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Good prices! You are already up 24%
Exactly! I pick up pennies on the street, so I sure would pick up the $200 or so that I was ripped off for in the past couple of hours!
I suppose that some would say that this is how the market makers are supposed to earn their money, but it damages both the buyer and the seller. I have been willing to pay .23 all day, yet the sellers were only getting .225 (at best).
Well, as I said, it is just nickle and dime stuff, but it does annoy you.
By the way, I just got filled on two more 5,000 share trades at .23 and this time there was no intermediary trade at .225
Maybe the MMs are reading this board!
Same thing just happened to me three more times. A 25,000 share trade is reported at 13:41:49 at .225 and then I was sold 25,000 shares at .23 seconds later.
Another $125 for the market maket.
Then 5,000 shares trade at .225 at 13:45:19 and another sale to me took place one second later at .23 for those 5,000 shares.
Then 5,000 shares trade at .225 at 13:46:10 and another sale to me took place one second later at .23 for those 5,000 shares.
Little nickle and dime rip-offs by the market makers!
Here is an example of what I meant:
A few seconds ago (13:34:18) a trade went through for 5,000 shares at .225
One second later (13:34:19) I was sold 5,000 shares at .23
The market maker picked up $25 by that action.
There is no reason that the bid should not be at .23 given the number of shares ready to buy at that price. My guess is that the market maker who is handling my orders has placed them in at .225, hoping to pick up .005 on those trades as they execute.
Here is an example of improper MM behavior. For the past couple of hours I have have had four unrestricted (i.e., not "all-or-none") buy orders at a price of $0.23/share for a total of more than 300,000 shares, yet the "bid" remains at $0.225 and only a few shares have been sold to me.
talons, I am just a shareholder here, like you. The reason that I feel more confident about the company's future today than I did before the debt was restructured is quite simple.
Had the lenders demanded payment at December 31 the company would likely have been forced into bankruptcy and we shareholders would have been in much worse position than the potential issuance (through conversion) of an additional ten million shares puts us.
The inability to repay loans is what usually puts companies into bankruptcy. E.Digital resolved that problem (which could have turned into a major crisis) with the equity swap and reduced their cash outflow requirements with the restructuring of the one remaining loan.
Why wouldn't any rational shareholder feel better about the company's future after that event?
I bought more shares in December after seeing the comments from management that a favorable resolution of the debt issue was likely. You may recall that I posted here on December 18 that the debt problem was one of three significant matters which shareholders should monitor and that a favorable outcome would reduce the risk faced by all investors.
I sincerely wish each person (even including the bashers!) a healthy, prosperous and happy new year (provided that said happiness is not derived from the suffering of others.)
JimC
CDR, nothing will guarantee that EDIG is not forced to sell some shares at prices below .20 - except better market conditions and improved company prospects.
If the investment community begins to see some signs of life in EDIG then the floor price will probably no longer be an issue.
Back on 12/18 I posted this note:
Let me make something clear to all.
I am not advocating that anyone else buy the stock here, nor do I question the rationale of anyone who sells.
I can understand anyone giving up after all of the disappointments we have endured.
This is a high risk stock and only those with high risk tolerance should buy it. Probably the most prudent course for most would be to see how the IFE business develops, what (if anything) develops at CES and how the current debt situation is resolved.
The right answers to those three questions would lower the risk substantially, but the price at that point would likely be substantially higher than the current level.
Well, we now have the answer to the debt issue.
In a few weeks we will know what arises from the expected CES announcements.
And within the quarter the potential for the IFE business should start to become clear.
It is my understanding that the airlines are willing to fund the development costs for the IFE units. This could relieve a lot of the cash strain facing the company and reduce the need to sell shares.
The full launch of the Odyssey 1000 (set to occur at the CES) should also help the cash situation.
For what it's worth, I am more confident today than I was prior to yesterday's announcement.
A true floorless convertible would provide for automatic conversion into more shares if the share price dropped.
