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HomeMy WebLinkAboutContract 60417STATE OF TEXAS COUNTY OF TARRANT TAX ABATEMENT AGREEMENT CSC No. 60417 This TAX ABATEMENT AGREEMENT ("Agreement") is entered into by and between the CITY OF FORT WORTH, TEXAS ("City"), a home -rule municipality organized under the laws of the State of Texas; CARTER PARK EAST PHASE 1, LLC, a Delaware limited liability company ("Carter") and SIEMENS INDUSTRY INC., a Delaware corporation ("Company"). RECITALS A. On February 28, 2023, the City Council adopted Resolution No. 5709-02-2023, stating that the City elects to be eligible to participate in tax abatement and setting forth guidelines and criteria governing tax abatement agreements entered into between the City and various parties, entitled "General Tax Abatement Policy" ("Policy"). B. The Policy contains appropriate guidelines and criteria governing tax abatement agreements to be entered into by the City as contemplated by Chapter 312 of the Texas Tax Code, as amended ("Code"). C. On September 12, 2023, the City Council adopted Ordinance No. 26417-09-2023 ("Ordinance") establishing Tax Abatement Reinvestment Zone No. 106, City of Fort Worth, Texas ("Zone"). D. Carter owns property located at 7200 Harris Legacy Drive, including a vacant building shell ("Current Structure") which is located within the Zone and is more specifically described in Exhibit "A" ("Land"), attached hereto and hereby made a part of this Agreement for all purposes. Contingent upon Company's receipt of the tax abatement herein (i.e. subject to Company's termination right if the grant of such tax abatement is not approved), Carter leases the Land and the Current Structure to Siemens Corporation (an Affiliate of the Company) which shall provide the Company the right to occupy the Land and the Current Structure measuring at least 540,000 square feet, pursuant to an agreement between Siemens Corporation and the Company, on terms and conditions that permit the buildout of the Current Structure for the purpose of assembly and fabrication of switchgear and related activity (more specifically defined herein as the "Real Property Improvements") to support Company's business operations, and in which Company will install certain taxable business personal property on the Land, all as more specifically set forth in this Agreement. The lease of the Land between Carter and Company ("Lease") will contain terms and conditions consistent with those outlined in Exhibit "B", attached hereto and hereby made a part of this Agreement for all purposes. E. Under the Lease, Company is required to pay real property taxes on the Land and all improvements thereon, including the Real Property Improvements. In order for the full tax abatement necessary to provide incentive for this project to be undertaken, the City has been requested to grant an abatement on real property taxes on improvements to the Land as well as an abatement on taxes on New Taxable Tangible Personal Property (as defined in Section 2) located on the Land. Section 312.204(a) of the Texas Tax Code permits the City to enter into an agreement with the owner of the Land to abate taxes on the value of improvements located on the Land, or of tangible personal property located on the Land, or both. Because Company must meet certain employment and spending commitments in order for the City to grant the full amount of abatement available hereunder on improvements to the Land, and because Company will be the owner or lessee of New Taxable Tangible Personal Property that is subject to abatement hereunder, it is necessary that both Carter and Company be parties to this Agreement. F. As of May 9, 2023, Company submitted an application for tax abatement ("Applications") to the City concerning plans for development of the Land, including construction of the Real Property Improvements, which Applications are attached hereto as Exhibit "C" for reference purposes. Subsequent to tendering such Application, investment amounts have been revised to reflect those amounts stated in this Agreement to those investment amounts reflected in Section 4.1 and 4.2 below. OFFICIAL RECORD CITY SECRETARY FT. WORTH, TX G. The contemplated use of the Land and the terms of this Agreement are consistent with encouraging development of the Zone and generating economic development and increased employment opportunities in the City, in accordance with the purposes for creation of the Zone, and are in compliance with the Policy, the Ordinance and other applicable laws, ordinances, rules and regulations. H. Under this Agreement, Company is committed to invest a total of at least $125 million as follows: at least $70 million in Construction Costs for the Real Property Improvements and at least $55 million towards the costs of New Taxable Tangible Personal Property to be installed in the Current Structure (with such New Taxable Tangible Personal Property having a minimum taxable appraised value of $45 million) all in connection with manufacturing business operations within the Real Property Improvements. Company is also committing to provide new Full-time Jobs whose average annual Salaries will equal at least $63,000.00. Therefore, the provisions of this Agreement, as well as the proposed use of the Land and Current Structure and nature of the proposed Real Property Improvements, as defined herein, satisfy the eligibility criteria for commercial/industrial tax abatement pursuant to Section 4 of the Policy. I. Written notice that the City intends to enter into this Agreement, along with a copy of this Agreement, have been furnished in the manner prescribed by the Code to the presiding officers of the governing bodies of each of the taxing units that have jurisdiction over the Land. NOW, THEREFORE, in consideration of the mutual benefits and promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: AGREEMENT 1. INCORPORATION OF RECITALS. The City Council has found, and the City, Carter, and Company agree, that the recitals set forth above are true and correct and form the basis upon which the parties have entered into this Agreement. 2. DEFINITIONS. In addition to terms defined in the body of this Agreement, the following terms have the definitions ascribed to them as follows: Abatement means the abatement of a percentage (not to exceed seventy percent (70%) in any year of the Abatement Term) of the City's incremental ad valorem real property taxes on any improvements located on the Land (but not on the Land itself, which taxes will not be subject to Abatement hereunder) and of the City's incremental ad valorem taxes on New Taxable Tangible Personal Property, all calculated in accordance with this Agreement. Abatement Term means the term of ten (10) consecutive years, commencing on January 1, 2025 and expiring on December 31 of the tenth (loth) year thereafter, in which Carter and Company will receive the Abatement in accordance with this Agreement. Affiliate means all entities, incorporated or otherwise, under common control with, controlled by, or controlling Company. For purposes of this definition, "control" means fifty percent (50%) or more of the ownership determined by either value or vote. Annual Salary Commitment has the meaning ascribed to it in Section 4.5.1. Annual Salary Percentage has the meaning ascribed to it in Section 6.5. Aanlications has the meaning ascribed to it in Recital F. Business Eauitv Firm(s) ("BEFs") has the meaning assigned to it in the City of Fort Worth's Business Equity Ordinance, as amended (Chapter 20, Article X of the City Code). BEF Construction Commitment has the meaning ascribed to it in Section 4.3. BEF Construction Percentage has the meaning ascribed to it in Section 6.3. Certificate of Completion has the meaning ascribed to it in Section 5. Code has the meaning ascribed to it in Recital B. Completion Date means the date as of which all space that Company will operate within the Real Property Improvements have received a certificate of occupancy (either temporary or permanent). Completion of punchlist items shall not impact the Completion Date. A portion of the Current Structure may remain vacant or be subleased and such shall not impact the Completion Date. Completion Deadline means December 31, 2024. Compliance Auditing Term means the term of ten (10) consecutive years, commencing on January 1 of 2025 and expiring on December 31 of 2034, in which the City will verify and audit Carter's and Company's compliance with the various commitments set forth in Section 4 that form the basis for calculation of the amount of each annual Abatement percentage hereunder. Construction Costs means the following costs expended directly for the Real Property Improvements: actual site development and construction costs, including directly -related contractor fees, plus costs of supplies and materials, engineering fees, architectural and design fees, and permit fees. Construction Costs specifically excludes any real property acquisition costs or rent payments or other costs required by the Lease. Director means the director of the City's Economic Development Department. Effective Date has the meaning ascribed to it in Section 3. Event of Default means, subject to the limitations established in Section 7.1, 7.2, 7.3 and 18, a material breach of this Agreement by a party, either by act or omission, as more specifically set forth in Section 7 of this Agreement. First Operating Year means the first full calendar year following the year in which the Completion Date occurred. Full-time Job means a job provided to one (1) individual by Company on the Land for at least forty (40) hours per week or such number of hours per week that Company has accepted per its agreement with the applicable union