honestbee creditor sues ex-CEO for US$3.8m loaned to startup
High Court suit filed before honestbee's move on Thursday to seek court protection from its lenders
Sharanya Pillai
Singapore
HONESTBEE co-founder and former chief executive Joel Sng is being sued by a creditor of the company for the repayment of a US$3.8 million loan that was made to honestbee, according to High Court filings dated July 19 obtained by The Business Times .
The plaintiff in the suit is Benjamin Lim Jia-Rong, who is represented by solicitors April Cheah and Julian Tay of law firm Lee and Lee. Mr Sng is represented by Solitaire LLP's Nichol Yeo, who was formally appointed on Thursday.
In his statement of claim, Mr Lim said that he had entered into an agreement dated Dec 27, 2018 with honestbee to grant the grocery delivery startup an interest-free convertible loan of US$3.8 million.
Under the agreement, the repayment date was to be six months later, or another date as agreed between the parties, the statement of claim indicated.
Mr Lim further alleged that on April 27 this year, Mr Sng had guaranteed the punctual repayment of the loan to Mr Lim, via a deed of guarantee.
On June 27, Lee and Lee gave written notice to honestbee to repay the loan by July 8, the statement said. In his claim, Mr Lim said that his lawyers issued letters of demand to honestbee and to Mr Sng on July 9 after the deadline was missed. Mr Lim said that he has not yet been paid.
In response to queries from BT, honestbee's current chief executive, Ong Lay Ann, confirmed that Mr Lim had extended the US$3.8 million loan, and that the startup has not repaid the loan.
"The monies were received and were used as operating capital. We have engaged with Mr Lim and are negotiating for a workable outcome," Mr Ong said in a statement.
Mr Yeo of Solitaire said that Mr Lim had extended the loan to honestbee "as part of its funding". He declined to comment further on Mr Sng's next steps.
BT could not reach Mr Lim. His lawyers had not responded to queries from BT as at press time on whether the case will be affected by honestbee's Thursday application for court protection from creditors. Mr Ong told BT that honestbee owes more than US$180 million to creditors.
According to the filings, a pre-trial conference is scheduled for Sept 11.
READ MORE: honestbee applies for court protection; eyes conversion of over US$180m debt into equity
