HomeMy WebLinkAboutLease Agreement for Property Located at 727-729 Howard Street07/31/2012 18:48 8475637265 CREATIVE COWORKING PAGE 02/05
Law Department
2100 Ridge Avenue
Evanston, IL 60201
T: 847.855.2937
F: 847A48.8093
July 25, 2012
City Lit Theatre AW
Attn: Michael btena�l�r��%
1020 West Bryn Mawr
Chicago, IL 60660
RE: Amended Letter of Understanding — 727-729 Howard Street, Evanston, Illinois
Dear Mr. Menaifr e
MpNA?,
We are pleased to submit this amended Letter of Understanding (the "Letter"), which
sets forth certain nonbinding understandings and certain binding agreements
between The City of Evanston, an Illinois municipal corporation ("Evanston") and
the City Lit Theatre Company, an Illinois not -for -profit corporation ("City Lit").
Evanston and City Lit shall be collectively referred to as the "Parties"_
The Parties seek to enter into this Letter with respect to a commercial lease and
grant agreement (the "Project") for the commercial property commonly known as
727-729 Howard, Evanston, Illinois (the "Property"). The Parties executed a Letter
of Understanding on or about January 27, 2012 regarding the Project, which has
expired and the Parties wish to renew the understanding,
PART ONE —BINDING PROVISIONS
Upon execution by City Lit of this Letter or counterparts thereof, the following
numbered paragraphs of this Latter (collectively, the "Binding Provisions") will
constitute the legally binding and enforceable agreement by and between City Lit
and Evanston, but still subject to final approval by the City Council,
1. Execution of Definitive Aoreernent. City Lit and Evanston will negotiate in
good faith to enter into a definitive agreement (the "Definitive Agreement") setting
forth in more detail the terms and conditions governing the details of the Project,
consistent with the nonbinding and binding provisions of this Letter. If Evanston and
City Lit are unable to negotiate and prepare a mutually acceptable Definitive
Agreement by November 1, 2012, either Evanston or City Lit may terminate this
Letter by giving written notice to the other party (the "Letter Term"). In the event of
such notice, none of Evanston, City Lit or their respective directors, officers,
attorneys, employees, shareholders, representatives or advisors will have any
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July 25, 2012
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further obligations or liability under this Letter. Evanston staff and the City Council
will be further evaluating the Project and its feasibility following the execution of this
Letter.
2, Representations, Warranties. Conditions and Covenants. The Definitive
Agreement will contain such representations, warranties, conditions and other terms
and conditions as are customary or appropriate for a transaction of this kind.
3. No Material Chancre. Evanston's obligation to engage in a relocation
assistance program for City Lit from its current facility to the Property will be
conditioned upon Evanston's determination that there has been no material change
from the basic terms set forth in this Letter, City Lit's financial condition and ability to
finance the Project, or other factors for the feasibility of the Project.
PART TWO — NONBINDING PROWSIONS,
The following numbered paragraphs of this Letter (collectively, the "Non -binding
Provisions") reflect the Parties mutual understanding of the matters described in
them, but each party acknowledges that the Nonbinding Provisions are not intended
to create or constitute any legally binding obligation between Evanston and City Lit
shall not have any liability to any other party with respect to the Nonbinding
Provisions until a definitive agreement (defined below) is prepared, authorized,
executed and delivered by and between the Parties, If the Project were to move
forward, the Parties would draft a formal agreement beyond this Letter, which would
include certain binding provisions. The terms stated herein are non -binding,
meaning that either party cannot seek performance under this Letter forterms stated
herein.
1. Permitted Use. City Lit will be relocating its operations and theater
company to the City of Evanston. City Lit shall perform stage adaptations of literary
material at the Property. The Parties also anticipate that the Property will also be
used for the viewing of classic films, cabaret performances, and rehearsal space.
