Enables IT Share Discussion Threads

[andre] 03/10/2009 19:07

Which is why directors do what they do. Because insolvency law allows them to take this p*ss and they pay the administrators.

If the directors owned about 75% of the shares in EIT then the other 25% is a gift to them from private investors who appear to be resigned and not making a fuss.

I have never seen a worthwhile creditors meeting yet.

[viateluk] 03/10/2009 11:44

Creditors meeting coming up later in the month I hear.

Normal format probably...adminstrators tell the sad story......creditors all have their whinge...or sit in glum silence...administrators pretend to listen nod their heads in sympathy but stress that everything has been done in line with current legislation and it's tough luck......I might be wrong!

I would have thought that there may have been a case for holding the directors to account for possibly trading whilst insolvent though...their losses have been accrued over more than a year or two and survived a couple of name changes or so I am told. I did hear somewhere that it was alleged that one of the directors has been held to account in the past for such things...still again, that's all hearsay.

[andre] 02/10/2009 20:19

Ahhh, but the administrators got paid. Any reason to think their ears may be sympathetic?

[viateluk] 02/10/2009 00:31

You got it Andre....though, and only imho of course...may have transfered assets that did not belong to them...but then that's just grapevine talk and must be regarded only as alleged. If you have been adversly affected, have you tried talking with the adminstrators?

[andre] 01/10/2009 13:38

I am assuming that no further announcements means they are not interested in keeping shareholders informed having got what the directors wanted. Suspended from trading they will continue to run the new private club (same people different name) and not have to compensate anyone who still owned shares then. Is this legal also? The same directors still own all the assets, yet the shareholders of EIT now own nothing but the debts.

Nice work if you can get it.

[andre] 27/9/2009 20:33

How so WB??

[viateluk] 25/9/2009 22:37

??? Go on.....give me a clue.

[viateluk] 16/9/2009 20:47

Believe you me they don't give a monkeys.
It could be though that the adminstrators have got a bit of a sniff of something that might not be quite right....keep your ears to the ground.

[andre] 16/9/2009 20:19

But surely the company directors feel a responsibility to the minority shareholders..... ;o)

[viateluk] 16/9/2009 09:45

Not sure that that is going to happen....don't hold your breath

[andre] 16/9/2009 07:58

No sign of the new RNS or coming out of suspension.

[andre] 01/9/2009 18:09

WB

It depends whether they are losing money for majority or minority shareholders, I guess. If a company has a pool of stock paid for by others who don't matter and you were on salary, (plus 12% of any money that you loaned to the company)and guaranteed repayment of said loans with the other shareholders money.... then it could be argued that you are less incentivised to let yourself go for poor performance.

After all, why shoot the cow that keeps producing milk just because she is eating more than her worth of other peoples feed?

Just messing around with similies obviously. No direct reference to anything to do with EIT intended. And all IMHO obviously.

[viateluk] 31/8/2009 20:26

Isn't it just the major shareholders who have kept their jobs at board level...together with a certain other who it is alleged has experience of managing companies in financial difficulties before?

[wilson blade] 31/8/2009 19:49

I thought when people within an organisation failed to produce results they parted company (usual terms to spend more time with family or health reasons) this company has kept them on why?

[andre] 24/8/2009 18:44

Quote -

"GHTT - 23 Aug'09 - 18:19 - 240 of 242

But:

1. The Directors are losing money, since one of them paid £1.2m to RBS to cover a loan guarantee he provided to RBS personally. (May 29, 2009 RNS)"



The loans were to Eagle Eye Holdings NOT Eagle Eye Telematics. Therefore as Eagle Eye Holdings are still in business then the loans should still be repayable to the directors. The directors have not lost out as they are still on salary, will get repaid plus interest (at 12%?) and have effectively offloaded the liabilities of Eagle Eye Telematics whilst retaining the assets.

IMHO

[viateluk] 23/8/2009 22:42

IMHO it is clear that they have been trading whilst insolvent and for some considerable time...why has this never been addressed / investigated by the appropriate authorities? I also believe that they may have retained assets that might be argued do not belong to EIT but that's another matter.

I suppose your supposition that "suppliers are not a (major) issue" rather depends upon your definition of supplier.

[cheshiremoggie] 23/8/2009 18:42

I thought that the loans are the problem - suppliers are not a (major) issue as far as we know.

I thought there were 2 loans outstanding both of £1.2m. One to one of the shareholders and one to RBS.

Effectively they own the company as, presumably they have first call on the assets.

Effectively the bank and the major shareholder owns the company.

Current shareholders dont get a look in.

Is that correct?

CM.

[ghtt] 23/8/2009 18:19

But:

1. The Directors are losing money, since one of them paid £1.2m to RBS to cover a loan guarantee he provided to RBS personally. (May 29, 2009 RNS)

2. I have no sympathy for external shareholders who bought recently into a company that was being valued at £7-15m in the last 2 years, when it had sales of £1-1.5m and losses of similar magnitude. At least CYH and MPS had circa £20m of sales and some profits when being valued at these levels!

[andre] 23/8/2009 13:14

Bear in mind also that in-house leases are generally not put into the accounts until the money is paid. Therefore much of the EI Telematics business profits will still come through to the in-house leasing company monthly (Eagle I Leasing) with little in the form of expenses as the outgoings are paid up front and already in the accounts.

Also that the loans are from EI Holdings to EI Telematics so writing them off as bad debts will reduce the tax burden on Eagle I Holdings.

There are many ways to look at this and most appear to benefit the large shareholders to a great degree.

In my experience and IMHO.

[andre] 23/8/2009 13:08

Hi Cheshire,

why would the debts be owed to the main shareholders? The debts have been created through running a loss making business. The creditors will surely be suppliers etc. By running the business at all, the directors will have taken salaries that they (as controlling shareholders) will have deemed 'appropriate'. Personally I think it is appropriate in a company whose losses are as big as their sales for the directors to pay back all of their salaries to the company as they do not appear to have 'earned' anything. Especially as they also make out of the leases, holding company etc. However, there is scant evidence of this happening. So whether you get your loan back as salary or repayment, I would argue that it is essentially the same thing - they get repaid. The creditors, unfortunately, like private investors, get nothing. Especially after their leasing arm takes all the assets and leaves the telematics arm in administration with nothing but debt.

Foreseeable yes, with research. But it still makes the sector look like the wild west and AIM look worse.

The law does need tightening. Especially around the 'discretion' of insolvency practitioners.

All IMHO.

[cheshiremoggie] 23/8/2009 11:51

From the reading of the last few posts it is surely the case that the debts owed by the company are to the main shareholders - to the tune of well over £1m.

The company cannot pay these debts so it is insolvent - which is what a lot of people here have been saying for months.

Current shareholder dont have any equity left, and havent for many months - a basic fact that should be recognised.

For the owners of the debt to effectively take over the company - with the agreement of the same people who are the main shareholders seems a bit dodgy to say the least but it is done regularly.Personally I think the law needs changing to give more protection to minority shareholders but what the heck.

Effectively though, the company has been owned by its debt holders for ages, so this is just formal recognition of that.

Not nice, but foreseeable by anyone researching this carefully.

CM.