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HomeMy WebLinkAbout2000-053 - Loan Agreement By and Among the Industrial Development Authority of the City of Santa Ana283 RESOLUTION NO. 2000-053 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA APPROVING THE EXECUTION AND DELIVERY OF A LOAN AGREEMENT BY AND AMONG THE INDUSTRIAL DEVELOPMENT AUTHORITY OF THE CITY OF SANTA ANA, D.F. STAUFFER BISCUIT COMPANY, INC. AND/OR LAGUNA COOKIE COMPANY, INC. AND GE CAPITAL PUBLIC FINANCE, INC. PROVIDING FOR THE LOAN OF AN AMOUNT NOT TO EXCEED $12,000,000.00 TO D.F. STAUFFER BISCUIT COMPANY, INC. AND/OR LAGUNA COOKIE COMPANY, INC. PURSUANT TO SUCH LOAN AGREEMENT AND ALLOCATING AN AMOUNT NOT TOEXCEED $12,000,000.00 OF THE SANTA ANA EMPOVVERMENT ZONE CEILING FOR PRIVATE ACTIVITY BONDS FOR THE BENEFIT OF PROJECT TO BE FINANCED PURSUANT TO SUCH LOAN AGREEMENT NOW BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANTA ANA: Section 1: The City Council hereby finds, determines and declares as follows: A. Pursuant to the Taxpayer's Relief Act of 1997 (the "Taxpayer's Relief Act"), the federal government has designated a portion of the City of Santa Ana ("City") as an empowerment zone (the "Santa Ana Empowerment Zone"). B Pursuant to the Taxpayer's Relief ACt, among the tax incentives conferred upon the City is the ability to issue up to $130 million in tax-exempt enterprise zone facility bonds (the "Empowerment Zone Ceiling") to make loans to qualifying business borrowers to finance the cost of certain commercial, retail, industrial or other facilities qualifying as "enterprise zone facilities" as that term is defined in Section 1394 of the Internal Revenue Code of 1988, as amended (the "Code"). C. As of the date of this Resolution, the City has utilized only Five Million Dollars ($5,000,000.00) of the City's Empowerment Zone Ceiling. D. The City and the Industrial Development Authority of the City of Santa Ana (the "Authority") have received an application (the "Application") from B.F. Stauffer Cookie Company, Inc. and Laguna Cookie Company, Inc., which are related companies, requesting the Authority and the City to assist in the financing of the (1) construction of certain improvements to the real property located at 4661 Garry Avenue, Santa Ana, California (the "Project Site"), (2) acquisition and installation of equipment at the Project Site, and (3) payment of capitalized interest and certain costs of issuance in connection with the financing (hereafter collectively referred to as the "Project"). Resolution No. 2000-053 Page 1 of 4 284 F. The Project will be used by the BF. Stauffer Cookie Company, Inc. or Laguna Cookie Company, Inc. (the "Borrower") to produce and distribute various baked cookie and cracker products or for other uses permitted by the Taxpayer's Relief Act. E. The Borrower has represented in the Application certain facts and information concerning the Project and the Borrower, including but not limited to the requirement that, after a two year start up period, 35% of the Borrower's employees shall be residents of the Santa Ana Empowerment Zone. G The City Council in evaluating the Project has relied upon the written facts and information represented in the Application by the Borrower as well as any comments made before the City Council in conjunction with the hearing on this matter. H. The Board of Directors of the Santa Ana Empowerment Corporation at its regular meeting of June 28, 2000, did unanimously recommend to the City Council that it approve this Application. I. It appears appropriate for the City Council to utilize a portion of the City's Empowerment Zone Ceiling in order to benefrt the Project as described in the Application. J. The Authority proposes to enter into a loan agreement (the "Loan Agreement") with GE Capital Public Finance, Inc. (the "Lender") and the Borrower pursuant to which the Lender will make a loan to the Authority in an amount not to exceed Twelve Million Dollars ($12,000,000.00) which will in turn be loaned by the Authority to the Borrower (the "Loan"), all in accordance with the provisions of the California Industrial Development Financing ACt, being Title 10 of the California Government Code, as supplemented and amended (the "Act"). K. The Authority has made the determinations required to be made pursuant to section 91530 of the Act preliminary to the loan from the Lender to the Authority and the Loan to the Borrower. L. The loan from the Lender to the