criteria and Guidelines for Creation of Reinvestment Zone: 1. No Property shall be eligible for tax abatement unless such property is located in a reinvestment zone designated as such in accordance with V.T.C.A., Tax Code, Section 312.202. To be designated as a reinvestment zone an area must meet one of the following: a) Substantially arrest or impair the sound growth of the municipality or county creating the zone, retard the provision of housing accommodations, or constitute an economic or social liability and be a menace to the public health, safety, morals, or welfare in its present condition and use because of the presence of: 1. a substantial number of substandard, slum, deteriorated, or deteriorating structures; 2. the predominance of defective or inadequate sidewalks or streets; 3. faulty size, adequacy, accessibility or usefulness of lots; 4. unsanitary or unsafe conditions; 5. the deterioration of site or other improvements; 6. tax or special assessment delinquency exceeding the fair value of the land; 7. defective or unusual conditions of title; 8. conditions that endanger life or property by fire or other cause; or, 2007 Industrial Tax Abatement Guidelines November 8, 2007 9. any combination of these factors; a) Be predominantly open and, because of obsolete platting, deterioration of structures or site improvements, or other factors, substantially impair or arrest the sound growth of the municipality; b) Be in a federally assisted new community located in a home rule municipality or in an area immediately adjacent to a federally assisted new community located in a home rule municipality; c) Be located entirely in an area that meets the requirements for federal assistance under Section 119 of the Housing and Community Development Act of 1974 (42 U.S.C. Section 5318); d) Encompass signs, billboards, or other outdoor advertising structures designated by the governing body of the municipality for relocation, reconstruction, or removal for the purpose of enhancing the physical environment of the municipality, which the legislature declaresto be a public purpose; or, e) Be reasonably likely as a result of the designation to contribute to the retention or expansion of primary employment or to attract major investment in the zone that would be a benefit to the property and that would contribute to the economic development of the municipality. 2. For purposes of this Section, federally assisted new community is a federally assisted area: a) That has received or will receive assistance in the form of loan guarantees under Title X of the National Housing Act (12 U.S.C., Section 1749aa et seq); and, b) A portion of which has received grants under Section 107 (a)(1) of the Housing and Community Development Act of 1974, as amended. 3. The governing body of a municipality, as required by Section 312.201, or a county, as required by V.T.C.A., Tax Code, Section 312.401, shall hold a public hearing on the designation of an area within its jurisdiction as a reinvestment zone. The burden shall be on the owner of the property sought to be included in the zone or applicant for the creation of the reinvestment zone to establish the following: a) That the requirements of Subsection 1 of this Section have been met. b) That the improvements sought are feasible and practical. 4. No later than the seventh day before the date set for the above public hearing notice of such hearing shall be: a) Published in a newspaper having general circulation in the Affected Jurisdiction. b) Delivered in writing to the presiding officer of the governing body of each taxing unit that includes in its boundaries Real Property that is to be included in the reinvestment zone. 5. At the public hearing above described in Subsection 3 above, any interested person is entitled to speak and present evidence for or against the designation of such reinvestment zone. 2007 Industrial Tax Abatement Guidelines November 8, 2007 6. At the conclusion of the hearing described in Subparagraph 3 above, the governing body shall enter its findings as follows: a) That the applicant or owner has or has not met his burden as hereinabove set forth, and/or, b) That the improvements sought are or ate not feasible and practical. c) That the proposed improvements sought will or will not be a benefit to the land to be included in the reinvestment zone and to the Affected Jurisdiction after the expiration of an agreement entered into under V.T.C.A., Tax Code, Section 312.204. 7. An application for the creation of a reinvestment zone shall not be granted unless the Affected Jurisdiction considering such application enters affirmative findings to Subparagraphs a, b, and c of Subsection 6 above set forth. 8. At the conclusion of the public hearing herein required and upon the affirmative finding of the governing body as required by Subsection 7 above set forth, the governing body may designate a reinvestment zone in accordance with the provisions of V.T.C.A., Tax Code, Sections 312.201 or 312.401, whichever Section shall be applicable under the premises. 9. The designation of a reinvestment zone expires five years after the date of the designation and may be renewed for periods not to exceed five years, except that a reinvestment zone that is a state enterprise zone is designated for the same period as a state enterprise zone as provided by Chapter 2303, Government Code. The expiration of the designation does not affect an existing tax abatement agreement made in accordance with V.T.C.A., Tax Code, Section 312.201 through Section 312.209. 10. Designation of an area as an enterprise zone under the Texas Enterprise Zone Act, Chapter 2303, Subchapter C, Texas Government Code, constitutes designation of the area as a reinvestment zone under Subchapter B of the Property Redevelopment and Tax Abatement Act without further hearing or other procedural requirements other than those provided by the Texas Enterprise Zone Act, Chapter 2303, Subchapter C, Texas Government Code. SECTION VI. Tax Abatement Agreement: 1. After the creation of a reinvestment zone as hereinabove authorized a Tax Abatement Agreement may be executed between the owner and any Affected Jurisdiction. A Tax Abatement Agreement shall: a) Establish and set forth the Base Year assessed value of the property for which tax abatement is sought. b) Provide that the taxes paid on the base year assessed value shall not be abated as a result of the execution of said Tax Abatement Agreement. c) Provide that ineligible property as subscribed in Section IV, Subsection 6, hereinabove shall be fully taxed. d) Provide for the exemption of Improvements in each year covered by the agreement only to the extent the value of such Improvements for each such year exceeds the value for the year in which the agreement is executed. 