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.
While there is no hard-and-fast rule in politics, former Molepolole North Member of Parliament, Mohamed Khan says populism acts in the body politic have forced him to quit active partisan politics. He brands this ancient ascription of politics as fake and says it lowers the moral compass of the society.
Khan who finally tasted political victory in the 2014 elections after numerous failed attempts, has decided to leave the ‘dirty game’, and on his way out he characteristically lashed at the current political leaders; including his own party president, Advocate Duma Boko. “I arrived at this decision because I have noticed that there are no genuine politics and politicians. The current leaders, Boko and President Dr Mokgweetsi Masisi are fake politicians who are just practicing populist politics to feed their egos,” he said.
Former Botswana Democratic Party (BDP) parliamentary hopeful, Lawrence Ookeditse has rejected the idea of taking up a crucial role in the Botswana Patriotic Front (BPF) Central Committee following his arrival in the party this week. According to sources close to development, BPF power brokers are coaxing Ookeditse to take up the secretary general position, left vacant by death of Roseline Panzirah-Matshome in November 2020.
Ookeditse’s arrival at BPF is projected to cause conflicts, as some believe they are being overlooked, in favour of a new arrival. The former ruling party strategist has however ruled out the possibility of serving in the party central committee as secretary general, and committed that he will turn down the overture if availed to him by party leadership.
Ookeditse, nevertheless, has indicated that if offered another opportunity to serve in a different capacity, he will gladly accept. “I still need to learn the party, how it functions and all its structures; I must be guided, but given any responsibility I will serve the party as long as it is not the SG position.”
“I joined the BPF with a clear conscious, to further advance my voice and the interests of the constituents of Nata/Gweta which I believe the BDP is no longer capable to execute.” Ookeditse speaks of abject poverty in his constituency and prevalent unemployment among the youth, issues he hopes his new home will prioritise.
He dismissed further allegations that he resigned from the BDP because he was not rewarded for his efforts towards the 2019 general elections. After losing in the BDP primaries in 2018, Ookeditse said, he was offered a job in government but declined to take the post due to his political ambitions. Ookeditse stated that he rejected the offer because, working for government clashed with his political journey.
He insists there are many activists who are more deserving than him; he could have chosen to take up the opportunity that was before him but his conscious for the entire populace’s wellbeing held him back. Ookeditse said there many people in the party who also contributed towards party success, asserting that he only left the BDP because he was concerned about the greater good of the majority not individualism purposes.
According to observers, Ookeditse has been enticed by the prospects of contesting Nata/Gweta constituency in the 2024 general election, following the party’s impressive performance in the last general elections. Nata/Gweta which is a traditional BDP stronghold saw its numbers shrinking to a margin of 1568. BDP represented by Polson Majaga garnered 4754, while BPF which had fielded Joe Linga received 3186 with UDC coming a distant with 1442 votes.
There are reports that Linga will pave way for Ookeditse to contest the constituency in 2024 and the latter is upbeat about the prospects of being elected to parliament. Despite Ookeditse dismissing reports that he is eying the secretary general position, insiders argue that the position will be availed to him nevertheless.
Alternative favourite for the position is Vuyo Notha who is the party Deputy Secretary General. Notha has since assumed duties of the secretariat office on the interim basis. BPF politburo is expected to meet on 25th of January 2020, where the vacancy will be filled.
Botswana Democratic Party (BDP) big wigs have decided to cancel a retreat with the party legislators this weekend owing to increasing numbers of Covid-19 cases. The meeting was billed for this weekend at a place that was to be confirmed, however a communique from the party this past Tuesday reversed the highly anticipated meeting.
“We received a communication this week that the meeting will not go as planned because of rapid spread of Covid-19,” one member of the party Central Committee confirmed to this publication. The gathering was to follow the first of its kind held late last year at party Treasurer Satar Dada’s place.