and/or such number of hours that is standard in Tarrant County for an equivalent full time job of such position. Land has the meaning ascribed to it in Recital D. Legal Requirements means federal, state and local laws, ordinances, rules and regulations, including, but not limited to, all provisions of the City's charter and ordinances, as amended. New Job has the meaning ascribed to it in Section 4.4.1. New Taxable Tangible Personal Property means any personal property other than inventory or supplies that (i) is subject to ad valorem taxation by the City; (ii) is located on the Land; (iii) is owned or leased by Company and used by Company for the business purposes outlined in this Agreement; and (iv) was not located in the City prior to the period covered by this Agreement and subject to the City's ad valorem business personal property tax. Ordinance has the meaning ascribed to it in Recital C. Overall Employment Commitment has the meaning ascribed to it in Section 4.4.1. Overall Emnlovment PercentaLye has the meaning ascribed to it in Section 6.4. Overall Improvement Percentaue has the meaning ascribed to it in Section 6.2. Personal Property Improvement Commitment has the meaning ascribed to it in Section 4.2. Policy has the meaning ascribed to it in Recital A. Real Property Improvement Commitment has the meaning ascribed to it in Section 4.1. Real Pronertv Improvements as such term is defined in Recital D above, and as verified in the Certificate of Completion issued by the Director in accordance with this Agreement. Records has the meaning ascribed to it in Section 4.8. Salary means the cash payment or remuneration made to a person holding a Full-time Job, including paid time off, commissions, and non -discretionary bonuses. A Salary does not include any benefits, such as health insurance or retirement contributions, reimbursements for employee expenses, or any discretionary bonuses. Second Oneratine Year means the second full calendar year following the year in which the Completion Date occurred. Term has the meaning ascribed to it in Section 3. Zone has the meaning ascribed to it in Recital C. 3. TERM. The effective date of this Agreement is September 12, 2023 ("Effective Date") and, unless terminated earlier in accordance with its terms and conditions, expires simultaneously upon expiration of the Abatement Term ("Term"). 4. OBLIGATIONS AND COMMITMENTS RELATED TO ABATEMENT. 4.1. Real Property Improvements. Carter and Company must expend or cause to be expended at least Seventy Million Dollars and Zero Cents ($70,000,000.00) in Construction Costs for the Real Property Improvements by the Completion Deadline, and the Completion Date for the Real Property Improvements must occur on or before the Completion Deadline ("Real Property Improvement Commitment"). Carter may perform this obligation in full by permitting Company to make or cause to be made the Real Property Improvements pursuant to the Lease. Funds expended by Company's Affiliate, Siemens Corporation, in Real Property Improvements shall qualify towards such expenditure requirement. Failure to meet the Real Property Improvement Commitment constitutes an Event of Default. 4.2. Personal Property Improvements. 4.2.1. On or before January 1, 2025, the Company shall spend a minimum of Fifty -Five Million dollars ($55,000,000) towards the acquisition and installation of New Taxable Tangible Personal Property on the Land having a minimum taxable appraised value of at least Forty -Five Million Dollars and Zero Cents ($45,000,000.00) ("Personal Property Improvement Commitment") which shall be in place on the Land. Failure to meet the meet the Personal Property Improvement Commitment constitutes an Event of Default. 4.2.2. The Personal Property Improvement Commitment is an obligation of the Company only, and Carter does not have any responsibility to ensure that the Personal Property Improvement Commitment is met. 4.2.3. The value of the New Taxable Tangible Person Property is determined solely by the appraisal district having jurisdiction over the Land at the time and reflected in the certified appraisal roll received by the City from such appraisal district in such year. 4.3. Construction Spending Commitment for BEFs. By the Completion Date, Company must expend or caused to be expended at least fifteen percent (15%) of all Construction Costs for the Real Property Improvements with BEFs, regardless of the total amount of such Construction Costs (`BEF Construction Commitment"). 4.4. Emplovment Commitment. 4.4.1. Company must employ and retain the following number of new Full -Time Jobs on the Land by the dates set forth below ("Overall Employment Commitment"). Company must retain all new Full -Time Jobs on the Land from and after the dates set forth below through the Term of this Agreement (each a "New Job"). A Full -Time Job will be considered new if the individual was hired on or after June 2, 2023, which is the date of the Company's execution of the terms sheet. A. Company must employ and retain a minimum of 167 Full -Time on or before December 31, 2024. b. Company must employ and retain a minimum of 715 Full -Time Jobs on the Land on or before December 31, 2026. 4.4.2 The Overall Employment Commitment is an obligation of the Company only, and Carter does not have any responsibility to ensure that the Overall Employment Commitment is met in any given year. 4.4.3 Determination each year of compliance with the following Employment Commitment will be based on the employment data provided by Company to the City for the year under evaluation. 4.5. Average Annual Salarv. 4.5.1 In each year of the Compliance Auditing Term, the average annual Salary, measured on a calendar year basis, for at all of the Full -Time Jobs provided and filled on the Land pursuant to this Agreement, regardless of the total number of such Full-time Jobs, must equal at least Sixty -Three Thousand Dollars and Zero Cents ($63,000.00) ("Annual Salary Commitment"). The Annual Salary Commitment is an obligation of the Company only, and Carter does not have any responsibility to ensure that the Annual Salary Commitment is met in any given year. 4.5.2. Determination each year of compliance with the following Annual Salary Commitment will be based on the employment data provided by Company to the City for the year under evaluation. 4.6. Reports and Filings. 4.6.1. Final Construction Report. Within sixty (60) calendar days following the Completion Date, in order for the City to assess whether Carter and Company expended or caused to be expended at least Seventy Million Dollars and Zero Cents ($70,000,000.00) in Construction Costs for the Real Property Improvements, and the extent to which the BEF Construction Commitment was met, Carter and Company must provide the Director with a report in a form reasonably acceptable to the City that specifically outlines the total Construction Costs expended for the Real Property Improvements and the total Construction Costs expended with BEFs for the Real Property Improvements, together with supporting invoices and other documents necessary to demonstrate that such amounts were actually paid, including, without limitation, unconditional lien waivers signed by the general contractor for the Real Property Improvements. Attached hereto as Schedule 4.6 is a form reasonably acceptable to the City. 4.6.2. Annual Emplovment Report. On or before March 15, 2025, and of each year thereafter for the remainder of the Compliance Auditing Term, in order for the City to assess the degree to which Company met in the previous year the Overall Employment Commitment and the Annual Salary Commitment, Company must provide the Director with a report in a form reasonably acceptable to the City that sets forth the total number of individuals who held Full -Time Jobs on the Land, as well as the Salary of each, all as of December 31 (or such other date requested by Company and reasonably acceptable to the City) of the previous calendar year, together with reasonable supporting documentation. Attached hereto as Schedule 4.6 is a form reasonably acceptable to the City. 4.6.3. General. Company will supply any additional information reasonably requested by the City that is pertinent to the City's evaluation of compliance with each of the terms and conditions of this Agreement, provided Company shall not be required to provide confidential and/or proprietary data in a form that the City will not or cannot keep confidential (including requests covered by the Texas Public Information Act and/or similar ordinance propagated by the City). However, the Company shall allow the City to view such information in a manner in which facilitates City's verification of information, but is able to remain confidential. 4.7. Inspections of Land and Improvements 4.7.1. At anytime during Company's normal business hours throughout the Term, the City will have the right to inspect and evaluate the Land, and any improvements thereon, and Company will provide full access to the same, in order for the City to monitor compliance with the terms and conditions of this Agreement. Company will use reasonable efforts to cooperate fully with the City during any such inspection and evaluation. 4.7.2. Notwithstanding the foregoing, Company may require that any representative of the City be escorted by a Company representative or security personnel during any such inspection and evaluation and abide by any site policies and protocols regarding health, safety, and treatment of Company's confidential information. 