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Home My Public Portal Aboutr 17-041Ta tenet C K. . Nu. 17-41 Datc ul Aduption February 23, 20 17 RESOLUTION APPROVING SETTLEMENT AGREEMENT WHEREAS, on February 19, 2003, the Borough Council (the "Borough Council ") of the Borough of Carteret (the "Borough ") adopted a Resolution designating 16 tax lots within the Borough (collectively, the "Redevelopment Area "), including Block 201, Lot 1 (the "Property ", formerly known as Block 4, Lot 1), being also known as 4000 Industrial Road and 200 Middlesex Avenue, as an "Area in Need of Redevelopment" (the "Redevelopment Area ") under the New Jersey Local Redevelopment and Housing Law, N.J.S.A. 40A:12A -1 et seq. ( "LRHL "); and WHEREAS, on February 20, 2003, the Borough Council, by Ordinance No. 03 -07, adopted a redevelopment plan for the Redevelopment Area (the "Redevelopment Plan"); and WHEREAS, the Borough entered into a Settlement Agreement, dated August 1, 2012, as amended on March 28, 2013 (as amended, the "Settlement Agreement "), with Keystone NJP II, LLC ( "Keystone ") and 200 Middlesex, LLC ( "200 Middlesex "), the prior and current owners, respectively, of the Property, in connection with litigation relating to the use thereof; and WHEREAS, the Borough and 200 Middlesex now desire to amend the Settlement Agreement by executing an amendment thereto (the "Amendment "); and WHEREAS, 200 Middlesex will pay the Borough $2,750,000 upon the execution of the Amendment. NOW, THEREFORE, BE AND IT IS HEREBY RESOLVED by the Mayor and Council of Borough of Carteret, in the County of Middlesex and the State of New Jersey, as follows: Section 1. The aforementioned recitals are incorporated herein as though fully set forth at length. Section 2. The Mayor is authorized to execute the Amendment in substantially the same form as that on file with the Borough Clerk, together with any additions, deletions or modifications deemed necessary by the Mayor upon consultation with counsel, and any competent party may attest same. Section 3. This resolution shall take effect immediately. Adopted this 23` day of February, 2017 and certified as a true copy of the original on February 24, 2017. KATHLEEN M. BARNEY, MMC Municipal Clerk RECOlt11 OIL COUNCIL VOTE COUNC11, WAN YF� NO I`I1t AJI. CO1 l \'IAN KI'',1? I`IU NV A.n MLIANO X JOLIAL X_ DIAZ X Ii1;Utl X D111IASCIO X MULLS X —d— I x - ludicalc VOIC All - Absent 14V - Nut Wing NUR - 1110icalcs Vute lu Uvenule Vctu Adolricd at a utccting of the Muntcipul Council AMENDMENT TO SETTLEMENT AGREEMENT THIS AMENDMENT TO SETTLEMENT AGREEMENT ( "Agreement ") is made as of this day of February, 2016 by and between 200 Middlesex, LLC, with an office at 22 Maple Avenue, Morristown, New Jersey 07960 ( "200 Middlesex ") and the Borough of Carteret, a municipal corporation of the State of New Jersey, with offices at 61 Cooke Avenue, Carteret, New Jersey 07008 (the `Borough "). 200 Middlesex and the Borough are collectively referred to herein as the "Parties." RF.f TTAT,C WHEREAS, Keystone NJP II, LLC ( "Keystone ") formerly owned the property located at Block 201, Lot 1 (formerly known as Block 4, Lot 1), as shown on the official tax map of the Borough (the "Property "), being also known as 4000 Industrial Road and 200 Middlesex Avenue, Carteret, Middlesex County, New Jersey; and WHEREAS, on February 19, 2003, the Borough Council adopted a Resolution designating a total of 16 tax lots within the Borough, including the Property, as an "Area in Need of Redevelopment" (the "Redevelopment Area ") under the New Jersey Local Redevelopment and Housing Law, N.J.S.A. 40A:12A -1 et seq. ( " LRHL" ); and WHEREAS, on February 20, 2003, the Borough, by Ordinance No. 03 -07, adopted a redevelopment plan for the Redevelopment Area (the "Redevelopment Plan "); and WHEREAS, prior to adoption of the Redevelopment Plan, the Property was located in the Borough's Heavy Industrial (HI -B) zone as set forth in the Borough's Land Development Ordinance (the "Land Development Ordinance "); and WHEREAS, the Redevelopment Plan superseded existing regulations contained in the Land Development Ordinance to provide that the Property would be