2007 Industrial Tax Abatement Guidelines November &, 2007 e) Fully describe and list the kind, number and location of all of the improvements to be made in or on the Real Property. f) Set forth the estimated value of all improvements to be made in or on the Real Property. g) Clearly provide that tax abatement shall be granted only to the extent: 1. The Improvements to Real Property increase the value of the Real Property for the year in which the Tax Abatement Agreement is executed; and, 2. That the Tangible Personal Property improvements to Real Property were not located on the Real Property prior to the execution of the Tax Abatement Agreement. h) Provide for the portion of the value of the improvements to Real Property of improvements to be abated. This determination is to be made consistent with the provisions of Section IV, Subsection 6, of these guidelines and criteria as hereinabove set forth. i) Provide for the commencement date and the termination date. In no event shall said dates exceed a period of ten years. j) Describe the type and proposed use of the improvements to Real Property or improvements including: 1. The type of facility. 2. Whether the improvements are for a new facility, modernization of a facility, or expansion of a facility. 3. The nature of the construction, proposed time table of completion, a map or drawings of the improvements above mentioned. 4. The amount of investment and the commitment for the creation of new jobs. 5. A list containing the kind, number and location of all proposed Improvements. 6. Any other information required by the Affected Jurisdiction. k) Provide a legal description of the Real Property upon which improvements are to be made. 1) Provide access to and authorize inspection of the Real Property or improvements by employees of the Affected Jurisdiction, who have executed a Tax Abatement Agreement with owner to insure improvements are made according to the specifications and conditions of the Tax Abatement Agreement. m) Provide for the limitation of the uses of the Real Property or improvements consistent with the general purpose of encouraging development or redevelopment of the zone during the period covered by the Tax Abatement Agreement. n) Provide the contractual obligations in the event of default by owner, violation of the terms or conditions by owner, recapturing property tax revenue in the event owner defaults or 9 2007 Industrial Tax Abatement Guidelines November 8, 2007 otherwise fails to make improvements as provided in said Tax Abatement Agreement, and any other provision as may be required or authorized by State Law. o) Contain each term agreed to by the owner of the property. p) Require the owner of the property to certify annually to the governing body of each taxing unit that the owner is in compliance with each applicable term of the agreement. q) Provide that the governing body of the municipality may cancel or modify the agreement if the property owner fails to comply with the agreement. 2. Not later than the seventh day before a municipality or the County of Lubbock(as required by V.T.C.A., Tax Code, Section 312.2041 or Section 312.402) enters into an agreement for tax abatement under V.T.C.A., Tax Code, Section 312.204, the governing body of a municipality or a designated officer or employee thereof or the governing body of the county of Lubbock or a designated officer or employee thereof shall deliver to the presiding officer of the governing body of each of the taxing units in which the property to be subject to the agreement is located, a written notice that the municipality or the County of Lubbock as the case may be, intends to enter into the agreement. The notice must include a copy of the proposed Tax Abatement Agreement. 3. A notice, as above described in Subparagraph 2, is presumed delivered when placed in the mail, postage paid and properly addressed to the appropriate presiding officer. A notice properly addressed and sent by registered or certified mail for which a return receipt is received by the sender is considered to have been delivered to the addressee. 4. Failure to deliver the notice does not affect the validity of the agreement. SECTION VII. Aunlication: Any present owner of taxable property located within an Affected Jurisdiction may apply for tax abatement by filing an application with the county of Lubbock, when the Real Property or Tangible Personal Property for which abatement is sought is located within the County of Lubbock but outside of the City limits of any City or with the appropriate City when the heal Property or Tangible Personal Property for which abatement is sought is located within the City limits of a municipality located whollyor partially within Lubbock County. 2. The application shall consist of a completed application form accompanied by: a) A general description of the improvements to be undertaken. b) A descriptive list of the improvements for which tax abatement is requested. c) A list of the kind, number and location of all proposed improvements of the Real Property Facility or Existing Facility. d) A map indicating the approximate location of improvements on the Real Property Facility or Existing Facility together with the location of any or all Existing Facilities located on the Real Property or Facility. e) A list of any and all Tangible Personal Property presently existing on the Real Property or located in an existing facility. 10 2007 Industrial Tax Abatement Guidelines November 8, 2007 f) A proposed time schedule for undertaking and completing the proposed improvements. g) A general description stating whether the proposed improvements are in connection with: 1. the modernization of a facility (of any type herein defined); or, 2, construction of a new facility (of any type herein defined); or, 3. expansion of a facility (of any type herein defined); or, 4. any combination of the above. h) A statement of the additional value to the Real Property or Facility as a result of the proposed improvements. i) A statement of the assessed value of the Real Property, Facility or Existing Facility for the Base Year. j) Information concerning the number of new jobs that will be created or information concerning the number of existing jobs to be retained as result of the improvements undertaken. k) Any other information which the Affected Jurisdiction, to which the application has been directed, deems appropriate for evaluating the financial capacity of the applicant and compatibility of the proposed improvements with these guidelines and