Electro Optic Systems Holdings Limited

ASX:EOS

Electro Optic Systems Holdings Limited

ASX:EOS
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$1.650 (+3.4%)
Last close price
#308
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10
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Forum Topics EOS EOS Risks

Pinned straw:
Rudyboy
Added 7 months ago

What is going on with EOS. One week they get a big order, the next their funder Soul Parts is serving them a notice.


Electro Optic Systems Holdings (“EOS”) is in Commercial Dispute with its lender, Washington H. Soul Pattinson (“WHSP”).

EOS announces today that after close of business on Friday 6 October 2023 it received a demand for payment of a $4.5 million fee within 7 days, from its primary lender WHSP.

EOS is seeking to meet with WHSP to discuss the matter, and believes this represents a commercial dispute with WHSP. EOS is seeking legal advice on the validity of the demand and intends to vigorously defend its position, noting that it has adequate funding to pay this fee if required.
Solvetheriddle
7 months ago

what struck me with this announcement was that SOL are quite conservative and unlikely to move unless they see a real issue. they are not attention seekers. maybe its a legal dispute over the interpretation of terms etc, thats the bull case for EOS. it sets off some alarms for me without knowing many facts.

15
Rudyboy
7 months ago

I know Rob Milner and you're absolutely right. WHSP are quite happy to let you get on with it through the thick and thin and certainly not show-boaters.

EOS seem to be saying "everything's fine, we don't need to advise you or tell you" but Soul Patts is saying "are you sure you know what your doing with our money".

The interest rate from memory is in the credit card range so very high.

14
jcmleng
7 months ago

Yeah, didn't like the tone of the announcement. EOS has been travelling quite nicely of late, so this setback is a bit of a bum.

11
AUROPAL
7 months ago

It seems like these new contracts have triggered some concerns from WHSP about EOS being able to meet it's obligations in the future so they're asking for money now to reduce their risk.

However, EOS doesn't seem to think terms of its new contract wins will make it unable to pay in the future or breach the covenants of the loan and so is rejecting to have to pay this demand from WHSP.

Either way, it's not a good look as it means WHSP doesn't have great faith in EOS.

13