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HomeMy WebLinkAboutAgenda - 10-21-2014 - 7bORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: October 21, 2014 Action Agenda Item No. 7 -b SUBJECT: Southern Branch Library Letter of Intent Approval DEPARTMENT: County Attorney, Asset PUBLIC HEARING: (Y /N) No Management Services, Library ATTACHMENT(S): Letter of Intent INFORMATION CONTACT: John Roberts, (919) 245 -2318 Jeff Thompson, (919) 245 -2658 Lucinda Munger, (919) 245 -2522 1 PURPOSE: To authorize the Chair to execute a Letter of Intent with regard to the Southern Branch Library upon the approval of the County Attorney. BACKGROUND: On May 13, 2014, the Board of County Commissioners authorized staff to engage in negotiations with Main Street Partners of Chapel Hill, LLC ( "Main Street ") regarding the potential location of the Southern Branch Library on property adjacent to the 300 Main development located in Carrboro known as the Butler Property. The attached Letter of Intent is drafted to frame the future negotiations for the definitive agreements necessary for the potential development and construction of a Southern Branch Library. The County's execution of this Letter of Intent does not bind the County to locate the Southern Branch Library on the Butler Property nor does it obligate the County to enter into definitive agreements with Main Street in the future. FINANCIAL IMPACT: Execution of this Letter of Intent and the subsequent negotiation of the Contract Agreement will require a Professional Services Agreement amendment in an amount not to exceed $25,000 for this task. Adequate funds are available for this amendment within the Southern Branch Library Capital Project. RECOMMENDATION(S): The Manager recommends the Board authorize the Chair to execute a Letter of Intent with regard to the Southern Branch Library upon the approval of the County Attorney. 2 LETTER OF INTENT AND DUE DILIGENCE AUTHORIZATION This Letter of Intent and Due Diligence Authorization (the "Letter of Intent "), is made by and between Main Street Properties of Chapel Hill, LLC (hereinafter called "Main Street ") and Orange County, North Carolina (hereinafter called "County "), for the purposes of establishing the intent of Main Street and the County to negotiate the necessary agreements for the County's acquisition of property interests from Main Street and for the construction of facilities as described in more detail below (the "Project "). PROJECT TITLE: Orange County Southern Branch Public Library (the "Southern Branch Library" or the "Branch Library "). PROJECT ADDRESS: 120 Brewer Lane, Carrboro, North Carolina (the "Property ") Main Street and the County intend to negotiate agreements for the conveyance of property interests from Main Street to the County resulting in the location of the Southern Branch Library (to include flexible meeting facilities and multipurpose rooms) as well as an expansion of the existing parking deck adjacent to the Property, all of which are subject to agreement on specific terms. This Letter of Intent serves as permission from Main Street to the County to proceed with its due diligence on the Property as set forth herein and shall serve as a framework for the definitive Project agreements to be negotiated in the future, if any. This Letter of Intent is effective as of the date last signed (the "Effective Date "). Subject to the terms of this Letter of Intent, Main Street and the County agree as follows: 1. Description of Parties: The County is a body politic and corporate political subdivision of the State of North Carolina. Main Street is a limited liability company organized and existing under the laws of the State of North Carolina (County and Main Street are sometimes individually referred to as a "Party" and collectively referred to as the "Parties "). 2. Description of the Property: BEING all of Lot 4 on plat entitled "Recombination of the Property of Main Street Properties, LLC and Downtown Urban Ventures, LLC dated February 28, 2005, revised on March 2, 2005, revised on August 12, 2005, and recorded in Plat Book 98, Page 194, Orange County Registry, reference to which is hereby made for a more particular description of the same. The Property is further identified as having Orange County PIN 9778 -96 -8060 as shown on the attached Exhibit A. The Property is subject to a Brownfields Agreement. A copy of the Brownfields Agreement is attached hereto as Exhibit B. The Property is currently encumbered by a Conditional Use Permit allowing for the construction of a five story mixed -use building (the "CUP "). A copy of the CUP is attached as Exhibit C. 3. Description of Project: The County has approved a set of guiding principles and comprehensive site selection criteria for locating the Southern Branch Library. The Property is currently being evaluated as the potential site for the Southern Branch Library. Main Street is the developer of a project located in central Carrboro known as "300 East Main ". 300 East Main is a phased mixed -use development project offering dining, shopping, arts, a parking deck ( "Parking Deck ") and hotel accommodations. 