criteria. l) Information that is provided to an Affected Jurisdiction in connection with an application or request for tax abatement and which describes the specific processes or business activity to be conducted or the equipment or other property to be located on the property for which tax abatement is sought is confidential and not subject to public disclosure until the Tax Abatement Agreement is executed. Information in the custody of an Affected Jurisdiction after the agreement is executed is not confidential. (V.T.C.A., Tax Code, Section 312.003). m) The Affected Jurisdiction to whom the application for tax abatement has been directed shall determine if the property described in said application is within a designated reinvestment zone. If the Affected Jurisdiction determines that the property described is not within a current reinvestment zone then they shall so notify the applicant and said application shall then be considered both as an application for the creation of a reinvestment zone and a request for tax abatement to be effective after the zone is created. SECTION VIII. Default Options In the event that the applicant, owner or lessee has entered into a tax abatement agreement to make improvements as defined in Section IV.2 above, but fails to undertake or complete such improvements; fails to create all or a portion of the new jobs provided by the Tax Abatement Agreement; or is in default of any of the terms or conditions contained in the Tax Abatement Agreement; then in such event the Affected Jurisdiction to whom the application for tax abatements was directed shall give the applicant or owner sixty (60) days notice of such failure. The applicant or owner shall demonstrate to the satisfaction of the Affected Jurisdiction above mentioned that the applicant or owner has commenced to cure such failure 11 2007 industrial Tax Abatement Guidelines November 8, 2007 within the sixty (60) days above mentioned. In the event the applicant owner, or lessee fails to demonstrate that he is taking affirmative action to cure his failure, the Affected Jurisdiction shall have three options: (a) The Affected Jurisdiction may renegotiate the Agreement with the applicant, owner or lessee, in which case the current Guidelines and Criteria Governing Tax Abatement for Commercial Projects in Designated Enterprise Zones shall apply to the new Agreement; or (b) The Affected Jurisdiction may determine that good cause exists to cancel the Agreement and all abatement of taxes shall terminate immediately; or (c) The Affected Jurisdiction may terminate the Agreement and recapture taxes abated under Section VIII. Recapture. 2. In any of the three options in subparagraph I above, the Affected Jurisdiction to which the application for tax abatement was directed shall determine whether default has occurred by the applicant, owner or lessee in the terms and conditions of the Tax Abatement Agreement and shall so notify all other Affected Jurisdictions. Cancellation or termination of the Tax Abatement Agreement by the Affected Jurisdiction to which the application for tax abatement was directed shall constitute simultaneous action to all Tax. Abatement Agreements of all other Affected Jurisdictions. SECTION IX. Recapture In the event that any type of facility, (as defined in Section II, Subparagraphs 5, 6, 7, 8, 10, 11, 12, 14, 18, 20) is completed and begins producing goods or services, but subsequently discontinues producing goods or services for any reason, excepting fire, explosion or other casualty or accident or natural disaster or other event beyond the reasonable control of applicant or owner for a period of 180 days during the term of a tax abatement agreement, then in such even the Tax Abatement Agreement shall terminate and all abatement of taxes shall likewise terminate. Taxes abated during the calendar year in which termination takes place shall be payable to each Affected Jurisdiction by no later than January 31 st of the following year. Taxes abated in years prior to the year of termination shall be payable to each Affected Jurisdiction within sixty (60) days of the date of termination. The burden shall be upon the applicant or owner to prove to the satisfaction of the Affected Jurisdiction to who the application for tax abatement was directed that the discontinuance of producing goods or services was as a result of fire, explosion, or other casualty or accident of natural disaster or other event beyond the control of applicant or owner. In the event that applicant or owner meets this burden and the Affected Jurisdiction is satisfied that the discontinuance of the production of goods or services was the result of vents beyond the control of the applicant or owner, then such applicant or owner shall have a period of one year in which to resume the production of goods and services. In the event that the applicant or owner fails to resume the production of goods or services within one year, then the Tax Abatement Agreement shall terminate and the Abatement of all taxes shall likewise terminate. Taxes abated during the calendar year in which termination takes place shall be payable to each Affected Jurisdiction by no later than January 31st of the following year. Taxes abated in years prior to the year of termination shall be payable to each Affected Jurisdiction within sixty (60) days of the date of termination. The one year time period, hereinabove mentioned, shall commence upon written notification from the Affected Jurisdiction to the applicant or owner. 12 2007 industrial Tax Abatement Guidelines November 8, 2007 2. In the event that the applicant or owner has entered into a tax abatement agreement to make improvements to a facility of any type described in Section 1 above, but fails to undertake or complete such improvements or fails to create all or a portion of the number of new jobs provided by the Tax Abatement Agreement, then in such event the Affected Jurisdiction to whom the application for tax abatement was directed shall give the applicant or owner sixty (60) days notice of such failure. The applicant or owner shall demonstrate to the satisfaction of the Affected Jurisdiction, above mentioned, that the applicant or owner has commenced to cure such failure within the sixty (60) days above mentioned. In the event that the applicant or owner fails to demonstrate that he is taking affirmative action to cure his failure, then in such event the Tax Abatement Agreement shall terminate and all abatement of taxes shall likewise terminate. Taxes abated during the calendar year in which termination takes place shall be payable to each Affected Jurisdiction by no later than January 31 st of the following