4.8. Audits. The City has the right throughout the Term to audit the financial and business records of Company that relate to the Real Property Improvements, Personal Property, and the Land and any other documents necessary to evaluate Company's compliance with this Agreement or with the commitments set forth in this Agreement, including, but not limited to construction documents and invoices (collectively, "Records"). Company must make all Records available to the City on the Land or at another location in the City acceptable to both parties following prior notice and will otherwise use reasonable efforts to cooperate fully with the City during any audit. If the City does not or cannot agree to keep confidential and/or proprietary data within the Record confidential (including due to potential request covered by the Texas Public Information Act and/or similar ordinance propagated by the City), the Company shall allow the City to view such information in a manner in which facilitates City's verification of information, but ensures such confidential and/or proprietary data remains confidential. 4.9. Use of Land. The Land and any improvements thereon, including, but not limited to, the Real Property Improvements, must be used at all times during the Term of this Agreement for Company's lawful business operations, as set forth in this Agreement, and otherwise in a manner that is consistent with the general purposes of encouraging development or redevelopment of the Zone. 4.10. Abatement Application Fee. The City acknowledges receipt from Company of the required Application fee of Two Thousand Five Hundred Dollars ($2,5000.00). 5. CERTIFICATE OF COMPLETION. Within ninety (90) calendar days following receipt by the City of the final construction spending report for the Real Property Improvements submitted in accordance with this Agreement, and assessment by the City of the information contained therein, if the City is able to reasonably verify that Construction Costs of at least Seventy Million Dollars and Zero Cents ($70,000,000.00) were expended for Real Property Improvements by the Completion Deadline and that the Completion Date occurred on or before Completion Deadline, the Director will issue Carter and Company a certificate stating the amount of Construction Costs expended for the Real Property Improvements, as well as the amount of Construction Costs expended for the Real Property Improvements specifically with BEFs ("Certificate of Completion"). The Certificate of Completion will serve as the basis for determining whether the Company or Carter, as applicable, met the BEF Construction Commitment. The City and/or the Director may not arbitrarily or unreasonably withhold, delay or refuse its verification and issuance of a Certificate of Completion verify such applicable matter, if the Company has provided reasonable documentation of the investment in Real Property Improvements and expenditures with BEF and the Completion Date such documentation to include witnessed certifications by the Company's officers. 6. TAX ABATEMENT. 6.1. Generally. 6.1.1. Subject to the terms and conditions of this Agreement, provided that the Real Property Improvement Commitment and Personal Property Improvement Commitment have been met, then the City will grant an Abatement in each year of the Abatement Term. 6.1.2. The amount of each Abatement that the City grants during such years will be a percentage of the City's ad valorem taxes on any improvements located on the Land (but not on the Land itself, which taxes will not be subject to Abatement hereunder) and on New Taxable Tangible Personal Property attributable to increases in the value of such improvements and New Taxable Tangible Personal Property, which percentage will equal the sum of the Overall Improvement Percentage, the BEF Construction Percentage, the Overall Employment Percentage, and the Annual Salary Percentage, as set forth below (not to exceed seventy percent (70%)). 6.2. Real Property Improvement and Personal Property Commitments (40%). City will grant an abatement to Company equal to forty percent (40%) of the overall Abatement ("Overall Improvement Percentage") if Company meets both the Real Property Improvement Commitment and Personal Property Commitment. 6.3. BEF Construction Cost SDendinLy (10%). A percentage of the Abatement will be based on the whether the Company met the BEF Construction Commitment ("BEF Construction Percentage"). If Company meets the BEF Construction Commitment, the BEF Construction Percentage for each Abatement hereunder will be ten percent (10%). If the Company does not meet the BEF Construction Commitment, the BEF Construction Percentage for each Abatement hereunder will be zero percent (0%). 6.4. Overall EmDlovment. 6.4.1. A percentage of the Abatement will be based on the extent to which the Company meets the Overall Employment Commitment in each given year of the Abatement Term as set forth in Sections 4.5.1(a) and (b) ("Overall Employment Percentage"). The Overall Employment Percentage for each Abatement will equal the product of ten percent (10%) multiplied by the percentage by which the Company met the Overall Employment Commitment in the previous calendar year, which will be calculated by dividing the actual number of Full -Time Jobs provided on the Land in the previous year by the number of Full -Time Jobs constituting the Overall Employment Commitment for that year. 6.4.2. For example, if Company only employed 134 individuals with Full -Time Jobs on the Land in 2024 instead of the required 167, the Overall Employment Percentage for the following year (2025) would be 8% instead of 10% (or .1 x [134/167]), or .10 x .80, or .08. If the Overall Employment Commitment is met or exceeded in any given year, the Overall Employment Percentage for the Abatement in the following year will be ten percent (10%). 6.5. Annual Salary (10%). A percentage of the Abatement will be based on whether Company meets the Annual Salary Commitment ("Annual Salary Percentage"). If Company met the Annual Salary Commitment in a given year, the Annual Salary Percentage for the Abatement in the following year will be ten percent (10%). If Company does not meet the Annual Salary Connnitment in a given year, Company and Carter will forfeit the entire Abatement to which they would otherwise have been entitled in the following year. 6.6. Abatement Limitations. The amount of real property taxes to be abated in a given year will not exceed one hundred fifty percent (150%) of the amount of the minimum Real Property Improvement Commitment and the minimum taxable appraised value of Personal Property Improvement Commitment multiplied by the City's tax rate in effect for that same year. As a formula, this would be expressed as $115,000,000 (minimum Property Improvement and Personal Property Commitments) x 1.5 x City's Tax Rate. The City and Company acknowledge that the Abatement cap is an annual cap and not an aggregate cap. 7. DEFAULT. TERMINATION AND FAILURE TO MEET VARIOUS DEADLINES AND COMMITMENTS. 7.1. Failure to Meet Real Property Imnrovement and Personal ProDerty Commitments. Notwithstanding anything to the contrary herein other than Section 18 Force Majeure below, if the Company does not meet both the Real Property Improvement Commitment and Personal Property Commitment, an Event of Default will occur and the City will have the right to terminate this Agreement, effective immediately, by providing written notice to Carter and Company without further obligation to Carter or Company hereunder. 7.2 Failure to Meet BEF Construction or the Overall EmDlovment Commitments. If the Company does not meet the BEF Construction Commitment or the Overall Employment Commitment in any given year, such event will not constitute an Event of Default hereunder or provide the City with the right to terminate this Agreement, but, rather, will only cause the percentage or amount of Abatement available pursuant to this Agreement to be reduced in accordance with this Agreement. 7.3 Forfeiture for Failure to Annual Salary Commitment. Notwithstanding anything to the contrary herein other than Section 18 Force Majeure below, if the Company fails to meet the Annual Salary Commitment in any year of the Compliance Auditing Term, an Event of Default will not occur, but Carter and Company will forfeit the entirety of the Abatement that would otherwise have been granted in the following year. In this event, an Abatement will be deemed to have been granted in that year for purposes of calculating the remaining number of years in the Abatement Term and the number of future Abatements that Carter and Company will be entitled to receive. 