The settlement, which will cost the SPA nearly $5 million, ends a 1999 contract that required CIP to operate a 100-acre shipping terminal at the former Charleston Navy Base and permanently returns the facility to the SPA.

CIP, which was created to run that terminal, might still survive as a company, CIP spokesman Richard Quinn said on behalf of CIP managing member Warren Lasch.

"CIP's future is still being discussed," he said Tuesday night.

As part of the settlement, unanimously accepted by the SPA board on Tuesday, the state agency will pay CIP $1.5 million as reimbursement for improvements and equipment the company paid for at the 100-acre breakbulk cargo terminal.

The SPA also will assume CIP's roughly $3.4 million debt at Carolina First Bank, where the company secured a $5.75 million line of credit to finance terminal improvements. The $3.4 million represents what CIP had drawn to date.

In addition, the SPA has spent more than $1 million to fight CIP in court and review the company's books.

The SPA insisted in recent months that it was only responsible for repaying CIP's investments in the terminal. CIP had said it was owed a buyout of its 30-year contract, which it estimated at between $25 million and $40 million.

Neither side can claim outright victory, said state Sen. Arthur Ravenel Jr., R-Mount Pleasant, who was credited with bringing both sides to the bargaining table. "It's good for both. If one side can come out claiming victory, that's not a compromise."

Port officials were tight-lipped about the discussions leading to the settlement, but they did say it grew out of a Dec. 9 meeting between Lasch and SPA board members Whit Smith and Harry Butler Jr.

The settlement, dated that same day and signed by all three men, is expected to be fulfilled within 10 days.

Gov. Mark Sanford "is pleased that the situation has been resolved," said his spokesman, Will Folks.

Both sides agreed to withhold comment on the settlement beyond a joint press release issued Tuesday. The statement says the parties "resolved their disputes and differences amicably" and that "there is mutual respect and good will between the parties."

Those sentiments are a far cry from the barbs traded over the past year. Citing an April 2003 financial report that called CIP's accounting practices "highly questionable," the SPA accused CIP officials of making spending decisions that harmed the terminal's profitability.

The contract required CIP to split terminal profits with the ports authority. Port officials said that never happened because the terminal never generated profits.

According to the financial report, Lasch made political and charitable contributions with CIP funds and loaned money to one of his other companies.

The report also said that CIP drew on the line of credit without prior approval from a joint SPA/CIP committee. Those and other findings prompted the SPA board to terminate CIP's contract and seize control of the terminal.

CIP claimed that in spite of what it alleged were attempts by the SPA to harm the relationship by not adequately marketing the shipping facility, the terminal was profitable. The company's attorney, Gedney Howe III, called the SPA's action at the time "a power play and an old-fashioned land grab."

CIP suggested that the SPA had ulterior motives for wanting the terminal back, arguing that the SPA began to show interest in the terminal only after its port expansion plan for Daniel Island was redirected to the former Navy Base.

Following unsuccessful attempts to mediate a settlement, CIP sued the SPA in October to win back control of the terminal. The case made it to the S.C. Court of Appeals, which referred a narrow legal question over jurisdiction to the S.C. Supreme Court.

The jurisdiction issue is now moot because of the settlement, and the SPA will withdraw its appeal, SPA attorney Rutledge Young said Tuesday.

Future court proceedings are unlikely because both sides agreed not to pursue litigation.

Outside the courts, the dispute also veered into the political arena. Ravenel challenged the amount of money the SPA spent to fight CIP, and state Rep. Jim Merrill asked the S.C. Attorney General's Office for an opinion on the legality of SPA's seizure of the terminal.

Lasch, who heads fundraising for the H.L. Hunley submarine project and has close ties to that project's chief proponent, state Sen. Glenn McConnell, was accused by port officials of wielding political influence in the dispute.

McConnell could not be reached for comment Tuesday but has said that Lasch's work on the Hunley did not afford him any political favors and that the SPA only made such claims because it had a weak case.

State Sen. Bill Mescher, R-Pinopolis, who was critical of the terminal contract when it was first proposed because Lasch's start-up company had no business background, said he hopes the settlement serves as a lesson to state agencies considering contracts with private companies. "They should pay more attention to who they are dealing with," he said.

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