year. Taxes abated in years prior to the year of termination shall be payable to each Affected Jurisdiction within sixty (60) days of the date of termination. In the event that the Affected Jurisdiction to whom application for tax abatement was directed determines that the applicant or owner is in default of any of the terms or conditions contained in the Tax Abatement Agreement, then in such even the Affected Jurisdiction, shall give the applicant or owner sixty (60) days written notice to cure such default. In the event such default is not cured to the satisfaction of the Affected Jurisdiction within the sixty (60) days notice period, then the Tax Abatement Agreement shall terminate and all abatement of taxes shall likewise terminate. Taxes abated during the calendar year in which termination takes place shall be payable to each Affected Jurisdiction by no later than January 31st of the following year. Taxes abated in years prior to the year of termination shall be payable to each Affected Jurisdiction within sixty (60) days of the date of termination. 4. In the event that the applicant or owner allows ad valorem taxes on property ineligible for tax abatement owed to any Affected Jurisdiction, to become delinquent and fails to timely and properly follow the legal procedures for their protest or contest, then in such even the Tax Abatement Agreement shall terminate and all abatement of taxes shall likewise terminate. Taxes abated during the calendar year in which termination, under this subparagraph, takes place shall be payable to each Affected Jurisdiction by no later than January 31st of the following year. Taxes abated in years prior to the year of termination shall be payable to each Affected Jurisdiction within sixty (60) days of the date of termination. 5. In the even that the applicant or owner, who has executed a tax abatement agreement with any Affected Jurisdiction, relocates the business for which tax abatement has been granted, to a location outside of the designated reinvestment zone, then in such event, the Tax Abatement Agreement shall terminate after sixty (60) days written notice by the Affected Jurisdiction to the Owner/Applicant. Taxes abated during the calendar year in which termination, under this subparagraph takes place shall be payable to each Affected Jurisdiction by no later than January 31st of the following year. Taxes abated in years prior to the year of termination shall be payable to each Affected Jurisdiction within sixty (60) days of the date of termination. 6. The date of termination as that term is used in this Subsection VIII shall, in every instance, be the 60th day after the day the Affected Jurisdiction sends notice of default, in the mail to the address shown in the Tax Abatement Agreement to the Applicant or Owner. Should the default be cured by the owner or Applicant within the sixty (60) day notice period, the Owner/Applicant shall be responsible for so advising the Affected Jurisdiction and obtaining a release from the notice of default from the Affected Jurisdiction, failing in which, the abatement remains terminated and the abated taxes must be paid. 13 2007 Industrial Tax Abatement Guidelines November B, 2007 In every case of termination set forth in Subparagraphs 1, 2, 3, 4 and 5 above, the Affected Jurisdiction to which the application for tax abatement was directed shall determine whether default has occurred by Owner (Applicant) in the terms and conditions of the Tax Abatement Agreement and shall so notify all other Affected Jurisdictions. Termination of the Tax Abatement Agreement by the Affected Jurisdiction to which the application for tax abatement was directed shall constitute simultaneous termination of all Tax Abatement Agreements of all other Affected Jurisdictions. 8. In the event that a tax abatement agreement is terminated for any reason what so ever and taxes are not paid within the time period herein specified, then in such event, the provisions of V.T.C.A., Tax Code, Section 33.01 will apply. SECTION X. Miscellaneous: 1. Any notice required to be given by these criteria or guidelines shall be given in the following manner: a) To the owner or applicant: written notice shall be sent to the address appearing on the Tax Abatement Agreement. b) To an Affected Jurisdiction: written notice shall be sent to the address appearing on the Tax Abatement Agreement. 2. The Chief Appraiser of the Lubbock Central Appraisal District shall annually assess the Real and Personal Property comprising the reinvestment zone. Each year, the applicant or owner receiving tax abatement shall furnish the chief Appraiser with such information as may be necessary for the abatement. Once value has been established, the Chief Appraiser shall notify the Affected Jurisdictions which levy taxes of the amount of assessment. 3. Upon the completion of improvements made to any type of Facility as set forth in Section VIII, Subparagraph I of these criteria and guidelines a designated employee or employees of any Affected Jurisdiction having executed a tax abatement agreement with applicant or owner shall have access to the Facility to insure compliance with the Tax Abatement Agreement. 4. A tax abatement agreement may be assigned to a new owner but only after written consent has been obtained from all Affected Jurisdictions which have executed such an agreement with the applicant or owner. 5. These guidelines and criteria are effective upon the date of their adoption by an Affected Jurisdiction and shall remain in force for two years. At the end of the two year period these guidelines and criteria may be readopted, modified, amended or rewritten as the conditions may warrant. 6. Each Affected Jurisdiction shall determine whether or not said Affected Jurisdiction elects to become eligible to participate in tax abatement. In the even the Affected Jurisdiction elects by resolution to become eligible to participate in tax abatement, then such Affected Jurisdiction shall adopt these guidelines and criteria by separate resolution forwarding a copy of both resolutions to all other Affected Jurisdictions. 7. In the event of a conflict between these guidelines and criteria and V.T.C.A., Tax Code, Chapter 312, then in such event the Tax Code shall prevail and these guidelines and criteria interpreted accordingly. 14 2007 Industrial Tax Abatement Guidelines November 8, 2007 8. The guidelines and criteria once adopted by an Affected Jurisdiction may be amended or repealed by a vote of three-fourths of the members of the governing body of an Affected Jurisdiction during the two year term in which these guidelines and criteria are effective. 