7.4. Knowine Emplovment of Undocumented Workers. Company acknowledges that effective September 1, 2007, the City is required to comply with Chapter 2264 of the Texas Government Code, enacted by House Bill 1196 (80th Texas Legislature), which relates to restrictions on the use of certain public subsidies. Company hereby certifies that Company, and any branches, divisions, or departments of Company, does not and will not knowingly employ an undocumented worker, as that term is defined by Section 2264.001(4) of the Texas Government Code. In the event that Company, or any branch, division, or department of Company, is convicted of a violation under 8 U.S. C. Section 1324a(n (relating to federal criminal penalties and injunctions for a pattern or practice of employing unauthorized aliens) and such violation occurs during the Term of this Agreement. if such conviction occurs during the Term of this Agreement, this Agreement will terminate contemporaneously upon such conviction (subject to any appellate rights that may lawfully be available to and exercised by Company) and Company must repay, within one hundred twenty (120) calendar days following receipt of written demand from the City, the aggregate amount of Abatement received by Company hereunder, if any, plus Simple Interest at a rate of two percent (2%) per annum based on the amount of Abatement received in each previous year as of December 31 of the tax year for which the Abatement was received, or if such conviction occurs after expiration or termination of this Agreement, subject to any appellate rights that may lawfully be available to and exercised by Company, Company must repay, within one hundred twenty (120) calendar days following receipt of written demand from the City, the aggregate amount of Abatement received by Company hereunder, if any, plus Simple Interest at a rate of two percent (2%) per annum based on the amount of Abatement received in each previous year as of December 31 of the tax year for which the Abatement was received. For the purposes of this Section 7.6, "Simple Interest" is defined as a rate of interest applied only to an original value, in this case the aggregate amount of Abatement. This rate of interest can be applied each year, but will only apply to the aggregate amount of Abatement and is not applied to interest calculated. For example, if the aggregate amount of Abatement is $10,000 and it is required to be paid back with two percent (2%) interest five years later, the total amount would be $10,000 + [5 x ($10,000 x 0.02)], which is $11,000. This Section 7.6 does not apply to convictions of any subsidiary or affiliate entity of Company, by any franchisees of Company, or by a person or entity with whom Company contracts. Notwithstanding anything to the contrary herein, the parties agree that the Abatement is a "public subsidy" (as that term is defined in Section 2264.001, Texas Government Code) for the benefit of Company and that, accordingly, this Section 7.6 does not apply to carter. This Section 7.6 will survive the expiration or termination of this Agreement. 7.5. Foreclosure on Land or Real Prooertv Improvements. Subject to Section 11, the City will have the right, during the Abatement Term, to terminate this Agreement immediately upon provision of written notice to Carter and Company of both of the following events: (a) (i) the conveyance of the Land or the Real Property Improvements pursuant to an action to foreclose or otherwise enforce a lien, mortgage or deed of trust on the Land or the Real Property Improvements; (ii) the involuntary conveyance to a third party of the Land or the Real Property Improvements; (iii) execution of any assignment of the Land or Real Property Improvements or deed in lieu of foreclosure to the Land or Real Property Improvements; or (iv) appointment of a trustee or receiver for the Land or Real Property Improvements and such appointment is not terminated within one hundred twenty (120) calendar days after the appointment (collectively "Landlord Insolvency") occurs and (b) the Company terminates its Lease with Carter or the successor landlord as a result of such Landlord Insolvency. However, if the successor Landlord is bound by this Agreement and the Company remains a tenant on the Land despite such Landlord Insolvency, and continues to operate on the Land, the Agreement shall not be terminated pursuant to this Section 7.5. 7.6. Failure to Pav Taxes or Non -Compliance with Other Legal Reauirements. An Event of Default will occur if any ad valorem taxes owed to the City by Company become delinquent and Company does not timely and properly follow the legal procedures for protest or contest of any such ad valorem taxes, or Company is in violation of any material Legal Requirement due to any act or omission connected with Company's operations on the Land; provided, however, that an Event of Default will not exist under this provision unless Company fails to cure the applicable failure or violation within thirty (30) calendar days (or such additional time as may be reasonably required) after Company receives written notice in accordance with Section 10 of such failure or violation. 7.7. General Brcach. In addition to Sections 7.1, 7.4, 7.5, and7.6 but subject to Section 18, 7.3 and 7.4, an Event of Default under this Agreement will occur if either party breaches any term or condition of this Agreement, in which case the non -defaulting party must provide the defaulting party with written notice specifying the nature of the Default in accordance with Section 10 below. Subject to Sections 7.1 in the event that any Event of Default hereunder remains uncured after thirty (30) calendar days following receipt of such written notice (or, if the defaulting party has diligently and continuously attempted to cure following receipt of such written notice but reasonably requires more than thirty (30) calendar days to cure, then such additional amount of time as is reasonably necessary to effect cure, as determined by both parties mutually and in good faith), the non - defaulting party will have the right to terminate this Agreement, effective immediately, by providing written notice to the defaulting party. 7.8. Statutory Damages. 7.8.1 Company acknowledges and agrees that termination of this Agreement due to an Event of Default by Company that has not been cured within the applicable cure period will (i) harm the City's economic development and redevelopment efforts on the Land and in the vicinity of the Land; (ii) require unplanned and expensive additional administrative oversight and involvement by the City; and (iii) be detrimental to the City's general economic development programs, both in the eyes of the general public and by other business entities and corporate relocation professionals, and Company agrees that the exact amounts of actual damages sustained by the City therefrom will be difficult or impossible to ascertain. 7.8.2 Therefore, upon termination of this Agreement for any Event of Default, and as authorized by Section 312.205(b)(6) of the Code, Company must pay the City, as damages authorized by the Code, an amount equal to all taxes that were abated in accordance with this Agreement for each year in which an Event of Default existed and which otherwise would have been paid to the City in the absence of this Agreement. 7.8.3 The City and Company agree that the above -stated amount is a reasonable approximation of actual damages that the City will incur as a result of an uncured Event of Default and that this Section 7.11 is intended to provide the City with compensation for actual damages, as authorized by the Code, and is not a penalty. 7.8.4 The above -stated amount may be recovered by the City through adjustments made to Company's ad valorem property tax appraisal by the appraisal district that has jurisdiction over the Land and over any taxable tangible personal property located thereon. Otherwise, this amount will be due, owing, and paid to the City within sixty (60) calendar days following the effective date of tennination of this Agreement. 7.8.5 In the event that all or any portion of this amount is not paid to the City within sixty (60) days following the effective date of termination of this Agreement, Company will also be liable for all penalties and interest on any outstanding amount at the statutory rate for delinquent taxes, as determined by the Code at the time of the payment of such penalties and interest (currently, Section 33.01 of the Code). 8. INDEPENDENT CONTRACTOR. It is expressly understood and agreed that Carter and Company will operate as independent contractors in each and every respect hereunder and not as agents, representatives or employees of the City. As to the City, Carter and Company will have the exclusive right to control all details and day-to-day operations relative to the Land and any improvements thereon and will be solely responsible for the acts and omissions of their officers, agents, servants, employees, contractors, subcontractors, licensees and invitees. Carter and Company acknowledge that the doctrine of respondeat superior will not apply as between the City and Carter or Company, their officers, agents, servants, employees, contractors, subcontractors, licensees, and invitees. Carter and Company further agree that nothing in this Agreement will be construed as the creation of a partnership or joint enterprise between the City and Carter or Company. 9. INDEMNIFICATION. COMPANY AND CARTER, AT NO COST TO THE CITY, AGREE TO DEFEND, INDEMNIFY AND HOLD THE CITY, AND ITS RESPECTIVE OFFICERS, AGENTS SERVANTS, REPRESENTATIVES, AND EMPLOYEES, HARMLESS AGAINST ANY AND ALL CLAIMS, LAWSUITS, ACTIONS, COSTS AND EXPENSES OF ANY KIND THATARE CLAIMED AGAINST THE CITYBYA THIRD PARTY, INCLUDING, BUT NOT LIMITED TO, THOSE FOR PROPERTY DAMAGE OR LOSS (INCLUDING ALLEGED DAMAGE OR LOSS TO A COMPANY'S B USINESS AND ANYRESULTING LOST PROFITS) AND PERSONAL INJURY, INCLUDING DEATH, TO THE EXTENT THAT SUCH 3rd PARTY CLAIM MAY RELATE TO, ARISE OUT OF OR BE OCCASIONED BY (i) COMPANY'S OR CARTER'S BREACH OF ANY OF THE TERMS OR PROVISIONS OF THIS AGREEMENT OR (ii) ANY NEGLIGENT ACT OR OMISSION OR INTENTIONAL MISCONDUCT OF CARTER OR COMPANY, ITS OFFICERS, AGENTS, ASSOCIATES, EMPLOYEES, CONTRACTORS (OTHER THAN THE CITY) OR SUBCONTRACTORS, RELATED TO THE REAL PROPERTY IMPROVEMENTS, THE LAND AND ANY OPERATIONS AND ACTIVITIES THEREON, OR THE PERFORMANCE OR NON-PERFORMANCE OF THIS AGREEMENT OTHERWISE BY CARTER OR THE COMPANY. THIS SECTION WILL SURVIVE ANY TERMINATION OR EXPIRATION OF THIS AGREEMENT. 10. NOTICES. All written notices called for or required by this Agreement must be addressed to the following, or such other party or address as either party designates in writing, by certified mail, postage prepaid, by delivery by reputable overnight courier or by hand delivery: City: City of Fort Worth Attn: City Manager 200 Texas Street Fort Worth, Texas 76102 With copies to: City Attorney at the same address and the Director at: City of Fort Worth Attn: Director Economic Development 1150 South Freeway Fort Worth, Texas 76104 Company: Siemens Industry, Inc. Attn: President & CEO 100 Technology Drive Alpharetta, GA 30005 With copies to: Siemens Industry, Inc. Attn. Legal Dept. 1000 Deerfield Parkway, Buffalo Grove, IL 60089, Carter Park East Phase 1, LLC Attn: DFW Asset Manager 1717 McKinney Ave., Suite 1900 Dallas, Texas 75202 11. EFFECT OF SALE OF LAND AND/OR REAL PROPERTY IMPROVEMENTS: ASSIGNMENT AND SUCCESSORS. 