Authority and the Loan to the Borrower must be approved by this City Council in order to satisfy the public approval requirement of Section 147(f) of the Code and Section 91530(f) of the Act. M. The Clerk of the Council has caused timely notice to appear in the Orange County Register, which is a newspaper of general cimulation in the City, to the effect that a public hearing would be held by the City Council on July 17, 2000, regarding the loan from the Lender to the Authority and the Loan to the Borrower and the nature and location of the Project. N. This City Council has held said public hearing on July 17, 2000, providing a reasonable opportunity for persons to comment on the loan from the Lender to the Authority and the Loan to the Borrower and the nature and location of the Project. Resolution No. 2000-053 Page 2 of 4 285 O. It is intended that this Resolution shall constitute the approval of the Project and the loan from the Lender to the Authority and the Loan to the Borrower required by Section 147(f) of the Code and Section 91530(f) of the Act. Section 2. This City Council hereby expresses its full support for the Project to be undertaken by the Borrower. The City Council finds and determines that the Project is vital to the City's business community and will provide significant public benefits to residents of the Santa Ana Empowerment Zone. Section 3. The Authority is hereby designated as an issuer in an amount of the City's Empowerment Zone Ceiling equal to Twelve Million Dollars ($12,000,000.00) for the benefit of Borrower (the "Allocation"). Such allocation may only be used by the Authority for the Project, as specifically described above and represented in the Application. Any modification of the Project may require reconsideration by the City Council before the Allocation may be used for the Project. The Authority is not authorized to transfer the Allocation set forth herein to any other governmental unit in the State except the City. Section 4. Unless the City has extended the date by which the Allocation must be used by the Authority, the Allocation designated to the Authority herein shall automatically revert to the City unless the Authority has used the Allocation for the Project by the close of business on September 30, 2000. Section 5. The City Council hereby approves the Project, subject to fulfillment of ail requirements under the Act, and approves the loan from the Lender to the Authority and the Loan to the Borrower, which loans shall be tax-exempt and in an amount not to exceed $12,000,000 to finance costs of the Project. The loan from the Lender to the Authority and the interest thereon shall be paid from revenues received by the Authority from the Borrower pursuant to the Loan Agreement. This resolution shall constitute both "host" and "issuer" approval of the loan from the Lender to the Authority and the Loan to the Borrower within the meaning of Section 147(f) of the Code and shall constitute the approval of the Project and the loan from the Lender to the Authority and the Loan to the Borrower within the meaning of Section 91530(f) of the Act. Section 6. All actions heretofore taken by the officers, employees and agents of the City with respect to the approval of the loan from the Lender to the Authority and the Loan to the Borrower are hereby approved, confirmed and ratified, and the officers and employees of the City and their authorized deputies and agents are hereby authorized and directed, jointly and severally, to do any and all things and to execute and deliver any and all certificates and documents which they or special counsel may deem necessary or advisable in order to consummate the transactions referred to herein and otherwise to effectuate the purposes of this Resolution. Resolution No. 2000-053 Page 3 of 4 286 Section 7. This Resolution shall take effect from and after its adoption. ADOPTED this 17th dayof July ,2000. ATTEST: Patricia E. Healy /,) Clerk of the City Council Miga/~A. Puli~lo May'or COUNCILMEMBERS: Pulido Absent Lutz Aye Bist Aye Christy Aye Franklin Aye McGuigan Moreno Not Voting APPROVED AS TO FORM: Joseph W. Fletcher City Attorney :~isKt~a~ttorney CERTIFICATE OF ORIGINALITY I, PATRICIA E. HEALY, Clerk of the Council, do hereby certify the attached Resolution No. 2000-053 to be the original resolution adopted by the City Council of the City of Santa Ana on July 17, 2000. Clerk of the Council City of Santa Ana Resolution No. 2000-053 Page 4 of 4