The Chief Executive Officer of Choppies Group, Mr Ramachandran Ottapathu has a new employment Contract as Chief Executive Officer – and it his pay cheque is down 43%. The employment contract of Mr Ottapathu was reviewed following advices from Advocates Hoffmann SC and Redding SC hance ‘appropriate clauses inserted in the employment contract’.
According to a Choppies circular, “In accordance with current best remuneration practises as advocated by King IV Code on Corporate Governance, the current guaranteed portion of the Chief Executive Officer’s remuneration has been reduced by 43% to facilitate the introduction of short-term incentives.”
The circular, released this week, states that upon the lifting of the suspension of the Company’s share trading on the BSEL and JSE, the Board will consider the introduction of long-term incentives as part of the remuneration of the Chief Executive Officer as well as the quantum of overall remuneration. The reviewed employment contract between the Company, and the Chief Executive Officer was effective as of 1 March 2020.
In addition Choppies has appointed a Chief Financial Officer. A South African Chartered Accountant has been appointed CFO with effect from mid-April 2020. This appointment is subject to the issuing of a work permit by the Botswana authorities. “The individual has extensive JSE listed company experience including group accountant of the Nampak Group for six years and more recently senior financial positions within the retail group Edcon.”
Furthermore the Group has recruited a Deputy Chief Executive Officer. According to the circular, a suitable candidate with over 25 years of grocery retail experience in Southern Africa including very senior executive position and proven retail track record has been identified and he will commence duties with the Group, as soon as his current commitment comes to an end, during April 2020.
Loans and injection of capital by founding shareholders
As of 19 September 2019 loans of an aggregate of approximately BWP680million were outstanding to the Lenders. According to Choppies, in terms of a facility agreement concluded between the Company and CDC and certain of the Lenders, the capital of majority of loans was repayable, over a 5-year period of time, commencing 1 July 2020, with interest payable on a monthly basis.
“Because of various instances of default, the main instance of which was failure to timeously deliver and publish the audited consolidated financial statements in respect of the year ended 30 June 2018, the principal balances of or the borrowings, became payable in full, on demand.”
The circular notes that the Lenders agreed to hold off making demand for immediate payment and proceeding to recover the full amount of the aggregate of the capital of the borrowings provided that there be an immediate reduction in the capital outstanding of the loans and sales of non-performing businesses of the Group, particularly those in South Africa, be proceeded with, with an agreed time frame.
“The Company agreed to a reduction of the capital of loans in the sum of BWP150million payable as to (1) the amount of BWP 100million by 10 October 2019 and (2) BWP 50million by 30 November 2019, and required that the Founding Shareholders guarantee the payment by the Company of the total aggregate of BWP 150million, on the due dates.” The Choppies Founding Shareholders have agreed to undertake that guarantee and as of the 10th of October 2019, the Company was not able to effect the reduction of capital of the loans outstanding to the Lenders in the sum of BWP 100million.
Accordingly, in terms of the guarantees, the Founding Shareholders effected the payment of BWP100million, Mr Ottapathu effecting a payment of BWP 80 million and Mr Ismail effecting a payment of BWP20million thereof to the agent for the Lenders, thereby causing the outstanding capital balance of the loans due to the Lenders to be reduced by the required BWP 100million, reads the circular.
“The Company and the Founding Shareholders agreed that, subject to compliance by the Company of the requirements of the BSEL, as set forth in the BSE Equity Listing Requirements for a related party transaction based on the size of the contribution made by the Founding Shareholders relative to the size of the Company, the payment of BWP 100million by the Founding Shareholders on behalf of the Company, to the Lenders, in reduction of the capital outstanding to the Lenders, would be considered a loan by them to the Company on the basis that:- such loan would accrue interest at a rate, comparable to current market related rates of interest; the claims of the Founding Shareholders for repayment of the capital of the loan be subordinated to the claims of the Lenders and trade creditors of the Group,” the circular reads.
They further agreed that the capital of the loan will be repayable provided that: a debt reduction plan in respect of the capital outstanding to Lenders has been approved by the Lenders; the Company and CDC are in compliance with the terms of the debt reduction plan including all debt reduction milestones; there is no default by the Company or CDC under facility agreements with the Lenders and the terms of securities granted in favour of the Lenders; no payments of interest or capital are outstanding to Lenders; neither the Company nor CDC are in arrears with any amount due and payable to Lenders; A repayment under the loan can be made from free cash flows which, in this context mean the net cash of the Company and CDC available for distribution after making provision for amounts due to Lenders and trade creditors.
The BSEL has confirmed that the contribution by the Founding Shareholders on behalf of the Company, in reduction of the capital outstanding to the Lenders may be considered a loan, by the Founding Shareholders, and a loan agreement in this regard entered into by the Company and the Founding Shareholders as related parties to the Company, provided that there be an independent professional expert opinion in respect of the fairness and reasonableness of the terms of the loan.
The second instalment in reduction of the outstanding capital of the loans (that of BWP 50million which was due and payable on the 30 November 2019) was paid, in two tranches (with the approval of the Lenders) of BWP 20million on 20 December 2019 and BWP 30million on 14 January 2020, from the resources of the Group generated over the 2019/2020 festive season. The Company and the Lenders are in advanced discussions to agree on a Debt Reduction Plan which is expected to be finalised by the 31 March 2020.
The Botswana Democratic Party (BDP) Central Committee (CC) meeting, chaired by President Dr Mokgweetsi Masisi late last month, resolved that the party’s next Secretary-General (SG) should be a full-time employee based at Tsholetsa House and not active in politics.
The resolution by the CC, which Masisi proposed, is viewed as a ploy to deflate the incumbent, Mpho Balopi’s political ambitions and send him into political obscurity. The two have not been on good terms since the 2019 elections, and the fallout has been widening despite attempts to reconcile them. In essence, the BDP says that Balopi, who is currently a Member of Parliament, Minister of Employment, Labour Productivity and Skills Development, and a businessman, is overwhelmed by the role.
The Botswana Defence Force (BDF)-Namibians fatal shooting tragedy Inquest has revealed through autopsy report that the BDF carried over 800 bullets for the mission, 32 of which were discharged towards the targets, and 19 of which hit the targets.
This would mean that 13 bullets missed the targets-in what would be a 60 percent precision rate for the BDF operation target shooting. The Autopsy report shows that Martin Nchindo was shot with five (4) bullets, Ernst Nchindo five (5) bullets, Tommy Nchindo five (5) bullets and Sinvula Munyeme five (5) bullets. From the seven (7) BDF soldiers that left the BDF camp in two boats, four (4) fired the shots that killed the Namibians.
The former Minister of Foreign Affairs and International Cooperation, Pelonomi Venson-Moitoi’s decision to apply for the positions of United Nations Special Representative of the Secretary-General (SRSG) and their deputies (DSRSG), has left the government confused over whether to lend her support or not, WeekendPost has established.
Moitoi’s application follows the Secretary-General’s launch of the third edition of the Global Call for Heads and Deputy Heads of United Nations Field Missions, which aims to expand the pool of candidates for the positions of SRSG) and their deputies to advance gender parity and geographical diversity at the most senior leadership level in the field. These mission leadership positions are graded at the Under-Secretary-General and Assistant Secretary-General levels.