Welcome to our 2009-2010 annual report. The year brought us abundant opportunity, in contrast to a worldwide economic crisis. Expansions in Fort Custer Industrial Park created 65 new jobs, while the TODA America, Inc. investment should create 57 more. A variety of sustainable energy projects remain in the pipeline along with other industrial prospects. Battle Creek’s competitive manufacturing stance sustains a compelling edge in job creation. Concluding the first year of an international aerospace marketing strategy, we receive intelligence about the sector on a global basis. Under continuous refinement, the strategy positions Battle Creek squarely within one of the healthier segments for investment. New marketing materials promote Battle Creek’s aviation and aerospace sector, as well as its renown as a center for food protection. Receiving $1million in federal grant money, the International Food Protection Training Institute this year trained hundreds of state and local food protection professionals. The Institute received recognition for its efforts during the oil spill disaster in the Gulf of Mexico. Closer to home, an energetic downtown transformation promises innovative improvements to the streetscape along with the added vitality of 600 Kellogg personnel consolidated downtown and more than 40 new jobs from Covance. We continue to pursue funding for the proposed relocation of the award-winning Battle Creek Area Math and Science Center. 2009-2010 has been a rewarding year to serve in the leadership of Battle Creek Unlimited. Our committed board of directors took on a rewrite of our bylaws, and provided critical input to the development of a contemporary, dynamic new logo. Staff contributed an unremitting depth and breadth of knowledge to their work. Thanks to all, we enter 2010-2011 with optimism, and satisfaction in

work well done.

Karl Dehn, President & CEO Battle Creek Unlimited, Inc.

Aviation and Aerospace An International marketing strategy under contract with OCO Global focuses on the aviation and aerospace sector in Battle Creek. Receiving intelligence on the industry worldwide, and two leads monthly for potential investment, staff utilized a compelling business proposition and developed a database of vendors, service providers, and customers within an efficient radius of Battle Creek. A schedule of international and domestic exhibitions and conferences continues, with refinement along the way. Meetings were arranged for staff at each trade show attended. A pipeline of leads for future projects has been established. Battle Creek Air National Guard Base

Air Operations Group provides mission support for 17th Air Force based in Stuttgart,

serving the AFRICOM mission. Received $14 million MILCON.

Cyber Defense Unit supports FEMA Region 5.

C-21 personnel transport mission operational with four jets in service.

C-27 cargo aircraft mission arrival planned with $13 million MILCON for new fuel cell hangar and bed down facilities.

Employment:

Traditional guard members - 654

Full-time air technicians - 135

Active, full-time military personnel - 86

Civilian state employees - 41

Contractors permanently assigned - 24

Civilian federal employees - 2 W. K. Kellogg Airport activities this year include the construction work on the new parallel runway. The new city-owned hangar project was moved forward when the BCTIFA board of directors passed resolutions authorizing the chairman to execute the final drafts of the development agreement and the construction contracts. The board also authorized the sale of bonds to fund the project. The Western Michigan University College of Aviation celebrated its 10

th anniversary at the W. K. Kellogg Airport this year.

Lastly, SEMCO acquired the former FedEx building located on Helmer, adjacent to the airport. Renovations are underway for the facility to become SEMCO’s Southwest Michigan operations center. The new center will house 50 employees including the Meter Shop, responsible for meter maintenance, testing and distribution of meters throughout the state of Michigan.

Fort Custer Industrial Park

Project Activity Job growth continues in Fort Custer Industrial Park, world-renowned for its global automotive supplier residents. Diversification now includes not only the proposed United Solar Ovonics manufacturing of thin film photovoltaic laminates, but also TODA America Incorporated manufacturing of lithium ion battery materials necessary for the electrification of automobiles. TODA anticipates completion of phase one construction in early 2011, with phase two expected to be operational in 2012. Total employment for both phases is expected to reach 57. The planned investment in Battle Creek will approach $77 million. United Solar Ovonics has reported approximately $103 million of investment of their planned $220 million investment. Machinery and equipment are warehoused at the Battle Creek site. Plant start-up, however, remains undetermined. Musashi Auto Parts – Michigan, Inc. has completed a $2 million expansion with seven new jobs. Roesler Metal Finishing USA LLC recently announced the addition of 58 new jobs, with an expansion of their Denso Road facility, nearly doubling the square footage of Roesler manufacturing space in Battle Creek. Hi-Lex received approval from the Battle Creek Unlimited Site Development Review Board for an expansion on the north side of their plant. Prospect Activity Several new prospects have been identified and provided with materials to show them why Battle Creek, Michigan is the right choice for the location of new operations. These industries range from sustainable energy machine component manufacturers to industries for the nano-technology and emulsion fuel fields, to recycling of food products and oil, and automobile assembly. In addition to the above identified projects, the BCU marketing staff continue to work on projects that will expand existing operations of residents in the Fort Custer Industrial Park including the proposed growth of Clyde Union Pump which is scheduled to begin in early 2011.

Doug Voshell, Marketing Director Battle Creek Unlimited, Inc.

