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<br />B. Definitions <br /> <br />When used herein, the listed words have the following meanings: <br /> <br />1. "City" means the City of La Porte, Texas, and does not include any other entities <br />that may levy taxes on the Complex including, but not limited to, cities, utility <br />districts and/or school districts. <br /> <br />2. "Complex" means the site described In Exhibit A attached hereto and all <br />improvements thereon. <br /> <br />3. "FTZ Inventory" means any inventory held in the Complex that would qualify for <br />the 19 U.S.C. 9810(e) federal exemption for certain foreign trade zone inventory <br />that would otherwise be taxable by the City Taxing Jurisdictions pursuant to <br />Chapter 11, TEX. PROPERTY TAX CODE. <br /> <br />4. "Pavment" means the amount equal to the property taxes on FTZ Inventory that a <br />User would owe the City Taxing Jurisdiction in accordance with the provisions of <br />Chapter31, TEX. PROPERTY TAX CODE, if the 19 U.S.C.9810(e) exemptions <br />is not applied. <br /> <br />C. Obligations <br /> <br />1. Company agrees to the following with respect to FTZ Inventory owned by <br />Company: <br /> <br />a) Company waives the federal exemption provided in 19 U.S.C. 9810(e) with <br />respect to ad valorem taxes payable to the City for FTZ Inventory owned by <br />Company and located at the Complex, to the extent of 75% of the City's ad <br />valorem tax rate, thereby claiming the Federal exemption at the rate of 25%, <br />and will actually pay to the City 75% of the otherwise total ad valorem tax <br />liability, on FTZ Inventory. Company further agrees not to not raise the <br />aforementioned exemption as a basis for protesting the appraisal of any FTZ <br />Inventory owned by Company. <br /> <br />b) On January 1st and September 1st of each year (the valuation date(s) for <br />taxation purposes pursuant to TEX. TAX CODE SECTIONS 23.01 and 23.12(f)), <br />Company will use reasonable efforts to identify and designate in a clearly <br />identifiable manner any FTZ Inventory owned by it and held in an activated <br />foreign trade zone space at the Complex. <br /> <br />c) If the Texas Legislature alters the valuation date(s) for taxation purposes in <br />the future, the inventory restriction outlined above will apply only to the new <br />valuation date(s) as established under Texas law. <br /> <br />d) Company will do the following: <br />