1 ' The Property is adjacent to 300 East Main. Main Street has an option to purchase the Property (the "Option "). A copy of the Option is attached hereto as Exhibit D. Main Street intends to integrate the Property into 300 East Main by utilizing similar design characteristics for the buildings to be built on the Property and by connecting the Property with the 300 East Main development through cross - easements and development covenants. Main Street anticipates the Property will ultimately include, among other improvements, a multi -story building (the "Building ") containing a basement level (containing some parking and mechanical installations), with the proposed Branch Library, and potentially some additional office space, on the first occupiable floor (with a finished floor elevation consistent with the nearby hotel /retail building and Main Street elevation) (hereinafter referred to as the "first floor "), and with 4 floors of single family apartments located on the upper floors of the building (collectively referred to as the "upper floors" or "upper stories "). It is also anticipated that the Parking Deck located on an adjacent parcel will be connected to the Building (but in such a manner as not to require the parking deck to be sprinkled) and will be enlarged and expanded in order to serve the Southern Branch Library and residents of the upper floor apartments. The expanded Parking Deck may also serve the public at large when the Branch Library is closed and not otherwise hosting County functions. The Parties' conception at this point of their respective responsibilities in designing and constructing the Project, along with an agreed upon anticipated timeline for completion of the Project as set forth on Exhibit E, all of which may change based on further investigation and negotiation by and between the Parties, is as follows: A. Main Street will be primarily responsible for procuring all necessary development approvals for the Project from the Town of Carrboro (the "Town "), including, but not limited to, attempting to obtain a modification to the existing CUP in order to permit the Branch Library on the Building's lower floors, the proposed multi - family apartment use on the upper floors as described herein and the Parking Deck expansion. The County will support Main Street's efforts to secure the necessary permits consistent with this LOI. B. Provided the Town approves all necessary development permits, the Parties will coordinate to complete construction drawings for the Building and the Project. The construction drawings shall be divided into four (4) separate parts (suitable to be permitted separately if necessary and suitable to be constructed pursuant to separate construction contracts): (1) preliminary schematic design for the site layout and external Building design; (2) the site work, foundations, the concrete and steel basement parking level, and the concrete and steel first floor of the building (with all attendant core areas on or passing through the parking level and first floor which may also serve the upper floors), the expectation that the first floor and basement level will be constructed with post- tensioned concrete; (3) the upper floors of the building; and (4) the Parking Deck expansion. The concept is that the Parking Deck expansion will be completed first because it will have to start first and has a much shorter duration than the other scopes of work, and that both scopes of work within the Building will be completed simultaneously. C. Provided the Town approves all necessary development permits for the County and Main Street's intended uses, the County thereafter will be contractually permitted to proceed with those components of the Project necessary for its intended uses should Main Street be unable or unwilling to complete any aspect of the Project within a reasonable time. 2 M D. The County, in accordance with applicable laws pertaining to public construction projects, will undertake to select a designer for its components of the Project, and Main Street will thereafter interview such designer and select either that same designer or a separate designer to help prepare schematic design drawings for its component of the Project. If separate designers are retained by the County and Main Street, then the Parties will use best efforts to ensure that their designers work together so the project components are property coordinated and that the schematic design of the building is harmonious with the existing newly- constructed buildings within the 300 East Main mixed -use development. The Parties will reasonably share the costs and effort, including the production of schematic design drawings. The County, in accordance with applicable laws pertaining to public construction projects, will enter into design and construction contract(s) for the Parking Deck expansion, and upon approval of the construction drawings and issuance of the necessary permits (the "Building Permit(s)"), the County will at a time reasonably agreed between the Parties begin construction of this scope of work (consistent with the schedule included on Exhibit E). E. Main Street will contract with all necessary design, engineering and construction firms for any and all environmental remediation work required by NC DENR pursuant to the Brownfields Agreement and all such environmental remediation shall be completed by Main Street. F. Main Street conveys ground leases to the County for the construction of the Branch Library and, potentially, the Parking Deck Expansion; (ii) the County contracts with professionals for the design and construction of the Parking Deck Expansion (if applicable), site work, basement parking level and Branch Library floor, and any other necessary Project component in its scope of responsibility, using the construction management at risk delivery method (or other legally permitted construction delivery method); (iii) Main Street contracts with design professionals for the construction of the upper floors of the Building and any other necessary Project component in its scope of responsibility, (iv) upon completion, the Parking Deck will be subject to the existing parking deck declaration of covenants with all necessary modifications agreed to by the existing owners and the County; (v) upon completion, the Building is subject to a new condominium