The employment potential of the prospects/projects in process range from two jobs to over 450 jobs. Compensation ranges from entry-level manufacturing employment opportunities to managerial and professional work. Investments for potential projects range from $500,000 to hundreds of millions of dollars. This is truly an exciting time as Battle Creek continues building a stronger and diversified industrial base. Community Partnership The Regional Manufacturing Technology Center began building a renewable energy program using federal appropriations and local contributions received by Kellogg Community College. The Industrial Trades Renewable Energy Program focuses on training industrial electricians to install, monitor and maintain small scale solar and wind energy systems. Photovoltaic panels and a wind turbine have been installed on the RMTC campus and will be used by students entering the new program. Local residents who wished to preserve charming old stone structures on Fort Custer land planned for future development were pleased with efforts by Battle Creek Unlimited and the Veterans Affairs Medical Center. A stone fountain dating to the Civilian Conservation Corps presence in Battle Creek was relocated by Veterans Affairs Medical Center engineers, and is intended to grace a common garden area on the VA Medical Center property for the enjoyment of hospital residents and their families.

RMTC alternative energy training equipment Workers removing historic fountain

Downtown Transformation Initiative

A year and a half into a downtown transformation, tactical planning remains underway. Changes are backed by growing technology and industry, especially food innovation and protection, Battle Creek’s unique heritage. More than $85 million in public and private investments will fund the project over the next few years. The transformation continues to evolve through the blending of four structural pillars as investment in downtown thrives. This investment focuses on education, food protection, private investment, and street enhancements. Business Review West Michigan selected Battle Creek’s downtown transformation project as a leader among high profile economic development and community improvements. This year’s accomplishments include: Education

The Battle Creek Area Math and Science Center was recognized for its educational kit program, which develops and distributes boxed lessons to schools in Michigan.

The Battle Creek Public School Board approved the next steps to relocate the Battle Creek Area Math and Science Center. The former cereal museum facility was recommended as the ideal location.

Battle Creek Area Math and Science Center students won first place in the 2010 Spirit of Innovation Awards Challenge presented by the Conrad Foundation at the NASA Ames Research Center. Winning students invented a healthy snack bar for astronauts that would replenish bone and muscle in weightless space.

Food Protection

The International Food Protection Training Institute (IFPTI) conducted inaugural training sessions for food safety regulators from around the United States.

The IFPTI received a $1 million federal grant to train state and local food safety inspectors.

The IFPTI announced appointments for its board of directors, including nationally recognized food protection leaders. Gerald Wojtala was named executive director. He joined IFPTI after 26 years with the State of Michigan, including deputy director of the Food Dairy Division with the Michigan Department of Agriculture.

The IFPTI received national attention due to its training efforts related to the BP oil spill in the Gulf.

The IFPTI delivered training to over 500 state and local food protection professionals from 37 states.

Private Investment 157,000 square foot expansion of the W. K. Kellogg

Institute for Nutritional Research, with capacity for nearly 275 additional people.

Kellogg Company announced its long-term lease for 67 West Michigan Avenue and the consolidation of 600 associates to downtown.

Relocation of building tenants from 67 West Michigan Avenue to other downtown locations, allowing for the Kellogg Company consolidation.

The Hinman Company renovated the BC Tower to accommodate displaced office tenants.

Covance announced its plans to create a nutritional chemistry and food safety laboratory downtown. Covance plans to invest $14 million as part of an effort to expand the contract research organization’s food safety testing capabilities.

Streetscape Enhancements Michigan Department of Transportation awarded

Anlaan Corporation the gateway enhancement contract. The funds, which are part of the Federal Transportation Enhancement funds to assist key redevelopment projects, will be utilized to beautify the city’s gateway along M-66. The improvements will include lighting and youth art, providing a sense of arrival into the downtown. Work will begin in late 2010.

Battle Creek Unlimited hosted several public forums to engage input for the streetscape enhancement plan. The final design portrays the city’s rich water resources and unique history. The streetscape concept reflects a productive collaboration among citizens, downtown employers, merchants, economic developers, governmental representatives and non-profit organizations.

Battle Creek Unlimited acquired several blighted properties in the downtown.

Cheryl Beard, Technology Marketing Director, Battle Creek Unlimited, Inc.

Proposed downtown streetscape

Downtown Partnership Other Downtown Initiatives

Residential living in downtown Battle Creek is on the rise. In conjunction with the Downtown Transformation, increasing residential living opportunities continues to be a primary focus. A study commissioned by the Danter Company in 2009 evaluated the feasibility of reinvigorating the residential living project at the former site of the Riverfront Condominium Development, exploring whether rentals vs. owner-occupied units would best fit the market. The study revealed that the properties could support 50 to 100 well-designed rental units offering a range of rent levels. Several developers are presently evaluating the properties.

In collaboration with the American Heart Association’s START! Walking Program a 1.08 mile loop downtown was determined and marked with lime green and white signs. This walk takes an average of 30 minutes, and promotes healthy benefits of walking to downtown employers, employees, and visitors.