11.1. Carter may assign this Agreement without the consent of the City Council, provided that Carter gives written notice to the City of the name and contact information for Carter assignee or successor in interest. Any lawful assignee or successor in interest of Carter of its rights under this Agreement will be deemed "Carter" for all purposes under this Agreement. 11.2. Company may assign this Agreement, and all or any of the benefits provided hereunder, without the consent of the City Council to (a) an Affiliate that leases, owns or takes title to the Land and owns or leases any New Taxable Tangible Personal Property or (b) a successor to Company by sale, merger or consolidation only if (i) prior to or contemporaneously with the effectiveness of such assignment, Company provides the City with written notice of such assignment, which notice must include the name of the Affiliate and a contact name, address and telephone number for the Affiliate, and (ii) the Affiliate agrees in writing to assume all terms and conditions of Company under this Agreement. 11.3. Otherwise, Company may not assign, transfer or otherwise convey any of its rights or obligations under this Agreement to any other person or entity without the prior consent of the City Council, which consent will not be unreasonably withheld, conditioned on (i) the proposed assignee or successor agrees and proceeds to lease or take title to the Land and any New Taxable Tangible Personal Property; (ii) the proposed assignee or successor is financially capable of meeting the terms and conditions of this Agreement; and (iii) prior execution by the proposed assignee or successor of a written agreement with the City under which the proposed assignee or successor agrees to assume and be bound by all covenants and obligations of Company under this Agreement. Any attempted assignment without the City Council's prior consent constitutes an Event of Default under this Agreement. Any lawful assignee or successor in interest of Company of all rights under this Agreement will be deemed "Company" for all purposes under this Agreement. 12. COMPLIANCE WITH LAWS. ORDINANCES. RULES AND REGULATIONS. This Agreement is subject to all applicable Legal Requirements. 13. GOVERNMENTAL POWERS. It is understood that by execution of this Agreement, the City does not waive or surrender any of its governmental powers or immunities. 14. SEVERABILITY. If any provision of this Agreement is held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired. 15. NO WAIVER. The failure of either party to insist upon the performance of any term or provision of this Agreement or to exercise any right granted hereunder will not constitute a waiver of that parry's right to insist upon appropriate performance or to assert any such right on any future occasion. 16. VENUE AND CHOICE OF LAW. If any action, whether real or asserted, at law or in equity, arises on the basis of any provision of this Agreement, venue for such action will lie in state courts located in Tarrant County, Texas or the United States District Court for the Northern District of Texas — Fort Worth Division. This Agreement will be construed in accordance with the laws of the State of Texas. 17. NO THIRD PARTY RIGHTS. The provisions and conditions of this Agreement are solely for the benefit of the City, Carter, and Company, and any lawful assign or successor of Carter or Company, and are not intended to create any rights, contractual or otherwise, to any other persons or entities. 18. FORCE MAJEURE. It is expressly understood and agreed by the parties to this Agreement that if the performance of any obligations hereunder is delayed by reason of war, government action or inaction, orders of the government, epidemics, pandemics, civil commotion, acts of God, strike, inclement weather, shortages or unavailability of labor or materials, unreasonable delays by the City (include delays caused by the then -current workload of the City department(s) responsible for undertaking the activity in question) in issuing any permits, consents, or certificates of occupancy or conducting any inspections of or with respect to the Land and Project Improvements, or other circumstances which are reasonably beyond the control of the party obligated or permitted under the terms of this Agreement to do or perform the same, regardless of whether any such circumstance is similar to any of those enumerated or not, the party so obligated or permitted will be excused from doing or performing the same during such period of delay, so that the time period applicable to such design or construction requirement and the Completion Deadline will be extended for a period of time equal to the period such party was delayed. Notwithstanding anything to the contrary herein, it is specifically understood and agreed that any failure to obtain adequate financing necessary to meet the Real Property Improvement Commitment or the Personal Property Commitment will not be deemed to be an event of force majeure and that this Section 18 will not operate to extend the Completion Deadline in such an event. 19. INTERPRETATION. In the event of any dispute over the meaning or application of any provision of this Agreement, this Agreement will be interpreted fairly and reasonably, and neither more strongly for or against any party, regardless of the actual drafter of this Agreement. In the event of any conflict between the body of this Agreement and the Applications, the body of this Agreement will control. 20. CAPTIONS. Captions and headings used in this Agreement are for reference purposes only and will not be deemed a part of this Agreement. 21. ELECTRONIC SIGNATURES. This Agreement may be executed by electronic signature, which will be considered as an original signature for all purposes and have the same force and effect as an original signature. For these purposes, "electronic signature" means electronically scanned and transmitted versions (e.g. via pdf file or facsimile transmission) of an original signature, or signatures electronically/digitally inserted via software such as Adobe Sign. 22. COUNTERPARTS. This Agreement may be executed in multiple counterparts, each of which will be considered an original, but all of which will constitute one instrument. 23. BONDHOLDER RIGHTS. The Real Property Improvements will not be financed by tax increment bonds. This Agreement is subject to the rights of holders of outstanding bonds of the City. 24. CONFLICTS OF INTEREST. Neither the Land nor any improvements thereon are owned or leased by any member of the City Council, any member of the City Plan or Zoning Commission or any member of the governing body of any taxing unit with jurisdiction in the Zone. 25. NO LIAIBLITY TO CARTER Carter is consenting to the provisions of this Agreement as an accommodation to, and at the request of, Company. Accordingly, notwithstanding anything to the contrary contained herein, in no event will Carter be responsible for any damages, clawbacks, fees, penalities, interest, or increase in ad valorem taxes as a result of any default under this Agreement, except to the extent is directly caused by Carter. 26. ENTIRETY OF AGREEMENT. This Agreement, including any exhibits attached hereto and any documents incorporated herein by reference, contains the entire understanding and agreement between the City, Carter, and Company, and any lawful assign and successor of Carter or Company, as to the matters contained herein. Any prior or contemporaneous oral or written agreement is hereby declared null and void to the extent in conflict with any provision of this Agreement. Notwithstanding anything to the contrary herein, this Agreement will not be amended unless executed in writing by both parties and approved by the City Council of the City in an open meeting held in accordance with Chapter 551 of the Texas Government Code. EXECUTED as of the last date indicated below: [SIGNATURES AND ACKNOWLEDGEMENTS IMMEDIATELY FOLLOW ON NEXT FOUR (4) PAGES] CITY: SIEMENS INDUSTRY, INC., A Delaware corporation By: J �' *- William Johnson By: Assistant City Manager Name: _Barry owell Title: Vice President Date: Nov 3, 2023 _Senior Date: 10/31 /23 Name: NUchael rouptain Title: Sr. Director'Finance Date: CARTER PARK EAST PHASE 1, L.L.C. A Delaware limited liability company By: Carters East Investor, L.L.C., A Delaware limited liability company, its managing member By: Name: Matthew E. Colter Title: Vice President Date: �k / 3 / Zon FOR CITY OF FORT WORTH INTERNAL PROCESSES: Approval Recommended: By: Robei�Nov 3, 202314:07 CDT) Name: Robert Sturns Title: Director, Economic Development Approved as to Form and Legality: y�n, Ct/a22a.i£ By: o Name: Tyler F. Wallach Title: Assistant City Attorney Contract Authorization: M&C: 23-0708 Form 1295:2023-1069566 Contract Compliance Manager: By signing I acknowledge that I am the person responsible for the monitoring and administration of this contract, including ensuring all performance and reporting requirements. By: Cherie Gordon 0-3,202312:43 CDT) Name: Cherie Gordon Title: Business Development Coordinator City Secretary: By: Name: Jannette Goodall Title: City Secretary 4,d-p�Upn a o � Pv8 o=� � nEXA?o4 OFFICIAL RECORD CITY SECRETARY FT. WORTH, TX STATE OF TEXAS § COUNTY OF TARRANT BEFORE ME, the undersigned authority, on this day personally appeared Michael E. Crum, on behalf of William Johnson, Assistant City Manager of the CITY OF FORT WORTH, a municipal corporation organized under the laws of the State of Texas, known to me to be the person and officer whose name is subscribed to the foregoing instrument, and acknowledged to me that the same was the act of the CITY OF FORT WORTH, that he was duly authorized to perform the same by appropriate resolution of the City Council of the City of Fort Worth and that he executed the same as the act of the CITY OF FORT WORTH for the purposes and consideration therein expressed and in the capacity therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE this =day of r) D i_/e oy-NhP ✓ , 2023. 