declaration with terms mutually agreed upon by Main Street and the County; (vi) the County receives a fee simple condominium interest in the Parking Deck and the Branch Library; and (vii) the ground leases terminate upon vesting of the condominium interests. G. The County will enter into a construction contract for the site work, foundations, the concrete and steel basement parking level, and the concrete and steel first floor of the Building (with all attendant core areas on or passing through the parking level and first floor which may also serve the upper floors), and upon approval of the construction drawings and issuance of the Building Permit(s), the County will at a time reasonably agreed between the Parties begin construction of this scope of work. Main Street will enter into a construction contract for the upper floors (floors 2 through 5), and upon approval of the construction drawings and issuance of the Building Permit(s), Main Street will at a time reasonably agreed between the Parties begin construction of this scope of work in coordination with what will then be the County's ongoing work on the site, basement parking level, and first floor. 4. Intent to Negotiate Definitive Contracts: 3 The County and Main Street desire to enter into negotiations for the location of the Southern Branch Library on the Property. The final scope and form of the contracts by and between Main Street, the County, designers and contractors are subject to future negotiation and any such agreements are conditioned upon the Parties' mutual written agreement on terms. Preliminary descriptions of the various contracts required for completion of the Project are included in Section 3 of this Agreement (sometimes collectively referred to herein as the "Contracts "). The Parties acknowledge that the elements of value to be considered in working to negotiate the Contracts include the items listed below: A. Land (including all easements and rights of access to be granted by Main Street) B. Existing Infrastructure to be Shared by Main Street (i) Existing Parking Deck is preconfigured for expansion with some components for expansion already installed (ii) Potential utilities tie -ins with infrastructure constructed by Main Street (iii) Potential signage areas elsewhere on Main Street's property (iv) Public art component (v) Impact of additional access and parking requirements for the Project due to difference, if any, due to location of the Branch Library on the Buildings 1st floor rather than general office space C. Soft Costs (i) Obtain Permits — costs will be allocated per a formula to be agreed upon with Main Street applying for and procuring the same (ii) Legal expenses — Each Party to bear their own (iii) Site design costs — costs will be allocated per a formula to be agreed upon (iv) Environmental — Main Street will be responsible for the costs of remediating any existing environmental contamination on the Property to the extent required by its agreement with DENR under the Brownfields Program and otherwise complying with any and all regulatory requirements related to the existing environmental contamination and conditions (specifically including, but not limited to, the requirements of the existing of the existing Brownfields Agreement) unless the County imposes requirements in addition to existing regulatory necessities which increase Main Street's costs (v) Building Design — Each Party to bear the costs of their own scope, with some cost sharing for the costs of designing shared elements, and unless the County imposes requirements in addition to existing regulatory necessities which increase Main Street's costs (vi) Parking Deck expansion design — costs to be allocated per a formula to be agreed (vii) Financing - Each Party to bear their own (viii) CA /CM - Each Party to bear the costs of their own scope, with some cost sharing for the costs related to shared elements (ix) Disruption Expenses — costs, if any, to be allocated per a formula to be agreed (x) Special Inspections — Each Party to bear the costs of their own scope, with some cost sharing for the costs related to shared elements save and except special inspections related to environmental testing, monitoring and remediation which shall be the responsibility of Main Street unless the County imposes requirements in addition to existing regulatory necessities which increase Main Street's costs 4 D. Construction (i) Parking Deck Expansion —by either Main Street or the County with acknowledged shared value (ii) Podium (parking level and first floor) — (a) Heavier foundations and columns to support upper floors — by County with acknowledged shared value (b) Overbuild of Podium (footprint supports more than 23,000 usable square feet of space on Podium level and County's Branch Library call for significantly less space) (iii) Core areas serving all floors — County to construct (c) Heavier foundations and columns to support upper floors — by County with acknowledged shared value (d) Elevators and stairwells on parking level and first floor — by County with acknowledged shared value (e) Amenity Decks /Terraces — Allocated as applicable, but most likely constructed by the County if not designed for use by upper floor residential apartments E. Site Work (i) Base Site Work — by County with acknowledged shared value (ii) Stormwater — by County with acknowledged shared value (iii) Environmental /Brownfields — by Main Street (iv) Hardscaping/Landscaping — by County with acknowledged shared value 5. Due Diligence: Main Street grants County, its employees, agents, citizen committees, and contractors a right of entry onto and into the Property and the property upon which 300 East Main is located during the Term for the purposes of conducting