This preferred stock issue has a fixed conversion price that does not change unless e.Digital sells shares at a lower price. If EDIG sells stock at .20 or above, the conversion ratio remains the same.
If the market price were to drop below .20 (as it did today) the conversion ratio does not automatically change. A true "death spiral convertible" would automatically adjust for the change in market price at the time of conversion.
However, this preferred stock issue has no such provision. It remains fixed at 50 common shares per preferred share, based upon a common share value of .20/share for the life of the issue, or until EDIG sells shares at a lower price. If EDIG does sell shares at a lower price, the new conversion rate is then fixed.
No, he is not correct. The debt was secured and consequently the debt holders could have effectively taken control of the company upon a repayment demand. They did not do so, nor did they force the company to sell all of its remaining registered shares in order to repay them.
I would disregard anything posted by seedieca. He is clearly just another basher and an honest discussion is not his objective here.
Getting ready to load in some new buy orders. I guess some here and on RB can't see the obvious - the company intends to remain in business despite the fervent wishes of the bashers to the contrary.
And certainly the debt holders like the prospects for the company stock enough to forgo immediate payment of their loans.
No, 24601, this is not a "floorless" convertible. That term refers to preferrred debt offerings in which the holder is guaranteed a fixed dollar amount for the security upon exchange. E.Digital has used that type of financing in the past and their use was the primary reason that the shares outstanding expanded from less than 30 million in 1997 to over 150 million today.
This preferred stock offering has a fixed conversion price of $0.20/share, with the provision that the company will lower that conversion price if it sells common stock at a lower price.
At this time the $2.05 million of debt has been converted into 205,000 shares of the Series D preferred stock. Each preferred share has the voting rights of 50 common shares, or a total of 10,250,000 shares.
If the preferred holders exchanged their stock for common the company would issue 10,250,000 new shares of common stock today.
As I read the 8-K, the 10,250,000 shares required for the potential conversion would not be drawn from the recently registered stock, leaving the balance of that stock available for future cash needs of the company.
There is also a provision in the preferred stock agreement which allows the company a ten day window to force the conversion into common if the common stock rises to $0.60/share or above and remains there for ten trading days.
Any preferred stock still outstanding on December 31, 2007 is automatically converted into common stock.
The good points of this agreement are that is relieves the debt repayment pressure on the company, fixes a conversion price for the debt and leaves the remaining registered shares available for other needs.
Given the tight cash situation faced by the company I believe this is about as good a deal as we could expect.
As requested, it was posted.
Merry Christmas to you!
Good catch. I did forget to highlight that one!
Highlights of the letter:
1. "first Odyssey 1000s are scheduled to ship to our headquarters by air later today"
2. "we expect our initial production run to sell through quickly. We also generated media interest due to internal public relations efforts and from the November 24 coverage in PARADE Weekly magazine. We expect this interest to continue at the official launch of the Odyssey 1000 at CES 2003, January 9-12 in Las Vegas."
3. "Our manufacturing partner, Digitalway, Inc. of Korea, is concurrently building feature-differentiated Odyssey 1000 units for their use in Asia -- where their OEM and branded products are the #1 selling digital audio products -- as well as in Europe and North America."
4. "Through Digitalway and other OEMs we expect this important new product, based on our patented MicroOS(TM) technology, to be licensed with variable features for sale around the world."
5. "Each licensed unit is expected to display our 'Powered by e.Digital Technology' tag line; e.Digital will be credited as the developer and we will receive licensing fees and royalties for each unit sold."
6. "We have made substantial progress on our first portable hard disk drive-based In-Flight Entertainment (IFE) system in association with APS and a major U.S. airline. With APS, we are in discussions and negotiations with other airlines and content providers who are expected to become partners in this new system."
7. "Based on forecasts by Eclipse by Fujitsu Ten, the first-generation products are scheduled to be available in the first quarter of calendar 2003. This is when we expect to begin recording revenues from sales of this product line."