15 Exhibit C APPLICATION FOR INDUSTRIAL TAX ABATEMENT IN LUBBOCK COUNTY FILING INSTRUCTIONS: This application must be submitted to the appropriate taxing iurisdiction before any construction begins to be eligible for tax abatement. This filing acknowledges familiarity and assumed conformance with "GUIDELINES AND CRITERIA GOVERNING TAX ABATEMENT FOR SELECTED TAXING UNITS CONTAINED WITHIN LUBBOCK COUNTY" (Copy attached). This application will become a part of any later agreement or contract, and knowingly false representations thereon will be grounds for the voiding of any later agreement or contract. ORIGINAL COPY OF THIS APPLICATION AND ATTACHMENTS SHOULD BE SUBMITTED TO: City of Lubbock Business Development Department P.O. Box 2000 162513 1h Street, Suite 105 Lubbock, TX 79457 (806) 775-2019 Section I — APPLICANT INFORMATION Date of Application: 3_1_20 _1_07, Applicant Name: Sergio Rascon Company Name: Molinos Anahuac, Inc. Address: Attn: Rodolfo Mata, 1112 Montana EI Paso, Texas 79902 Phone: 915.613.0780 Fax: 915.351.4494 Applicants Representative on this project: Rodolfo Mata, Attorney Name: Rodolfo Mata, Esq. Address; 1112 Montana Ave,. EI Paso, Texas 79902 Phone: 915.613.0780 Email: rmataaa.rmatapc.com Type of Ownership: [X] Corporation [ ) Partnership [ ] Proprietorship Total Current Number Employees: NA Corporate Annual Sales Per Year: Prosection $14,000,000.00 Annual Report Submitted? [X] Yes [ ] No E 5 ` -771 ERIV Molinos Anahuac Inc - abatement application 2-8-07.doc Industrial Tax Abatement Application Page 2 Section Il - FACILITY INFORMATION Place a check mark in the box on those statements which are applicable to your company: (a) This application is for a: [X] New Facility [ ] Expansion [ ] Modernization (b) Is the company a producer, manufacturer or distributor of goods and services of which 50 percent or more are distributed outside of Lubbock ?(If yes, provide documentation as Attachment 1) [X] Yes [ ] No (c) Check the following target industry which is applicable to your company [ ] Manufacturing Facility: Electronics/Electrical/Assembly, Semiconductor Fabrication [X] Value-added Agricultural Production including Food Processing and Machinery ] Med Tech Research/Manufacturing/Assembly [ ] Aviation/Avionics Production/Rehab [X] Warehouse/Distribution [ ] Corporate Headquarters of a Regional/National Service Center [ ] The project is not included in the above target industries, but has the potential of generating additional significant economic development opportunities in Lubbock. (Provide documentation) (d) [X] The existing facility to be modernized or expanded or the property where the new facility is to be built is located in a designated ERt8FPFi68 ZGne, "Reinvestment Zone." (e) [X] New Company to Lubbock [ ] Existing Company (f) If New Company checked, which of the following statements apply to the project: [X] The project will add at least $1 million in real estate assessed valuation [X] The project will add at least $2 million of personal property assessed valuation [X] The project will add at least 25 new permanent jobs (g) If Existing Company checked, which of the following statements apply to the project: [ ] The project will add at least $500,000 in real estate assessed valuation [ ] The project will add at least $1 million of personal property assessed valuation [ ] The project will add at least 20 new permanent jobs (h) Address of proposed facility: 301 Insurance Street, Lubbock, Texas 79403 (i) Legal description of proposed facility: See Exhibit "A" and Exhibit "B" [WARRANTY DEED PENDING} (j) The proposed facility is located in: School District: New Deal Independent School District City: Lubbock Industrial Tax Abatement Application Page 3 (k) Describe product or service to be provided: Manufacture and processing of Corn Flour Section III - FACILITY DESCRIPTION Please attach the following: Attachment 2 (a) A general description of the improvements to be undertaken (example: modernization of manufacturing facility located at 4501 Peach Street and purchase of new manufacturing equipment). (b) A descriptive list of the improvements for which tax abatement is requested, including: (1) description of construction and location of all proposed improvements of the Real Property or Existing Facility, and; (2) list of new equipment and cost of the equipment. (c) A list of any and all Tangible Personal Property presently existing on the Real Property or located in an existing facility. (d) A proposed time schedule for undertaking and completing the proposed improvements. Attachment 3 (a) A site map indicating the approximate location of improvements on the Real Property Facility or Existing Facility together with the location of any or all Existing Facilities located on the Real Property or Facility. Attachment 4 (a) A statement of the additional value to the Real Property or Facility as a result of the proposed improvements. (b) A statement of the assessed value of the Real Property, Facility or Existing Facility for the base year (attach tax assessment for property from the Lubbock Central Appraisal District). Section IV - ECONOMIC IMPACT INFORMATION Part A — Current Investment in Existing Improvements: NA Part B — Permanent Employment Estimates: (1) If existing facility, what is the current plant employment: NA industrial Tax Abatement Application Page 4 (2) Estimated number of new jobs to be created and time frame for creation of jobs: Target Job Positions YEAR 1 NEW JOBS Production Target of No. of Job i Positions To Be Created - Target Annual Compensation In U.S. Dollars Target Incentive In U. S. Dollars Target Total Incentives Li In U. S. Dollars Production Manager 1 $72,600.00 $ 7,500.00 17,5006 00 Shift Mana er 3 $38,016.00 each 3,000.00 9,000.00 Maintenance 3 $30,412.00 each 3,000.00 900000 Grinding 3 $25,344.00 each 2,500.00 7,500.00 Sales Business Manager 1 $65,340.00 $ 7,500.00 $ 7,500.00 Administration Administrative Coordinator 1 $52,800.00 S 5.000.00 $ 5,000.00 Totals 12 $472,056.00 $28,500.00 $45,500.00 YEAR 2 NEW JOBS Production Shift Man er 1 $38,775.00 $3,000.00 $ 3,000.00 Corn Warehouse Manager 1 382772.00 3,000.00 3,000-00 Maintenance 1 31,020.00 3,000.00 3,000.00 Grinding 1 25 851.00 2,500.00 2,500.00 Laboratory Worker 3 $25,852.00 each 2,500.00 7,500.00 Warehouse 1 31 020.00 3,000.00 3,000.00 Sales Sales Coordinator 1 $40,392.00 $4,000.00 $ 4,000.00 Sales Assistant 2 $31,020.00 each 3,000.00 6,000.00 Credit & Collection 1 31,020.00 3,000.00 3,000.00 Administrative Assistant 2 $31,020.00 each 3 000.00 600000 Totals 13 new $438,486.00 new $30,000.00 $41,000.00 YEAR. 3 NEW JOBS Finished Prod. Warehouse 1(new) 31 644.00 new ILQ00,00 $3,000.00 Totals 1 $31,644.00 $3,000.00 $3,000.00 (3) Opening of improvements: (Month) January of (Year) 2008. Part C — Permanent Payroll Estimates: (1) If existing facility, what is the current plant payroll: SIA (2) Estimated amount of new payroll: See Part B Industrial Tax Abatement Application Page 5 Part D — Construction and Employment Estimates: (1) Construction start: Month June Year 2007. (2) Number of construction jobs: At Start Peak Finish [Pending receipt of information from General Contractor]] (3) Number of man-years: NA Part E — School District Impact Estimates: Give Estimated number of: Families transferred to area 2 Children added to ISD's 4 Part F — City Impact Estimates: (1) Volume of treated water required from City 211,000 cubic feet per month. (2) Volume of effluent to be treated by City 130,000 cubic feet per month. (3) Please provide a statement on planned water and sewer treatment methods, and disposal of effluent if the facility is to be located outside City systems. NIA (4) Has permitting been started? ❑ Yes 1 No Part G — Estimated Appraised Value on Site: LAND Value of Existing Facility Before New Construction (From Central Appraisal District) Wending] Value of New Improvements Estimated Total Value After PERSONAL PROPERTY $0 $1,658,000.100 _ IMPROVEMENTS $0 $1,000,000.00 Improvements rPendinal ^$1,658,000.00 $1,000,000.00 Part H — Variance: (a) Is a variance being sought under Section IV 9(d) of the "Guidelines"? [ ] Yes [ X ] No (b) If "Yes", attach any supplementary information required. Section V - OTHER AGREEMENT APPLICATIONS (a) Has applicant made application for abatement of this facility by other taxing jurisdictions or counties? [ ] Yes [X] No (b) If "Yes", please provide: (1) Dates of Application: Industrial Tax Abatement Application Page 6 (2) blearing Dates: (3) Name of Jurisdiction(s): (4) Name of Contact(s): (4) Attach any letters of intent to abate. Section VI -DECLARATION To the best of my knowledge, the above information is an accurate description of project details. Gabriel Aaron Rascon Polanco Printed Name of Company Official President Title of Company Official Industrial Tax Abatement Application Page 7 Exhibit A: Property Description WEST 19.00 ACRE TRACT IN THE WEST HALF OF SECTION 38, BLOCK D. LUBBOCK COUNTY, TEXAS METES AND BOUNDS DESQUPTION OF AN 18.00 ACRE TRACT OF LAND LOCATED IN THE WEST HALF OF SECTION 38, BLOCK D, LUBBOCK COUNTY, TEXAS BEING A PORTION OF THAT TRACT DESCRIBED IN VOLUME 5901, PAGE 319 OF THE OFFICIAL PUBLIC RECORDS OF LUBBOCK COUNTY, TEXAS AND FURTHER DESCRIBED AS FOLLOWS: BEGINNING AT A %" IRON ROD WITH CAP SET FOR THE SOU'I*IWEST CORNER OF THIS TRACT IN ME EAST RIGHT OF WAY LINE OF COUNTY ROAD. 2400 (OLD AMARILLO HIGHWAY) FROM WHENCE THE SOUTHEAST CORNER OF SAID SECTION 38 IS CALLED TO BEAR S 01'05' I0" W A DISTANCE OF 1523.60 FET AND S 88.3349' E A DISTANCE OF 5237.71 FEET THENCE. N 01'0510" E. ALONG SAID RIGHT OF WAY LWE, A DISTANCE OF 302.42 FEET TO A %" IRON ROD FOUND AT THE BEGINNING OF A CURVE TO THE RIGHT HAVING A RADIUS OF 2814.60 FEET, TILEN'CE NORTHEASTERLY, ALONG SAID RIGHT OF WAY LJNE AND SAM CURVE HAVING A CHORD BEARING OF N 6'08'40" E, A CHORD DISTANCE OF 49633 FEET TO A 'R" IRON ROD FOUND FOR A CORNER OF THIS TRACT; THENCE N 1 I-IZ'08" E. ALONG SAID RIGHT OF WAY LINE, A DISTANCE OF 309.79 FEET TO A V,' IRON ROD WITH CAP FOUND AT THE BLGRO04G OF A CURVE TO THE LEFT HAVING A RADIUS OF 2914.99 FEET; THENCE NORTHEASTERLY. ALONG SAID RIGHT OF WAY L.JNC AND SAID CURVE HAVING A CHORD BEARING OF N 10'05'24" 1?, A CHORD DISTANCE OF 11434 FEET TO A W' IRON ROD WITH CAP SET FOR THE NORTHWEST CORNER OF THIS TRACT IN THE SOUTHWEST LINE OF A RAILROAD SPUR TRACK:. THENCE SOUTHEASTERLY, ALONG SAID SOUTHWEST LINE AND A CURVE TO THE LEFT HAVING A RADIUS OF 802.75 FEET AND A CHORD BEARING OF S 35°00'06" E, A CHORD DISTANCE OF 78.64 FEET TO A '/A` IRON ROD WITH CAP SET FOR A CORNER OF THIS TRACT; THDgCE 3 52'11'27" W, ALONG SAID SOUTHWEST LINE, A DISTANCE OF 10.00 FEET TO A %" IRON ROD WITH CAP SET FOR A CORNER OF THIS TRACT, THENCE SoU IHEA.YTERLY, ALONG SAID SOUTHWEST LINE AND A CURVE TO THE LET T HAVING A RADIUS OF 812.75 FEET AND A CHORD BEARING OF S 40°35'08" E, A CHORD DISTANCE OF 78.74 FEET TO A 'h" IRON ROD WITH CAP SET FOR A CORNER OF THIS TRA(7r. THENCE S 43'21'44" E, ALONG SAID SOUTHWEST LDIE, A DISTANCE OF 1265.13 FEET TO A 'A" IRON ROD WITH CAP SET AT THE BEGINNING OF A CURVE TO THE RIGHT RAVING A RADIUS OF 712.75 FEET, THENCE SOUTHEASTERLY, ALONG SAID SOUTHWEST LINE AND SAID CURVE HAVING A CHORD BEARING OF S 33"59'13" F. A CHORD DISTANCE OF 232.62 FEET TO A 'r4" IRON ROD WITH CAP SET FOR THE ,SOUTHEAST CORNER OF THIS TRAGI; THENCE N 88°3344" W A DISTANCE OF 1226.52 FEET TO THE PLACE OF BEGINNING. 1. ROBERT L. SMITH, REGISTERED PROMSIONAL LAND SURVEYOR, DO HEREBY CERTIFY THAT THIS DESCRIPTION WAS PREPARED FROM AN ACTUAL SURVEY OF THE PROPERTY AND THAT THE INFORMATION HEREON REPRESENTS THE FINDINGS OF THIS SURVEY TO THE BEST OF MYM OWLEDGE AND BELIEF. SUR V1YED: DECEMBER 8, 2006 ROBERT L. SMITH R.P.L.S. 3906 SURVEYOR'S REPORT: VA, Sit THIS SURVEY IS SUBJECT TO ANY Y BE DISCLOSED BY A FULL AND ACCURATE TITLE SEARCH. FOUND MONUMENTS ARE ACCEPTED STMUS SURVEYOR AS CONTROLLING EVTD&ICE DUE TO SUBSTANTIAL AGREEMENT WITH RECORD DOCUI GRM. BEARINGS ARE RELATIVE TO GRID NORTH, TEXAS COORDINATE SYSTEM, NORTH -CENTRAL ZONE. NAD 83, CITY OF LU30OCK GEODEITC CONTROL AND AERIAL NETWORK. Industrial Tax Abatement Application Page 8 Attachment 1: Letter to the City of Lubbock MOLINOS ANAHUAC, INC.. March 22, 2007 City of Lubbock Business Development Department P.O. Box 2000 1625 13'h Street, Suite 106 Lubbock Texas, 79457 Re: Distribution of Product To Whom It May Concern: Pursuant to this letter, Molinos Anahuac, Inc., certifies that fifty percent (50%) or more of the product to be produced at its pending facility in Lubbock, Texas, will be distributed outside the City of Lubbock and throughout the United States. Sincere , ab aeon Rascon Polanco e ' nt olinos Anahuac, Inc. Industrial Tax Abatement Application Page 9 (a) U. (c) Attachment 2: General Description of Improvements A general description of the improvements to be undertaken (example: modernization of manufacturing facility located at 4501 Peach Street and purchase of new manufacturing equipment). New Corn Flour Processing Facility, located on Insurance St., North of the Preston Smith International Airport, and purchase of manufacturing equipment. A descriptive list of the improvements for which tax abatement is requested, including: Three new buildings, (Production, Personnel and Administrative) with about 23,000 square feet. 2. Boiler $80,000.00 Corn storage $190,000.00 Scales $25,000.00 