1999-025-PARIS PANDA POWER, REINVESTMENT ZONE 1998-I

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I. Term 1.1. The term of this AGREEMENT shall begin on the 8th day of June, 1998, with, as hereinafter provided, tax abatement granted herein beginning with the tax year beginning January 1, 1999, and expiring on December 31, 2005. . II. Area to be Improved 2.1. The property to be the subject of this AGREEMENT shall be that property described by metes and bounds and as shown by plat, attached hereto as Exhibits A and B, respectively, which are made a part hereof and shall be hereinafter referred to as PROPERTY. III. Improvements 3.1. The OWNER shall make improvements to the PROPERTY as follows: construction of a 1,000 megawatt natural gas-fired power generation facility. This facility will include a new building or buildings with an anticipated taxable value of approximately $1,500,000.00; the acquisition and installation of machinery and equipment with an anticipated taxable value of approximately $110,000,000.00; and the acquisition and installation of furniture and fIxtures with an anticipated taxable value of approximately $500,000.00; for a total capital investment of approximately $112,000,000.00; all of which improvements will be particularly described in CITY's Certificate of Completion prepared after the completion and installation of the improvements and machinery herein described which shall be furnished to and filed with the Chief Appraiser of Lamar County and the Tax Assessor and Collector of the City of Paris. Said Certificate shall be duly executed by the Mayor of the City of Paris and attached hereto as Exhibit C. The improvements described in this paragraph shall be hereinafter referred to as IMPROVEMENTS. The IMPROVEMENTS will be at a cost of approximately $112,000,000.00, and shall be substantially completed on or about June 30, 2001, or such later date as may be mutually agreed upon by CITY and OWNER; provided, that OWNER shall have such additional time to complete the IMPROVEMENTS as may be required in the event of "force majeure" if OWNER is diligently and faithfully pursuing completion of the IMPROVEMENTS. For this purpose, "force majeure" shall mean any contingency or cause beyond the reasonable control of OWNER including, without limitation, acts of God, or the public enemy, any natural disaster, war, riot, civil commotion, insurrection, governmental or de facto governmental action, fires, explosions, accidents, floods, and labor disputes or strikes, unless caused by acts or omissions of OWNER. The date of completion of the IMPROVEMENTS shall be defined as the date a Certificate of Occupancy is issued by the City of Paris, said Certificate shall be attached hereto as Exhibit D upon issuance of the same. TAX ABATEMENT AGREEMENT - Page 2