surveys, inspections, tests and other analysis and due diligence on the Property. County will coordinate any such entry with Main Street, and County will minimize any disturbance to tenants on the subject properties. During the Term, County will work diligently to determine the viability of locating the Southern Branch Library on the Property. County will keep Main Street informed of its due diligence progress throughout the Term. Prior to conducting any tests, studies or analyses on the Property during the Inspection Period, the County shall work with Main Street to ensure than any activities are consistent with the Brownfields Agreement, Main Street's current approvals and applicable law. In order to ensure compliance with the Brownfields Agreement, which requires NC DENR's advance approval of land disturbing activities, the County will coordinate and secure Main Street's reasonable prior approval of all visits to the Property with Main Street for any inspections, tests, studies or analyses, including but not limited to the following: A. The tests, studies or analyses to be conducted on the Property; and B. The extent of any destructive testing, drilling, boring, cutting, excavating, digging, boring or similar disturbances, including the use of any machines on the Property. C. The methods to be used by the contractor conducting such tests or other activities. 5 7 Main Street will deliver to County copies of all written approvals from NC DENR permitting land disturbing activities on the Property. The County shall promptly deliver a copy of the results and reports of all such tests, studies and analyses to Main Street upon their completion. To the extent permitted by law, and to the extent not caused by the negligent or intentional conduct of Main Street, its contractors or agents, the County shall indemnify and hold Main Street harmless from and against any and all claims arising out of the County's or its designees' or citizens committees' entry upon the Property and due diligence or other activities thereon. The County shall restore the Property to substantially the same condition it was in immediately prior to the County's due diligence activities if such restoration is necessary as a result of due diligence activities performed by the County, its contractors or agents. It is the intent of both Parties to work toward entering into mutually beneficial agreements for the location of the Southern Branch Library on the Property at the end of the Term based on County's due diligence and the viability of development options available to the Parties. 6. Term: This Letter of Intent shall be effective as of the Effective Date and shall continue for one hundred and eighty days thereafter unless earlier terminated as provided herein or upon the full execution of the Contracts (the "Initial Term "). This Letter of Intent may be renewed and otherwise extended for additional periods upon the mutual written agreement of the Parties (each a "Renewal Term "; the Initial Term and any and all Renewal Term(s) are collectively referred to herein as the "Term "). 7. Termination: This Letter of Intent shall terminate: (i) immediately and automatically upon execution of the Contracts between Main Street and County pertaining to the subject matter hereof, (ii) automatically upon the expiration of the Term; (iii) at any time, by mutual agreement of the Parties; or (iv) by Main Street, upon the material breach by County of any provision contained herein which material breach remains uncured by County after Main Street provides thirty (30) days advance written notice of said material breach to County, and by County, upon the material breach by Main Street of any provision contained herein which material breach remains uncured by Main Street after County provides thirty (30) days advance written notice of said material breach to Main Street. 8. Access; Confidentiality: Subject to the laws governing public records in North Carolina, County agrees to retain all duly marked and qualifying trade secrets and other confidential information which may be received in the course of negotiations from Main Street on a confidential basis (collectively, the "Information "). Main Street shall conspicuously mark as "trade secret" or "confidential" any record it claims is exempt from public disclosure pursuant to N.C. Gen. Stat. § 132 -1.2. If County is called upon to disclose any record received from Main Street marked "trade secret" or "confidential ", then County shall so notify Main Street and Main Street, at Main Street's election, shall be entitled to participate in bringing or defending any action to prevent disclosure of the record. Upon the termination of this Letter of Intent for any reason, County shall return promptly to Main Street all Information received by County from Main Street in connection with the Project. The Information will be used solely for the purpose of evaluating the transaction described herein, and will be kept confidential by County and its officials, officers, employees, representatives, agents, and advisers; provided that (i) any of such Information may be disclosed 0 in confidence to County's officials, officers, employees, representatives, agents, and advisers who need to know such Information for the purpose of evaluating the proposed transaction, and (ii) such Information will be disclosed if required by applicable law. 9. Conditions Precedent & Contingencies: The Parties understand and agree that there are a number of conditions precedent and contingencies that will impact the ability to enter into the Contracts for the Project. At a minimum, the Parties understand and agree that the following must be resolved to the County's and Main Street's satisfaction prior to