Compressor $18,.000.00 Corn cooker $300,000.00 Corn washing machine $75,000.00 Corn hopper $18,000.00 Furnace and burner $35,000.00 Corn mills $85,000.00 Valves, Pumps, pipes, tools $50,000-00 Dehydrators $55,000.00 Fans $40,000.00 Corn flour storage $60,000.00 Packing equipment $220,000.00 Screener $75,000.00 Multiaspiration equipment $20,000.00 Compute equipment $25,000.00 Offices equipment $14,000.00 Freight elevator $28,000.00 Electrical equipment $180,000.00 Laboratory Equipment $40,000.00 Transport Equipment $25,000.00 Building: $1,000,000.00 Total (estimate): $2,658,000.00 A list of any and all Tangible Personal Property presently existing on the Real Property or located in an existing facility. There is no Tangible Personal property located on this Property at the time. (d) A proposed time schedule for undertaking and completing the proposed improvements. The construction of the buildings will begin in June 2007 and will be completed by November 2007 The manufacturing equipment will be installed beginning August 2007 and completed by the end of December 2007. Industrial Tax Abatement Application Page 10 Attachment 3: Site Map (a) A site map indicating the approximate location of improvements on the Real Property Facility or Existing Facility together with the location of any or all Existing Facilities located on the Real Property or Facility. See Attached [Fending receipt from arch itecVengineer] Industrial Tax Abatement Application Page 14 Attachment 4: Statement of Added Value and Assessed Value (a) A statement of the additional value to the Real Property or Facility as a result of the proposed improvements. The additional value is estimated to be $1,000,000.00. (b) A statement of the assessed value of the Real Property, Facility or Existing Facility for the base year [Pending receipt of tax assessment for property from the Lubbock Central Appraisal District]. tndustnal Tax Abatement Application Page 9 Attachment 2: General Description of Improvements (a) A general description of the improvements to be undertaken (example: modernization of manufacturing facility located at 4501 Peach Street and purchase of new manufacturing equipment). New Corn Flour Processing Facility, located on Insurance St., North of the Preston Smith International Airport, and purchase of manufacturing equipment. (b) A descriptive list of the improvements for which tax abatement is requested, including: Three new buildings, (Production, Personnel and Administrative) with about 23,000 square feet. 2. Boiler $80,000.00 Corn storage $190,000.00 Scales 525,000.00 Compressor S18,000.00 Corn cooker $300.000.00 Corn washing machine $75,000.00 Corn hopper $18,000.00 Furnace and burner $35,000.00 Corn mills $85,000.00 Valves, Pumps, pipes, tools $50,000.00 Dehydrators $55,000.00 Fans $40,000.00 Corn Flour storage $60,000,00 Packing equipment $220,000.00 Screener $75,000.00 Multiaspiration equipment $20,000.00 Compute equipment $25,000,00 Offices equipment $14,000.00 Freight elevator $28,000.00 Electrical equipment $180,000.00 Laboratory Equipment $40,000.00 Transport Equipment $25,000.00 _Building:_ $1,000,000.00 Total (estimate): $42,658,000.00 (c) A list of any and all Tangible Personal Property presently existing on the Real Property or located in an existing facility. There is no Tangible Personai property located on this Property at the time. (d) A proposed time schedule for undertaking and completing the proposed improvements. The construction of the buildings will begin in June 2007 and will be completed by November 2007 The manufacturing equipment will be installed beginning August 2007 and completed by the end of December 2007. Industrial Tax Abatement Application Page 9 (a) M (c) Attachment 2: General Description of Improvements A general description of the improvements to be undertaken (example: modernization of manufacturing facility located at 4501 Peach Street and purchase of new manufacturing equipment). New Corn Flour Processing Facility, located on Insurance St., North of the Preston Smith International Airport, and purchase of manufacturing equipment. A descriptive list of the improvements for which tax abatement is requested, including: Three new buildings, (Production, Personnel and Administrative) with about 23,000 square feet. Boiler $80,000.00 Corn storage $190,000.00 Scales $25,000.00 Compressor $18,000.00 Corn cooker $300,000.00 Corn washing machine $75,000.00 Corn hopper $18,000.00 Furnace and burner $35,000.00 Corn mills $85,000.00 Valves, Pumps, pipes, tools $50,000.00 Dehydrators $55,000.00 Fans $40,000.00 Corn flour storage $60,000.00 Packing equipment $220,000.00 Screener $75,000.00 Multiaspiration equipment $20,000.00 Compute equipment $25,000.00 Offices equipment $14,000.00 Freight elevator $28,000.00 Electrical equipment $180,000.00 Laboratory Equipment $40,000.00 Transport Equipment $25,000.00 Total (estimate): $1,658,000.00 A list of any and all Tangible Personal Property presently existing on the Real Property or located in an existing facility. There is no Tangible Personal property located on this Property at the time (d) A proposed time schedule for undertaking and completing the proposed improvements. The construction of the buildings will begin in June 2007 and will be completed by November 2007 The manufacturing equipment will be installed beginning August 2007 and completed by the end of December 2007. RECEI'VFD 05/10/2007 08:26 9153514494 10 May 2007 5:44 MOLINOS RNRHURC SR 4173614 Molinos Anahuac, SA de CV (MolncoAna) Industry C1sssillcatlon: NAICS Code: 311211 Detailed Balance Sheet - Actual and % Statement Dots 12131/2004 12J3traos 12131!2006 MW the Covered _ 12 12 12 Audit Method Co.Prep'd Co.Prsp'd.. Co.Prep'd Accountanl Analyst !!Marla M. Mariv ht Mama M. Annual nu Source Currwxy. MXP Mwacan Pews Target Currency: USD United States Dollars CURRENT ASSETS Cash 217 6-2 203 6.4 262 7.5 Aects/Ndes Rsc-Trade 728 20.8 716 22A 844 24.2 Aoctw%ldes Rec-Other 84 1.8 22 0.7 25 0-7 Inventory 1.545 44.2 1,275 40.0 1,274 36.5 Taxes Fiaookmble - IVA 106 3.0 98 3.1 169 48 Advances to Suppliers 116 3.154 1.7 T 2.770 792 2M 742 2,571 _ 737 NON-CURRENT ASSNS Land 57 1.8 57 1.8 57 15 Bulldlnps 3 Improvements 2011 5.8 213 6.7 213 6.1 Machinery 8 EquOrlent 226 6.4 394 12.3 587 16.8 Cornputer7Ctanmunication Equipment 23 0.7 20 0.5 25 07 Laboratory Equipment 17 0.5 17 O.5 17 0.9 Fumltlre b FDMju 5 0.1 5 0.2 8 0.2 Transportation Equipment 282 A.1 344 = _ 358 Groes Fbmd Asesba 812 23.2 1,051 32A 1,265 _j0.9 36.2 Accumulated Deprec () 88 _LL 351 _1110_ 73.2 Total Fixed Assets - Not 524 15.0 700 212 _4.