The Downtown Partnership partners with the Battle Creek Farmers Market to support its efforts, which include maintaining the current location at Festival Market Square. Accomplishments included:

Partnering with downtown business to provide programming including a farm to fork cooking demonstration

Marketing assistance to Farmers Market Association

Assistance with marketing and serving as a liaison with downtown businesses and city staff

Coordination of the Festival Market Music Series

The Downtown Partnership sponsors events throughout the summer, fall, and spring, encouraging the community to visit downtown, view the changes, and experience the offerings.

The Downtown Partnership utilizes various forms of communication media including Facebook and Twitter, reporting a daily dose of downtown activity in 140 characters or less.

Direct Investment Fund Because of the economic downturn, the Direct Investment Fund has seen limited requests for loans and equity investments. This time has been constructively used to focus on the current portfolio. Direct Investment Fund clients have had special needs during this slow economic time. In an effort to help them maintain their businesses, additional funding or a temporary change in the terms of their loans were extended. Several companies paid their financial obligations in full. A great deal of time was spent on such administrative duties as process improvements and systems updates. The Direct Investment Fund was able to provide The Alley Cat Angels, a community based non-profit, with the use of a Battle Creek Unlimited building to further their efforts to control the feral cat population. Loan requests received were related to the Downtown Transformation Project.

BCU online Battle Creek Unlimited maintains three websites. Each site offers information for distinct visitor categories:

www.BCUnlimited.org www.WelcomeToBattleCreek.com

www.bcuKnowledgeNow.com

Business Improvement Districts The Dickman Road and Columbia Avenue Business Improvement Districts experienced several successes. Battle Creek Honda renovations continued, a vacant building began its transformation into Baxter Funeral & Cremation Service and a former brownfield site was occupied by Kalsee Credit Union. The Columbia Avenue Business Improvement District awarded grant dollars to property owners for exterior improvements, held an event to gather donations for deployed military personnel, and continued beautification efforts.

BC CAL KAL Inland Port Development Corporation BC CAL KAL supports economic development by providing international trade services through use of the Port of Battle Creek, Foreign-Trade Zone 43, and the Customs Cargo Center. A non-profit corporation in partnership with Battle Creek Unlimited, BC CAL KAL is governed by a 20-member board of directors representing manufacturing, education, service firms, and government from its service area across West Michigan. In its most recent annual report, BC CAL KAL reported statistics for FTZ 43:

$44,404,071 total exports

Four businesses served in the Customs Cargo Center, one on a continuing basis, employing 10 full time personnel

The Battle Creek FTZ handled four primary items:

Beer from Canada

Machinery from China

Micro G-bikes from China

Auto parts from Germany

The FTZ supported four Subzones:

Mead Johnson Nutritionals in Zeeland

Ross Products Division of Abbott Labs in Sturgis

Perrigo in Allegan

Pfizer in Kalamazoo BC CAL KAL increased and enhanced marketing and promotional efforts this year through publication of a quarterly newsletter, a Chinese language newsletter distributed in China, and presentations to national audiences.

With its mission including the efficient movement of people and freight, BC CAL KAL and West Michigan partners founded the West Michigan Rail Coalition, a multi-member organization committed to monitoring and intervening in rail issues affecting the region. The coalition advocated for negotiation between the Michigan Department of Transportation, Amtrak, and Norfolk Southern to maintain 115 miles of track between Ypsilanti and Kalamazoo to passenger standards, allowing the portion of Michigan rail system to become part of a high speed rail corridor.

Jan Frantz, Executive Director BC CAL KAL Inland Port Development Corporation

Initiatives for 2011 Continue implementation of downtown transformation plan

Establish the Global Food Protection Institute as a national leader in food protection

Begin implementation of the streetscape enhancement plan

Elevate science, technology, engineering, and mathematics education to area schools

Continue strong retention program

Continue to enhance city-wide tax base

Implement Business Improvement District plans

Strengthen the Direct Investment Fund portfolio

Rigorous investment attraction program focused on the aviation and aerospace sector

Governance & Community Involvement Our governing body represents a cross section of the community including educators, entrepreneurs, manufacturers, health care and other professional service providers, elected and appointed public officials, labor representatives, and leaders in philanthropy. Staff volunteer time and expertise to a variety of associations and organizations including education, health care, philanthropy, business membership, and economic development.

New Identity A collaborative effort successfully updated the branding image for BCU, taking into account economic development functions well beyond its original industrial manufacturing focus. The contemporary color range of yellow and orange represents innovation and creativity, an optimistic visage of the sun, as well as an industrial gear box. The words “Battle Creek Unlimited” have been incorporated directly into the brand, leaving no doubts about what the logo represents. Finally, the sleek, modern font conveys a strong, place-based image.

4950 West Dickman Road, Suite A-1 Battle Creek, Michigan 49037

77 East Michigan Avenue, Suite 160 Battle Creek, Michigan 49017

269.962.7526 www.BCUnlimited.org