located in the WPD Zone within the Redevelopment Area; and 13030 -099 674000 -1 43727914.x4 WHEREAS, the Borough executed a Lease on September 15, 2003, pursuant to which the Borough leased the one -acre northeast portion of the Property (the "Parking Lot "; the balance of the Property, other than the Parking Lot, is referred to herein as the "Remainder Property ") for public parking and additional access to the Borough's waterfront park and boat launch located on the adjacent Block 201, Lot 4 (formerly known as Block 4, Lot 3) for a six -month term; and WHEREAS, on March 15, 2004, Keystone and the Borough entered into another lease ( "March 2004 Lease ") with regard to the Parking Lot for an additional 12 months; and WHEREAS, on August 22, 2008, Keystone filed a Complaint for Possession and Nonpayment of Rent, in the New Jersey Superior Court, Middlesex County, Special Civil Part (the "Landlord /Tenant Action ") asserting a claim against the Borough for possession of the Parking Lot; and WHEREAS, by Order dated September 21, 2008, the New Jersey Superior Court transferred the Landlord /Tenant Action from the Special Civil Part to the Law Division (the "Law Division Action "); and WHEREAS, on December 9, 2008, Keystone filed a First Amended Complaint in the Law Division Action, asserting claims against the Borough for possession of the Parking Lot and for payment of rent from March 15, 2005 (the date of expiration of the March 2004 Lease) forward ( "Keystone's Claims "); and WHEREAS, on January 22, 2009, the Borough filed an Answer, Separate Defenses and Additional Claims, disputing Keystone's claims for possession and for payment of rent, and asserting counterclaims against Keystone for unjust enrichment, easement by prescription and easement by necessity ( "Borough's Counterclaims "); and 43727914.v4 WHEREAS, on May 15, 2009, the Borough instituted a separate condemnation action to acquire title to the Parking Lot (the "Condemnation Action "), which was subsequently resolved with title to the Parking Lot passing to the Borough; and WHEREAS, on August 1, 2012, the Borough and Keystone entered into that certain Settlement Agreement (the "Original Agreement "), pursuant to which the Borough and Keystone resolved the outstanding Keystone Claims and the Borough's Claims as follows: • the Borough agreed to forebear from exercising the power of eminent domain to acquire the Remainder Property under the LRHL for a period of fifteen (15) years from January 1, 2012 through December 31, 2027 ( "Forbearance Period ") and to dismiss, with prejudice, its Counterclaims in the Law Division Action; in exchange for which • Keystone agreed to dismiss, with prejudice, its Claims in the Law Division Action for possession of the Parking Lot and for past due rent; and WHEREAS, the Borough acknowledged in the Original Agreement that Keystone's use of the Remainder Property under the Borough's Heavy Industrial (HI -B) zoning regulations set forth in the Land Development Ordinance constituted a valid pre- existing, non - conforming use following the adoption of the Redevelopment Plan and that, during the above - described 15 -year period through December 31, 2027, Keystone would continue such use on the Remainder Property; and WHEREAS, following the execution of the Original Agreement, the Borough dismissed, with prejudice, the Borough's Counterclaims and Keystone dismissed, with prejudice, Keystone's Claims; and 43727914.v4 WHEREAS, Keystone conveyed the Remainder Property to 200 Middlesex by Deed dated March 28, 2013 and 200 Middlesex entered into an Agreement dated July 25, 2014 with the Borough, amending the Original Agreement to extend the Forbearance Period to September 30, 2031 (the Original Agreement as amended by the Agreement dated July 25, 2014 is the "Settlement Agreement "); and WHEREAS, 200 Middlesex now desires to sell its interest in the Remainder Property to a purchaser that desires to continue warehouse use thereon; and WHEREAS, 200 Middlesex has requested that the Borough agree, among other things, and the Borough has agreed, to forebear from exercising the power of eminent domain to acquire the Remainder Property under the LRHL