entering into the Contracts (or a timeline and means for resolving any such issue shall be a part of the Contracts): A. Main Street obtaining all Permits, including zoning, conditional /special use permits, variances, subdivision plats, approvals, permits, easements and licenses for the Project and the Town of Carrboro grants all necessary Permits which allow for the County's proposed use of the Property and the Parking Deck expansion and which permits up to 100 units (containing approximately 112 total bedrooms as distinguished from the 101 total bedrooms approved in the currently CUP on the Property) of apartment housing for rent to be constructed on floors 2 through 5 above the Branch Library's floor (which does not impose requirement that renders the Project not financeable or financially impractical to either Party). B. The Town of Carrboro and other applicable governing authorities permit Main Street to utilize wood frame construction for the upper floors (above the first floor concrete "podium ") as is common in multi - family developments throughout the region. C. The County secures all necessary approvals from its Board to proceed with the Project. D. Main Street exercises its option on the Property and subdivides the Property such that the northeast corner of the property (in dimensions reasonably necessary to permit a full - length third bay of the Parking Deck to be constructed) and recombine this northeast corner parcel with the adjacent Parking Deck parcel to permit the development and construction of a full - length third bay connected to the existing Parking Deck, which third bay will serve the County's use of the Property and the upper floor apartments. E. Main Street and the County are able to procure suitable financing for their respective components of the Project. F. The mutual negotiation and execution of an Environmental Indemnification Agreement whereby Main Street will indemnify the County for any and all liability, loss, damage, cost and expense (including reasonable attorneys' fees and expenses) resulting from any "Hazardous Substance" (as defined below) existing on or under the Property or originating on the Property and migrating off -site in violation of applicable Environmental Laws, but only to the extent that the Hazardous Substance existed at the Property prior to the date on which the County leases the Property or is introduced to the Property by Main Street after the commencement of the County's lease of the Property. Main Street shall not be liable with regard to any Hazardous Substances disposed of, placed, or otherwise existing on or under the Property because of the actions of the County. The County will likewise, and to the extent permitted by law, indemnify Main Street for any and all liability, loss, damage, cost and expense (including reasonable attorneys' fees and expenses) resulting from any Hazardous Substances existing on or under the Property or originating on the Property and migrating off -site in violation of 7 9 applicable Environmental Laws that are introduced or placed on the Property, or caused to migrate off the property, because of the actions of the County. Save and except any liability resulting from remediation required pursuant to the Brownfields Agreement which shall solely rest with Main Street, neither Party shall be liable to the other for liabilities, losses, damages, costs or expenses resulting from the actions of third Parties after the date on which the County leases the Property "Hazardous Substances" shall mean: (a) those substances included within the definitions of any one or more of the terms "hazardous materials," "hazardous wastes," "hazardous substances," "industrial wastes," and "toxic pollutants," as such terms are defined under the Environmental Laws, or any of them; (b) petroleum and petroleum products, including, without limitation, crude oil and any fractions thereof, (c) natural gas, synthetic gas and any mixtures thereof, (d) asbestos and or any material which contains any hydrated mineral silicate, including, without limitation, chrysotile, amosite, crocidolite, tremolite, anthophylite and /or actinolite, whether friable or non - friable; (e) polychlorinated biphenyl ( "PCBs ") or PCB - containing materials or fluids; (f) radon; (g) any other hazardous or radioactive substance, material, pollutant, contaminant or waste; and (h) any other substance with respect to which any Environmental Law or governmental authority requires environmental investigation, monitoring or remediation. As used herein, the term "Environmental Laws" shall mean all federal, state and local laws, statutes, ordinances and regulations, now or hereafter in effect, in each case as amended or supplemented from time to time, including, without limitation, all applicable judicial or administrative orders, applicable consent decrees and binding judgments relating to the regulation and protection of human health, safety, the environment and natural resources (including, without limitation, ambient air, surface, water, groundwater, wetlands, land surface or subsurface strata, wildlife, aquatic species and vegetation), including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (42 U.S.C. § 9601 et seq.), the Hazardous Material Transportation Act, as amended (49 U.S.C. §§ 5101 et seq.), the Federal Insecticide, Fungicide, and Rodenticide Act, as amended (7 U.S.C. § 136 et seq.), the Resource Conservation and Recovery Act, as amended (42 U.S.C. § 6901 et seq.), the Toxic Substances Control Act, as amended (15 U.S.C. § 2601 et seq.), the Clean Air Act, as amended (42 U.S.C. § 7401 et seq.), the Federal Water Pollution Control Act, as amended (33 U.S.C. § 1251 et seq), the Safe Drinking Water Act, as amended (42 U.S.C. § 300f