e.Digital Corporation (fka EDIG)

[Cassandra]

What I dont understand is why the company would go to the extreme of this fairly complicated transaction as opposed to simply selling stock on the open market...

That wouldn't allow Polis, Barnes, Norris and the other Series E financiers to make a phenomenal guaranteed profit. It's interesting that Norris is in on this deal when the legal incentive is to short EDIG. Polis and Barnes have been "financing" EDIG and other Norris Corporations for many, many years. List of Series E financiers in #msg-1805241.

It will be interesting to see if EDIG includes some shelf shares in the S-3 that is required to be filed by Dec. 19. If so, there is a good likelihood IMO that additional shares would eventually be sold below $0.19, lowering the artificial floor.

I'm sure they'll have a good sounding explanation in EDIGspeak at the ASM as to why this was a good financing, hinting at great things to come. The simple fact is that the use of proceeds disclosed in the 8-K states that the money is to be used for working capital. Given that the working capital deficit was nearly $2 million in the 10Q, anyone who thinks this funding was to close some major OEM deal is in denial IMO. This funding just keeps the lights on and salaries paid a little longer. If they don't reach profitability, more financings will be needed.