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HomeMy WebLinkAboutO-1987-1531 p-.=. ~~.. ....'i .. -- . <" ORDINANCE NO. 1531 AN ORDINANCE AUTHORIZING THE EXECUTION BY THE CITY OF LA PORTE OF INDUSTRIAL DISTRICT AGREEMENTS WITH INDUSTRY WITHIN THE BATTLEGROUND INDUSTRIAL DISTRICT, AND THE BAYPORT INDUSTRIAL DISTRICT, FOR THE SEVEN (7) YEAR PERIOD COMMENCING JANUARY 1, 1987. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LA PORTE: Section 1. The City Council of the City of La Porte hereby finds, dtermines and declares that the following named corporations have each executed industrial district agreements with the City of La Porte, for the seven-year term commencing January 1, 1987, a copy of each of said proposed industrial district agreements being attached hereto, incorporated by reference herein, and made a part hereof for all purposes, to-wit: DUNN EQUIPMENT, INC. GRACE EQUIPMENT CO. NIPPON PIGMENTS, USA, INC. TEXAS ELECTRIC EQUIPMENT COMPANY DRAGO SUPPLY COMPANY, INC. REVAK ENTERPRISES, INC. BILLIE and LYNN REVAK EX-1M FREEZER JOINT VENTURE Section 2. The Mayor and the City Secretary of the City of La Porte, Texas, be, and they are hereby authorized, and empowered to execute and deliver on behalf of the City of La Porte, Texas, the industrial district agreements with the firms and corporations named in Section 1 hereof, copies of which are attached hereto. Section 3. The City Council officially finds, determines, re- cites and declares that a sufficient written notice of the date, hour, place and subject of this meeting of the City Council was posted at a place convenient to the public at the City Hall of the City for the time required by law preceding this meeting, as required by the Open Meetings Law, Article 6252-17, Texas Revised Civil Statutes Annotated: and that this meeting has been open to the public as .. ;Y :-. ~ o. .. .- .. .. ., Ordinance No. 1531 , Page 2 required by law at all times during which this Resolution and the subject matter thereof has been discussed, considered and formally acted upon. The City Council further ratifies, approves and confirms such written notice and the contents and posting thereof. section 4. This ordinance shall be effective from and after its passage and approval. PASSED and APPROVED this ...t3,uA.. day of d~ CITY OF LA PORTE 1987. ~~L~ ATTEST: (#~JAA~~ Clierie Black, City Secretary Knox W. Askl.ns, APPROVED: b::4~ ,0 . . ''''!II !;i ,; .. (Revised: 06/86) NOTICE: THIS CONTRACT IS SUBJECT TO ARBITRATION UNDER THE TEXAS GENERAL ARBITRATION ACT, ARTICLE 224, ET. SEQ., REVISED CIVIL STATUTES OF TEXAS THE STATE OF TEXAS ~ ~ COUNTY OF HARRIS ~ ~ CITY OF LA PORTE ~ INDUSTRIAL DISTRICT AGREEMENT This AGREEMENT made and entered into by and between the CITY OF LA PORTE, TEXAS, a municipal corporation of Harris County., Texas, hereinafter called "CITY" , and Dunn Equipment, Inc. , a Texas corporation, hereinafter called "COMPANY", WIT N E SSE T H: That WHEREAS, it is the established policy of the City Council of the City of La Porte, Texas, to adopt such reasonable measures from time to time as are permitted by law and which will tend to enhance the economic stability and growth of the City and its environs by attracting the location of new and the expansion of existing industries therein, and such policy is hereby reaffirmed and adopted by this City Council as being in the best interest of the City and its citizens: and WHEREAS, Company is the owner of a certain tract(s) of land more particularly described in the Deed Records of Harris County, Texas, in the following Volume and Page references, to-wit: That certain 2.9.37 acre tract out of Lot 10, of the F. A. Staashen Subdivision, being out of the Enoch Brinson Survey, Abstract 5, Harris County, Texas, as more fully shown on Exhibit "A" attached hereto, incorporated by reference herein, and made a part hereof for all purposes. ,". . . . . Industrial District Agreement - 2 upon which tract(s) Company has either constructed an industrial plant(s) or contemplates the construction of an industrial plant(s): and WHEREAS, pursuant to its policy, City has enacted Ordinance No. 729, designating portions of the area located in its extraterritorial jurisdiction as the "Battleground Industrial District of La Porte, Texas," and Ordinance No. 842, designating portions of the area 10- cated in its extraterritorial jurisdiction as the "Bayport Industrial District of La Porte, Texas," hereinafter collectively called "Dis- trict," such Ordinances being in compliance with the Municipal Annex- ation Act of Texas, Article 970a, Vernons Annotated Revised Civil Statutes of Texas: and WHEREAS, City desires to encourage the expansion and growth of industrial plants within said Districts and for such purpose desires to enter into this Agreement with Company pursuant to Resolution adopted by the City Council of said City and recorded in the official minutes of said City: NOW, THEREFORE, in consideration of the premises and the mutual agreements of the parties contained herein and pursuant to the authority granted under the Municipal Annexation Act and the Ordinances of City referred to above, City and Company hereby agree with each other as follows: I. :e+:~ covenants, agrees and guarantees that during the term of _~:;..oI..:. . ._ this Agreement, provided below, and subject to the terms and provisions .+ "-.:.. "--:. of tbis Agreement, said District shall continue and retain its extraterritorial status as an industrial district, at least to the extent that the same covers the land described above and belonging to Company and its assigns, and unless and until the status of said land, or a portion or portions thereof, as an industrial district may be changed pursuant to the terms of this Agreement. Sub j ect to ., " . . Industrial District Agreement - 3 the foregoing and to the later provisions of this Agrement, City does further covenant, agree and guarantee that such industrial district, to the extent that it covers said land lying within said District and not now within the corporate limits of City, or to be annexed under the provisions of Article II hereof, shall be immune from annexation by City during the term hereof (except as hereinafter provided) and shall have no right to have extended to it any services by City, and that all of said land, including that which has been heretofore or which may be annexed pursuant to the later provisions 'of this Agreement, shall not have extended to it by ordinance any rules and regulations (a) governing plats and subdivisions of land, (b) prescri- bing any building, electrical, plumbing or inspection code or codes, or (c) attempting to exercise in any manner whatever control over the conduct of business thereon: provided, however, it is agreed that City shall have the right to institute or intervene in any judicial proceeding authorized by the Texas Water Code or the Texas Clean Air Act to the same extent and to the same intent and effect as if all land covered by this Agreement were located within the corporate limits of City. II. A portion of the hereinabove described property has heretofore been annexed by City. Company has filed with City, coincident with the execution hereof, its petition to City to annex an addi tional portion of the hereinabove described property, to th~ end that twenty- five percent (25%) of the total value of the land and improvements hereinabove described shall be annexed to City. Company agrees to render and pay full City ad valorem taxes on such annexed land and improvements, and tangible personal property. Under the terms of the Texas Property. Tax Code (S.B. 621, Acts of the 65th Texas Legislature, Regular Session, 1979, as amended), i. .. . Industrial District Agreement - 4 the appraised value for tax purposes of the annexed portion of land, improvements, and tangible personal property shall be determined by the Harris County Appraisal District. The parties hereto recognize that said District has no authority to appraise the land, improvements, and tangible personal property in the unannexed area for the purpose of computing the II in lieu II payments hereunder. Therefore, the parties agree that the appraisal of the land, improvements, and tangible personal property in the unannexed area shall be conducted ~Xx:xiXU1~ * at City' s expense, by ~W<Xi<<<~~x~.i~xxxix~~rx'~XM:J<"~W" * The parties recognize that in making such appraisal for II in lieu II payment purposes, such appraiser must of necessity appraise the entire (annexed and unannexed) land, improvements, and tangible personal property. Company agrees to render and pay full City ad valorem taxes on such annexed land, improvements, and tangible personal pro- perty. Company also agrees to render to City and pay an amount lIin lieu of taxes" on company' s land, improvements, and tangible personal property in the unannexed area equal to the sum of: (1) Fifty percent (50%) of the amount of ad valorem taxes which would be payable to City if all of the hereinabove described property which existed on January 1, 1986, had been within the corporate limits of City and appraised each year by City's independent appraiser: and (2) Thirty percent (30% ) of the amount of ad valorem taxes which would be payable to City on any increase in value of the hereinabove described property, in excess of the appraised value of same on January 1, 1986, resulting from new construction and new acquisitions of tangible personal property, (exclusive of Construction in Progress, which shall be exempt from taxation), if all of said new construction and acquisitions had been within the corporate limits of City and appraised by City's independent * appraisal to be conducted by Harris County Appraisal District. . . Industrial District Agreement - 5 appraiser: with the sum of (1) and (2) reduced by the amount of City's ad valorem taxes on the annexed portion thereof as determined by appraisal by the Harris County Appraisal District. Nothing herein contained shall ever be construed as in derogation of the authority of the Harris County Appraisal District to establish the appraised value of land, improvements, and tangible personal property in the annexed portion, for ad valorem tax purposes. III. This Agreement shall extend for a period beginning on the 1st day of January, 1987, and continue thereafter until December 31, 1993, unless extended for an additional period or periods of time upon mutual consent of Company and City as provided by the Municipal Annexation Act: provided, however, that in the event this Agreement is not so extended for an additional period or periods of time on or before August 31, 1993, the agreement of City not to annex property of Company within the District shall terminate. In that event, City shall have the right to commence immediate annexation proceedings as to all of Company' s property covered by this Agreement, notwithstanding any of the terms and provisions of this agrement, and in such event Company agrees that if the Texas Municipal Act, Article 97~lf'(V.A.T.S.), as amended after January 1, 1980, or any new legislation is thereafter * enacted by the Legislature of the State of Texas which imposes greater * restrictions on the right of City to annex land beionging to Con~any * or imposes further obligations on City in connection therewith after * the annexation of such land, Company will waive the right to require * Ci ty to comply with any such additional restrictions or obligations * and the rights of the parties shall be then determined in accordance wi th the provisions of said Texas Municipal Annexation Act as the same existed January 1, 1980. * Dunn Equipment, Inc. to receive any benefits to be derived from any amendmcots to Article 970a ( M.A.T.S.) 1- IV., J /':~d\'~ ( ''') . . Industrial District Agreement - 6 IV. This Agreement may be extended for an additional period or periods by agreement between City and Company and/or its assigns even though it is not extended by agreement between City and all of the owners of all land within the District of which it is a part. In this connection, City hereby expresses its belief that industrial district agreements of the kind made herein are conducive to the development of existing and future industry and are to .the best interest of all citizens of City and encourage future City Councils to enter into future industrial district agreements and to extend for additional periods permitted by law this Industrial District Agreement upon request of Company or its assigns~ provided, however, that nothing herein contained shall be deemed to obligate either party hereto to agree to an extension of this Agrement. V. Company agrees to pay all ad valorem taxes, and all II in lieu of taxes II payments hereunder, to City on or before December 31 of each year during the term hereof. It is agreed that presently the ratio of ad valorem tax assessment used by City is one hundred percent (100%) of the fair market value of property. Any change in such ratio used by City shall be reflected in any subsequent computations hereunder. This Agreement shall be subject to all provisions of law relating to determination of value of land, improvements, and tangible personal property, for tax purposes (e.g., rendition, assessment, Harris County Appraisal District review and appeal procedures, court appeals, etc.) for purposes of fixing and determining the amount of ad valorem tax payments, and the amount of "in lieu of tax" payments hereunder, except as otherwise provided in Articles II and VI hereof. VI. (A) In the event Company elects to protest the valuation for tax purposes set on its said properties by City or by the Harris :. . . Industrial District Agreement - 7 County Appraisal District for any year or years during the terms hereof, nothing in this Agreement shall preclude such protest and Company shall have the right to take all legal steps desired by it to reduce the same. Nothwithstanding such protest by Company, Company agrees to pay to City on or before the date therefor hereinabove provided, at least the total of (a) the total amount of ad valorem taxes on the annexed portions, plus (b) the total amount of the "in lieu of taxes" on the unannexed portions of Company.s hereinabove-described property which would be due by Company to City in accordance with the foregoing provisions of this Agrement on the basis of renditions which shall be filed by Company on or before March 31 of each year during the term of this Agreement, with both the City and the Harris County Appraisal District (as the case may be) for that year. When the City or Harris County Appraisal District (as the case may be) valuation on said property of Company has been so finally determined, either as the result of final judgment of a court of competent jurisdiction or as the result of other final conclusion of the controversy, then within thirty (30) days thereafter Company shall make payment to City of any additional payment due hereunder based on such final valuation, together with applicable penal ties, interests, and costs. (B) Should Company disagree wi th any appraisal made by the ~independent apppraiser selected by City pursuant to Article II above (which shall be given in writing to Company), Company shall, within twenty (20) days of receiving such copy, give written notice to the City of such disagreement. In the event Company does not give such written notice of disagreement within such time period, the appraisal made by said independent appraiser shall be final and controlling for purposes of the determination of II in lieu of taxes II payments to be made under this Agreement. Should Company give such notice of disagreement, Company shall 1&' lJSf! J~-A.t?:{?}~ c:.o..:;>,^",,~ 'I A,1/,P/1 i'9;'s A'-~ ~"~'.