et seq.), any state or local counterpart or equivalent of any of the foregoing, and any federal, state or local transfer of ownership notification or approval statutes. "Release" shall mean any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping or disposing of any Hazardous Substances. G. The negotiation and completion of agreements and documents guiding the selection of designers and contractors, the timelines for the completion of various aspects of the design work, the methods and scheduling input, and other specific design and construction coordination necessary to ensure the successful completion of the Project. H. The negotiation and execution of ground leases (wherein the County's property interests in the Parking Deck and Branch Library will convert to condominium interests post - construction) under which the County as Lessee shall have the right to construct the improvements on the Property subject to the County's obligation to subject the Property and all improvements constructed thereon to a condominium declaration similar in structure and form to the "Declaration Of Condominium for 300 East Main Hotel /Retail 91 10 Condominium" governing the adjacent 300 East Main Hotel/Retail condominium as recorded in Book 5739, Page 1 in the Orange County Registry. L The modification and amendment of the existing "Declaration of Condominium for 300 East Main Parking Condominium" recorded in Book 5739, Page 75 in the Orange County Registry to acknowledge the planned Parking Deck expansion, the expansion of the Parking Deck parcel for that purpose, and that the County will become a unit owner in the expanded deck upon completion of the expansion (all of which actions are currently contemplated in the 300 East Main Parking Condominium Declaration but require additional language to effect such actions in accordance with the terms of such declaration). J. The negotiation and completion of appropriate agreements whereunder the Parties' lenders, if any, agree to subordinate to the requirement that the Property be subjected to the condominium declaration upon completion of construction, and agree to subordinate to all applicable cross - easements, rights of access, etc., as necessary, and as otherwise may be necessary otherwise to protect each Party from a default of the other during the construction of the building and associated Parking Deck expansion, which may require obligations to complete certain portions of the work. K. The negotiation and completion of an agreement to be included within or attached to the condominium declaration to be developed between the Parties which articulates the meaning of "library use" and permitted ancillary uses, and permits the use of the County's condominium(s) and Main Street's condominium for other purposes consistent with the Permits and the Brownfields Agreement and subject to reasonable use restrictions meant to protect the legitimate interests of both the County and Main Street. Nothing in any declaration or other agreement by the Parties shall prevent the use of the Property in the future for governmental or non - governmental office uses without any retail or service aspect that would be competitive with or adversely affect Main Street's retail and service businesses on adjacent properties. L. Confirmation that adequate utilities services are available within a reasonable distance from the Property for connection and suitable for the proposed uses to be included within the Building. M. The County complying with all necessary requirements for contracting with North Carolina local governments, including, but not limited to, compliance with all requirements for the Project. N. Both Main Street and County will retain design approval of all aspects of the exterior of the Building to contain the Southern Branch Library and other improvements on the Property, which approval is not to be unreasonably withheld provided the proposed design elements are harmonious with the existing new buildings within 300 East Main. This will include but not be limited to site plan, elevations, exterior design, construction materials and colors visible from the outside. O. All governmental and other third party consents and approvals shall be obtained; there shall be no significant pending or threatened litigation materially adversely affecting the Property. P. Main Street understands and agrees that the provision of sufficient way - finding and other signage is necessary for patrons to quickly and conveniently locate the Library which will E 11 be located toward the rear of the buildings in the 300 East Main project. The Parties understand and agree that interior signage for the Project is subject to regulation by the Town. Significant opportunities for distinctive signage exist along Boyd Street near the main entrance to the Parking Deck and along Padgett Lane entrance. Main Street shall provide reasonably sufficient signage for the County throughout 300 East Main, the Property and the Parking Deck along with legally sufficient access rights to the Project, provide that the any at or near ground level signage for the proposed library within the 300 East Main mixed -use development shall not be significantly greater than that afforded to commercial enterprises also located within the 300 East Main mixed -use development unless agreed to by the Parties and all such commercial enterprises. The use of quality made outdoor A -frame style signage in front of the Building will be permitted for advertising current programs and services and otherwise providing information to Library patrons. Interior banner type electronic signage visible to those on the outside of the Library may be permitted consistent with Town ordinances and other applicable requirements. Q. The