THE Solomon Islands National Provident Fund (SINPF) is believed to be considering new management for its Tavanipupu Island Resort (TIR), sources close to the Fund’s Management have revealed.
The Fund’s Investment Committee is believed to be discussing the matter before it makes its recommendation to the SINPF Board.
The Board is due to meet later this month, the sources said.
“The new management for Tavanipupu Island Resort is expected to be one of the agenda items for the Board’s meeting,” the sources said.
Another major issues for the Board meeting are the purchase of a 94-hectare tract of land behind the Panatina Campus of the Solomon Islands National University (SINU).
The SINPF Management is said to be embroiled in the ownership issue of the land, which the SINPF bought, only to find it was sold to other people already.
It is understood a former Lands Officer sold the tract of land to SINPF, which later found that the same land, previously said to be customary land, had been sold to individuals who have already built on the land.
It is not clear how much the land was sold for, but an insider said the land would be worth millions of dollars.
The SINPF is said to have bought it so it could build a housing estate for Government workers. It is unclear whether the parties (SINPF and SIG) have signed a formal agreement for the project.
The SINPF is also understood to have negotiated a housing deal with the Australian Government under a 10-year contract. Under the contract, sources said, the SINPF would contract builders to build executive houses, which would be rented out to the Australian government for 10 years,
No comments could be obtained from the Australian government on the housing project.
Meanwhile, the 2012 SINPF Annual Report, has thrown more light onto a $15 million loan businesswoman Pamela Kimberly and John Sullivan QC had obtained from the SINPF to management the Resort.
The SINPF reclaimed the management of Tavanipupu in 2014 only after two years. The management contract was due to expire in June 2017.
Documents obtained by Solomon Star showed the beneficial ownership of TIRL was vested in Pamela Kimberly (90 percent) and John Sullivan (10 percent) respectively.”
Under the heading, Tavanipupu Island Resort Limited – Loan Agreement, the Fund’s 2012 Annual Report has shed some light on the terms and conditions of the loan.
It said, “This loan relates to a five-year loan agreement with Tavanipupu Island Resort that was entered into on 22 February 2012 and matures on 22 February 2017. Under the agreement interest, 12.5% is payable by Tavanipupu Island Resort annually in arrears on 15 June every year and the total loan amount of $ 15,000,000 is repayable on 22 February 2017 as shown above.
The agreement gives the option to the borrower of early redemption of the principal amount of the loan taken into account that such repayments will be charged with a 2% levied fee of the amount repaid by the borrower with a minimum reduction of $2,000,000 in the case of any early repayments.
The agreement makes a further provision for any late interest payments by the borrower of 1.5% per month on the amount remaining unpaid until paid in full.
An additional default rate of 1% per month will be charged in addition to the applicable interest in force at the time of default when the loan is called up and demanded to be paid in full.
Any interest including default interest plus any default cost will be accruing and charged to the outstanding loan balance until settlement.
In the event of default by the borrower which is not remedied within 30 days after service of notice of default and requiring default to be rectified was effected on the borrower, the lender shall have the right to convert debt into 51% of equity.
The revelation last week by Mr. Sullivan that “SINPF caused TIR to transfer certain land at Lungga (“Lungga land”) to Kimberly,” throws a different spin on the deed of settlement of the loan.
“The transfer of TIR to SINPF took place as part of a settlement of loan arrangements between those parties,” John Sullivan QC revealed last week.
“As part of those arrangements, SINPF caused TIR to transfer certain land at Lungga (“Lungga land”) to Kimberly. I have no interest in the Lungga land,” Mr. Sullivan, QC, said.
Mr. Sullivan was appointed, along with others, a director of Tavanipupu Island Resort on 14 October 2014. His directorship ceased on 16 November 2017, according to Company Haus extracts.
And this is the mystery.
The 51 percent equity for the debt meant that if Pamela Kimberly and John Sullivan defaulted on the loan, they would still have 49 percent equity in TIRL.
This probably answers the deed of settlement issue with Pamela Kimberly having got the four properties at Lungga, valued at $6.4 million in 2018.