11 o ary Public in and for � the State of Texas I ` l Linda M. Hirrlinger r r 1 ((n (✓ My Commission Expires Notary's Printed Name Notarryy°ID 124144746 SIEMENS INDUSTRY, INC. a Delaware corporation: STATE OF GEORGIA § COUNTY OF _FORSYTH § BEFORE ME, the undersigned authority, on this day personally appeared Barry Powell and Michael Fountain, Senior Vice -President and Sr. Director Finance respectively of SIEMENS INDUSTRY, INC., a Delaware corporation, known to me to be the persons whose names are subscribed to the foregoing instrument, and acknowledged to me that they executed the same for the purposes and consideration therein expressed, in the capacity therein stated and as the act and deed of SIEMENS INDUSTRY, INC. GIVEN UNDER MY HAND AND SEAL OF OFFICE this _31st day of October , 2023. Notary Public in and for the State of Georgia Notary's Printed Name: Paula Quirk CARTER PARK EAST PHASE 1, LLC A Delaware limited partnership Paula Quirk NOTARY PUBLIC Forsyth County, GEORGIA My Commission Expires 04/01/2026 By: Carter Paris East Investor, L.L.C., A Delaware limited liability company, its managing member STATE OF Tex CL. COUNTY OF p L l L S § v:w BEFORE ME, the undersigned authority, on this day personally appeared (, Vu .! 'w of Carter Park East Phase 1, L.L.C., a Delaware limited liahility company, known to me to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that s/he executed the same for the purposes and consideration therein expressed, in the capacity therein stated and as the act and deed of Carter Park East Phase 1, L.L.C. GIVEN UNDER MY HAND AND SEAL OF OFFICE this r� day of Nov emb ex , 2023. Notary Public in and for ,av" ANDREA BLAIR the State of -Q-X(s * Notary Public, State of Texas Nota�� My Commis10 13208937-2 slonExp. 07 17 2027 ArA�,re� �ta.i r " Notary's Printed Name EXHIBIT A DESCRIPTION AND MAP DEPICTING THE LAND �� BEING a 43,0805 am ( 1,878,077 square feet) tract of Land situated in the Shelby County School Land survey, Tracts 3 and 4, Abstract No. 1375, City of Fort Worth, Tarrant County. Texas, being all of Lot 11, Bkxt A, Carter Park EasL an adbtion to the City of Fort Worth, Texas according to the pot reoorded in Instrument No D22108M2 of ft OfFi W Pubt+c Records of Taarant County, Texas. EX)=IIBIT B LEASE TERMS LEASE ABSTRACT Property Address: Property Owner: Tenant: Rentable Area: Lease Term (including renewal extension): Tenant's Share of CAM and taxes on the Building: Party Responsible For Cost of Real Property Taxes on the Building and any improvements in the Building Tenant's Business Personal Property Buildout / Tenant Improvements Landlord's Address Tenant's Address 7200 Harris Legacy Drive CARTER PARK EAST PHASE 1, L.L.C. Siemens Corporation 549,780 rentable square feet 12/31/2035 100% Tenant (via reimbursement to Landlord) (Section 8 and Section 3(e) of Lease) Tenant (direct to applicable municipality) (Section 8 of the Lease) Tenant enters into direct contract for design and construction of the Buildout and TI. Carter Park East Phase 1, L.L.C. c/o Clarion Partners 1717 McKinney Ave., Suite 1900 Dallas, Texas 75202-1236 Attention: Jack Stamets Siemens Real Estate (a Division of Siemens Corporation) 200 Wood Avenue South, Suite 200 Iselin, New Jersey 08830 Attention: Lease Administration EXHIBIT C TAX ABATEMENT APPLICATION FORT WORTH Economic Development Incentive Application CONFIDENTIAL: Tex. Gov't Code § 552.131(a)(1);(2). Information relates to economic development negotiations Date 5/22/2023 Project name Project Moonshot Applicant Information Consultant Information Company Siemens Industry, Inc. ("Company") Company Miller Canfield Contact Name Joe Retoff Contact Name Grant Williams Title Location Management Unit Head Title Outside Counsel Address Address 840 W Long Lake Suite 150 City, State ZIP City, State ZIP Troy, MI Phone (512) 924-4132 Phone (517) 605-2626 Email joseph.retoff@siemens.com Email williamsg@millercanfield.com Project Description The project will establish an advanced manufacturing plant for production of low voltage switchgear and switch boards. The current global demand for low voltage switchgear has skyrocketed, in part due to increased construction, expansion of manufacturing operations and growing use of sustainable energy. These factors are predicted to drive significant continued demand over the next ten years. In particular, given the quality, efficiency and reliability of Siemens products, the demand for Siemens products is far outpacing current production capabilities. The goal of Project Moonshot is to address the increasing demand by establishing an additional production facility with over 715 new full-time well paid jobs (average annualized wages of $63,000) and an initial capital investment exceeding $143,000,000. The Company anticipates the capital investment to be comprised of $80,000,000 in real property improvements and another $63,000,000 in machinery, equipment and other trade fixtures to equip the facility. A project of this size would bring significant benefit to Fort Worth, including pouring over $41,000,000 in wages each year directly into the local economy, as well as providing additional millions in state and local taxes. Please also see the attached revised Request For Proposal which was provided as an introduction to the Project. Project Impact: The Company estimates that the Project will pour over $41,000,000 per year in direct wages into the local economy. The Project, if the City of Fort Worth is selected, would be located within an Enterprise Zone. The Company anticipates many of the positions would be filled with individuals who reside within Enterprise Zones. Additionally the Company estimates that the Project would generate $4,950,000 in sales taxes just as a result of construction of the improvements. Considerable additional sales taxes would be generated over the years operation. The Company also estimates the Project would generate over $20,000,000 in real and personal property taxes in its first 10 years and $500,000 in inventory taxes annually. Financial Gap, Project Impediment, or Multi -region Competition: The Company carefully selects new manufacturing sites after considering various factors, including economic incentives. Currently, the Company is exploring two locations, the potential site in Fort Worth and another potential location where real property taxes will be exempted (creating the potential for savings of up about $1.5M annually). Such potential savings will be a significant factor in any decision by the Company. The Company considers many unique factors when choosing a new manufacturing site, including access to transportation, the availability of a skilled workforce, and the cost of doing business. They also look at economic incentives, such as incentives that abate or rebate a portion of the property, inventory and sales tax generated by the project, as such are needed to offset the steep cost of establishing a new manufacturing facility. One facet of Siemens' successful is that its site selection and investments takes into account the net cost after accounting for all unique costs and benefits of all sites under consideration. A favorable decision for the selection of the Fort Worth becomes problematic without the provision of economic development incentives given the potential subtantial saving in real property taxes available at the competing site. Business Expansion or Relocation Continue to next section if not applicable Form of Business Corporation If other, describe Publicly Traded No Ticker Symbol Siemens Industry, Inc is the applicant and was formed November 28 1972. The applicant is a part of the Siemens AG corporate family of companies ("Siemens") which has been operating for 175 years. https://www.siemens.com/global/en/c Years in Operation ompany/about/history.html Parent Company Industry Advanced Manufacturing Power NAICS Expansion or Relocation Expansion Current Location Ultimate Parent = Siemens AG 335313 Global - Link for US Locations below https://www.siemens.com/us/en/com pany/siemens-in-the-usa. html If Investment Fund (Including PE, VC, Family Office, Institutional, Infrastructure Fund, etc.): Assets Under Mgmt. Describe the Company's Principal Business: n/a Portfolio Size (Cos.) n/a Page 2 of 6 Current and Proposed Operations: This division of Siemens focuses on providing products, systems, and services for industrial automation, drives, motors, and energy management systems. Siemens has been shaping the future for 174 years beginning with the founder's work on telegraphs, electric railways, and other electrical products. With at least 13 sites in North America, 9 of which are in the United States, this division of Siemens has its influence spread across the entire country. Siemens provides customized solutions to its customers and engages in industrial manufacturing across various sectors such as automotive, chemicals, food and beverage, aerospace, and more. Siemens is also researching and working in smart infrastructure, additive manufacturing, autonomous