}r~/~ rf. '. e e Industrial District Agreement - 8 also submit to the City with such notice a written statement setting forth what Company believes to be the market value of Company IS hereinabove described property. Both parties agree to thereupon enter into good faith negotiations in an attempt to reach an agreement as to the market value of Company I s property for "in lieu II purposes hereunder. If, after the expiration of thirty (30) days from the date the notice of disagreement was received by City, the parties have not reached agreement as to such market value, the parties agree to submit the dispute to final arbitration as provided in subparagraph (1) of this Article VI(B). Notwithstanding any such disagreement by Company, Company agrees to pay to City on or before December 31 of each year during the term hereof, at least the total of (a) the ad valorem taxes on the annexed portions, plus (b) the total amount of the II in lieu II payments which would be due hereunder on the basis of Company I s valuations rendered and/or submitted to City by Company hereunder, or the total assessment and lIin lieu of taxesll thereon for the last preceding year, whichever is higher. (1) A Board of Arbitrators shall be created composed of one person named by Company, one by City, and a third to be named by those two. In case of no agreement on this arbitrator in 10 days, the parties will join in a written request that the Chief Judge of the U. S. District Court for the Southern District of Texas appoint the third arbitrator who, (as the II Impartial Arbitratorll) shall preside over the arbitration proceeding. The sole issue to be determined in the arbitration shall be resolution of the difference between the parties as to the fair market value of Company I s property for calculation of the II in lieu II payment and total payment hereunder for the year in question. The Board shall hear and consider all relevant and material evidence on that issue including expert opinion, and shall render its written decision as promptly as practicable. That decision shall then be final and binding upon the parties, . . Industrial District Agreement - 9 subject only to judicial review as may be available under the Texas General Arbitration Act (Articles 224-238, Vernonls Annot- ated Revised Civil Statutes of Texas). Costs of the arbitration shall be shared equally by the Company and the City, provided that each party shall bear its own attorneys fees. (C) Should the provisions of Article II of this Agreement become impossible of enforcement because of (I) the invalidity or unenforceability of the Texas Property Code (S.B. 621, Acts of the 65th Texas Legislature, Regular Session, 1979), or any relevant provision thereof, or (2) because of any material delay or failure to act on the part of the Harris County Appraisal District, then and in any of such events, all payments under this Agreement shall be governed by the provisions of Article II hereof; anything to the contrary in this Agreement notwithstanding. VII. City shall be entitled to a tax lien on Companyls above-described property, all improvements thereon, and all tangible personal property thereon, in the event of default in payment of lIin lieu of taxesll payments hereunder, which shall accrue penalty and interest in like manner as delinquent taxes, and which shall be collectible by City in the same manner as provided by law for delinquent taxes. VIII. Company agrees to provide to City at Companyls expense, a survey plat and field note description of the land and improvements which Company petitions to be annexed in accordance with the provisions of Article II above. Such annexation tract shall be contiguous to a point on the existing corporate limits of La Porte. In the event of failure of Company to file either such petition, or such description, City shall have the right by notice in writing to Company to cancel and terminate this Agreement. t. v . e Industrial District Agreement - 10 IX. This Agreement shall inure to the benefit of and be binding upon City and Company, and upon Company's successors and assigns, affiliates and sUbsidiaries, and shall remain in force whether Company sells, Oassigns, or in any other manner disposes of, either voluntarily or by operation of law, all or any part of the property belonging to it within the territory hereinabove described, and the agreements herein contained shall be held to be covenants running with the land owned by Company situated within said territory, for so long as this Agreement or any extension thereof remains in force. X. If City enters into an Agreement with any other landowner with respect to an industrial district or enters into a renewal of any existing industrial district agreements after the effective date hereof and while this Agreement is in effect, which contains terms and provisions more favorable to the landowner than those in this Agreement, Company and its assigns shall have the right to amend this Agreement and City agrees to amend same to embrace the more favorable terms of such agreement or renewal agreement; provided, however, City reserves the right to enter into such agreements or renewal agreements with other landowners not covered by existing agreements, containing a percentage of ad valorem taxes more favorable to the landowner than that contained in Paragraph II, Subparagraph 3 (2) hereof, and Company and its assigns shall not have the right to amend this agreement to embrace the more favorable percentage of ad valorem taxes contained in such agreement or renewal thereof, than that contained in Paragraph II, Subparagraph 3 (2) hereof. City may extend more favorable terms to landowners covered by existing contracts only to the extent such favorable terms apply to any increase in value of the hereinabove described property, in excess of the appraised value of same on January 1, 1986, as described in Paragraph II, Sub- paragraph 3 (2) hereof. ~ '.. . . Industrial District Agreement - 11 XI. In the event anyone or more words, phrases, clauses, sentences, paragraphs, sections, articles or other parts of this Agreement or the applicaton thereof to any person, firm, corporation or circum- stances shall be held by any court of competent jurisdiction to be invalid or unconstitutional for any reason, then the application, invalidity or unconstitutionality of such words, phrase, clause, sentence, paragraph, section, article or other part of the Agreement shall be deemed to be independent of and separable from the remainder of this Agreement and the validity of the remaining partes of this Agreement shall not be affected thereby. XII. Upon the commencement of the term of this Agreement, all other previously existing industrial district agreements with respect to said land shall terminate. ENTERED INTO this 1st day of June, 1986. ~i:L &.~ Secretary BY (COMPANY) ATTEST: Name: J. L. Dunn 111 Name: BEATRICE E DUNN Title: President 225 West Bayou Address: Dickinson, Tx. 77539 APPROVED BY COUNSEL: ATTORNEY FOR COMPANY Name: Address: Telephone: . Industrial District Agreement - 12 ATTEST: Ch &F~ er1e Back, 1ty Secretary did tJ. APPROVED BY COUNSEL: KNOX W. ASKINS, City Attorney 702 W. Fairmont Parkway P. O. Box 1218 La Porte, Texas 77571 Telephone: (713) 471-1886 (Revised: 03/87) . CITY OF LA PORTE By: ~mn~#C4 FNo man Malone, May r BY:~ r: ~ Robert T. Herrera, City Manager CITY OF LA PORTE P. O. Box 1115 La Porte, Texas 77571 /, .. . . , ~ ............. -r""" ;- ~ EXHIBIT "A" .......... -.. f ,.That certain 2.937 acre tract out of Lot 10, of the F. A. Staashen t Subdivision, being out of the Enoch Brinson Survey, Abstract 5, : Harris County, Texas. / . . 'l'Tm~gre~ por'~ol Ci" I Liml,. of LlJPorl. Dnd c~mp.~ ~ , .~ ..... ;JT.~59 A~'" A \ ~ , . . '.' ~'''''- I~ ~ ~~ ~o.UIA'~ I:~j~~i~"<: - . ~.. 66.'8:~. 7--------.....~~ IhI.MS.:d..Tt: fs~ $Ill "dtbnd. ........ .. 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It"' ~,!!~ .# ~ .' , gT.4T" A.. . .- . 12 I ! 0' ~ di'~. ..11. ". ~'::': II ...HA '-M."""""" I 1.1.' .. 11 " / . " /1 A ," .// J /.1 / 1&' . ~.,.... l' ,/-<~ . :=., A, . '", . , ~ (Revised: 06/86) NOTICE: THIS CONTRACT IS SUBJECT TO ARBITRATION UNDER THE TEXAS GENERAL ARBITRATION ACT, ARTICLE 224, ET. SEQ., REVISED CIVIL STATUTES OF TEXAS THE STATE OF TEXAS i ~ COUNTY OF HARRIS ~ ~ CITY OF LA PORTE ~ INDUSTRIAL DISTRICT AGREEMENT This AGREEMENT made and entered into by and between the CITY OF LA PORTE, TEXAS, a municipal corporation of Harris County., Texas, JPINT VSAlrt-/RE and Ex - IM -F'i2 G 6~Jli3.. , a ~;<QJ.-S ;"Jlnf ,jRn';'~,..~ '" hereinafter called "CITY", eerperat.iem, hereinafter called "COMPANY", WIT N E SSE T H: That WHEREAS, it is the established policy of the City Council of the City of La Porte, Texas, to adopt such reasonable measures from time to time as are permitted by law and which will tend to enhance the economic stability and growth of the City and its environs by attracting the location of new and the expansion of existing industries therein, and such policy is hereby reaffirmed and adopted by this City Council as being in the best interest of the City and its citizens; and WHEREAS, Company is the owner of a certain tract(s) of land more particularly described in the D:~d Re~~_r~s. <?f.,~Clr.!"j.s~ounty.l_. T~~g_s...L--_ ..~-- ._-- --. .-... ~ - - .-. - - _. - -... .. . in the following Volume and Page references, to-wit: ," ". ". I "- ETES AJo"I) ~Uh"DS D!sCU1'TION .,'~ /J....5..~p. EXHiBIT A Be1D1 a 12.3OS acre tract of land out of a 822.154 .cre tract .s conveyed to Z. 1. J)u Pont de Remour. , Campau)'. be deed dated MArcb 29. 1'44. recorded SD VolLDe 1318. at Pale 36', BalTb COUDt} Deed iecord.. DUt of tbe Enoch Ir1Dlcm Survey. &-5. BalTiI CO\IDt)'. Tuas. aaid 12.308 acre uact be1Da ~re particularly deacr1bed .. follaws: BECINNINC .t the P01Dt of 1Dtera.ct1cm of tbe ~elt r1lht-of~I' l1De of JUlIeI' 10ld aDd tlae .ouh "!1M-of_I)' Ibe of Tuu State natlv., .0. 225. .. elublilhed '" deed dated J\lDe 3. 1966. ..ecorded 1D Vol~ 6451. at rale '5. et aeq. Barr 1. CouDt} Deed lecord.. a Texal K1lhva, J)eplrtaeDt concrete .ClDUlleDt foune! for coner; .. 1De!ic.tec! em the plat of the .une)' perforwed '" B. Carlo. 6a1tb. EDliDeen , Surve,on. lac., U JIDUlI')' 1983. !'beDce, I 44- 4" 40" V. co1Dcidct with the .ort~. r1&ht-of....,.7 !!De of Texas St.te I11bva7 10. 225; a dbtaDce of 52.36 feet h . Tell.. B1Ib1I' DeparnDeDt cemcrete .oil\BeDt found for cOl"Der; - ". TheDce S 8'- 40' 47" V, caatbuiDl co1Dc1c!eut with the Rorth riaht-of- .a)' liDe of 2'exas State BiabIRy Wo. 22.5: a dlltanee of 48.26 feet to a Texaa tilhvl' J)eparr..ent cemerete ~D_Dt fOUDd for COl'1ler ad _ pout of curve; ~eDce. U a.Southwesterl, dlre~tlOD. CODt1Du1nS coiDcide~~ ~th the. Borth r1&ht-of_.,. liDe of aaid Sute Bilhv.,. 110. 225; followbl a curve to the left. aaid curve bav1.Da a ceutr,l aDlle of 3'- 55' 17" .Dd . radius of '22.72 feet: aD arc dlstlDce of 2'4.53 feet to a TexI. Bishwa, Deplre.eDt concrete .onument found for the poiDt of LaDleDC,; ~eDce. S ,,- '5' 30" V. cClDtbuinS co1ncleleut with Rorth r1&ht-of_l, I1De of .a1d State Bilhway Ro. 225: a distance of 191.81 feet to a Texas Bisbvay Department concrete aonumeDt found for corner aDd a point of curve; Thence. in a ~outhveaterly"direction. continuing coincielent with the Borth risht-of-way line of ..id State Blahwa, Ho. 225; followlns a curve to tbe rilht. .aiel curve bav1DS I radius of 341.SS feet and a central ansle of 52- 04' 54". aD arc dlstance of 310.49 feet to a Tuu 1l11bvay Depart_Dt concrete aonUlDeDt found for the POiDt of tanSeDc10 'l'hence. B 78- 09' 36" V. cont1Duina coincideDt with the Rorth right- of-wl, liDe of ..id State Bllbva, Ro. ~2.5i at 342.77 feet pa.. a Texas Hishway Deparrment CODcrete ~uumeDt; at a totll distance of 348.77 feet to a ~/8u !rOD rod fOUDi! for COrDer. .. Thence. iD a Rorthvelterl, directiOD. cODtlnuinl coincident with the Bortb dsht-of:v.,. ~be of ..id SUte H1sbvl' 225i fol1011/'ba a c~e to the r1sht: add curve.havinl a radius of 5.689.58 feet and a central, aDSle of 1- 01' 50"; for, aD arc distlDce.102.34 feet t~ a 1/2 1Dch irOD rod eet for the Southweat COrDer of tb1.a tract. . Thence. 50rth a diltaDee of '55.'6 feet to a 1/2 iDch iron rod aet for the .orthweat corDer of tbll 'tr.ct. . '. ~ . /~/ ~ s F.~ TEXAS REC1SUR.ED PUll-It SUJlVEYOI 10. 2021 JOB NO. 1591-83 D,UE: JANUARY 25.1983 .. . ,'" ~ 4. J. r .. . . " Industrial District Agreement - 2 upon which tract(s) Company has either constructed an industrial plant(s) or contemplates the construction of an industrial plant(s); and WHEREAS, pursuant to its policy, City has enacted Ordinan~e No. 729, designating portions of the area located in its extraterritorial jurisdiction as the "Battleground Industrial District of La Porte, Texas," and Ordinance No. 842, designating portions of the area lo- cated in its extraterritorial jurisdiction as the "Bayport Industrial District of La Porte, Texas," hereinafter collectively called "Dis- trict," such Ordinances being in compliance with the Municipal Annex- ation Act of Texas, Article 970a, Vernons Annotated Revised Civil Statutes of Texas; and WHEREAS, City desires to encourage the expansion and growth of industrial plants within said Districts and for such purpose desires to enter into this Agreement with Company pursuant to Resolution adopted by the City Council of said City and recorded in the official minutes of said City: NOW, THEREFORE, in consideration of the premises and the mutual agreements of the parties contained herein and pursuant to the authority granted under the Municipal Annexation Act and the Ordinances of City referred to above, City and Company hereby agree with each other as follows: I. Ci ty covenants, agrees and guarantees that during the term of this Agreement, provided below, and subject to the terms and provisions of this Agreement, said District shall continue and retain its extraterri torial status as an industrial district, at least to the extent that the same covers the land described above and belonging to Company and its assigns, and unless and until the status of said land, or a portion or portions thereof, as an industrial district may be changed pursuant to the terms of this Agreement. Subject to e e Industrial District Agreement - 3 the foregoing and to the later provisions of this Agrement, City does further covenant, agree and guarantee that such industrial district, to the extent that it covers said land lying within said District and not now within the corporate limits of City, or to be annexed under the provisions of Article II hereof, shall be immune from annexation by City during the term hereof (except as hereinafter provided) and shall have no right to have extended to it any services by City, and that all of said land, including that which has been heretofore or which may be annexed pursuant to the later provisions 'of this Agreement, shall not have extended to it by ordinance any rules and regulations (a) governing plats and subdivisions of land, (b) prescri- bing any building, electrical, plumbing or inspection code or codes, or (c) attempting to exercise in any manner whatever control over the conduct of business thereon: provided, however, it is agreed that City shall have the right to institute or intervene in any judicial proceeding authorized by the Texas Water Code or the Texas Clean Air Act to the same extent and to the same intent and effect as if all land covered by this Agreement were located within the corporate limits of City. II. A portion of the hereinabove described property has heretofore been annexed by City. Company has filed with City, coincident with the execution hereof, its petition to City to annex an additional portion of the hereinabove described property, to the end that twenty- five percent (25%) of the total value of the land and improvements hereinabove described shall be annexed to City. Company agrees to render and pay full City ad valorem taxes on such annexed land and improvements, and tangible personal property. Under the terms of the Texas Property Tax Code (S.B. 621, Acts of the 65th Texas Legislature, Regular Session, 1979, as amended), e e Industrial District Agreement - 4 the appraised value for tax purposes of the annexed portion of land, improvements, and tangible personal property shall be determined by the Harris County Appraisal District. The parties hereto recognize that said District has no authority to appraise the land, improvements, and tangible personal property in the unannexed area for the purpose of computing the lIin lieull payments hereunder. Therefore, the parties agree that the appraisal of the land, improvements, and tangible personal property in the unannexed area shall be conducted by City, at City's expense, by an independent appraiser of City's selection. The parties recognize that in making such appraisal for II in lieu II payment purposes, such appraiser must of necessity appraise the entire (annexed and unannexed) land, improvements, and tangible personal property. Company agrees to render and pay full Ci ty ad valorem taxes on such annexed land, improvements, and tangible personal pro- perty. Company also agrees to render to City and pay an amount lIin lieu of taxes II on company' s land, improvements, and tangible personal property in the unannexed area equal to the sum of: (1) Fifty percent (50%) of the amount of ad valorem taxes which would be payable to City if all of the hereinabove described property which existed on January l, 1986, had been within the corporate limits of City and appraised each year by City's independent appraiser; and (2) Thirty percent (30% ) of the amount of ad valorem taxes which would be payable to City on any increase in value of the hereinabove described