EDIG has warned about the likelihood of more financing before the end of the year.
The forbearance agreement on the $750,000 note expires on 12/31/03. The formerly renegotiated terms of the note offered interest-only payments of $7,500/mo until 12/31/03 and then payments of $50,000/mo thereafter. However EDIG was not even able to make the $7,500/mo payments so entered into yet another forbearance agreement that will expire next month.
EDIG warned about the likelihood of needing more financing in the last 10Q: #msg-1330846
They have also revealed some disturbing things about potential rights of the note holder if they default: #msg-1145831
From the last 10Q:
3. UNSECURED PROMISSORY NOTES 15% Unsecured Notes On December 11, 2002, the Company issued a 15% Unsecured Promissory Note ("15% Unsecured Note") for gross cash proceeds of $750,000. The 15% Unsecured Note, under the original term, was scheduled to mature on February 11, 2004 and payable $50,000 each month, with a final payment of $35,801 on February 11, 2004. The Company entered into a forbearance agreement with the lender through and including December 31, 2002. On December 30, 2002, the Company issued 133,223 shares of Common Stock in consideration for all unpaid interest. On December 23, 2002, the holder of the 15% Unsecured Note agreed to (i) extend the maturity date of the 15% Unsecured Note from February 11, 2004 to May 31, 2005; (ii) reduce the monthly payments from $50,000 to $7,500 through December 31, 2003, representing the monthly interest on the 15% Unsecured Note and (iii) $50,000 payments each month, beginning January 31, 2004. As at June 30, 2003, accrued interest totaled $56,250 [March 31, 2003 - $28,125]. The Company has entered into an additional forbearance agreement with the lender deferring any payments through and including December 31, 2003.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.