robotics, blockchain applications, connected mobility, cybersecurity, data analytics, distributed energy systems, energy storage, as well as software systems and processes. The following website provides great detail on Siemens and its activities in the USA. https://www.siemens.com/us/en/comDanv/siemens-in-the-usa.html This voiect will be for production of low voltage switchgear and switchboards, the demand for which has skvrocketed due to increased construction, expansion of manufacturing operations and growing use of sustainable energv. Describe the Company's International Presence, if any: Siemens has a strong international presence, with operations in more than 190 countries worldwide. The company has a network of foreign offices, which include sales and service centers, manufacturing facilities, research and development centers, and regional headquarters. Some of the major foreign office locations of Siemens include China, India, Germany, the United Kingdom, the United States, and Brazil.The international locations can be found here: https://www.siemens.com/global/en/companv/iobs/our- locations.html Siemens AG and its corporate family of companies operates various industries, including energy, healthcare, and infrastructure. Part of the focus of Siemens Industry, Inc. is providing solutions for industrial automation, drives, motors, and energy management systems. Siemens sources its raw materials and supplies from a variety of global markets, including Europe, Asia, and the Americas. Describe the Companv's Corporate Citizenship Practices: Siemens Industry, Inc. is committed to corporate citizenship and social responsibility. Corporate social responsibility has been an integral part of Siemens from the very beginning. Today, serving society continues to be core to Siemens purpose. The following link provides greater detail on Siemens corporate citizenship practices: httDs://www.siemens.com/us/en/company/about/corporate- responsibilitv.html Real Estate Development Continue to next section if not applicable Not appliable Describe the Development Team: Not Applicable. A Clarion subsidiary called Carter Park East is developing the land, which is unaffiliated with Siemens. Siemens does have Siemens Real Estate which is involved and participates in real estate matters of Siemens companies. Project Partners: Page 3 of 6 [Architect, Engineer, General Contractor, Key Consultants, Lender, etc.] N/A Site Plan, Illustrations, and Other Documents Attach: 1) Site Plan, 2) Illustrations or Renderings, 3) Environmental Documents, 4) Survey, 5) Legal Description N/A Project Financial Statements: Attach documents outlining project Sources & Uses, Capital Stack, and Pro Forma, if available. N/A If Hotel Project: Total Number of Keys N/A Total SF Meeting Space N/A Proiect Site Details Project Site Address 7200 Harris Legacy Drive, Fort Worth Existing or New New Construction Current Land Valuation Construction is not yet appraised Project Type Industrial Est. Start Date 10/1/2023 Project Type Industrial Anticipated Ownership Lease Current Zoning Zoned J Variances Required [Select] Capital Improvement & Investment Details The entire development site has Project Site Acreage 12.62 acres Historic Designation(s) [Select] $80M in completion of construction Improvements Valuation and tenant improvements If Other, Describe: Est. Completion Date 11/1/2024 If Other, Describe: Term of Lease (Years) 7 years 3 months Requested Zoning Describe Variances: Total Construction Costs $80,000,000 Hard Construction Costs tbd New Personal Property $63,000,000 Historic Tax Credits No Annual R&D Expenses n/a Annual Patents n/a Value of Inventory $13,900,000* Value of Supplies n/a *High level estimate only based on other operation Est. Value of Imports To Be Determined Est. Value of Exports To Be Determined Employment and Job Creation Current Employment not applicable - new site Avg. Wage (of Current) not applicable - new site New Employees (FTEs) 715 Avg. Wage (of New) $63,000 Page 4 of 6 Description of Existing Positions and New Positions to be Added and Hiring Schedule: Please utilize the "Employment Info" tab to outline the number and average annual salaries of existing, as well as new employees, by job category (executive, professional, etc.), as well as hiring schedule for new positions (i.e. how many new employees at Project Completion, Year 1, Year 3, and so forth.) Other Incentive Requests Do you intend to pursue abatement of County taxes? Do you intend to pursue State Economic Development incentives? Yes Yes Description of Other Incentives: The incentives being pursued for the City of Fort Worth include the following: 1.Property Tax Abatement. A 70% abatement of real and personal property taxes owed to the City for ten years. 2.Workforce Solutions. Potentially making use of a customized training program to skill -up employees for the jobs being created. 33exas Enterprise Zone. Application for benefits under the Texas Enterprise Zone benefits. Confidentiality & Disclosures State Law and City of Fort Worth practices and procedures guard the confidentiality of information and materials submitted in application or negotiation for economic development incentives (Section 552.131: Confidentiality of Certain Economic Development Negotiation Information). Unless otherwise permitted by or coordinated with the applicant, all information will be kept in strict confidence except where required under applicable state or federal law. City staff will coordinate with the applicant on information disclosures as necessary to the incentive review and approval process. Disclosure of Financial Interest No: no person or firm is receiving any form of compensation, commission or other monetary benefit based on the level of incentive obtained by the applicant from the City of Fort Worth. Form 1295 Certificate of Interested Parties State law (Chapter 2264, Texas Government Code) requires that all parties entering into an incentive agreement with the City of Fort Worth must complete and submit a Form 1295 Certificate of Interested Parties. Certain exceptions apply. City of Fort Worth Economic Development staff must receive a completed copy of the Form 1295 (which may be delivered by email as a PDF) or an explanation of why Company is excepted from this requirement (to be confirmed by the City Attorney's Office before any proposal for incentives may be presented to the City Council. The Form 1295 can be completed electronically at: Siemens Industry Inc., is a wholly owned subsidiary of Siemens AG which is a publicly traded entity but a form is being developed for submission Application Fee Page 5 of 6 The company is responsible for paying $2,500 non-refunable application fee. Certification On behalf of the applicant, I certify that to the best of my knowledge, the information contained in this application, including all attachments to be true and correct. I further certify that, on behalf of the applicant, I have read the current Incentive Policy and all other pertinent City of Fort Worth policies and I understand that any incentives provided for the Project will be subject to the guidelines and criteria stated therein. Signature Date Barry Powell Vice President, Siemens Industry, Inc. Printed Name Title Signature Date Printed Name Title Michael Fountain Sr. Director Finance, Siemens Industry, Inc. Page 6 of 6 Schedule 4.6 Final Construction Report Annual Employment Report If blank, then such reasonable report provided by the Company FORT WORTH,, City of Fort Worth Project Completion Report I. PROJECT INFORMATION Property Owner: Company/Project Name: Project Contact: Title: Telephone: Fax: E-Mail: Property Owner Address (If Different): Address of Property Subject to Agreement: Construction start Date: Construction completion Date: Date of issuance of the Certificate of Occupancy or Temporary Certificate of Occupancy, if applicable: (Please attach a copy) Date Total Dollars Spent on Business Personal Property (including acquisition and installation) prior to January 1, 2025: $ II. CONSTRUCTION SPENDING Company names, addresses, and the amounts paid during the construction period should be attached to this report. Use of the Excel spreadsheet provided to you by the City of Fort Worth is recommended. Total Construction Cost Spent (A): $ BUSINESS EQUITY FIRM Unless specified otherwise in your agreement, a Business Equity Firm(s) ("BEFs") has the meaning assigned to it in the City of Fort Worth's Business Equity Ordinance, as amended (Chapter 20, Article X of the City Code).. Total Construction Cost Spent with BEFs(B): $ Percentage of Total Construction Dollars Spent with BEFs(8/A): III. ADDITIONAL INFORMATION (TO BE ATTACHED AS EXHIBITS) EXHIBIT A: List of Real Property Appraisal District Account Numbers (Applicable to Projects with Real Property Commitments) EXHIBIT B: List of Business Personal Property Appraisal District Account Numbers (Applicable to Projects with Business Personal Property Commitments) EXHIBIT C: Copy of the Certificate (or Temporary Certificate) of Occupancy issued by the City of Fort Worth's Planning and Development Department EXHIBIT E: List of all Company Names, Addresses, Invoice Numbers, and Amounts Paid During Construction. Clearly note the BE companies. (Excel Format. Use of the Excel spreadsheet provided by the City of Fort Worth Is recommended.) FORT WORTH City of Fort Worth Project Completion Report VI. CERTIFICATION In connection with the review of the Tax Abatement Agreement for the respective project, between the City of Fort Worth and Siemens Industry, Inc., ("Agreement"), we confirm, to the best of our knowledge and belief, the following representations made to the City of Fort Worth. 1.) The information provided above is accurate. 