until December 31, 2046, in consideration for which 200 Middlesex has agreed to pay the Borough $2,750,000 (the "Consideration Payment ") upon the delivery of (i) an adopted resolution of the Borough's governing body authorizing the execution and delivery of this Agreement by the Mayor of Carteret on behalf of the Borough (the "Adopted Resolution "); and (ii) an original, executed counterpart of this Agreement signed and delivered by the Mayor of Carteret on behalf of the Borough; and TERMS AND CONDITIONS NOW, THEREFORE, in consideration of the promises, covenants and agreements set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned Parties, for themselves and their affiliates, agents, associates, attorneys, directors, employees, officers, representatives, heirs, administrators and successors /assigns, intending to be legally bound, hereby agree as follows: 1. The Parties hereby incorporate the above recitals as if fully set forth herein. 2. Subject to the provisions of Section 3 hereof, the Borough agrees as follows: 43727914.x4 a. The Forbearance Period shall be a period of time from and including January 1, 2012 to and including December 31, 2046. During the Forbearance Period, the Borough shall not exercise its power of eminent domain pursuant to the LRHL or any other law permitting the Borough to condemn property with regard to all or any portion of the Remainder Property (the foregoing agreement is the "Non- Condemnation Covenant "); and b. Following the adoption of the Redevelopment Plan, the current use of the Remainder Property constitutes a valid pre- existing, non - conforming use, and, in the event of a casualty destroying the structure(s) on the Remainder Property prior to the expiration of the Forbearance Period, 200 Middlesex may rebuild such structure(s) and continue the warehouse use notwithstanding the provisions of the Redevelopment Plan. 3. The Borough shall designate 200 Middlesex or its successor in interest which then owns title to the Remainder Property, as the redeveloper of the Remainder Property pursuant to the LRHL, within sixty (60) days of the Borough's receipt of a written request for such designation by 200 Middlesex or any such successor in interest to 200 Middlesex." 4. Simultaneously with the delivery to 200 Middlesex of the Adopted Resolution and an original, executed counterpart of this Agreement signed and delivered by the Mayor of Carteret on behalf of the Borough, 200 Middlesex will make the Consideration Payment to the Borough in consideration for (i) the Borough deferring its right to exercise eminent domain powers or condemnation procedures with respect to the Remainder Property as provided in Paragraph 2 above, (ii) any loss of tax revenue the Borough may incur as a result of the extension of the Forbearance Period to December 31, 2046, (iii) the Borough's agreeing that through December 31, 2046, in the event of a casualty destroying the structure(s) on the Remainder Property, 200 Middlesex may rebuild such structure(s) and continue the warehouse 43727914.v4 use notwithstanding the provisions of the Redevelopment Plan, and (iv) the Borough agreeing to designate 200 Middlesex or its successor in interest as the redeveloper of the Remainder Property as provided in Paragraph 3 above. 5. Should the Borough breach the Non - Condemnation Covenant, then in addition to the payment required to be made by the Borough pursuant to Paragraph 7 of the Original Agreement, and payment of the amounts awarded in any taking action by the Borough to acquire the Remainder Property, which payments shall be made to the then -owner of the Remainder Property: (a) the Borough shall repay the Consideration Payment in full to the then owner of the Remainder Property together with interest thereon at the prime commercial lending rate publicly announced from time to time by Citibank N.A. or its successor bank plus two percent (2 %) compounded annually, which payment obligation is in addition to and not in limitation of all other rights and remedies available at law or in equity resulting from the Borough's breach of the Non - Condemnation Covenant, and shall not be prorated or reduced for any reason, and (b) the Borough shall be responsible for and shall pay all reasonable attorney's fees incurred by the owner of the Remainder Property resulting from or related to the Borough's breach of the Non- Condemnation Covenant. 