property, in excess of the appraised value of same on January 1, 1986, resulting from new construction and new acquisitions of tangible personal property, (exclusive of Construction in Progress, which shall be exempt from taxation), if all of said new construction and acquisitions had been within the corporate limits of City and appraised by City's independent e e Industrial District Agreement - 5 appraiser: with the sum of (1) and (2) reduced by the amount of City's ad valorem taxes on the annexed portion thereof as determined by appraisal by the Harris County Appraisal District. Nothing herein contained shall ever be construed as in derogation of the authority of the Harris County Appraisal District to establish the appraised value of land, improvements, and tangible personal property in the annexed portion, for ad valorem tax purposes. III. This Agreement shall extend for a period beginning on the 1st day of January, 1987, and continue thereafter until December 31, 1993, unless extended for an additional period or periods of time upon mutual consent of Company and City as provided by the Municipal Annexation Act: provided, however, that in the event this Agreement is not so extended for an additional period or periods of time on or before August 31, 1993, the agreement of City not to annex property of Company within the District shall terminate. In that event, City shall have the right to commence immediate annexation proceedings as to all of Company I s property covered by this Agreement, notwithstanding any of the terms and provisions of this agrement, and in such event Company agrees that if the Texas Municipal Act, Article 970a (V. A. T. S. ) , as amended after January 1, 1980, or any new legislation is thereafter enacted by the Legislature of the State of Texas which imposes greater restrictions on the right of City to annex land belonging to Company or imposes further obligations on City in connection therewith after the annexation of such land, Company will waive the right to require City to comply with any such additional restrictions or obligations and the rights of the parties shall be then determined in accordance with the provisions of said Texas Municipal Annexation Act as the same existed January 1, 1980. e e Industrial District Agreement - 6 IV. This Agreement may be extended for an additional period or periods by agreement between City and Company and/or its assigns even though it is not extended by agreement between City and all of the owners of all land wi thin the District of which it is a part. In this connection, City hereby expresses its belief that industrial district agreements of the kind made herein are conducive to the development of existing and future industry and are to .the best interest of all citizens of City and encourage future City Councils to enter into future industrial district agreements and to extend for additional periods permitted by law this Industrial District Agreement upon request of Company or its assigns: provided, however, that nothing herein contained shall be deemed to obligate either party hereto to agree to an extension of this Agrement. V. Company agrees to pay all ad valorem taxes, and all "in lieu of taxes" payments hereunder, to City on or before December 31 of each year during the term hereof. It is agreed that presently the ratio of ad valorem tax assessment used by City is one hundred percent (100%) of the fair market value of property. Any change in such ratio used by City shall be reflected in any subsequent computations hereunder. This Agreement shall be subject to all provisions of law relating to determination of value of land, improvements, and tangible personal property, for tax purposes (e.g., rendition, assessment, Harris County Appraisal District review and appeal procedures, court appeals, etc.) for purposes of fixing and determining the amount of ad valorem tax payments, and the amount of "in lieu of tax" payments hereunder, except as otherwise provided in Articles II and VI hereof. VI. (A) In the event Company elects to protest the valuation for tax purposes set on its said properties by City or by the Harris . e Industrial District Agreement - 7 County Appraisal District for any year or years during the terms hereof, nothing in this Agreement shall preclude such protest and Company shall have the right to take all legal steps desired by it to reduce the same. Nothwithstanding such protest by Company, Company agrees to pay to City on or before the date therefor hereinabove provided, at least the total of (a) the total amount of ad valorem taxes on the annexed portions, plus (b) the total amount of the lIin lieu of taxesll on the unannexed portions of Company's hereinabove-described property which would be due by Company to City in accordance with the foregoing provisions of this Agrement on the basis of renditions which shall be filed by Company on or before March 31 of each year during the term of this Agreement, with both the City and the Harris County Appraisal District (as the case may be) for that year. When the City or Harris County Appraisal District (as the case may be) valuation on said property of Company has been so finally determined, either as the result of final judgment of a court of competent jurisdiction or as the result of other final conclusion of the controversy, then wi thin thirty (30) days thereafter Company shall make payment to City of any additional payment due hereunder based on such final valuation, together with applicable penalties, interests, and costs. (B) Should Company disagree wi th any appraisal made by the independent apppraiser selected by City pursuant to Article II above (which shall be given in writing to Company), Company shall, within twenty (20) days of receiving such copy, give written notice to the City of such disagreement. In the event Company does not give such written notice of disagreement within such time period, the appraisal made by said independent appraiser shall be final and controlling for purposes of the determination of II in lieu of taxes II payments to be made under this Agreement. Should Company give such notice of disagreement, Company shall . . " Industrial District Agreement - 8 also submit to the City with such notice a written statement setting forth what Company believes to be the market value of Company's hereinabove described property. Both parties agree to thereupon enter into good faith negotiations in an attempt to reach an agreement as to the market value of Company I s property for II in lieu II purposes hereunder. If, after the expiration of thirty (30) days from the date the notice of disagreement was received by City, the parties have not reached agreement as to such market value, the parties agree to submit the dispute to final arbitration as provided in subparagraph (1) of this Article VI(B). Notwithstanding any such disagreement by Company, Company agrees to pay to City on or before December 31 of each year during the term hereof, at least the total of (a) the ad valorem taxes on the annexed portions, plus (b) the total amount of the II in lieu II payments which would be due hereunder on the basis of Company's valuations rendered and/or submitted to City by Company hereunder, or the total assessment and "in lieu of taxesll thereon for the last preceding year, whichever is higher. (1) A Board of Arbitrators shall be created composed of one person named by Company, one by City, and a third to be named by those two. In case of no agreement on this arbitrator in 10 days, the parties will join in a written request that the Chief Judge of the U. S. District Court for the Southern District of Texas appoint the third arbitrator who, (as the II Impartial Arbitratorll) shall preside over the arbitration proceeding. The sole issue to be determined in the arbitration shall be resolution of the difference between the parties as to the fair market value of Company' s property for calculation of the II in lieu II payment and total payment hereunder for the year in question. The Board shall hear and consider all relevant and material evidence on that issue including expert opinion, and shall render its written decision as promptly as practicable. That decision shall then be final and binding upon the parties, . . .' Industrial District Agreement - 9 subject only to judicial review as may be available under the Texas General Arbitration Act (Articles 224-238, Vernon's Annot- ated Revised Civil Statutes of Texas). Costs of the arbitration shall be shared equally by the Company and the City, provided that each party shall bear its own attorneys fees. (C) Should the provisions of Article II of this Agreement become impossible of enforcement because of (1) the invalidity or unenforceabi Ii ty of the Texas Property Code (S . B . 621, Acts of the 65th Texas Legislature, Regular Session, 1979), or any relevant provision thereof, or (2) because of any material delay or failure to act on the part of the Harris County Appraisal District, then and in any of such events, all payments under this Agreement shall be governed by the provisions of Article II hereof: anything to the contrary in this Agreement notwithstanding. VII. City shall be entitled to a tax lien on Company's above-described property, all improvements thereon, and all tangible personal property thereon, in the event of default in payment of "in lieu of taxes" payments hereunder, which shall accrue penalty and interest in like manner as delinquent taxes, and which shall be collectible by City in the same manner as provided by law for delinquent taxes. VIII. Company agrees to provide to City at Company's expense, a survey plat and field note description of the land and improvements which Company petitions to be annexed in accordance with the provisions of Article II above. Such annexation tract shall be contiguous to a point on the existing corporate limits of La Porte. In the event of failure of Company to file either such petition, or such description, City shall have the right by notice in writing to Company to cancel and terminate this Agreement. . . Industrial District Agreement - 10 IX. This Agreement shall inure to the benefit of and be binding upon City and Company, and upon Company's successors and assigns, affiliates and subsidiaries, and shall remain in force whether Company sells, assigns, or in any other manner disposes of, either voluntarily or by operation of law, all or any part of the property belonging to it within the territory hereinabove described, and the agreements herein contained shall be held to be covenants running with the land owned by Company situated within said territory, for so long as this Agreement or any extension thereof remains in force. X. If City enters into an Agreement with any other landowner with respect to an industrial district or enters into a renewal of any existing industrial district agreements after the effective date hereof and while this Agreement is in effect, which contains terms and provisions more favorable to the landowner than those in this Agreement, Company and its assigns shall have the right to amend this Agreement and City agrees to amend same to embrace the more favorable terms of such agreement or renewal agreement: provided, however, City reserves the right to enter into such agreements or renewal agreements with other landowners not covered by existing agreements, containing a percentage of ad valorem taxes more favorable to the landowner than that contained in Paragraph II, Subparagraph 3 (2) hereof, and Company and its assigns shall not have the right to amend this agreement to embrace the more favorable percentage of ad valorem taxes contained in such agreement or renewal thereof, than that contained in Paragraph II, Subparagraph 3 (2) hereof. City may extend more favorable terms to landowners covered by existing contracts only to the extent such favorable terms apply to any increase in value of the hereinabove described property, in excess of the appraised value of same on January 1, 1986, as described in Paragraph II, Sub- paragraph 3 (2) hereof. , . . Industrial District Agreement - 11 XI. In the event anyone or more words, phrases, clauses, sentences, paragraphs, sections, articles or other parts of this Agreement or the applicaton thereof to any person, firm, corporation or circum- stances shall be held by any court of competent jurisdiction to be invalid or unconstitutional for any reason, then the application, invalidity or unconstitutionality of such words, phrase, clause, sentence, paragraph, section, article or other part of the Agreement shall be deemed to be independent of and separable from the remainder of this Agreement and the validity of the remaining partes of this Agreement shall not be affected thereby. XII. Upon the commencement of the term of this Agreement, all other previously existing industrial district agreements with respect to said land shall terminate. ENTERED INTO this 1st day of June, 1986. ATTEST: Ex -IM kBEZ6R ;;;;Alr \k-NT4'~E (COMPANY) ::e.'~~: Title: ~n~?/'7f ~n'/d/'?!'r Address: P~. B~.><. J 34c8.9 . /k..s~/? /x:-7&7// , Secretary Name: APPROVED BY COUNSEL: ATTORNEY FOR COMPANY Name: Address: Telephone: . Industrial District Agreement - 12 ATTEST: (!J,A-i ~,,~ Cherie Black, City Secretary APPROVED BY COUNSEL: KNOX W. AS INS, City Attorney 702 W. Fairmont Parkway P. O. Box 1218 La Porte, Texas 77571 Telephone: (713) 471-1886 (Revised: 03/87) . CITY OF LA PORTE BY:~~~___ N rm~n Ma on ,ayor By: G?~ ~ Robert T. Herrera, City Manager CITY OF LA PORTE P. O. Box 1115 La Porte, Texas 77571 /. , . . . . . . (Revised: 06/86) NOTICE: THIS CONTRACT IS SUBJECT TO ARBITRATION UNDER THE TEXAS GENERAL ARBITRATION ACT, ARTICLE 224, ET. SEQ., REVISED CIVIL STATUTES OF TEXAS THE" STATE OF TEXAS ~ ~ COUNTY OF HARRIS ~ ~ CITY OF LA PORTE ~ INDUSTRIAL DISTRICT AGREEMENT This AGREEMENT made and entered into by and between the CITY OF LA PORTE, TEXAS, a municipal corporation of Harris County., Texas, hereinafter called "CITY" , and Nippon Piqrnent (U.S.A.). Inc. , a Texas corpoI'ation, hereinafter called "COMPANY", WIT N E SSE T H: That WHEREAS, it is the established policy of the City Council of the City of La Porte, Texas, to adopt such reasonable measures from time to time as are permitted by law and which will tend to enhance the economic stability and growth of the City and its environs by attracting the location of new and the expansion of existing industries therein, and such policy is hereby reaffirmed and adopted by this City Council as being in the best interest of the City and its citizens: and WHEREAS, Company is the owner of a certain tract(s) of land more particularly described in the Deed Records of Harris County, Texas, in the following Volume and Page references, to-wit: A 20.2505 acre tract, more or less, out of the Enoch Brinson Survey, Abstract No.5, Harris County, Texas, and being more particularly described by metes and bounds on Exhibit "A" attached hereto~ Said tract being Lots 13 and l4 of STRANG SUBDIVISION, according to the map or plat thereof recorded in Volume 75, Page 22 of the Deed Records of Harris County, Texas. . e . . Industrial District Agreement - 2 upon which tract(s) Company has either constructed an industrial plant(s) or contemplates the construction of an industrial plant(s)i and WHEREAS, pursuant to its policy, City has enacted Ordinance No. 729, designating portions of the area located in its extraterritorial jurisdiction as the "Battleground Industrial District of La Porte, Texas," and Ordinance No. 842, des ignating portions of the area lo- cated in its extraterritorial jurisdiction as the "Bayport Industrial District of La Porte, Texas," hereinafter collectively called "Dis- trict," such Ordinances being in compliance with the Municipal Annex- ation Act of Texas, Article 970a, Vernons Annotated Revised Civil Statutes of Texasi and WHEREAS, City desires to encourage the expansion and growth of industrial plants within said Districts and for such purpose desires to enter into this Agreement with Company pursuant to Resolution adopted by the City Council of said City and recorded in the official minutes of said City: NOW, THEREFORE, in consideration of the premises and the mutual agreements of the parties contained herein and pursuant to the authori ty granted under the Municipal Annexation Act and the Ordinances of City referred to above, City and Company hereby agree with each other as follows: I. Ci ty covenants, agrees and guarantees that during the term of this Agreement, provided below, and subject to the terms and provisions of this Agreement, said District shall continue and retain its extraterritorial status as an industrial district, at least to the extent that the same