2. Lease with Oofion to Purchase. The Parties anticipate that the Definitive
Agreement will be structured as a three-year commercial lease agreement with an
option to purchase the Property. The monthly rent will be $1,800.00. The rental
payments will be deposited into an account with Evanston, to be used as a future
security deposit if City Lit exercises its option to purchase the Property. In the event
that City Lit does not exercise its option, the rental payments will be kept by
Evanston and Evanston will be freely able to market the Property. City Lit will be
responsible for the payment of all utilities and real estate property taxes for the
Property. The purchase price for the Property is $326,000.00, subject to City
Council approval and City Lit purchasing the Property.
3. Improvements_ The Parties antioipate major renovations to the Property
and the cost of the improvements to be split is anticipated as follows:
2
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a) Evanston paid improvements: The City will solicit bids to raise the roof of the
Property structure a half -story ("Property Improvement Funds'). Upon receipt of bids,
the parties will evaluate the bids and the feasibility of the Project.
b) City Lit paid improvements: (i) installation of a stage, audience risers and seats,
dimmers and other lighting equipment; (ii) lay floor treatments; (ill) installation of two
sound systems for the performance space and the lobby; (iv) paint the premises;
and (v) installation of outdoor signage.
c) Further improvements will be determined based on the site plan for the Property
and the parties will work cooperatively to determine the party to bear the
responsibility and costs for said construction.
d) Evanston shall record a restrictive covenant against the Property regarding the
Property Improvement Funds. The restrictive covenant shall state; (1) if City Lit sells
the Property; or (2) discontinues the Permitted Use within 10 years of purchase; the
Evanston paid Property Improvement Funds shall be paid back to the City in a lump
sum within 6 months of the sale or discontinuance of the Permitted Use. The
amount of the refund would be based on a decelerating scale and "burned off" as the
loll year of the restrictive covenant approaches.
e) City Lit must have the Project fully bid out and an executed contract with a
general contractor by no later than November 1, 2012,
f) City Lit shall have a detailed funding plan, addressing all sources of funding, in
place for the Project by no later than November 1, 2012.
4. ExDenses and Fees. Upon signing this Letter, each party agrees to pay its
own expenses incident to the due diligence process, negotiations, and preparation of
the Definitive Agreement. In the event, however, City Lit decides not to purchase
the Property from Evanston, for any reason, the terms of this Letter are null and
void. In the event City Lit and Evanston, after exhausting good faith efforts to enter
into a Definitive Agreement and fail to do so, each party to bear its own expenses..
5, Brokerace Fees. The Parties acknowledge and agree that there will be no
brokerage commission and that the transaction is an arm's length transaction.
6. Multiple Countergy fs. For the convenience of the Parties hereto, this Letter
may be executed in multiple counterparts, each of which will be deemed an original,
and all counterparts hereof so executed by the parties hereto, whether or not such
counterpart will bear the execution of each of the parties hereto, will be deemed to
be, and will be construed as, one and the same. A telecopy or facsimile
transmission of a signed counterpart of this Letter shall be sufficient to bind the party
or parties whose signature(s) appear thereon.
M
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7. Effective Date, Terms, This Letter will be effective only if (i) it is executed by
City Lit and (it) a fully executed copy of this Letter is returned to Evanston on or
before 5:00 p.m. CST on July 31, 2012, The Binding Provisions of this Letter shall
remain In full force and effect thereafter until the earlier of (i) the execution and
delivery of the Definitive Agreement or (ii) the termination of this Letter.
IN WITNESS WHEREOF, the Parties have Caused this Letter of
Understanding to be executed this _ day of L 2012.
CITY 1?- r
Print Name: Michael tuloasrir�
m7c-hIVIL- IY7 0114W
its: President of the Board of Trustees
CITY OF EVANSTON,
an Illinois
municipal corporation
By:
Print Name:
Its: Assistant City Manager
,approved as to form:
W. Grant Farrar
Corporation Counsel
0
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