6. The Borough acknowledges that 200 Middlesex has provided notice of the possible sale of the Remainder Property in accordance with Paragraph 5 of the Original Agreement. Paragraph 5 of the Original Agreement shall be of no further force or effect with regard to a possible sale of the Remainder Property and shall be of no further force or effect upon completing closing of title for the conveyance of the Remainder Property from 200 Middlesex. 7. The Parties acknowledge that this Agreement is not confidential and may be provided to prospective tenants at the Remainder Property. 43727914.x4 8. This Agreement may be amended only by subsequent written agreement of the Parties. Any agreement hereinafter made shall be ineffective to change, modify, discharge or effect an abandonment of this Agreement in whole or in part unless such agreement is in writing and signed by the Party against whom enforcement of the change, modification, discharge or abandonment is sought. 9. The provisions of this Agreement shall be binding upon and shall inure to any future holder of the title of the Remainder Property and the Borough. 10. Any notice, request, demand or other communication to be given hereunder or under the Original Agreement shall be in writing and shall be deemed sufficient if sent via (a) electronic mail (with a copy being delivered the next day by overnight courier service as provided herein) and /or (b) sent by overnight courier service (i.e., Federal Express or UPS) addressed as follows: To 200 Middlesex: 200 Middlesex LLC 22 Maple Avenue Morristown, New Jersey Attention: Mark S. Rosen E -mail: mrosen a,hampshirecompanies.com with a copy to: Fox Rothschild LLC 15 Maple Avenue Morristown, New Jersey 07960 Attention: Robert A. Klausner E -mail: rklausner a,foxrothschild.com To the Borough: Kathleen M. Barney, Municipal Clerk Municipal Building 61 Cooke Avenue Carteret, New Jersey 07008 43727914.v4 Fax: (732) 541 -4989 E -mail: barneygcareret.net With copies to: Robert Bergen, Borough Law Director Municipal Building 61 Cooke Avenue Carteret, New Jersey 07008 Fax: (732) 541 -4989 E -mail: bergenr@careret.net and Kevin P. McManimon, Esq. McManimon, Scotland & Baumann, LLC 75 Livingston Avenue, 2 nd Floor Roseland, New Jersey 07068 Fax: (973) 712 -1440 E -mail: kmcmanimonamsbnj.com 11. This Agreement shall be construed, interpreted and governed by the laws of the State of New Jersey. 12. Preparation of this Agreement has been a joint effort of the Parties, with the advice of their respective counsel, and neither this Agreement, nor any document delivered by the Parties pursuant hereto, nor any term or provision hereof or thereof shall be construed more severely against any Party as the drafter hereof or thereof, notwithstanding any presumption of law to the contrary. 13. This Agreement together with the Settlement Agreement contains the entire agreement between the parties with respect to the subject matter hereof, and may not be amended, modified or terminated without the written consent of both parties. Except to the extent modified by this Agreement, the Settlement Agreement remains in full force and effect. 43727914.v4 14. This Agreement may be executed in any number of counterparts, each of which shall be an original, and such counterparts together shall constitute one and the same agreement. This Agreement can be legally delivered by a party when it executes and transmits a counterpart electronically or by any other means to the other party. 15. Upon the sale of the Remainder Property, 200 Middlesex shall give the Borough prompt written notice of the identity of the new purchaser of the Remainder Property. [REMAINDER OF PAGE LEFT INTENTIONALLY BLANK] 43727914.v4 IN WITNESS WHEREOF, and intending to be legally bound, the Parties have duly executed this Agreement as of the day and year first above written. WITNESS /ATTEST: WITNESS /ATTEST: L o ln 200 MIDDLESEX, LLC Name: Title: BOROUGH OF CARTERET Name: Title 43727914.v4