Monday, October 26, 2020

Letlole La Rona rebuffs CEO’s P14 million benefits claim

Letlole la Rona Limited has instituted writ of summons against the suspended chief executive officer (CEO) Chikuni Shenjere-Mutiswa who is currently facing a disciplinary hearing.

Letlole la Rona slapped the CEO with a writ of summons, seeking a court order declaring that the CEO is not entitled to payment of some P14 million (BwP14 948 368.29) as his benefits claim.

In the writ dated 14th August 2020, the lawyers from Armstrong attorneys asked the court to dismiss Shenjer-Mutuswa’s claim which was through a notice dated 28th April 2020.

According to court records, the particulars of claims are that the defendant has made a demand for payment to the plaintiff (Letlole la Rona) under a Long-Term Incentive Plan Agreement (LTIP or the Plan) dated 11th December 2019.

Letlole la Rona seeks to declare void ab initio (invalid) the LTIP executed on the 11th December 2019 by its Board of Directors Chairperson on behalf of the plaintiff and the Defendant who has made a claim under the LTPIP.

According to courts papers, before Lobatse High Court Judge, Modiri Letsididi  the first version (LTIP 1) is initiated on each page and signed by the chairperson and by the CEO and is dated 11 December 2019.

It contains a clause which triggers clients’ obligation to make payment of the incentive benefits under the agreement in the event of the change in the board’s control through “the removal, resignation or departure in whatever manner and for whatever reason, within twelve months, of three or more of the existing members of the Board, in office as at the approval date of this plan or an increase, of three or more in the number of directors from the number of appointment directors as at date of approval of the plan’’ read part of the LTIP version

The second version (LTIP 2) while bearing the signature of both the chairperson and the CEO and date of 11th December 2019 is only initiated on each page by defendant (Shenjere-Mutiswa) and not by the Chairperson. It in all respect with LTIP 1 but contains a different clause 1.1.15.5 providing for the payment-trigger based on a change in the board’s control through, “a change (being the removal, resignation, departure, addition or inclusion) in whatever manner and/for whatever reason, within 12 months of at least three members of the board in office as at the approval date of this plan.

Letlole La Rona through their lawyers at Armstrong attorneys said the second version furthermore contains a clause 18.3, whereas the first does not. This clause provides that it is unnecessary for the agreement to be initialed or for the signatures to be witnessed for the agreement to be valid.

“The change in the two versions was brought about by the CEO’s fraudulent misrepresentation in that the Chairperson’s signature was signature required due to change in plaintif logo only. The defendant conduct in regard to LTIP 2 constitute a repudiation of LTIP 1, which repudiation, the Plaintiff, as it was entitled to, has accepted,” read part of the content of the summons

Letlole la Rona through their attorney prays from court for an order declaring that the LTOP initialed on each page and signed by both defendant and plaintiff’s Board of Directors chairperson on 11th December 2019 is of no legal force and effect, alternatively was cancelled by the plaintiff

They also prayed for an order declaring that the defendant is not entitled to the payment of P14 million (BwP14 948 368.29.

According to LLR documents, the company boasts properties valued at about P819 million mainly in the industrial and retail sectors suspended Shenjere-Mutiswa with full benefits, pending the outcome of further and full investigations. LLR is 45 percent owned by Botswana Development Corporation 

The Company is currently on a closed period as it has started preparing for the results for the financial year ended 30 June 2020 and are expected to continue until 30 September 2020 or thereabout when the results are expected to be published.

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