covers the land described above and belonging to Company and its assigns, and unless and until the status of said land, or a portion or portions thereof, as an industrial district may be changed pursuant to the terms of this Agreement. Subject to e e . . Industrial District Agreement - 3 the foregoing and to the later provisions of this Agrement, City does further covenant, agree and guarantee that such industrial district, to the extent that it covers said land lying within said District and not now within the corporate limits of City, or to be annexed under the provisions of Article II hereof, shall be immune from annexation by City during the term hereof (except as hereinafter provided) and shall have no right to have extended to it any services by City, and that all of said land, including that which has been heretofore or which may be annexed pursuant to the later provisions .of this Agreement, shall not have extended to it .by ordinance any rules and regulations (a) governing plats and subdivisions of land, (b) prescri- bing any building, electrical, plumbing or inspection code or codes, or (c) attempting to exercise in any manner whatever control over the conduct of business thereon: provided, however, it is agreed that City shall have the right to institute or intervene in any judicial proceeding authorized by the Texas Water Code or the Texas Clean Air Act to the same extent and to the same intent and effect as if all land covered by this Agreement were located within the corporate limits of City. II. A portion of the hereinabove described property has heretofore been annexed by City. Company has filed with City, coincident with the execution hereof, its petition to City to annex an additional portion of the hereinabove described property, to the end that twenty- five percent (25%) of the total value of the land and improvements hereinabove described shall be annexed to City. Company agrees to render and pay full City ad valorem taxes on such annexed land and improvements, and tangible personal property. Under the terms of the Texas Property Tax Code (S.B. 621, Acts of the 65th Texas Legislature, Regular Session, 1979, as amended), . e Industrial District Agreement - 4 the appraised value for tax purposes of the annexed portion of land, improvements, and tangible personal property shall be determined by the Harris County Appraisal District. The parties hereto recognize that said District has no authority to appraise the land, improvements, and tangible personal property in the unannexed area for the purpose of computing the II in lieu II payments hereunder. Therefore, the parties agree that the appraisal of the land, improvements, and tangible personal property in the unannexed area shall be conducted by City, at City's expense, by an independent appraiser of City's selection. The parties recognize that in making such appraisal for II in lieu II payment purposes, such appraiser must of necessity appraise the entire (annexed and unannexed) land, improvements, and tangible personal property. Company agrees to render and pay full City ad valorem taxes on such annexed land, improvements, and tangible personal pro- perty. Company also agrees to render to City and pay an amount lIin lieu of taxes" on company' s land, improvements, and tangible personal property in the unannexed area equal to the sum of: (I) Fifty percent (50% ) of the amount of ad valorem taxes which would be payable to City if all of the hereinabove described property which existed on January 1, 1986, had been within the corporate limits of City and appraised each year by City's independent appraiser: and (2) Thirty percent (30% ) of the amount of ad valorem taxes which would be payable to City on any increase in value of the hereinabove described property, in excess of the appraised value of same on January 1, 1986, resulting from new construction and new acquisitions of tangible personal property, (exclusive of Construction in Progress, which shall be exempt from taxation), if all of said new construction and acquisitions had been within the corporate limits of City and appraised by City's independent . e Industrial District Agreement - 5 appraiser: with the sum of (l) and (2) reduced by the amount of City's ad valorem taxes on the annexed portion thereof as determined by appraisal by the Harris County Appraisal District. Nothing herein contained shall ever be construed as in derogation of the authority of the Harris County Appraisal District to establish the appraised value of land, improvements, and tangible personal property in the annexed portion, for ad valorem tax purposes. III. This Agreement shall extend for a period beginning on the 1st day of January, 1987, and continue thereafter until December 31, 1993, unless extended for an additional period or periods of time upon mutual consent of Company and City as provided by the Municipal Annexation Act: provided, however, that in the event this Agreement is not so extended for an additional period or periods of time On or before August 31, 1993, the agreement of City not to annex property of Company within the District shall terminate. In that event, City shall have the right to commence immediate annexation proceedings as to all of Company' s property covered by this Agreement, notwithstanding any of the terms and provisions of this agrement, and in such event Company agrees that if the Texas Municipal Act, Article 970a (V.A.T.S.), as amended after January 1, 1980, or any new legislation is thereafter enacted by the Legislature of the State of Texas which imposes greater restrictions on the right of City to annex land belonging to Company or imposes further obligations on City in connection therewith after the annexation of such land, Company will waive the right to require City to comply with any such additional restrictions or obligations and the rights of the parties shall be then determined in accordance with the provisions of said Texas Municipal Annexation Act as the same existed January 1, 1980. e e Industrial District Agreement - 6 IV. This Agreement may be extended for an additional period or periods by agreement between City and Company and/or its assigns even though it is not extended by agreement between City and all of the owners of all land within the District of which it is a part. In this connection, City hereby expresses its belief that industrial district agreements of the kind made herein are conducive to the development of existing and future industry and are to .the best interest of all citizens of City and encourage future City Councils to enter into future industrial district agreements and to extend for additional periods permitted by law this Industrial District Ag~eement upon request of Company or its assigns~ provided, however, that nothing herein contained shall be deemed to obligate either party hereto to agree to an extension of this Agrement. V. Company agrees to pay all ad valorem taxes i and all .. in lieu of taxes" payments hereunder, to City on or before December 31 of each year during the term hereof. It is agreed that presently the ratio of ad valorem tax assessment used by City is one hundred percent (100%) of the fair market value of property. Any change in such ratio used by City shall be reflected in any subsequent computations hereunder. This Agreement shall be subject to all provisions of law relating to determination of value of land, improvements, and tangible personal property, for tax purposes (e.g., rendition, assessment, Harris County Appraisal District review and appeal procedures, court appeals, etc.) for purposes of fixing and determining the amount of ad valorem tax payments, and the amount of "in lieu of tax" payments hereunder, except as otherwise provided in Articles II and VI hereof. VI. (A) In the event Company elects to protest the valuation for tax purposes set on its said properties by City or by the Harris e e Industrial District Agreement - 7 County Appraisal District for any year or years during the terms hereof, nothing in this Agreement shall preclude such protest and Company shall have the right to take all legal steps desired by it to reduce the same. Nothwithstanding such protest by Company, Company agrees to pay to City on or before the date therefor hereinabove provided, at least the total of (a) the total amount of ad valorem taxes on the annexed portions, plus (b) the total amount of the "in lieu of taxes" on the unannexed portions of Company's hereinabove-described property which would be due by Company to City in accordance with the foregoing provisions of this Agrement on the basis of renditions which shall be filed by Company on or before March 31 of each year during the term of this Agreement, with both the City and the Harris County Appraisal District (as the case may be) for that year. When the City or Harris County Appraisal District (as the case may be) valuation on said property of Company has been so finally determined, either as the result of final judgm~nt of a court of competent jurisdiction or as the result of other final conclusion of the controversy, then wi thin thirty (30) days thereafter Company shall make payment to City of any additional payment due hereunder based on such final valuation, together with applicable penalties, interests, and costs. (B) Should Company disagree with any appraisal made by the independent apppraiser selected by City pursuant to Article II above (which shall be given in writing to Company), Company shall, within twenty (20) days of receiving such copy, give written notice to the City of such disagreement. In the event Company does not give such written notice of disagreement within such time period, the appraisal made by said independent appraiser shall be final and controlling for purposes of the determination of II in lieu of taxes II payments to be made under this Agreement. Should Company give such notice of disagreement, Company shall e e Industrial District Agreement - 8 also submit to the City with such notice a written statement setting forth what Company believes to be the market value of Company IS hereinabove described property. Both parties agree to thereupon enter into good faith negotiations in an attempt to reach an agreement as to the market value of Company I s property for II in lieu II purposes hereunder. If, after the expiration of thirty (30) days from the date the notice of disagreement was received by City, the parties have not reached agreement as to such market value, the parties agree to submit the dispute to final arbitration as provided in subparagraph (1) of this Article VI(B~. Notwithstandi~g any such disagreement by Company, Company agrees to pay to City on or before December 31 of each year during the term hereof, at least the total of (a) the ad valorem taxes on the annexed portions, plus (b) the total amount of the "in lieu" payments which would be due hereunder on the basis of Company I s valuations rendered and/or submitted to City by Company hereunder, or the total assessment and II in lieu of taxes II thereon for the last preceding year, whichever is higher. ' (1) A Board of Arbitrators shall be created composed of one person named by Company, one by City, and a third to be named by those two. In case of no agreement on this arbitrator in 10 days, the parties will join in a written request that the Chief Judge of the U. S. District Court for the Southern District of Texas appoint the third arbitrator who, (as the "Impartial Arbitrator") shall preside over the arbitration proceeding. The sole issue to be determined in the arbitration shall be resolution of the difference between the parties as to the fair ,market value of Company I s property for calculation of the II in lieu II payment and total payment hereunder for the year in question. The Board shall hear and consider all relevant and material evidence on that issue including expert opinion, and shall render its written decision as promptly as practicable. That decision shall then be final and binding upon the parties, . e Industrial District Agreement - 9 subject only to judicial review as may be available under the Texas General Arbitration Act (Articles 224-238, Vernon's Annot- ated Revised Civil Statutes of Texas). Costs of the arbitration shall be shared equally by the Company and the City, provided that each party shall bear its own attorneys fees. (C) Should the provisions of Article II of this Agreement become impossible of enforcement because of (l) the invalidity or unenforceability of the Texas Property Code (S.B. 621, Acts of the 65th Texas Legislature, Regular Session, 1979), or any relevant provision thereof, or (2) because of any material delay or failure to act on the part of the Harris County Appraisal District, then and in any of such events, all payments under this Agreement shall be governed by the provisions of Article II hereof: anything to the contrary in this Agreement notwithstanding. VII. City shall be entitled to a tax lien on Company's above-described property, all improvements thereon, and all tangible personal property thereon, in the event of default in payment of II in lieu of taxes II payments hereunder, which shall accrue penalty and interest in like manner as delinquent taxes, and which shall be collectible by City in the same manner as provided by law for delinquent taxes. VIII. Company agrees to provide to City at Company's expense, a survey p1at and fie1d note description of the 1and and improvements which Company petitions to be annexed in accordance with the provisions of Article II above. Such annexation tract shall be contiguous to a point on the existing corporate limits of La Porte. In the event of failure of Company to file either such petition, or such description, City shall have the right by notice in writing to Company to cancel and terminate this Agreement. e e . . Industrial District Agreement - 10 IX. This Agreement shall inure to the benefit of and be binding upon City and Company, and upon Company's successors and assigns, affiliates and subsidiaries, and shall remain in force whether Company sells, assigns, or in any other manner disposes of, either voluntarily or by operation of law, all or any part of the property belonging to it within the territory hereinabove described, and the agreements herein contained shall be held to be covenants running with the land owned by Company situated within said territory, for so long as this Agreement or any extension thereof remains in force. X. If City enters into an Agreement with any other landowner with respect to an industrial district or enters into a renewal of any existing industrial district agreements after the effective date hereof and while this Agreement is in effect, which contains terms and provisions more favorable to the landowner than those in this Agreement, Company and its assigns shall have the right to amend this Agreement and City agrees to amend same to embrace the more favorable terms of such agreement or renewal agreement; provided, however, City reserves the right to enter into such agreements or renewal agreements with other landowners not covered by existing agreements, containing a percentage of ad valorem taxes more favorable to the landowner than that contained in Paragraph II, Subparagraph 3 (2) hereof, and Company and its assigns shall not have the right to amend this agreement to embrace the more favorable percentage of ad valorem taxes contained in such agreement or renewal thereof, than that contained in Paragraph II, Subparagraph 3 (2) hereof. City may extend more favorable terms to landowners covered by existing contracts only to the extent such favorable terms apply to any increase in value of the hereinabove described property, in excess of the appraised value of same on January 1, 1986, as described in Paragraph II, Sub- paragraph 3 (2) hereof. .' e e " . Industrial District Agreement - 11 XI. In the event anyone or more words, phrases, clauses, sentences, paragraphs, sections, articles or other parts of this Agreement or the applicaton thereof to any person, firm, corporation or circum- stances shall be held by any court of competent jurisdiction to be invalid or unconstitutional for any reason, then the application, invalidity or unconstitutionality of such words, phrase, clause, sentence, paragraph, section, article or other part of the Agreement shall be deemed to be independent of and separable from the remainder of this Agreement and the validity of t~e remaining partes of this Agreement shall not be affected thereby. XII. Upon the commencement of the term of this Agreement, all other previously existing industrial district agreements with respect to said land shall terminate. ENTERED INTO this 1st day of June, 1986. ATTEST: Niooon Piament (U.S.A.). Inc. (COMPANY) ~~ t1(4~ Secretary BY Name: Masahiro Akiva Name: Masahiro Akiva Title: Executive Vice President Address: 10900 Stran9 Road T.i"l Pnr1-p. 