2.) We have made available all information that we believe is required under to the Project Completion Report. 3.) We will respond in accordance with the terms of the Agreement to all inquiries made by the City of Fort Worth during the audit process. 4.) We acknowledge Section 4.5, Section 4.7 and Section 5 of the Agreement continue to apply. Name of Certifying Officers: Title: Signature of Certifying Officer: Title: Signature of Certifying Officer: Tax Abatement Agreement between City of Fort Worth, Carter Park East Phase 1, LLC and Siemens Industry, Inc. Page 24 of 26 41213 869. l / l 14706.02565 DRAFT Phone: Date: Date: FORT WDRTH@ This Excel spreadsheet has two input tabs. This tab will assist you in completing the Project Completion Report, if applicable. TOTAL CONSTRUCTION COST: If your agreement calculates percentages of Total Construction Cost for BEFs, use the information below Use the information below, generated from the information you put into the 1st Tab, to fill in the appropriate fields in the Project Completion Report Total Construction Cost Spent Total Construction Cost Spent with BEFs (B) Percentage of Total Construction Costs Spent with BEFs (B/A) Tax Abatement Agreement between City of Fort Worth, Carter Park East Phase 1, LLC and Siemens Industry, Inc. Page 25 of 26 41213 869.1 / 114706.02565 DRAFT This section calculates Fill out this section automatically - do not modifv Pay Additional Total Is Contractors Company Name Street Address City State Zip Code Application Comments, if Construction BEF? (Yes/No) Number (if _ any Dollars Spent Ex: Main Street Inc. Ex: 123 Main Street Ex: Fort Ex: TX Ex: 76102 Ex: 12345 Ex: $600 1 Ex: No Ex: N/A Ex: $0 Ex: Main Street Inc. Ex: 123 Main Street Ex: Fort Ex: TX Ex: 76102 Ex: 12345 Ex: $400 Ex: Yes Ex: N/A Ex: $400 Ex. ABC Street Inc. Ex. 456 Main Street Ex: Fort Ex: TX Ex: 76102 Ex: 12346 Ex: $5,000 Ex: Yes Ex: N/A Ex: $5,000 Ex: XYZ Street Inc. Ex: 789 Main Street Ex: Fort Ex: TX Ex: 76102 Ex: 12347 Ex: $25,000 Ex: Yes Ex: N/A Ex: $25,000 Tax Abatement Agreement between City of Fort Worth, Carter Park East Phase 1, LLC and Siemens Industry, Inc. Page 26 of 26 41213 869.1 / 114706.025 65 DRAFT CITY COUNCIL AGENDA Create New From This M&C DATE: 9/12/2023 REFERENCE NO.: M&C 23-0708 LOG NAME: 17SIEMENSTA CODE: C TYPE: NON -CONSENT PUBLIC NO HEARING: SUBJECT: (CD 8) Authorize Execution of a Ten -Year Tax Abatement Agreement with Siemens Industry Inc., or Affiliate, and Carter Park East Phase 1, LLC for the Development of a Minimum 540,000 Square Foot Manufacturing Facility Having a Cost of at Least $125 Million, Located at 7200 Harris Legacy Drive in Tax Abatement Reinvestment Zone No. 106, City of Fort Worth, Texas and Adopt the Attached Resolution Nominating this Project as an Enterprise Project Persuant to Chapter 2303, Texas Government Code RECOMMENDATION: It is recommended that the City Council: 1. Authorize the execution of a ten-year tax abatement agreement with Siemens Industry Inc., or affiliate, and Carter Park East Phase I, LLC for the development of a minimum 540,000 square foot manufacturing facility having a cost of at least $125 million, located at 7200 Harris Legacy Drive in Tax Abatement Reinvestment Zone No. 106, City of Fort Worth, Texas; 2. Find that the terms of, and the property subject to, the Tax Abatement Agreement meet the criteria and guidelines set forth in the City of Fort Worth's General Tax Abatement Policy (Resolution No. 5709-02-2023); and 3. Adopt the attached Resolution nominating this project as an Enterprise Project, pursuant to the Texas Enterprise Zone Act, Chapter 2303 of the Texas Government Code. DISCUSSION: Siemens Industry Inc. (Siemens), a subsidiary of Siemens AG, is a multinational, German corporation that is the largest industrial manufacturing company in Europe, with operations in more than 190 countries worldwide. Siemens provides products, systems, and services for industrial automation, drives, motors and energy management systems. Siemens has a presence today in Grand Prairie, Texas, and is looking to expand in the region with a second facility for the production of low voltage switchgear and switch boards. After a competitive site selection process, Siemens selected a site at 7200 Harris Legacy Drive to establish an advanced manufacturing plant (Project Site). The site is owned by Carter Park East Phase 1, LLC (Carter Park East) and includes a building measuring a minimum of 540,000 square feet. Pursuant to a lease with Carter Park East, Siemens, and its affiliates, will be responsible for the design and construction of the improvements for the project. In order to facilitate the establishment of Siemens's manufacturing operation, the City proposes to enter into a tax abatement agreement with Siemens and Carter Park East. The tax abatement will be tied to the amount of investment made by Siemens and satisfaction of other project and spending requirements, as follows: Investment: 1, Siemens must expend a minimum of $70,000,000.00 in total construction costs at the Project Site on or before December 31, 2024; 2. Siemens must install $55 million in taxable business personal property (BPP) that is new to the City at the Project Site having a minimum taxable appraised value of $45,000,000.00 by January 1, 2025; and Siemens will be required to spend at least 15 percent of hard and soft construction costs with contractors that are Business Equity Firms. Failure to meet this requirement will result in a reduction of the grant by 10 percent. Siemens must provide a minimum of 167 full-time jobs on the Project Site on or before December 31, 2024, and a minimum of 715 on the Project Site by December 31, 2026 and maintain that level for the duration of the agreement, with an average salary of at least $63,000.00 Citv Commitments: 1. The City will enter into a Tax Abatement Agreement with Siemens for a term of ten years. 2. The amount of City real property and BPP taxes to be abated in a given year will be equal to up to seventy percent (70\%). TABLE - Maximum Potential Abatement with Corresponding Components: Official site of tie Otq cf Fort Te,ss FORTWORTII Property Owner or Company Commitment I Potential Abatement Base Commitment: Real and Business Personal 40\% Property BEF Commitments (15\% of Total Construction Costs) 10\% Annual Commitments: Average Annual Salary > $63,000 10\% Overall Employment — 167 for years 2024-2025 and 10\% 715 for years 2026-2033 (as applicable) TOTAL 70\% Resolution Nominating this Project as an Enterprise Project The City Council of the City of Fort Worth (City) has previously passed Ordinance No. 15733 electing to participate in the Texas Enterprise Zone Program. On May 12, 2015, the City Council adopted Ordinance No. 21743-05-2015, amending Ordinance No. 15733 by adding additional potential local incentives that could be made available to qualified businesses under the Texas Enterprise Zone Program. The Office of the Governor Economic Development and Tourism through the Economic Development Bank will consider Siemens Industry Inc. as an enterprise project pursuant to a nomination and an application made by the City. The Texas Enterprise Zone Program is an economic development tool for local communities to partner with the State of Texas to promote job creation and capital investment in economically distressed areas of the state. An enterprise project is defined as a business that is nominated by a municipality or county and then approved for state benefits. Designated projects are eligible to apply for state sales and use tax refunds on qualified expenditures. The level and amount of refund is related to the capital investment and jobs created at the qualified business site. If designated as an enterprise project by the State of Texas, Siemens commits to hiring thirty five percent (35\%) economically disadvantaged persons or enterprise zone residents for its certified jobs at its Fort Worth facility during its enterprise project designation. Siemens qualifies for a single Enterprise Project Designation. The single project designation allows for a state sales and use tax refund on qualified expenditures of $5,000.00 per job, for up to 500 jobs, with a maximum benefit of $1.25 million over a five-year period. Under the Texas Enterprise Zone Act, at least twenty-five percent of the business' new or retained employees will be residents of an enterprise zone, economically disadvantaged individuals or veterans. In addition, the jobs will be provided through the end of the designation period or at least three years after the date on which a state benefit is received, whichever is later. The project is located in COUNCIL DISTRICT 8. FISCAL INFORMATION/CERTIFICATION: The Director of Finance certifies that upon final approval of the Tax Abatement Agreement, this agreement will have no material effect on the Fiscal Year 2023 Budget and an estimated $8,117,451.00 in new incremental property tax revenue will be reduced by $5,682,215.00, resulting in the collection of $2,435,35.00 in net new incremental property tax revenue of over the next ten-year period. This impact to revenue will be incorporated into the long-term financial forecast upon the Tax Abatement being officially granted. TO Fund Department Account Project Program Activity Budget Reference # Amount I I I ID I Year (Chartfield 2) FROM Fund Department Account Project Program Activity Budget Reference # Amount I I ID Year I (Chartfield 2) Submitted for Citv Manager's Office by Originating Department Head: Additional Information Contact: ATTACHMENTS William Johnson (5806) Robert Sturns (2663) Cherie Gordon (6053) 230726 Siemens TEZ Nomination Resolution (3).docx (Public) M&C Financials3.xlsx (CFW Internal) Map of Location Siemens.odf (Public)