SSF, INC. DBA VOLVO OF ORANGE COUNTY - 2015

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A -2015 -231 SALES TAX REBATE AGREEMENT This SALES TAX REBATE AGREEMENT ( "Agreement ") is made and entered into this b 20`h day of October, 2015, by and between SSF, INC., doing business as VOLVO OF ORANGE COUNTY, a California corporation ( "Volvo'), and the CITY OF SANTA ANA, a charter city and municipal corporation organized and existing under the Constitution and laws of the State of California ( "City "). RECITALS A. Sales tax rebate assistance is an economic development tool used to encourage the development or expansion of new businesses that create additional sales tax for a City. The purpose of this Agreement is to help offset some of the building costs and to increase sales by increasing vehicle allocation from Volvo Cars North America as a result of Volvo of Orange County meeting the new facility requirements and not as dividends to stock holders. B. The City was recently approached by Volvo, one of the Santa Ana Auto Mall dealerships, to consider a sales tax rebate assistance agreement to help fund their facility upgrade. The Volvo Group Global, the corporate office of Volvo of Orange County, has requested dealerships complete a remodel, both interior and exterior, of their facilities to reposition themselves within the automotive market. Enhancements to the Auto Mall should be supported by the City to keep it competitive and state of the art. C. The remodel of the facility is estimated to cost $2.5 million dollars and will take approximately six months to complete. With the agreement to remodel, Volvo will receive an increase in the allocation of newly designed and highly desired new vehicles for their location. It was indicated that if the facility upgrade did not occur, Volvo would be at a competitive disadvantage as compared to other Volvo dealerships in the region. D. Currently, Volvo is one of the top 50 sales tax generators for the City, while other dealers in the Auto Mall are in the top 10. Since 2011, Volvo saw a nine percent decrease in sales, while other dealers saw increases in their sales. Improvements to their facility will only enhance their prosperity for the future. E. The proposed agreement for consideration is to reimburse 50 percent of the new sales tax generated above the base year (July 1, 2015 — June 30, 2016) up to $1 million dollars, or 10 years, whichever comes first. For the remodel, the Volvo Group Global has committed to pay $500,000, while Volvo of Orange County will pay $1 million dollars for their facility upgrade. NOW THEREFORE, in consideration of the mutual and respective promises, and subject to the terms and conditions hereinafter set forth, the parties agree as follows: DEFINED TERMS. The following terms when used in this Agreement shall have the meanings set forth below: "Base Year" shall mean July 1, 2015, through June 30, 2016.