exterior and common areas of the Property will at all times, including after being subjected to the condominium declaration be subject to all the generally- applicable Rules and Regulations of the 300 East Main mixed -use development, as the same may be amended from time to time, which such rules concerning the Property and related to personal conduct shall be similar to the existing Rules of Conduct and Courtesy in place for County library patrons. R. The County as a ground lessor (prior to the completion of construction) and as a condominium unit owner (following the completion of construction) will agree to contribute pro rata to the common area maintenance and insurance provided by Landlord for the Project including a reasonable pro -rata contribution for maintenance of the sidewalks and other shared amenities of the 300 East Main. Because the County is exempt from paying ad valorem taxes, the typical procedure of apportioning each tenant a share of those taxes assessed against common areas is not applicable. Main Street would like the County to consider an appropriate mechanism for acknowledging the shared value in its use of the privately owned common areas within 300 East Main. S. During hours when the Library is not being used by the County, the County will agree to allow its parking spaces to be used by on the same terms and charges, if any, as other non - reserved parking spaces within the Parking Deck are made available to the public. The County and Main Street will provide for a mechanism to allocate parking fee revenue received for County owned spaces (depending on who manages the fee collection and other relevant factors) if or when fees are collected for the use of parking spaces in the Parking Deck. T. Main Street secures environmental regulatory approval from DENR prior to the Lease Commencement Date or provides reasonable security to cover Main Street's environmental responsibilities until regulatory approval is obtained. U. Contract terms sufficient to permit the construction of the Parking Deck expansion and the ground and first floor of the Building following the County's acquisition of the ground lease or other property interest from Main Street. V. The successful completion by the County of a Cultural & Archeological Survey on the Property 10 12 W. The implementation of all recommendations related to demolition and reuse of any existing structures on the Property in accordance with County policies, the cost of which, if in excess of Main Street's cost to demolish the same, will be borne by the County. X. The County acknowledges that, if a library was not to be located on the first floor of the proposed mixed use building on the Property, Main Street would at some time construct a similar overall building but with general daytime office space on the first floor instead of library and meeting space. Main Street and the County will work together to have an updated Traffic Impact Analysis performed comparing the trip generation and other impacts of the library use as compared to the alternative of a general office use. If it is determined that the library uses generates significant additional traffic impact as compared to the alternative of a general office use and such additional traffic impact significantly increases the number of parking spaces required above those that would be required if the Branch Library were daytime office space, then the County will reasonably work to secure additional vehicular access from the Property to Brewer Lane so as to ensure appropriate traffic flow for the Branch Library's higher intensity use without limiting Main Street's ability to develop the remainder of its property consistent with its existing CUP for the 300 East Main mixed -use development. Y. Consistent with the scope of each Parties responsibilities hereunder, all necessary and appropriate construction and crane easements will be secured by Main Street and County from all adjacent landowners, including UNC (the railroad right -of -way), and the Town of Carrboro (the Libba Cotton bikeway /greenway). 10. Representations and Warranties: Main Street and the County each represent to the other to the best of their respective knowledge: A. Main Street and the County have all requisite power and authority to execute this Letter of Intent, and any other instruments required to be delivered by Main Street or the County hereunder. B. Main Street's and the County's entry into this Letter of Intent will not violate any private restriction or agreement or to the best of Main Street's or the County's knowledge without investigation or inquiry any applicable statute, ordinance, governmental restriction or regulation. C. During the Term, Main Street will not execute or create any lease, contract, option, easement, covenant, condition, restriction, lien or encumbrance with respect to the Property or any portion thereof without the written consent of County unless the same is terminable upon no more than sixty (60) days written notice or otherwise may be cleared on or before any Closing or Lease Commencement Date that may be contemplated in any Contract that may be entered into between Main Street and the County or that otherwise will be subordinated to the County's potential ground lease. D. There is no pending or threatened action, litigation, bankruptcy, condemnation, or other proceeding of any kind pending against Main Street which materially adversely affects the Property. 