8. "Additional OEM projects, both completed and in process, will be announced as appropriate and timed according to the launch plans of our OEM customers and partners."
9. "To date, revenue for the December quarter is much improved over the September quarter. Based on the expected deliveries of the first IFE systems, Eclipse by Fujitsu Ten automotive stereo products, full launch of the Odyssey 1000, and other developments, the first calendar quarter of 2003 is expected to show continuing revenue growth."
10. "Through the assistance of our Chairman, Alex Diaz, we have acquired www.edigital.com and will begin making use of this domain as our primary URL in early 2003"
11. "We have negotiated an agreement with our short-term note holders to restructure the notes on terms favorable to the company. We expect this agreement to be formalized before the end of this month"
12. "We are preparing for the International Consumer Electronics Show (CES) in Las Vegas January 9-12. Our booth ... will also have information on OEM platforms featuring digital audio and video support. We are planning to have products and technology platform demonstrations in several OEM customers' and partners' booths as well as in technology suites and pavilions."
All in all, a good letter which resolves many of the current concerns expressed by shareholders.
Thanks packers1, that was quick spotting. The letter should relieve anyone who was concerned about bad news today. Everything seems to be progressing.
Frank, your numbers are off by a factor of ten.
If Woody sold 6 million shares at $15 the proceeds would have been $90 million and after federal and local tax (since his holdings were long-term) that would have netted him about $63 million.
However, I doubt that Woody sold that many shares and I further doubt that he would have obtained that average price.
But if he did, he certainly has the cash to support EDIG almost indefinitely.
Do you mean, how would someone who had a large block know about bad news?
I am just speculating that a number of the suppliers who have been paid with stock would certainly have a pretty good idea of the company's current situation and would not hesitate to unload their stock if they were concerned.
If you mean how would they know about the block orders, all market makers can see the size of all-or-none orders.
If they were about to release bad news don't you think that someone who was concerned, and owned 100,000+ shares would want to sell at a price above the ask?
No such sale, hence no such concern.
The other odd thing is that almost all of the buy orders which have been filled since the volume was at 160,000 have been my any size orders at .22
First time that I have seen such a blatant example on my own orders, though!
OK, that order is back up to .23
It certainly doesn't speak well for the honesty of the market makers, does it? They are supposed to insure an orderly market, filling orders to buy at the ask and orders to sell at the bid. Here they had an order above the ask (and plenty more at the ask), yet no trades were going through.
Maybe I'll move the price down to .22 and see what they do.
Sometimes they fill an all-or-none when they see a price change coming.
Yes, and now I see one at 14:09 (1500 at .22)
No, I was wrong, my streamer stopped. Trades are going through at lower prices than my order.
Funny, not one trade since I moved that order over their heads.
Yes that block is all-or-none.
Nope, no market orders for me. But it is interesting to see this. When you enter an all-or-none order the broker has to show the entire order to the market makers, so they all know that it is sitting above the ask.
That is why I have been using "all-or-none" orders for the past week.
Any size orders can be fed into the market in small pieces by the broker, so the market maker may not know how much buying (or selling) interest is behind the orders which are visible.
Very interesting. I am sitting above the ask with a big order and the market makers won't fill it.
Just moved one of the 100,000 share block orders to .23
I managed to pick up about 30,000 at .22 (from the any size orders) before they raised the bid to .225
They now have a huge slug of orders from me, sitting at .22
Very good due dilligence there, dy2147!
Once a patent is issued it remains in effect for the normal life. But I assume that you knew that and were simply bashing again, right?
Just for the heck of it I am going to move one of my 100,000 share block orders up to .22 and then break up the others into any size (i.e. removing the all-or-none restriction) at various prices.
Let's see how much selling interest there is at the ask now.
Hi drhunt and welcome to a much nicer forum.
RB just isn't worth posting or (or even reading, for that matter) anymore.