§9 806 231 PrepaidalDeferreds - LTP 162 5.2 104 3.3 96 2.9 Guaranteed Deposits 9 0.2 14 0.4 13 0 4 Otkers 8 Employes c _ 15 0.4 _ 5 0..2 D, I TOTAL NON-CURRENT ASSETS 728 20.8 823 25.5 i2 920 26,4 TOTAL ASSETS 39$8 100.0 3 191 100 o 3 490 1 M.0 CURRENT LIABILITIES ST Loans Payable -Bank 1,153 33.0 677 21.2 943 27.0 Ac+counSsPayable-Trade 462 13.8 671 21.0 Ise 5.9 Accounts Pay -Other 58 1.7 106 3.4 522 15.0 OtherAccruais 16 0.5 9 0.3 - - Other Tom Payable 12 03 _ Z _02 0 � Total Accrued IJabilities 29 0.8 17 0.5 ^ 20 0.6 C Jsww Adwanoes 5 -OZ 11 �. TOTAL CURRENT LIABILITIES 17722 49.2 1,477 46.3 1,692 48.5 TOTAL NOM -CURRENT (JABS _ TOTALLIMILITIES 1,722 492 1477 46.E 1.692 43.5 NET WORTH Common Shv* 18'e 6.3 188 5.8 18E 5.3 Retained Earnings 1.590 45.5 1.526 U 13 46.2 TOTAL NET WORTH 1,776 50.8 1,714 53.7 1,799 51.5 TOTAL LIABS S NET WORTH 3,493 100.0 3,191 100.0 3,490 100.4) Working Capital 1,048 30.0 891 27.9 879 25-2 Tana Net Worth-Acbmt 11.7%) 50 3 1,709 .. Aa.6 1 7% 51 L5 Notes; I . Custarner The rate used to oonvert pesos to dollars is $10.8116 pesos 10 SUS dollar. Source: Banco de Meoriav '0"0TrartssftlSnptxFa117871 �1V eoFMfiar'NIWs PAPW NRr r F:IVI91S ft;x P.I Prepared 12.31. +1!17!2007 Paye 1 Th otusands KM'S Version ilii Resolution No. 2007-80551 Return to: Rodolfo Mata, P.C. 1112 Montana Ave. El Paso, TX 79902 r GF N 0 0 _ 71 41 F / GW _ DEED 1007031676 a PGs NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OF THE FOLLOWING INFORMATION FROM THIS INSTRUMENT BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER. SPECIAL WARRANTY DEED Date: July 16, 2007 Grantor: LUBBOCK ECONOMIC DEVELOPMENT ALLIANCE:, INC., d/b/a LEDA, a Texas non-profit corporation Grantor's Marling Address (including county): 1500 Broadway, 6th Floor Lubbock, Lubbock County, Texas 79401 Grantee: MOLINOS ANAH'UAC, INC., a Texas corporation Grantee's Mailing Address (including county): Calle Sara Perez de Madero No. 1938 Frace. Francisco I. Madero Chihuahua 31770 Mexico Consideration: Ten and No/100 Dollars and other good and valuable consideration Property (including any improvements): The SURFACE ONLY to Tract "A", Railport an Addition to the City of Lubbock, Lubbock County, Texas according to the map, plat and/or dedication decd recorded as document No. M70_a9_59 in the Official Public Records of Lubbock County, Texas Reservations from Conveyance: This conveyance is subject to all effective covenants, conditions, restrictions, mineral reservations, oil, gas and mineral leases, rights-of-way arid easements of record in the records of the County Clerk of Lubbock County, Texas, and all of those visible or apparent upon the ground, and in use. This conveyance is also subject to the Declaration of Protective Covenants for Lubbock Railport recorded at document No. 2007002929 in the Official Public Records of Lubbock County, Texas and that certain Agreement Regarding Conveyance of Land, Easement, Covenants and Restrictions and Power of Attorney Coupled with an Interest dated January 12, 2007 and recorded at document No. 2007002930 in the Official Public Records of Lubbock County, Texas. �pccal Wanantr Deed • Page I '.SY.�iMNIsW.4M'LEDAWN[ SASPMN W- DIN 1+" 11 Exceptions to Conveyance and Warranty: If for any reason, should Grantee, Molinos Anahuac, Inc., or its successors or assigns, choose to permanently shut its doors, or for a period of ninety (90) days temporarily close the manufacturing facility to be constructed on the Property, without LEDA's express written approval, at any time within the first five (S) years of operation, then LEDA or its designee may exercise its exclusive ninety (90) day option to purchase the Lubbock, Texas, manufacturing facility from Molinos Anahuac, Inc. However, if the temporary closure is due to force majeure (fire, wind, water, damage unavailability of raw materials, etc., or other events byoncolinr Ar rt s control a specifically set forth in the Performance Agreement4niere into a ween ��ie"`p es), EDA w not have the option to exercise the ninety (90) day option to purchase. The teams for purchase of the Molinos Anahuac, Inc. manufacturing facility shall be the sum equivalent to the market value of the property as evidenced by an appraisal by a qualified and certified real estate appraiser in the City of Lubbock, Texas, including paving, curbs, and outdoor lighting, exclusive of land value OR cost of construction, whichever is greater, less the subsidized funds received from LEDA. If LEDA does not exercise its option to purchase the facility from Molinos Anahuac, Inc., then Molinos Anahuac, Inc. may offer for sale or lease the property without LEDA's approval. If LEDA purchases the building, Molinos Anahuac, Inc. shall re -convey the Real Property to LEDA. Such sale would not include any of the equipment, inventory, or other items of personal property and Molinos Anahuac, Inc, would have the right to remove same from the Property within 120 days of LEDA's purchase. Grantee shall assume all ad valorem taxes on the herein described real property for 2007 and subsequent years. Grantor, for the Consideration and subject to the Reservations from Conveyance and the Exceptions to Conveyance and Warranty, grants, sells, and conveys to Grantee the Property, together with all and singular the rights and appurtenances thereto in any way belonging, to have and hold it to Grantee and Grantee's heirs, successors and assigns forever. Grantor binds Grantor and Grantor's heirs and successors to warrant and forever defend all and singular the Property to Grantee and Grantee's heirs, successors and assigns, against every person whomsoever lawfully claiming or to claim the same or any part thereof, when the claim is by, through, or under Grantor but not otherwise, except as to the Reservations from Conveyance and the Exceptions to Conveyance and Warranty. When the context requires, singular nouns and pronouns include the plural. ;�acn�l W'arnnly Reed . °ago 2 i 'A.-TiLr.1 <km L:)AV. ACSA.Sgp[.) 'SW IN LUBBOCYE,jCONOMIC DEVELOPMENT ALLIANCE INC.. d/b/a Lawrence, its Chief Executive Officer STATE OF TEXAS § COUNTY OF LUBBOCK § This instrument was acknowledged before me on theday of July, 2007, by Gary C. Lawrence, Chief Executive Officer and President of Lubbock Economic Development Alliance, Inc., d/b/a LEDA, a Texas non-profit corporation, on behalf ol-the corporation. UWA ki DAM"') win PWc. NOTARY PUBLIC, STATE OF TEXAS Ihij CanrnlruE�tw 1.5 � AFTER RECORDING RETURN TO; Rodolfo Mata Rodolfo Mata, P.C. I 112 Montana Avenue El Paso, Texas 79902 915.613.0780 Symai Wzaaah Dccd - Page ] � n+e:'Tr Af 1C111"DAWACf­%-11F Worm. Dm " FILED AND RECORDED y OFFICIAL PUBLIC RECORDS ti t Kelly Pinion, County Clerk Lubbock County TEXAS August 03, 2807 04.01:12 PM n p FEE: i19.0b 1�01�MI