11 13 E. No broker, finder or other intermediary is involved in the transaction contemplated by this Letter of Intent, and that no brokerage fee or commission is due and payable by Main Street or the County upon any lease or conveyance of the Property. F. Main Street now has an indefeasible option to purchase the Property. G. Main Street will have at closing on the conveyance of a property interest in the Property to the County an marketable, insurable and indefeasible title in fee simple to the Property free and clear of all liens, charges, encumbrances, mortgages, pledges, security interests, adverse claims and title matters except for those permitted encumbrances reasonably accepted by the County, or which are subordinated to the County's interest, and the Property has not been assigned or conveyed to any third party. No person or entity (other than Main Street pursuant to the Option and the County pursuant to this Agreement) has a right to acquire an interest in the Property. The Town of Carrboro claims an easement or right of access along the edge of the Property along the railroad tracks for the Libba Cotton bikeway /greenway. H. Main Street has not received written notice of any violations of any laws, ordinances or similar rules and regulations relating and /or applicable to the ownership, use and operation of the Property as it is now operated, and /or other licenses or permits, which remain uncured. L All ad valorem taxes for the Property have been paid in full. [Please note that under the Brownfields program, a portion of property taxes are abated beginning the first five years following the completion of improvements (on that portion of the Property which is subject to ad valorem taxation)] J. No assessments or special assessments for public improvements or otherwise have been levied or are not affecting the Property. K. To the best of Main Street's present knowledge, the Property is not within an area determined to be flood -prone under the Federal Flood Protection Act of 1973. 11. Miscellaneous: A. Binding Effect. This Letter of Intent sets forth a declaration of the intentions of the Parties concerning the transactions described herein, but the Parties understand that until the Contracts shall have been executed and delivered, no Party has any legal obligation in connection herewith, except as to the obligations set forth in this Section and Sections 5, 6, 8 and 10, which shall become effective when this Letter of Intent shall have been executed by and delivered, and which shall be binding upon and inure to the benefit of the Parties hereto, and their respective heirs, members, successors, personal representatives, officers, agents, employees, and permitted assigns. B. Assignment. The rights under this Letter of Intent may be transferred and assigned only upon the written consent of the non - assigning Party. C. Fees and Expenses. Each Party will be responsible for his or its own legal fees and expenses incurred in connection with the transactions contemplated by this Letter of Intent. 12 D. Governing g Law. This Letter of Intent shall be governed by and construLaw. This Letter of Intent shall be governed by and construed in accordance with the laws of the State of North Carolina. Any dispute regarding this Letter of Intent shall be filed in a court of competent jurisdiction located in Orange County, NC. E. Counterparts. This Letter of Intent may be executed in any number of counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same document. A signed copy of this Letter of Intent delivered by facsimile, e- mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy. F. Amendment. This Letter shall not be amended except by a written instrument executed by both County and Main Street. G. No Third Party Beneficiaries. Nothing contained in this Letter of Intent shall be deemed to create a contractual relationship with, or a cause of action in favor of, any third party against Main Street or County. Main Street and the County acknowledge that this Letter of Intent is not a purchase and sale agreement for the Property, is not binding upon any party hereto except as provided herein, and that it is intended only as the basis for the negotiation of definitive Contracts. The Contracts shall be subject to Main Street's and County's approval and full execution. Orange County, North Carolina By: _ Title: Date: AGREED AND ACCEPTED: Main Street Properties of Chapel Hill, LLC By: Name: Title: 13 14 15 EXHIBIT A [GIS Map of Property] 14 16 EXHIBIT B [Brownfields Agreement] 15 17 EXHIBIT C [Conditional Use Permit] 16 W EXHIBIT D [Main Street Option] 17 19 FXTTTRTT F. Southern Branch Library - Estimated Project Activity Timeline This estimated timeline for the development, construction, and operation of the potential Southern Branch Library is as follows. A conservative 4 -6 month contingency interval for is reasonable for planning purposes and process delays. Bolded activities signify Board of County Commissioner actions. Event Estimated Completion Date Board of County Commissioners Action: October, 2014 Approval of Letter of Intent between Orange County and Main Street Board of County Commissioners Action: December, 2014 Approval of Contracts with Main Street Board of County Commissioner Action: April, 2015 Designer, Construction Manager at Risk firms selected through RFQ process Carrboro CUP process (est. 9 months) September, 2015 Board of County Commissioners Action: November, 2015 Design approval; Authorization to finalize construction documents and solicit Guaranteed Maximum Price; Regulatory review & construction permitting; Acceptance of LGC financing review and approval Board of County Commissioners Action: April, 2016 Approval of Guaranteed Maximum Price Project construction & systems commissioning (est. 8 months) December, 2016 Board of County Commissioners Action: February, 2017 Condominium Declarations Recorded; Conversion of Ground Lease to Condominium Interests Library Occupancy; February, 2017 Library operations start -up Opening April, 2017 18