Alteri Bakery has agreed to settle out of court a lawsuit on delinquent loans it has with three economic development agencies.
In May, the Jefferson County Industrial Development Agency, Watertown Local Development Corp. and North Country Alliance Local Development Corp. filed suit, claiming they are owed a combined $142,630, plus interest and late fees.
On Thursday morning, the Watertown Local Development Corp., also known as the Watertown Trust, discussed the settlement in executive session for about 15 minutes before unanimously agreeing to proceed with it.
Terms of the settlement were not released because it has not been signed by any of the parties, said attorney W. James Heary, who represents the Watertown Trust and the JCIDA.
There will be a 10-day grace period before the first payment is made, Mr. Heary said.
JCIDA claims it gave Alteri a $200,000 loan for equipment in 1999, with $41,706 due on the principal as of the end of April. The Watertown Trust provided a $100,000 mortgage to the business the same year and claims $61,934 remains due. The North Country Alliance claims it lent the business $200,000 in 1998, with $38,990 remaining to be repaid.
According to court documents, Alteri has been in default on the loans since August 2011, although it has been making some payments.
Alteris last full loan payment coincided with the month Jreck Subs Inc. announced it was shifting its sandwich roll business from the Watertown bakery to a producer in Cleveland, Ohio, taking away more than half of Alteris business.
The company also was forced to lay off about 20 workers.
The move prompted Seaway Valley Capital, parent company of Alteri, to sue Jreck, claiming it had a 2002 contract calling for Jreck franchises across the state to buy all of their rolls from Alteri.
Jreck has countered that a subsequent agreement superseded the earlier one, allowing it to make the vendor change.
JCIDA and the Watertown Trust have joined Seaway Valley Capital as plaintiffs in that action, which remains pending in Supreme Court.