Claremont Redevelopment Agency

Agenda Report

TO JEFFREY C PARKER EXECUTIVE DIRECTOR

FROM ANTHONY WITT COMMUNITY DEVELOPMENT DIRECTOR

DATE MAY 9 2006

SUBJECT RESTRUCTURING OF CANDLELIGHT PAVILION DINNER THEATER

REHABILITATION LOAN REPAYMENT

SUMMARY

Ben Bollinger Productions Inc is requesting a change to the terms of a 160 000 business
retention loan approved by the Claremont Redevelopment Agency on November 14 2000
The loan calls for repayment of 80 000 of the loan
principal five years into the ten year
loan term which is March 2006 and of the
repayment remaining 80 000 of the original
principal at the end of the ten year term which is March 2011

The Bollinger family is requesting a restructuring of the 80 000 due this year by making a
25 000 loan payment now and amortizing the remaining 55 000 over the next five years
at an interest rate of 6 The Bollingers have offered to pledge theater
production sets that
they own as security for the 55 000 portion of the loan
being restructured The City
Manager has detailed documentation describing the contents of these sets in his office

Staff Recommendation

Staff recommends that the Agency Board

approve the amended terms for the Agency loan
to Ben Bollinger Productions Inc and authorize the executive director to execute an
amendment to the note
promissory

ANALYSIS

This business retention loan was made at a time when the

owner of the surrounding
Claremont Inn complex also owner of the theater
building and property was in bankruptcy
Uncertainty about the future of the site caused the property owner to defer maintenance
and resist requests by the dinner theater
operators to make repairs in exchange for a long
term lease The had deteriorated
property to a point where serious consideration was
being
given to relocating the theater outside of the City The theater operators
used the loan
proceeds to make the intended
repairs to their business and remain in the City While there
was noproperty or assets pledged as security to the original loan the Bollingers have
offered to pledge over 20 theater production sets as security for the 55 000 being
refinanced These are full production sets that are rented to
theaters all over the county
The Bollingers estimate the value of these sets to be in the
hundreds of thousands of
dollars

The property has since been purchased and the hotel is

currently undergoing an extensive
renovation Group sales related t bus tours that
stay at the inn have been particularly hard
FOR CITY COUNCIL AGENDA
ITEM 0
Claremont Redevelopment Agency
May 9 2006
Page 2 of 2

hit Construction related

disruptions are expected to continue as the entire inn old school
house complex is renovated
Restructuring the loan payments will help the dinner theater
weather this temporary drop in revenue

FINANCIAL REVIEW

The has
Agency adequate funds to amortize repayment of the 55 000 that would have
otherwise been received as a lump payment Ben Bollinger Productions Inc has made all
interest payments in accordance with the payment schedule

LEGAL REVIEW

The revised loan agreement was reviewed and approved by the Agency counsel

PUBLIC NOTICE PROCESS

This item has been noticed

through the regular agenda notification process Copies of this
report are available at the City Hall public counter Youth Activity Center Alexander Hughes
Community Center Claremont Public Library and the City website

ALTERNATIVES TO THE STAFF RECOMMENDATION

In addition to the staff recommendation there are the following alternatives

1 Do not approve the loan

restructuring
2 Continue the item and request additional information

Submitted by

fuCru
W
Anthony
W
Witt
a
Brian Desatnik

Community Development Director Housing and Redevelopment Manager

Reviewed by

rYt
Matthew Hawkesworth
Finance Manager

c Michael Mick Bollinger Vice President General Manager Candlelight Pavilion Dinner Theater