CORPORATE FRANCHISE TAX

Corporate Franchise Tax is levied at the rate of $1.50 per $1,000 on the first $300,000 of capital stock, surplus, undivided profits and borrowed capital employed in Louisiana. The rate is $3.00 per $1,000 after the first $300,000 with a minimum tax of $10 per year. See Incentives section below for a description of the various ways that qualifying Louisiana companies can offset Corporate Franchise Taxes.

In addition to the above, Louisiana is phasing out the Corporate Franchise Tax on long-term debt by excluding "borrowed capital" from the definition of "taxable capital". As of December 31, 2009, 70% of borrowed capital will be excluded and 100% will be excluded as of December 31, 2010.