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IN EXCHANGE FOR PAGAN MINING PERMIT
JG Sablan, CNMI govt settle for $4.8M
Businessman John T. Sablan of JG Sablan Rock Quarry Inc. has reached a $4.8-million settlement agreement with the CNMI government in connection with the company’s legal battle against the Department of Public Lands that began in 2006 when DPL terminated JG Sablan’s mining permit.
At a settlement hearing yesterday before U.S. District Court for the NMI Magistrate Judge Heather L. Kennedy, attorney Michael Dotts, counsel for Sablan, stated that the parties have settled multiple litigations with two primary aspects.
Dotts said Sablan has agreed to pay $4,806,867.12 to the CNMI government and the later will issue a mining permit for Pagan Island.
With regard to the $4.8 million, it will not accrue interest. However, if there is a material default in the repayment, whatever amount remains outstanding will be subject to a penalty of a 100 percent.
With respect to the mining permit, the length of such permit will be for 20 years, with a $100,000 permit fee payable in 120 days from its execution.
Afterwards, there will be royalty fees essentially either the greater of $100,000 or 8 percent of the gross per year.
After the $4.8 million has been paid, the royalty rate will drop from 8 percent to 3 percent.
The first payment of the royalty will be due on the first anniversary after all ancillary permits to the mining permit have been obtained.
With regard to the litigation, all actions in the Superior Court will be dismissed with prejudice, each side to bear their own attorney’s fees and costs.
With respect to the case pending in federal court, the case will be dismissed with prejudice with each party to bear their own attorneys fees and costs. The federal court will retain jurisdiction of the case to enforce the settlement agreement.
Kennedy ordered the parties to submit stipulation to dismiss the case and final settlement agreement no later than July 3, 2014.
Assistant attorneys general Peter Prestley and Gilbert Birnbrich appeared at the hearing for the government.
