Bad news Les, it all seemed to be going so sweetly. Unfortunately this kind of thing does sometimes happen when you're dealing with people whose only God is money. Seems these guys are blinkered to the fact that a Folk-Club can fill a room with punters (and boost bar-takings, not to mention giving the place that elusive commodity so often lacking - ATMOSPHERE) on nights when it would otherwise be pretty well empty - I know of at least one other VERY successful club with a similar (although not identical) problem, i.e. with its roots in the tunnel-vision that afflicts the landlord of the premises they use.
Don't be downhearted, if you can find another venue I'm still enthusiastic and I'll be happy to support your venture.
Very best wishes fella.