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CAPS United last year used their players as security and gambled on potential earnings, which could be generated from proceeds from transfers both at home and abroad, as collateral to unlock a raft of interest-free loans from an investor that the Premiership giants used to service their operations.

The Green Machine also committed themselves to pursue an aggressive strategy to try and sell their top stars as part of the grand plan to bring in funds into the club to enable CAPS United to dissolve the debt it owed to the investor who pumped US$52 000 into the team’s coffers last year.

The money was used for various commitments at the club including, but not limited to, direct operational costs like incentives, the cost of surgery performed on Tawanda “Rambo” Munyanduri and Tawanda Nyamandwe, their physiotherapy sessions, payment for training grounds and lunches for the team.

In return CAPS United committed themselves to cede the club’s rights to any transfer earnings that could be realised from the local or international transfer of their players as part of their package to pay back the loans to the investor who is also a fan of the Green Machine.

CAPS United president Twine Phiri, in his capacity as executive chairman, and former chief executive Joe Makuvire, signed the agreement with the investor, who has chosen to keep his identity a secret for now for fear of being targeted by other fans given his other interests as a supporter of the club, in Harare on August 29 last year.

The Green Machine also committed themselves, alternatively, to cede their rights to any prize money that could be earned by the club, for the duration of the loan period, and channel it towards the settlement of the debt until the last cent had been paid back.

Makepekepe took home US$45 000 for being runners-up in the Mbada Diamonds Cup and also pocketed a further US$24 000, at the end of the season, after the Green Machine finished fifth in the championship race and, according to the agreement, part of this money should have gone towards liquidating that debt but it didn’t.

CAPS United committed themselves to paying the debt by February 28 this year but when the day came and passed, without payment being done or any players being sold to generate funds to direct towards such payment, the investor decided to take legal action on the club.

Yesterday, his lawyers, Zimbodza and Associates, wrote to Phiri demanding payment of that outstanding amount.

“Our client aises us that at your special instance and request he aanced to you a loan of US$52 000 to finance your football club,” read the letter from the lawyers.

“You entered and signed with our client a letter of guarantee wherein you undertook to pay back the money, among other guarantees, on or before the 28th February 2014.

“ON 28th of February you were reminded of the debt and called upon to liquidate it, which you totally ignored. We are instructed to demand, as we do hereby do:

a) Payment of US$52 000

b) 10 percent collection commission in the said sum within five days of receipt of this letter failing which we are instructed to proceed to court without any further communication to you.

The Herald yesterday saw a copy of the agreement signed by Phiri and Makuvire with the investor on August 29 last year reads:

a) This note serves as letter of guarantee andor confirmation of surety of debt.

b) CAPS United FC hereby acknowledge indebtedness for various amounts defined by various acknowledgement of debt notes.

c) The creditor also fully acknowledges the cash constrains facing the club and the resultant inability to immediately service the debts.

d) CAPS United FC currently acknowledges lack of capacity to service such debts.

e) The creditor further promises to continue to provide funds to the club in various quantities and availed time to time on condition that such funds are fully acknowledged by the club and are subject to this guarantee.

f) The guarantee is for funds not exceeding US$100 000 (one hundred thousand United States dollars)

g) CAPS United FC hereby cede the club’s rights to any transfer earnings that may be realised for the local or international transfer of players currently in the club’s books,

h) The club further cedes rights to any prize money that may be earned for the duration and quantum of indebtedness to the creditor.

i) The club hereby consents and expressly empowers the creditor to recover his debt in part or in full from any future transfer earnings.

j) The Club undertakes to service all debts under this guarantee by 28 February 2014 and shall ensure a deliberate effort to export players so as to meet obligations covered by this guarantee by due date.

k) The ceded rights are limited strictly to amounts owed by the club to the creditor and fully acknowledged by both parties.

l) The cession expires on full payment of all the funds owed.

m) The cession acts as a guarantee and entitles the creditor to future earnings in respect of the debt only and in no way does it communicate or translate to ownership of players andor their rights.

Phiri, who is also the PSL chairman, installed a new board to run the Green Machine at the beginning of the year that is led by businessman Nhamo Tutisani and it has brought a wave of great expectations that it could resolve the challenges that have been bedevilling the club.

Some seasoned observers feel the Green Machine would have won the league championship last season, if they had similar backing that is received by their major rivals Dynamos and Highlanders from BancABC, and blame the player protests, at a key point in the season, for the losses at Shabanie and Black Mambas which, if they had been victories, could have put CAPS United firmly in the mix for the title race.

The new board has been working behind the scenes to resolve the challenges stalking the Green Machine and help it fulfil its potential and have already thrashed out an agreement between Phiri and his partner Farai Jere by officially acknowledging the latter’s shareholding in the club.

Jere returns to the club’s administrative structures, after a year in which he took a break from the game, as a non-executive director.

It’s very likely that the CAPS United board will be looking at such outstanding issues, which have the capacity of harming the club’s image at a time when they need to boost their appeal and bring in corporate partners, as part of their drive to take the Green Machine forward.

Thousands of CAPS United fans converged at Rufaro on Sunday to cheer their team to a huge victory over Harare City, their first over their bogey side since the Sunshine Boys came into the Premiership, and there was a party mood at the stadium after the game.

Source : The Herald

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