'Pp.X;:)l=; 77"i71 APPROVED BY COUNSEL: Name: Address: Telephone: . . . Industrial District Agreement - 12 ATTEST: Ch~ er1e B a~.l(.",C,1 ty Secretary ~,. _':-.,:....~ : ..... : ,-' :' . -;;;.. - ; -:;.; ---,,:; .--" " - --'"'~,/ ~< - " > :~. ~ - ~ ," -' t ---...,;. i--+ . .~. ~..... ~ ~: : . ". .~ w :So "'f APPROVED BY COUNSEL: & 1t/Ie KNOX W. ASKINS, City Attorney 702 Wo Fairmont Parkway P. O. Box 1218 La Porte, Texas 77571 Telephone: (713) 471-1886 (Revised: 03/87) ;. CITY OF LA PORTE By.~7~~ Norman Malone, Mayor By: G?~ T. ~ Robert T. Herrera, City Manager CITY OF LA PORTE P.O.' Box 1115 La Porte, Texas 77571 ,. . .' , ,... .. -, '! . e , .. . 4 EXHIBIT "A" ...:.... .. All that certaon 20.2505 acres of land being all of Lots 13 and 14, Strang Subdivision according to the plat thereof filed .at Volume 75, Page 22 Harris County Deed Records, in the Enoch Brinson Survey, A-95, Harris County,' Texas and being more particularly described by metes and bounds as follows: BEGINNING at a found brass cap rod in concrete marking the southeast corner of said Lot 13 and also being the southeast corner of that certain 20.2505 acres save and except 0.4011 acre of land described in a deed dated 6-17-1976 from Claud B. Hamill to Southwest Specialty Chemicals, Inc. filed in the official pubfic records of real property of Harris County, Texas at Clerk File No. E-796776, Film Code No. 143-04-0303; THENCE S 870 OS' 47" W - 1,031.89', along the south line of said Lots 13 and 14, to a set 5/8" iron rod for corner; THENCE N 030 00' 55" W - 855.54', along the common line of Lots 14 and 15, same being the east line of that certain parcel of land described in a.deed dated 11-16-1961 from Bank of the Southwest National Association to Greif Bros. Cooperage Corp. filed at Volume 4554, Page 28 Harris County Deed Records, to a found 1/2" iron rod for cornerj ... I, = THENCE N 870 04' 55" E - 1,029.911, along the south right-of-way line of Strang Road .(60' wide). to a set 5/8" iron rod for corner; THENCE S 030 08' 53" E - 855.81', along the common line of Lots 12 and 13, to the POINT OF BEGINNING and containing 20.2505 acres (882,l09 square feet) of land, more or less. ~ e e " "T"T-* (Revised: 06/86) NOTICE: THIS CONTRACT IS SUBJECT TO ARBITRATION UNDER THE TEXAS GENERAL ARBITRATION ACT, ARTICLE 224, ET. SEQ., REVISED CIVIL STATUTES OF TEXAS THE STATE OF TEXAS ~ ~ COUNTY OF HARRIS ~ ~ CITY OF LA PORTE ~ INDUSTRIAL DISTRICT AGREEMENT This AGREEMENT made and entered into by and between the CITY OF LA PORTE, TEXAS, a municipal corporation of Harris County., Texas, hereinafter called nCITY" , and Drago Supply Company, Inc. , a Texas corporation, hereinafter called "COMPANY", WIT N E SSE T H: That WHEREAS, it is the established policy of the City Council of the City of La Porte, Texas, to adopt such reasonable measures from time to time as are permitted by law and which will tend to enhance the economic stability and growth of the City and its environs by attracting the location'of new and the expansion of existing industries therein, and such policy is hereby reaffirmeh and adopted by this City Council as being in the best interest of the City and its citizens; and WHEREAS, Company is the owner of a certain tract(s) of land more particularly described in the Deed Records of Harris County, Texas, in the following Volume and Page references, to-wit: See Exhibit nA" attached hereto, incorporated by reference herein, and made a part hereof for all purposes. e e " Industrial District Agreement - 2 upon which tract(s) Company has either constructed an industrial plant(s) or contemplates the construction of an industrial plant(s): and WHEREAS, pursuant to its policy, City has enacted Ordinance No. 729, designating portions of the area located in its extraterritorial jurisdiction as the "Battleground Industrial District of La Porte, Texas, II and Ordinance No. 842, designating portions of the area lo- cated in its extraterritorial jurisdiction as the "Bayport Industrial District of La Porte, Texas," hereinafter collectively called "Dis- trict," such Ordinances being in compliance with the Municipal Annex- ation Act of Texas, Article 970a, Vernons Annotated Revised Civil Statutes of Texas: and WHEREAS, City desires to encourage the expansion and growth of industrial plants within said Districts and for such purpose desires to enter into this Agreement with Company pursuant to Resolution adopted by the City Council of said City and recorded in the official minutes of said City: NOW, THEREFORE, in consideration of the premises and the mutual ,. agreements of the parties contained herein and pursuant to the authority granted under the Municipal Annexation Act and the Ordinances of City referred to above, City and Company hereby agree with each other as follows: I. Ci ty covenants, agrees and guarantees that during the term of this Agreement, provided bedow, and subject to the terms and provisions of this Agreement, said District shall continue and retain its extraterritorial status as an industrial district, at least to the extent that the same covers the land described above and belonging to Company and its assigns, and unless and until the status of said land, or a portion or portions thereof, as an industrial district may be changed pursuant to the terms of this Agreement. Subject to e e .' Industrial District Agreement - 3 the foregoing and to the later provisions of this Agrement, City does further covenant, agree and guarantee that such industrial district, to the extent that it covers said land lying within said District and not now within the corporate limits of City, or to be annexed under the provisions of Article II hereof, shall be immune from annexation by City during the t~rm hereof (except as hereinafter provided) and shall have no right to have extended to it any services by City, and that all of said land, including that which has been heretofore or which may be annexed pursuant to the later provisions .of this Agreement, shall not have extended to it by ordinance any rules and regulations (a) governing plats and subdivisions of land, (b) prescri- bing any building, electrical, plumbing or inspection code or codes, or (c) attempting to exercise in any manner whatever control over the conduct of business thereon: provided, however, it is agreed that City shall have the right to institute or intervene in any judicial proceeding authorized by the Texas Water Code or the Texas Clean Air Act to the same extent and to the same intent and effect as if all land covered by this Agreement were located wi thin the corporate limits of City. /. II. A portion of the hereinabove described property has heretofore been annexed by City. Company has filed with City, coincident with the execution hereof, its petition to City to annex an additional portion of the hereinabove described property, to the end that twenty- five percent (25%) of the total value of the land and improvements hereinabove described shall be annexed to City. Company agrees to render and pay full City ad valorem taxes on such annexed land and improvements, and tangible personal property. Under the terms of the Texas Property Tax Code (S.B. 621, Acts of the 65th Texas Legislature, Regular Session, 1979, as amended), e e " Industrial District Agreement - 4 the appraised value for tax purposes of the annexed portion of land, improvements, and tangible personal property shall be determined by the Harris County Appraisal District. The parties hereto recognize that said District has no authority to appraise the land, improvements, and tangible personal property in the unannexed area for the purpose of computing the "in lieu" payments hereunder. Therefore, the parties agree that the appraisal of the land, improvements, and tangible personal property in the unannexed area shall be conducted by City, at City's expense, by an independent appraiser of City's selection. The parties recognize that in making such appraisal for .. in lieu" payment purposes, such appraiser must of necessity appraise the entire (annexed and unannexed) land, improvements, and tangible personal property. Company agrees to render and pay full City ad valorem taxes on such annexed land, improvements, and tangible personal pro- perty. Company also agrees to render to City and pay an amount "in lieu ., I of taxes" on company' s land, improvements, and tangible personal 'I !! property in the unannexed area equal to the sum of: (l) Fifty percent (SOt) of the amount of ad valorem taxes which would be payable to City if all of the hereinabove described property which existed on January 1, 1986, had been within the corporate limits of City and appraised each year by City's independent appraiser: and (2) Thirty percent (30%) of the amount of ad valorem taxes which would be payable to City on any increase in value of the hereinabove described property, in excess of the appraised value of same on January 1, 1986, resulting from new construction and new acquisitions of tangible personal property, (exclusive of Construction in Progress, which shall be exempt from taxation), if all of said new construction and acquisitions had been within the corporate limits of City and appraised by City's independent It e .. .1 Industrial District Agreement - 5 appraiser; with the sum of (I) and (2) reduced by the amount of City's ad valorem taxes on the annexed portion thereof as determined by appraisal by the Harris County Appraisal District. Nothing herein contained shall ever be construed as in derogation of the authority of the Harris County Appraisal District to establish the appraised value of land, improvements, and tangible personal property in the annexed portion, for ad valorem tax purposes. III. This Agreement shall extend for a period beginning on the 1st day of January, 1987, and continue thereafter until December 31, 1993, unless extended for an additional period or. periods of time upon mutual consent of Company and City as provided by the Municipal Annexation Act; provided, however, that in the event this Agreement is not so extended for an additional period or periods of time On or before August 31, 1993, the agreement of City not to annex property of Company within the District shall terminate. In that event, City shall have the right to commence immediate annexation proceedings as to all of Company' s property covered by this Agreement, notwithstanding any of the terms and provisions of this agrement, and in such event Company agrees that if the Texas Municipal Act, Article 970a (V.A.T.S.), as amended after January 1, 1980, or any new legislation is thereafter enacted by the L~gislature of the State of Texas which imposes greater restrictions on the right of City to annex land belonging to Company or imposes further obligations on City in connection therewith after the annexation of such land, Company will waive the right to require Ci ty to comply with any such additional restrictions or obligations and the rights of the parties shall be then determined in accordance with the provisions of said Texas Municipal Annexation Act as the same existed January 1, 1980. e e . . Industrial District Agreement - 6 IV. This Agreement may be extended for an additional period or periods by agreement between City and Company and/or its assigns even though it is not extended by agreement between City and all of the owners of all land wi thin the District of which it is a part. In this connection, City hereby expresses its belief that industrial district agreements of the kind made herein are conducive to the development of existing and future industry and are to .the best interest of all citizens of City and encourage future City Councils to enter into future industrial district agreements and to extend for additional periods permitted by law this Industrial District Agreement upon request of Company or its assigns: provided, however, that nothing herein contained shall be deemed to obligate either party hereto to agree to an extension of this Agrement. V. Company agrees to pay all ad valorem taxes, and all "in lieu of taxes" payments hereunder, to City on or before December 31 of each year during the term hereof. It is agreed that presently the I, ratio of ad valorem tax assessment used by City is one hundred percent (100%) of the fair market value of property. Any change in such ratio used by City shall be reflected in any subsequent computations hereunder. This Agreement shall be subject to all provisions of law relating to determination of value of land, improvements, and tangible personal property, for tax purposes (e.g., rendition, assessment, Harris County Appraisal District review and appeal procedures, court appeals, etc.) for purposes of fixing and determining the amount of ad valorem tax payments, and the amount of "in lieu of tax" payments hereunder, except as otherwise provided in Articles II and VI hereof. VI. (A) In the event Company elects to protest the valuation for tax purposes set on its said properties by City or by the Harris e e " .' Industrial District Agreement - 7 County Appraisal District for any year or years during the terms hereof, nothing in this Agreement shall preclude such protest and Company shall have the right to take all legal steps desired by it to reduce the same. Nothwithstanding such protest by Company, Company agrees to pay to City on or before the date therefor hereinabove provided, at least the total of (a) the total amount of ad valorem taxes on the annexed portions, plus (b) the total amount of the "in lieu of taxes" on the unannexed portions of Company's hereinabove-described property which would be due by Company to City in accordance with the foregoing provisions of this Agrement on the basis of renditions which shall be filed by Company on or before March 31 of each year during the term of this Agreement, with both the City and the Harris County Appraisal District (as the case may be) for that year. When the City or Harris County Appraisal District (as the case may be) valuation on said property of Company has been so finally determined, either as the result of final judgment of a court of competent jurisdiction or as the result of other final conclusion of the controversy, then within thirty (30) days thereafter Company I. shall make payment to City of any additional payment due hereunder based on such final valuation, together with applicable penalties, interests, and costs. (B) Should Company disagree with any appraisal made by the independent apppraiser selected by City pursuant to Article II above (which shall be given in writing to Company), Company shall, within twenty (20) days of receiving such copy, give written notice to the City of such disagreement. In the event Company does not give such written notice of disagreement within such time period, the appraisal made by said independent appraiser shall be final and controlling for purposes of the determination of "in lieu of taxes" payments to be made under this Agreement. Should Company give such notice of disagreement, Company shall e e : .' Industrial District Agreement - 8 also submit to the City with such notice a written statement setting forth what Company believes to be the market value of Company. s hereinabove described property. Both parties agree to thereupon enter into good faith negotiations in an attempt to reach an agreement as to the market value of Company. s property for II in lieu II purposes hereunder. If, after the expiration of thirty (30) days from the date the notice of disagreement was received by City, the parties have not reached agreement as to such market value, the parties agree to submit the dispute to final arbitration as provided in subparagraph . (1) of this Article VI(B). Notwithstanding any such disagreement by Company, Company agrees to pay to City on or before December 31 of each year during the term hereof, at least the total of (a) the ad valorem taxes on the annexed portions, plus (b) the total amount of the lIin lieull payments which would be due hereunder on the basis of Company.s valuations rendered and/or submitted to City by Company hereunder, or the total assessment and lIin lieu of taxes II thereon for the last preceding year, whichever is higher. (1) A Board of Arbitrators shall be created composed of one person named by Company, one by City, and a third to be named by those two. In case of no agreement on this arbitrator in 10 days, the parties will join in a written request that the Chief Judge of the U. S. District Court for the Southern District of Texas appoint the third arbitrator who, (as