What this document is
A single-page action instrument: what Hill County commits, what it receives, and the one authorisation to give before the schedule moves.
- One operator dominates disposal on the I-35 corridor, and its rate escalates on its own annual cycle.
- One CSA: a $100/ton Beneficiation Fee, and a Circular Royalty™ of $4.38M in Year 2 at Phase Initial rising to ~$218M gross over the 30-year term.
- One action: execute an LOI/MOU and authorise Term Sheet phase verification, which holds a Q2 2028 Phase Initial COD.
Why this matters — what Carbotura is offering Hillsboro and Hill County
Phase Initial reaches commercial operation 24 months after T0. A T0 of Q2 2026 places COD at Q2 2028; deciding in Q4 2027 instead places it at Q4 2029. The binding constraint is not a permit deadline but the disposal contract escalation cycle: each cycle that closes first raises the County’s existing cost with no royalty yet flowing.
Carbotura converts the residual Hill County currently land-fills into manufactured Circular Materials — synthetic graphite, graphene compounds, recovered minerals, plus net-positive ultrapure water — by primary elemental dissociation in an oxygen-free process. Not landfill, not incineration, not waste-to-energy: manufacturing, on the I-35 corridor.
Blended disposal cost across the corridor is estimated at $100/ton — $82/ton at Hill County gate rates, $108/ton in the Fort Worth metro and $95/ton around Waco. The Beneficiation Fee is $100/ton, escalating 2.5%/yr; at Phase Initial (100 TPD, 36,500 TPY) that is $3.65M in Year 1. Carbotura funds 100% of the facility — the County commits feedstock, not capital.
Beginning 13 months after the first Beneficiation Fee payment, the County receives a rolling monthly Circular Royalty™ — $4.38M in Year 2 at Phase Initial, 120% of that year’s fee, adding a percentage point every year. Over the 30-year term that is approximately $218M gross at Phase Initial. The fee and the royalty are two transactions and are shown separately throughout.
Why this fits
Hill County routes its residual to a single dominant operator whose rate escalates on its own annual cycle. There is no second gate to bid against, so each cycle raises cost without a competitive check.
Hill County verifies at $82/ton, Fort Worth metro at $108/ton and Waco metro at $95/ton — a blended $100/ton ESTIMATED, against which the $100/ton Beneficiation Fee is set. Audit of the blended rate is the first Term Sheet phase verification deliverable.
From 13 months after the first fee payment the County receives $4.38M in Year 2 at Phase Initial, growing every year of the 30-year term to approximately $218M gross. It is not a discount on the fee and is never netted against it.
Carbotura finances, builds, owns and operates the facility. The County commits feedstock under the CSA and carries no construction or operating risk at 100 TPD or at 2,000 TPD.
Phase Initial COD is 24 months from T0. Authorising in Q2 2026 holds Q2 2028; every two quarters of delay moves COD by the same two quarters.
The structure, stated once
The Beneficiation Fee and the Circular Royalty™ are independent gross transactions with different payers. They are reported separately and never netted against one another.
The same physical mass is counted once in each of three dimensions — asset, revenue, attributes — and never summed as three independent masses.
Build-Own-Operate. Carbotura funds 100% of capital at every phase. The counterparty commits feedstock, not money.
One Circular Supply Agreement
+ Circular Royalty™
- Beneficiation Fee: $100–150/tonne · set at Term Sheet against the verified FWDC · 2.5%/yr escalator
- Circular Royalty™: 120% of the current-year Beneficiation Fee in Year 1 ($120–180/tonne), +1pp/yr, uncapped
- Royalty commencement: 13 months after the first Beneficiation Fee payment, rolling monthly on delivered tonnage
- Perpetual CSA, 30-year minimum term · Build-Own-Operate · zero counterparty capital
- Feedstock transfers under the CSA — ownership and liability pass at collection or delivery
- Accounting basis: US GAAP · GASB reporting basis (Texas county)
Key figures at a glance
Hill $82 · Fort Worth $108 · Waco $95
120% of current-year fee
280 at Phase Expanded
Circular Royalty™ projections by phase
Beneficiation Fee and Circular Royalty™ shown independently per the Separate Transaction Principle. No figure on this page nets one against the other.
| Capacity | Annual TPY | Beneficiation Fee · Year 1 | Circular Royalty™ · Year 1 basis | 30-Year Gross Royalty | Direct FTE |
|---|---|---|---|---|---|
| 100 TPD ← Phase Initial | 36,500 | $3.65M | $4.38M | ~$218M ESTIMATED | — |
| 400 TPD · Phase Medium | 146,000 | $14.60M | $17.52M | ~$874M ESTIMATED | — |
| 2,000 TPD · Phase Expanded | 730,000 | $73.00M | $87.60M | ~$4.37B ESTIMATED | — |
FWDC $100/ton blended ESTIMATED. Beneficiation Fee $100/ton. Circular Royalty™ (Year n) = (120% + (n−1)pp) × that year’s Beneficiation Fee; payments commence 13 months after the first fee payment and roll monthly. 30-Year Gross Royalty is gross royalty over 30 payments, ESTIMATED. The Beneficiation Fee and the Circular Royalty™ are independent gross transactions and are not netted or combined anywhere in this package.