A popular digital radio station founded by media personality and businessman Sbusiso “DJ Sbu” Leope is facing the prospect of liquidation after failing to pay its debts.
A Joburg-based company, Business Partners Leadership (BPL), has obtained a default judgment against Massiv Metro for failing to pay it at least R4-million.
BPL is now applying for another default judgment against Leadership Twenty-20, a company founded by DJ Sbu, after it acted as security for the bad loan granted to Massiv Metro.
According to the papers, which are in our possession, Massiv Metro, represented by one Tyrone Willemse, entered into a written agreement in which BPL advanced a R3-million loan to the digital station on March 27, 2018.
The station was required to pay back the loan in R100 000 instalments for 36 months from September 1, 2019.
The station also entered into an agreement with BPL to pay it 2% of its royalties on the higher of actual monthly turnover or of the projected monthly turnover.
In terms of the royalty agreement, Massiv Metro was expected to submit monthly management accounts to BPL on or before the first day of the month following the month in respect of which the royalties became due and payable.
The station was also required to submit to BPL an auditor’s verification of the turnover of the business concerned.
They agreed that if royalties were not paid, the outstanding amount shall be subjected to finance charges in accordance with the finance charge applicable to the R3-million loan from time to time
“If the first defendant breaches the term of the loan agreement or royalty agreement, the first defendant shall immediately pay to the plaintiff all outstanding and future royalties,” read the papers.
BPL said Massiv Metro breached the royalty agreement when it failed to comply with its terms and conditions by failing to pay the royalties.
According to the papers, Willemse and BPL met on June 24, 2020, where they amended and signed the loan and royalty agreement in a bid to enable the station to service the debt. But the tardy Massiv Metro still defaulted on repayments of the amended agreement.
As a result, BPL obtained a default judgment against Massiv Metro on July 11 this year.
The entity is now seeking a default judgment against Leadership Twenty-20.
Leadership Twenty-20’s sin was that it signed an agreement binding itself as Massiv Metro’s surety and co-principal of the R3-million debt.
The matter between BPL and Leadership Twenty-20 will be heard in court on August 16.
“Default judgment application was heard before the honourable judge Mia on July 11, 2023 and judgment was granted against the first defendant (Massiv
Metro), jointly and severally with any order to be granted against the second defendant.
Wherefore the plaintiff prays for judgment against the second defendant (Leadership Twenty-20), jointly and severally with any order granted against the first defendant, the one paying the other to be absolved,” read the papers.
DJ Sbu declined to comment, saying he was no longer a director of both entities.
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