the IIImpartial Arbitratorll) shall preside over the arbitration proceeding. The sole issue to be determined in the arbitration shall be resolution of the difference between the parties as to the fair market value of Company. s property for calculation of the II in lieu II payment and total payment hereunder for the year in question. The Board shall hear and consider all relevant and material evidence on that issue including expert opinion, and shall render its written decision as promptly as practicable. That decision shall then be final and binding upon the parties, e e . . . . Industrial District Agreement - 9 subject only to judicial review as may be available under the Texas General Arbitration Act (Articles 224-238, Vernon's Annot- , ated Revised Civil Statutes of Texas). Costs of the arbitration -shall be shared equally by the Company and the City, provided that each party shall bear its own attorneys fees. (C) Should the provisions of Article II of this Agreement become impossible of enforcement because of (1) the invalidity or unenforceabili ty of the Texas Property Code (S. B. 621, Acts of the 65th Texas Legislature, Regular Session, 1979), or any relevant provision thereof, or (2) because of any material delay or failure to act on the part of the Harris County Appraisal District, then and in any of such events, all payments under this Agreement shall be governed by the provisions of Article II hereof: anything to the contrary in this Agreement notwithstanding. VII. City shall be entitled to a tax lien on Company's above-described property, all improvements thereon, and all tangible personal property thereon, in the event of default in payment of .. in lieu of taxes" I. payments hereunder, which shall accrue penalty and interest in like manner as delinquent taxes, and which shall be collectible by City in the same manner as provided by law for delinquent taxes. VIII. Company agrees to provide to City at Company's expense, a survey plat and field note description of the land and improvements which Company petitions to be annexed in accordance with the provisions of Article II above. Such annexation tract shall be contiguous to a point on the existing corporate limits of La Porte. In the event of failure of Company to file either such petition, or such description, City shall have the right by notice in writing to Company to cancel and terminate this Agreement. e e .. " . Industrial District Agreement - 10 IX. This Agreement shall inure to the benefit of and be binding upon City and Company, and upon Company's successors and assigns, affiliates and subsidiaries, and shall remain in force whether Company sells, assigns, or in any other manner disposes of, either voluntarily or by operation of law, all or any part of the property belonging to it wi thin the territory hereinabove described, and the agreements :1 herein contained shall be held to be covenants running with the land owned by Company situated within said territory, for so long as this Agreement or any extension thereof remains in force. , j' X. If City enters into an Agreement with any other landowner with respect to an industrial district or enters into a renewal of any existing industrial district agreements after the effective date hereof and while this Agreement is in effect, which contains terms and provisions more favorable to the landowner than those in this , f Agreement, Company and its assigns shall have the right to amend I I this Agreement and City agrees to amend same to embrace the more favorable terms of such agreement or renewal agreement; provided, I. however, City reserves the right to enter into such agreements or renewal agreements with other landowners not covered by existing agreements, containing a percentage of ad valorem taxes more favorable to the landowner than that contained in Paragraph II, Subparagraph 3 (2) hereof, and Company and its assigns shall not have the right to amend this agreement to embrace the more favorable percentage of ad valorem taxes contained in such agreement or renewal thereof, than that contained in Paragraph II, Subparagraph 3 (2) hereof. City may extend more favorable terms to landowners covered by existing contracts only to the extent such favorable terms apply to any increase in value of the hereinabove described property, in excess of the appraised value of same on January 1, 1986, as described in Paragraph II, Sub- paragraph 3 (2) hereof. e e .. . " . Industrial District Agreement - 11 XI. In the event anyone or more words, phrases, clauses, sentences, paragraphs, sections, articles or other parts of this Agreement or the applicaton thereof to' any person, firm, corporation or circum- stances shall be held by any court of competent jurisdiction to be invalid or unconstitutional for any reason, then the application, invalidity or unconstitutionality of such words, phrase, clause, sentence, paragraph, section, article or other part of the Agreement shall be deemed to be independent of and separable from the remainder of this Agreement and the validity of the remaining partes of this Agreement shall not be affected thereby. XII. Upon the commencement of the term of this Agreement, all other previously existing industrial district agreements with respect to said land shall terminate. ENTERED INTO this 1st day of June, 1986. ATTEST: Drago Supply Company, Inc. BY (COMPANY) -cz~/ i2~ ( Joseph P. Drago /. Name: Name: Philip Drago, Jr. Ti tIe: President Address: P. O. Box 1647 Port Arthur, TX 77640 APPROVED BY COUNSEL: A~,,(~ ~C-~ ATTO~EY FOR COMPANY Name: ~A.AJ~t!~ ~A;'2g-~ Address: c;;) 9'.33 ~/Z,I~ 4ce /:?/JZfi', ~r 4/C7#V~,1 "/,( 17~t/,;{ - Telephone: (<I()p) fi'3-v~-33 e e Industrial District Agreement - 12 ATTEST: ~~ Cherie Black, City Secretary / " '. , " ., -; APPROVED BY COUNSEL: 6M{)~ KNOX W. ASKINS, City Attorney 702 W. Fairmont Parkway P. O. Box 1218 La Porte, Texas 77571 Telephone: (713) 471-1886 (Revised: 03/87) CITY OF LA PORTE By: ~W?-(/G~~ IS r an 'a1o e, ayor By: CX~ ~ Robert T. Herrera, City Manager CITY OF LA PORTE P. O. Box 1115 La Porte, Texas 77571 ,. . . EXHIBIT "A" .. Lot Six I:C0.n ( Hi ) () r: the S t r anq SII he"l i vir: j Oil , in the J!;noch Br j n~jon ~;urvey., lIil rr. .i.:j COUll ty , Texas, ilCC()rcl.i.Il~J to t~e Map or. _P]:u I: thereof .. recorded in Volume 75i, Page 22 of" U;"e' -Deed Records of Hilrris County, Tcy-hs; and bei.nq m(>re particularly described, in two trabts, as follow~: Tract 1: 9.303 acres of land in Lot 16, Strang Subdivision, Enoch nrinson Survey, ^bstrnct No.5, Harris County, 'l'exar;, according to the m':l!"> thereof recorded in Volume 75, Pi1<Jq 22 of the lI.:irris County Deed Records, more particularly described as follows: Beginning at an iran rod in the south line of Strang Road located East 50 feet from the cast line of Miller cut off road and the ~est line of said Lot 16; Thence East 473.3 feet along the south line of Strang Road to an iron rod in the east line of said Lot 16; 'l'hencc S." 00 021 \v.. 056.1U feet along Lho eilst line of said Lot IG to iln iron rod in tile north riyht of way linc of thc '1'. f. N. o. Railroad Company right of way 40 feet in width; 'I'hence Wes t 1173. 3 fee t along thc north l.i.n(~ 0 f said rai.lroad ri<jht of: way to iln iron rod 10c.Jted 50 feet east of the east line of Miller cut off road; Thence N. 00 ~21 E. 856.18 feet along iI line 50 feet east of the cast line of r.1iller (mt off I"oad to the place of beginning. I Tract II: ^ trilct of land contuining 0.903 ilcres and being the west fifty feet of Lot l6 of Strang Subdivision in the Enoch "Brinson Survey, Harris County, Texils, according to the Map or Plat thereof recorded nt Volume 75, Page 22 of the Deed Records of Harris County, TeXilS. . . . (Revised: 06/86) NOTICE: THIS CONTRACT IS SUBJECT TO ARBITRATION UNDER THE TEXAS GENERAL ARBITRATION ACT, ARTICLE 224, ET. SEQ., REVISED CIVIL STATUTES OF TEXAS THE STATE OF TEXAS ~ ~ COUNTY OF HARRIS ~ ~ CITY OF LA PORTE ~ INDUSTRIAL DISTRICT AGREEMENT This AGREEMENT made and entered into by and between the CITY OF LA PORTE, TEXAS, a municipal corporation of Harris County., Texas, hereinafter called "CITY", and Grace Eauinment Co. , a Texas corporation, hereinafter called "COMPANY",' WIT N E SSE T H: That WHEREAS, it is the established policy of the City Council of the City of La Porte, Texas, to adopt such reasonable measures from time to time as are permitted by law and which will tend to enhance the economic stability and growth of the City and its environs by attracting the location of new and the expansion of existing industries therein, and such policy is hereby reaffirmed and adopted by this City Council as being in the best interest of the City and its citizens: and WHEREAS, Company is the owner of a certain tract(s) of land more particularly described in the Deed Records of Harris County, Texas, in the following Volume and Page references, to-wit: (See Eitlil:01t "A") . . Industrial District Agreement - 2 upon which tract(s) Company has either constructed an industrial plant(s) or contemplates the construction of an industrial plant(s): and WHEREAS, pursuant to its policy, City has enacted Ordinance No. 729, designating portions of the area located in its extraterritorial jurisdiction as the "Battleground Industrial District of La Porte, Texas, II and Ordinance No. 842, designating portions of the area lo- cated in its extraterritorial jurisdiction as the "Bayport Industrial District of La Porte, Texas, II hereinafter collectively called "Dis- trict," such Ordinances being in compliance with the Municipal Annex- ation Act of Texas, Article 970a, Vernons Annotated Revised Civil Statutes of Texas: and WHEREAS, City desires to encourage the expansion and growth of industrial plants within said Districts and for such purpose desires to enter into this Agreement with Company pursuant to Resolution adopted by the City Council of said City and recorded in the official minutes of said City: NOW, THEREFORE, in consideration of the premises and the mutual agreements of the parties contained herein and pursuant to the authority granted under the Municipal Annexation Act and the Ordinances of City referred to above, City and Company hereby agree with each other as follows: I. City covenants, agrees and guarantees that during the term of this Agreement, provided belew, and subject to the terms and provisions of this Agreement, said District shall continue and retain its extraterritorial status as an industrial district, at least to the extent that the same covers the land described above and belonging to Company and its assigns, and unless and until the status of said land, or a portion or portions thereof, as an industrial district may be changed pursuant to the terms of this Agreement. Subject to . . Industrial District Agreement - 3 the foregoing and to the later provisions of this Agrement, City does further covenant, agree and guarantee that such industrial district, to the. extent that it covers said land lying within said District and not now within the corporate limits of City, or to be annexed under the provisions of Article II hereof, shall be immune from annexation by City during the term hereof (except as hereinafter provided) and shall have no right to have extended to it any services by City, and that all of said land, including that which has been heretofore or which may be annexed pursuant to the later provisions .of this Agreement, shall not have extended to it by ordinance any rules and regulations (a) governing plats and subdivisions of land, (b) prescri- bing any building, electrical, plumbing or inspection code or codes, or (c) attempting to exercise in any manner whatever control over the conduct of business thereon: provided, however, it is agreed that City shall have the right to institute or intervene in any judicial proceeding authorized by the Texas Water Code or the Texas Clean Air Act to the same extent and to the same intent and effect as if all land covered by this Agreement were located within the corporate limits of City. II. }fll{~xotiXl.>>Jex~x(ia:~x.X!lll.Jextxx>>>>>>x~~ JbeerK~~dUc:"k)txxx~x~~x'<<:icttlxxSiiiXxxj:fi~j:ii.j~~~xW:i-f1 Jbbec~xllE.lIt.Glixxxbbsx~x:tgx~xtGlX~X~~x~ ~o6c*hexluere:imakliD"axci.s.Jl:i1a.ci~JC~dlec~~~ ~~xki:~~)cxlPxxJd::ihec:~kx".ti14ex~~x~xHJi.gx~~ ~~Ji~xa1lt&;xxxbex~xk&x~xx~tix.gj[ei}lix~ ~~~xi~kkx~~x~&X&K&.X.R.i}lix~~xiRRiligx~~~jx~ ~x~~~""~~ JUndIecc,cbec~x&:ix1G.ai}x;r:exc:il:a;x~~~x~XCX&&.x~Sixixx:>>fiJSx~ ~JChetxiiit1ltx~<<1t~xR.'lIlk&;lItx~x~~;x:xasx~~. JCN--' e e Industrial District Agreement - 4 '\2hEK~~~x~<<x~ilxxllnIXlDIBISRSX1D:lfxi:.iuex~~,t:.~~~~ ~x~xtt\i\:&lJkR~ix~"~~x~.lDRx~18.x~ 1J.QB~xQII1Il1llitlfX~~<<Xx'i1ll.x~B.x:t.iltsx~X>x~ tmactx~~~R1D~~.Jl'Jl':I'.:ilfi~XHRRxki.l:Jxli~~ ~xt~it&~xIUn[iU1RillxW'~3XJX:Ibbet~~XEtutx1xh:&~ aI:iXCltauqtnica~xbhetx~~'x~i).*-fixRill[illllRliIUfxxx~~ICl!~:K.~xklx.xp~ atCJEGEGEx1xh:nx~x.HKji.ii.fiji.il-xxlilixxt2hetXi.Rlixx~*iXx~x"k~~ peul:sGllm:atkxJlllt&Jl6UIt"k~xiRx*-il~~~x5t&:&:]dcxliix~~xQ:k~~ ' aExQi~,*sx2SJl'eRae~x~~~~~~~~X\i\:~1It~:ka.xx~x~'~xSGEkGE<<kX~K' D~x';I;JS:~i.sx~rldi:~"kx~x1It~:ktix:ft1~x~x:flDxx~Ximcxk:k.~~ I pa~.BKExPlllxplIs.ax~~~~~~xReeessi:t.~x.PPllt.ia.xka.x.Rki~~ ~aRRRxe.x.Rlix~kx~xximBxeXil.ilRkixx~x~xPRlItalllll.X __pxlBI~.x:t.J'xxxiGDmpaR2tx~ x*,~xxti~<<x~~x~x2i~]fx~x.aiGllJt.1Il :t..SIt.X.RX~~~~X~~~~iXX\i\:&~XHilR9i~iixlD.XBIBIRB.iXlDXIBIH ~ p2rtp Company also agrees to render to City and pay an amount "in lieu of taxes" on company's land, improvements, and tangible personal property in the unannexed area equal to the sum of: (1) Fifty percent (50% ) of the amount of ad valorem taxes which would be payable to City if all of the hereinabove described property which existed on January 1, 1986, had been within the corporate limits of City and appraised each year by City's independent appraiser~ and (2) Thirty percent (30%) of the amount of ad valorem taxes which would be payable to City on any increase in value of the hereinabove described property, in excess of the appraised value of same on January 1, 1986, resulting from new construction and new acquisitions of tangible personal property, (exclusive of Construction in Progress, which shall be exempt from taxation), if all of said new construction and acquisitions had been within the corporate limits of City and appraised by City's independent ," . e Industrial District Agreement - 5 appraiser: with the sum of (1) and (2) reduced by the amount of City's ad valorem taxes on the annexed portion thereof as determined by appraisal by the Harris County Appraisal District. Nothing herein contained shall ever be construed as in derogation of the authority of the Harris County Appraisal District to establish the appraised value of land, improvements, and tangible personal property in the annexed portion, for ad valorem tax purposes. III. This Agreement shall extend for a period beginning on the 1st day of January, 1987, and continue thereafter until December 31, 1993, unless extended for an additional period or periods of time upon mutual consent of Company and City as provided by the Municipal Annexation Act: provided, however, that in the event this Agreement is not so extended for an additional period or periods of time on or before August 31, 1993, the agreement of City not to annex property of Company within the District shall terminate. In that event, City shall have the right to commence immediate annexation proceedings as to all of Company' s property covered by this Agreement, notwithstanding any of the terms and provisions of this agrement, and in such event Company agrees that if the Texas Municipal Act, Article 970a (V.A.T.S.), as amended after January 1, 1980, or any new legislation is thereafter enacted by the Legislature of the State of Texas which imposes greater restrictions on the right of City to annex land belonging to Company or imposes further obligations on City in connection therewith after the annexation of such land, Company will waive the right to require City to comply with any such additional restrictions or obligations and the rights of the parties shall be then determined in accordance with the provisions of said Texas Municipal Annexation Act as the same existed January 1, 1980. e e Industrial District Agreement - 6 IV. This Agreement may be extended for an additional period or periods by agreement between City and Company and/or its assigns even though it is not extended by agreement between City and all of the owners of all land within the District of which it is a part. In this connection, City hereby expresses its belief that industrial district agreements of the kind made herein are conducive to the development of existing and future industry and are to .the best interest of all citizens of City and encourage future City Councils to enter into future industrial district agreements and to extend for additional periods permitted by law this Industrial District Agreement upon request of Company or its assigns~ provided, however, that nothing herein contained shall be deemed to obligate either party hereto to agree to an extension of this Agrement. V. Company agrees to pay all ad valorem taxes, and all "in lieu of taxes" payments hereunder, to City on or before December 31 of each year during the term hereof. It is agreed that presently the ratio of ad valorem tax assessment used by City is one hundred percent (100%) of the fair market value of property. Any change in such ratio used by City shall be reflected in any subsequent computations hereunder. This Agreement shall be subject to all provisions of law relating to determination of value of land, improvements, and tangible personal property, for tax purposes (e.g., rendition, assessment, Harris County Appraisal District review and appeal procedures, court appeals, etc.) for purposes of fixing and determining the amount of ad valorem tax payments, and the amount of "in lieu of tax" payments hereunder, except as otherwise provided in Articles II and VI hereof. VI. (A) In the event Company elects to protest the valuation for tax purposes set on its said properties by City or by the Harris It e Industrial District Agreement - 7 County Appraisal District for any year or years during the terms hereof, nothing in this Agreement shall preclude such protest and Company shall have the right to take all legal steps desired by it to reduce the same. Nothwithstanding such protest by Company, Company agrees to pay to City on or before the date therefor hereinabove provided, at least the total of (a) the total amount of ad valorem taxes on the annexed portions, plus (b) the total amount of the "in lieu of taxes" on the unannexed portions of Company's hereinabove-described property which would be due by Company to City in accordance with the foregoing provisions of this Agrement on the basis of renditions which shall be filed by Company on or before March 31 of each year during the term of this Agreement, with both the City and the Harris County Appraisal District (as the case may be) for that year. When the City or Harris County Appraisal District (as the case may be) valuation on said property of Company has been so finally determined, either as the result of final judgment of a court of competent jurisdiction or as the result of other final conclusion of the controversy, then within thirty (30) days thereafter Company shall make payment to City of any additional payment due hereunder based on such final valuation, together with applicable penal ties, interests, and costs. (B) Should Company disagree with any appraisal made by the independent apppraiser selected by City pursuant to Article II above (which shall be given in writing to Company), Company shall, within twenty (20) days of receiving such copy, give written notice to the City of such disagreement. In the event Company does not give such written notice of disagreement within such time period, the appraisal made by said independent appraiser shall be final and controlling for purposes of the determination of "in lieu of taxes" payments to be made under this Agreement. Should Company give such notice of disagreement, Company shall e . Industrial District Agreement - 8 also submit to the City with such notice a written statement setting forth what Company believes to be the market value of Company's hereinabove described property. Both parties agree to thereupon enter into good faith negotiations in an attempt to reach an agreement as to the market value of Company I s property for II in lieu II purposes hereunder. If, after the expiration of thirty (30) days from the date the notice of disagreement was received by City, the parties have not reached agreement as to such market value, the parties agree to submit the dispute to final arbitration as provided in subparagraph (1) of this Article VI(B). Notwithstanding any such disagreement by Company, Company agrees to pay to City on or before December 31 of each year during the term hereof, at least the total of (a) the ad valorem taxes on the annexed portions, plus (b) the total amount of the II in lieu II payments which would be due hereunder on the basis of Company I s valuations rendered and/or submitted to City by Company hereunder, or the total assessment and lIin lieu of taxes" thereon for the last preceding year, whichever is higher. (1) A Board of Arbitrators shall be created composed of one person named by Company, one by City, and a third to be named by those two. In case of no agreement on this arbitrator in 10 days, the parties will join in a written request that the Chief Judge of the U. S. District Court for the Southern District of Texas appoint the third arbitrator who, (as the II Impartial Arbitratorll) shall preside over the arbitration proceeding. The sole issue to be determined in the arbitration shall be resolution of the difference between the parties as to the fair market value of Company I s property for calculation of the II in lieu II payment and total payment hereunder for the year in question. The Board shall hear and consider all relevant and material evidence on that issue including expert opinion, and shall render its written decision as promptly as practicable. That decision shall then be final and binding upon the parties, e . Industrial District Agreement - 9 subject only to judicial review as may be available under the Texas General Arbitration Act (Articles 224-238, Vernon's Annot- ated Revised Civil Statutes of Texas). Costs of the arbitration shall be shared equally by the Company and the City, provided that each party shall bear its own attorneys fees. (C) Should the provisions of Article II of this Agreement become impossible of enforcement because of (1) the invalidity or unenforceability of the Texas Property Code (S.B. 62l, Acts of the 65th Texas Legislature, Regular Session, 1979), or any relevant provision thereof, or (2) because of any material delay or failure to act on the part of the Harris County Appraisal District, then and in any of such events, all payments under this Agreement shall be governed by the provisions of Article II hereof: anything to the contrary in this Agreement notwithstanding. VII. City shall be entitled to a tax lien on Company's above-described property, all improvements thereon, and all tangible personal property thereon, in the event of default in payment of "in lieu of taxes" payments hereunder, which shall accrue penalty and interest in like manner as delinquent taxes, and which shall be collectible by City in the same manner as provided by law for delinquent taxes. VIII. Company agrees to provide to City at Company's expense, a survey plat and field note description of the land and improvements which Company petitions to be annexed in accordance with the provisions of Article II above. Such annexation tract shall be contiguous to a point on the existing corporate limits of La Porte. In the event of failure of Company to file either such petition, or such description, City shall have the right by notice in writing to Company to cancel and terminate this Agreement. . . Industrial District Agreement - 10 IX. This Agreement shall inure to the benefit of and be binding upon City and Company, and upon Company's successors and assigns, affiliates and sUbsidiaries, and shall remain in force whether Company sells, assigns, or in any other manner disposes of, either voluntarily or by operation of law, all or any part of the property belonging to it within the territory hereinabove described, and the agreements herein contained shall be held to be covenants running with the land owned by Company situated within said territory, for so long as this Agreement or any extension thereof remains in force. X. If City enters into an Agreement with any other landowner with respect to an industrial district or enters into a renewal of any existing industrial district agreements after the effective date hereof and while this Agreement is in effect, which contains terms and provisions more favorable to the landowner than those in this Agreement, Company and its assigns shall have the right to amend this Agreement and City agrees to amend same to embrace the more favorable terms of such agreement or renewal agreement: provided, however, City reserves the right to enter into such agreements or renewal agreements with other landowners not covered by existing agreements, containing a percentage of ad valorem taxes more favorable to the landowner than that contained in Paragraph II, Subparagraph 3 (2) hereof, and Company and its assigns shall not have the right to amend this agreement to embrace the more favorable percentage of ad valorem taxes contained in such agreement or renewal thereof, than that contained in Paragraph II, Subparagraph 3 (2) hereof. City may extend more favorable terms to landowners covered by existing contracts only to the extent such favorable terms apply to any increase in value of the hereinabove described property, in excess of the appraised value of same on January l, 1986, as described in Paragraph II, Sub- paragraph 3 (2) hereof. Asst. ." it . Industrial District Agreement - II XI. In the event anyone or more words, phrases, clauses, sentences, paragraphs, sections, articles or other parts of this Agreement or the applicaton thereof to any person, firm, corporation or circum- stances shall be held by any court of competent jurisdiction to be invalid or unconstitutional for any reason, then the application, invalidity or unconstitutionality of such words, phrase, clause, sentence, paragraph, section, article or other part of the Agreement shall be deemed to be independent of and separable from the remainder of this Agreement and the validity of the remaining partes of this Agreement shall not be affected thereby. XII. Upon the commencement of the term of this Agreement, all other previously existing industrial district agreements with respect to said land shall terminate. ENTERED INTO this 1st day of June, 1986. ATTEST: Grace Equipment Co. (COMPANY) 'l\ BY Name: Name John D. Latimer Title: Vice President, Finance Address: 3200 Wilcrest #500 Houston. TX 77042 APPROVED BY COUNSEL: ATTO~~ Name: ~"k.fljeA C ~-Ie/I1'" ; Address: 13~5S AA,~/ ~;I: /500 ~DI/.,..s . ~:x_ 75AVO . Telephone: (;l./q) '170 -0 2l/6' e . Industrial District Agreement - 12 ATTEST: (I~/U~~~ Cherie ~B~ack, City Secretary APPROVED BY COUNSEL: KNOX W. ASKINS, City Attorney 702 W. Fairmont Parkway P. O. Box 1218 La Porte, Texas 77571 Telephone: (713) 471-1886 (Revised: 03/87) By: By: G~ ,-; ~ Robert T. Herrera, City Manager CITY OF LA PORTE P. O. Box 1115 La Porte, Texas 77571 I, J 1" .1 l' :I e . . ,'. . '.' " 73~92~J755 I '" ,...4.80 ACRES .'. .~. .~ . .., Field note description of a tract of land containing 4.80 acres beiug part of aDd out ,of Strang Subdivision, as' per map or plat of said subdivision recorded in Volume 75, Page 22 of the Deed Records of Harris County, Texas, . . .and being part of and out of that certain l5.65S5 acre tract per instrument .: . . . recorded iu Harris County Clerk's File ~o. F-04l752, .in the EDoch Brinson . .Survey. Abstract 5. in Barris County, Texas and being more particua~1y described ~ by metes and bounds as follows: . COMMENCING at a point being the intersection of the south right-of-way line of Strang Road. 60 feet wide, and the northerly righ~-of-way line of State Highway 225. 310 feet .wide, nt the most west corner of the said 15'.6585 acre tract; THENCE S 690 55' 0311 E, along the northeasterly right-of-way line of State Highway 225, 370 feet wide, for a distance of 1,714.78 feet to a 5/S inch iron rod set for ctbrner and the PLACE OJ.' BI-:C:JNNING; THENCE S 690 55' 03" !, continuing along the northeasterly right-of-way line of State Highway 225. 370 feeL wide for a distance of 343.65 feet to a 1/2 inch iron rod found for corner aL the southeast corner of aforesaid 15.6585 acre tract; ... 'THENCE N O. 07' 561' W, along LIIl.! east .line of the 15.658~ acre trac.'l~ for a distance of 706.22 feet to a 3/H inch iron rod found for corn~r on the south right-of-way :line of said Strang Jtoad, 60 feet wide, at the northeast corner of the said 1:5.6585 acre tract; THENCE N' 890 5S' 57" W. along the Bouth right-of-way line of Strang Road. 60 feet wide, for a distance of 323.03 feet to a 5/8 inch iron rod set for corner; THENCE S 00 07' 56" E, for a diy'tance of 58S.32 feet to the PLACE OF BEGINNING, of a tract con~aining 4.80 acres of land. STATE 0' TEXAS I COUNTY OF HARRIS r rll I hereb, cert", tll't thl. In.tru...ent we. FILED In · Number Sequence on the dete end ot Ihe tlm. elemped I.ereon b, me; lInd W.. dut, RECORDED, In tll. Official Public Record. 01 Re.' Prop.,t, of Herrle Counl,. T.... _ DEe 111980 cp...~.~u_~ COUNTY CLERK. HARRIS COUNTY. TEXAS EXHIBIT "A" . ..~,. :"'U .,- . ~ . . ." (Revised: 06/86) NOTICE: THIS CONTRACT IS SUBJECT TO ARBITRATION UNDER THE TEXAS GENERAL ARBITRATION ACT, ARTICLE 224, ET. SEQ., REVISED CIVIL STATUTES OF TEXAS THE" STATE OF TEXAS ~ ~ COUNTY OF HARRIS ~ ~ CITY OF LA PORTE ~ INDUSTRIAL DISTRICT AGREEMENT This AGREEMENT made and entered into by and between the CITY OF LA PORTE, TEXAS, a municipal corporation of Harris County., Texas, hereinafter called "CITY" , and Texas Electric Equipment Co., Inc. , a Texas corporation, hereinafter called "COMPANY", WIT N E SSE T H: That WHEREAS, it is the established policy of the City Council of the City of La Porte, Texas, to adopt such reasonable measures from time to time as are permitted by law and which will tend to enhance the economic stability and growth of the City and its environs by attracting the location of new and the expansion of existing industries therein, and such policy is hereby reaffirmed and adopted by this City Council as being in the best interest of the City and its citizens; and WHEREAS, Company is the owner of a certain tract(s) of land more particularly described in the Deed Records of Harris County, Texas, in the following Volume and Page references, to-wit: Part of IDts 22 and 23, ~'I. W. Bence Property, 3.4104 acres out of the Strang Subdivision, Enoch Brinson Survey, Abstract 5, recorded in Volurre 75, Pa,ge 22 of the f.'Iap Records of Harris County, Texas. . e Industrial District Agreement - 2 upon which tract(s) Company has either constructed an industrial plant(s) or contemplates the construction of an industrial plant(s); and WHEREAS, pursuant to its policy, City has enacted Ordinance No. 729, designating portions of the area located in its extraterritorial jurisdiction as the "Battleground Industrial District of La Porte, Texas, II and Ordinance No. 842, designating portions of the area lo- cated in its extraterritorial jurisdiction as the "Bayport Industrial District of La Porte, Texas," hereinafter collectively called "Dis- trict," such Ordinances being in compliance with the Municipal Annex- ation Act of Texas, Article 970a, Vernons Annotated Revised Civil Statutes of Texas; and WHEREAS, City desires to encourage the expansion and growth of industrial plants within said Districts and for such purpose desires to enter into this Agreement with Company pursuant to Resolution adopted by the City Council of said City and recorded in the official minutes of said City: NOW, THEREFORE, in consideration of the premises and the mutual agreements of the parties contained herein and pursuant to the authority granted under the Municipal Annexation Act and the Ordinances of City referred to above, City and Company hereby agree with each other as follows: I. Ci ty covenants, agrees and guarantees that during the term of this Agreement, provided below, and subject to the terms and provisions of this Agreement, said District shall continue and retain its extraterritorial status as an industrial district, at least to the extent that the same covers the land described above and belonging to Company and its assigns, and unless and until the status of said land, or a portion or portions thereof, as an industrial district may be changed pursuant to the terms of this Agreement. Subject to . e Industrial District Agreement - 3 the foregoing and to the later provisions of this Agrement, City does further covenant, agree and guarantee that such industrial district, to the extent that it covers said land lying within said District and not now within the corporate limits of City, or to be annexed under the provisions of Article II hereof, shall be immune from annexation by City during the term hereof (except as hereinafter provided) and shall have no right to have extended to it any services by City, and that all of said land, including that which has been heretofore or which may be annexed pursuant to the later provisions 'of this Agreement, shall not have extended to it by ordinance any rules and regulations (a) governing plats and subdivisions of land, (b) prescri- bing any building, electrical, plumbing or inspection code or codes, or (c) attempting to exercise in any manner whatever control over the conduct of business thereon; provided, however, it is agreed that City shall have the right to institute or intervene in any judicial proceeding authorized by the Texas Water Code or the Texas Clean Air Act to the same extent and to the same intent and effect as if all land covered by this Agreement were located within the corporate limits of City. II. A portion of the hereinabove described property has heretofore been annexed by City. Company has filed with City, coincident with the execution hereof, its petition to City to annex an additional portion of the hereinabove described property, to the end that twenty- five percent (25%) of the total value of the land and improvements hereinabove described shall be annexed to City. Company agrees to render and pay full City ad valorem taxes on such annexed land and improvements, and tangible personal property. Under the terms of the Texas Property Tax Code (S.B. 621, Acts of the 65th Texas LegiSlature, Regular Session, 1979, as amended), e e Industrial District Agreement - 4 the appraised value for tax purposes of the annexed portion of land, improvements, and tangible personal property shall be determined by the Harris County Appraisal District. The parties hereto recognize that said District has no authority to appraise the land, improvements, and tangible personal property in the unannexed area for the purpose of computing the II in lieu II payments hereunder. Therefore, the parties agree that the appraisal of the land, improvements, and tangible personal property in the unannexed area shall be conducted by City, . at City's expense, by an independent appraiser of City's selection. The parties recognize that in making such appraisal for II in lieu II payment purposes, such appraiser must of necessity appraise the entire (annexed and unannexed) land, improvements, and tangible personal property. Company agrees to render and pay full City ad valorem taxes on such annexed land, improvements, and tangible personal pro- perty. Company also agrees to render to City and pay an amount lIin lieu of taxes II on company's land, improvements, and tangible personal property in the unannexed area equal to the sum of: (1) Fifty percent (50% ) of the amount of ad valorem taxes which would be payable to City if all of the hereinabove described property which existed on January 1, 1986, had been within the corporate limits of City and appraised each year by City's independent appraiser; and (2) Thirty percent (30% ) of the amount of ad valorem taxes which would be payable to City on any increase in value of the hereinabove described property, in excess of the appraised value of same on January I, 1986, resulting from new construction and new acquisitions of tangible personal property, (exclusive of Construction in Progress, which shall be exempt from taxation), if all of said new construction and acquisitions had been within the corporate limits of City and appraised by City's independent . . Industrial District Agreement - 5 appraiser; with the sum of (1) and (2) reduced by the amount of City's ad valorem taxes on the annexed portion thereof as determined by appraisal by the Harris County Appraisal District. Nothing herein contained shall ever be construed as in derogation of the authority of the Harris County Appraisal District to establish the appraised value of land, improvements, and tangible personal property in the annexed portion, for ad valorem tax purposes. III. This Agreement shall extend for a period beginning on the 1st day of January, 1987, and continue thereafter until December 31, 1993, unless extended for an additional period or periods of time upon mutual consent of Company and City as provided by the Municipal Annexation Act; provided, however, that in the event this Agreement is not so extended for an additional period or periods of time On or before August 3l, 1993, the agreement of City not to annex property of Company within the District shall terminate. In that event, City shall have the right to commence immediate annexation proceedings as to all of Company's property covered by this Agreement, notwithstanding any of the terms and provisions of this agrement, and in such event Company agrees that if the Texas Municipal Act, Article 970a (V.A.T.S.), as amended after January 1, 1980, or any new legislation is thereafter enacted by the Legislature of the State of Texas which imposes greater restrictions on the right of City to annex land belonging to Company or imposes further obligations on City in connection therewith after the annexation of such land, Company will waive the right to require City to comply with any such additional restrictions or obligations and the rights of the parties shall be then determined in accordance wi th the provisions of said Texas Municipal Annexation Act as the same existed January 1, 1980. . e Industrial District Agreement - 6 IV. This Agreement may be extended for an additional period or periods by agreement between City and Company and/or its assigns even though it is not extended by agreement between City and all of the owners of all land within the District of which it is a part. In this connection, City hereby expresses its belief that industrial district agreements of the kind made herein are conducive to the development of existing and future industry and are to, .the best interest of all citizens of City and encourage future City Councils to enter into future industrial district agreements and to extend for additional periods permitted by law this Industrial District Ag~eement upon request of Company or its assigns; provided, however, that nothing herein contained shall be deemed to obligate either party hereto to agree to an extension of this Agrement. V. Company agrees to pay all ad valorem taxes i and all II in lieu of taxesll paYments hereunder, to City on or before December 31 of each year during the term hereof. It is agreed that presently the ratio of ad valorem tax assessment used by City is one hundred percent (100%) of the fair market value of property. Any change in such ratio used by City shall be reflected in any subsequent computations hereunder. This Agreement shall be subject to all provisions of law relating to determination of value of land, improvements, and tangible personal property, for tax purposes (e.g., rendition, assessment, Harris County Appraisal District review and appeal procedures, court appeals, etc.) for purposes of fixing and determining the amount of ad valorem tax paYments, and the amount of lIin lieu of taxll payments hereunder, except as otherwise provided in Articles II and VI hereof. VI. (A) In the event Company elects to protest the valuation for tax purposes set on its said properties by City or by the Harris e e Industrial District Agreement - 7 County Appraisal District for any year or years during the terms hereof, nothing in this Agreement shall preclude such protest and Company shall have the right to take all legal steps desired by it to reduce the same. Nothwithstanding such protest by Company, Company agrees to pay to City on or before the date therefor hereinabove provided, at least the total of (a) the total amount of ad valorem taxes on the annexed portions, plus (b) the total amount of the "in lieu of taxesll on the unannexed portions of Company's hereinabove-described property which would be due by Company to City in accordance with the foregoing provisions of this Agrement on the basis of renditions which shall be filed by Company on or before March 31 of each year during the term of this Agreement, with both the City and the Harris County Appraisal District (as the case may be) for that year. When the City or Harris County Appraisal District (as the case may be) valuation on said property of Company has been so finally determined, either as the result of final judgmE;!nt of a court of competent jurisdiction or as the result of other final conclusion of the controversy, then wi thin thirty (30) days thereafter Company shall make paYment to City of any additional payment due hereunder based on such final valuation, together with applicable penal ties, interests, and costs. (B) Should Company disagree wi th any appraisal made by the independent apppraiser selected by City pursuant to Article II above (whiCh shall be given in writing to Company), Company shall, within twenty (20) days of receiving such copy, give written notice to the City of such disagreement. In the event Company does not give such written notice of disagreement within such time periOd, the appraisal made by said indepen4ent appraiser shall be final and controlling for purposes of the determination of II in lieu of taxes II payments to be made under this Agreement. Should Company give such notice of disagreement, Company shall e . Industrial District Agreement - 8 also submit to the City with such notice a written statement setting forth what Company believes to be the market value of Company' s hereinabove described property. Both parties agree to thereupon enter into good faith negotiations in an attempt to reach an agreement as to the market value of Company' s property for II in lieu II purposes hereunder. If, after the expiration of thirty (30) days from the date the notice of disagreement was received by City, the parties have not reached agreement as to such market value, the parties agree to submit the dispute to final arbitration as provided in subparagraph (l) of this Article VI(B). Notwithstanding any such disagreement by Company, Company agrees to pay to City on or before December 3l of each year during the term hereof, at least the total of (a) the ad valorem taxes on the annexed portions, plus (b) the total amount of the II in lieu II paYments which would be due hereunder on the basis of Company' s valuations rendered and/or submitted to City by Company hereunder, or the total assessment and lIin lieu of taxesll thereon for the last preceding year, whichever is higher. . (l) A Board of Arbitrators shall be created composed of one person named by Company, one by City, and a third to be named by those two. In case of no agreement on this arbitrator in 10 days, the parties will join in a written request that the Chief Judge of the U. S. District Court for the Southern District of Texas appoint the third arbitrator who, (as the II Impartial Arbitratorll) shall preside over the arbitration proceeding. The sole issue to be determined in the arbitration shall be resolution of the difference between the parties as to the fair market value of Company' s property for calculation of the II in lieu II payment and total paYment hereunder for the year in question. The Board shall hear and consider all relevant and material evidence on that issue including expert opinion, and shall render its written decision as promptly as practicable. That decision shall then be final and binding upon the parties, . . Industrial District Agreement - 9 subject only to judicial review as may be available under the Texas General Arbitration Act (Articles 224-238, Vernon's Annot- ated Revised Civil Statutes of Texas). Costs of the arbitration shall be shared equally by the Company and the City, provided that each party shall bear its own attorneys fees. (C) Should the provisions of Article II of this Agreement become impossible of enforcement because of (1) the invalidity or unenforceabi Ii ty of the Texas Property Code (S . B . 6 21, Acts of the 65th Texas Legislature, Regular Session,. 1979), or any relevant provision thereof, or (2) because of any material delay or failure to act on the part of the Harris County Appraisal District, then and in any of such events, all payments under this Agreement shall be governed by the provisions of Article II hereof; anything to the contrary in this Agreement notwithstanding. VII. City shall be entitled to a tax lien on Company's above-described property, all improvements thereon, and all tangible personal property thereon, in the event of default in payment of II in lieu of taxes II payments hereunder, which shall accrue penalty and interest in like manner as delinquent taxes, and which shall be collectible by City in the same manner as provided by law for delinquent taxes. VIII. Company agrees to provide to City at Company's expense, a survey plat and field note description of the land and improvements which Company petitions to be annexed in accordance with the provisions of Article II above. Such annexation tract shall be contiguous to a point on the existing corporate limits of La Porte. In the event of failure of Company to file either such petition, or such description, City shall have the right by notice in writing to Company to cancel and terminate this Agreement. . . Industrial District Agreement - 10 IX. This Agreement shall inure to the benefit of and be binding upon City and Company, and upon Company's successors and assigns, affiliates and sUbsidiaries, and shall remain in force whether Company sells, assigns, or in any other manner disposes of, either voluntarily or by operation of law, all or any part of the property belonging to it wi thin the territory hereinabove described, and the agreements herein contained shall be held to be covenants running with the land owned by Company situated within said territory, for so long as this Agreement or any extension thereof remains in force. X. If City enters into an Agreement with any other landowner with respect to an industrial district or enters into a renewal of any existing industrial district agreements after the effective date hereof and while this Agreement is in effect, which contains terms and provisions more favorable to the landowner than those in this Agreement, Company and its assigns shall have the right to amend this Agreement and City agrees to amend same to embrace the more favorable terms of such agreement or renewal agreement; provided, however, City reserves the right to enter into such agreements or renewal agreements with other landowners not covered by existing agreements, containing a percentage of ad valorem taxes more favorable to the landowner than that contained in Paragraph II, Subparagraph 3 (2) hereof, and Company and its assigns shall not have the right to amend this agreement to embrace the more favorable percentage of ad valorem taxes contained in such agreement or renewal thereof, than that contained in Paragraph II, Subparagraph 3 (2) hereof. City may extend more favorable terms to landowners covered by existing contracts only to the extent such favorable terms apply to any increase in value of the hereinabove described property, in excess of the appraised value of same on January 1, 1986, as described in Paragraph II, Sub- paragraph 3 (2) hereof. . . Industrial District Agreement - II XI. In the event anyone or more words, phrases, clauses, sentences, paragraphs, sections, articles or other parts of this Agreement or the applicaton thereof to any person, firm, corporation or circum- stances shall be held by any court of competent jurisdiction to be invalid or unconstitutional for any reason, then the application, invalidity or unconstitutionality of such words, phrase, clause, sentence, paragraph, section, article or other part of the Agreement shall be deemed to be independent of and separable from the remainder of this Agreement and the validity of t~e remaining partes of this Agreement shall not be affected thereby. XII. Upon the commencement of the term of this Agreement, all other previously existing industrial district agreements with respect to said land shall terminate. ENTERED INTO this 1st day of June, 1986. ATTEST: Texas Electric Equipment Co., Inc. (COMPANY) --11~I--rJ ~ Secretary BY ~/1-~ Name: Edmond J. Faneca Name: Edward J. Hoerner Title: Pres i dent 9401 Highway 225 Address: La Porte, Texas 77571 APPROVED BY COUNSEL: L \ ;L/A ~RNEY FOUOMPANY Name: -1AME5. J. "'Bw~ Address: ..f\C>2.S ~~WA'Y \-IousrotoJ . ~. '"1"7007 "' Telephone: tA4-S4~~ . . (, . \ .' Industrial District Agreement - 12 ATTEST: ~~ Cherie- Bla_ck~ City Secretary APPROVED BY COUNSEL: ~ KNOX W. ASKINS, 702 W. Fairmont P. O. Box 1218 La Porte, Texas 77571 Telephone: (713) 471-1886 (Revised: 03/87) . CITY OF LA PORTE By. ~rA:..~~ 'N rman Malone, Ma or BY:CX~ ~ ~ Robert T. Herrera, City Manager CITY OF LA PORTE P. O. Box IllS La Porte, Texas 77571 I.