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Re: cksla post# 256

Monday, 01/12/2004 3:15:07 PM

Monday, January 12, 2004 3:15:07 PM

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SUNPOOP --SH Mtg summaries
PostID 297503 On Friday, December 05, 2003 (EST) at 2:55:05 AM

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A few of us arrived early. Early enough to have a coffee clatch in the parking lot....Ediglong, jdtiii (the nit picker) Edigokie (whom I will trounch at golf tommorrow) myself and two or three more who I apologize for not naming since my notes are in the car and I am not going downstairs to get them....Hitachi was there.... Anyway we did our normal Edig speculation on what would transpire at the meeting with jdtiii being honestly negative and not too enthused. We all went inside and saw that the meeting was not very well attended. In fact a room 1/4 that size would have been sufficient. Maybe 1/3 of the amount of attendees from last year...

I was in error when I previously posted EDig would NOT be at the CES ''ala'' RP. Of course ''RP Speak'' was a little foggy on that subject...EDig will have no booth but will have a display, about the size of the prior booths at the CES in the middle of TI's booth, manned by EDig people. TI wanted and invited EDig to be there to showcase the products that are being produced with TI technology. To me that is a heckova a deal. More exposure that EDig ever got from its own booth with TI pushing and I do mean pushing EDig and its technology.(and its free) In fact RP, after the formal meeting, emphasized that TI has sent EDig many customers and is still doing so. TI gets inquirees about certain technology and replies to those queries ''we don't do that but the company you wish to talk to is EDigital'' Call them.......I was't going to the CES this year but I am now and will meet with D'inki (Ediglong) to do our normal harrasment of all and with the express purpose of checking out the HP booth.....

I hit RP about HP and he flat refused to answer one way or the other about EDig's involvement. I did throw some other questions to try to get around ''RP Speak'' and while this is just pure conjecture on my part, ''everthing fits''.

RP did emphasize and re-emphasize that companies the magniture of HP or Gateway will NOT acknowledge anywhere on the product anyone else but themselves. The IPOD being a great example. I did not know it until today but the IPOD has a great percentage of the unit made by other companies, WHO WILL NEVER BE ACKNOWLEDGED. (in fact FF did say that EDig tried to get its name somewhere on the Gateway player but Gateway flat refused and (verbatum) ''you want our business you do it our way''.

Again talking privately with FF, I tried ''smoozing'' a bit but could get nothing factual about the 2 OEM's that he stated ''will be bigger than anything we have ever been involved with'' and that ''we are in advanced negotiations with as we speak'' I guess I lost my touch at ''smoozing'' but I did get something very significant from him, at least to me, in that I said ''in the past we have heard about this OEM and that OEM etc...with no business ever quite coming about.'' In his candid opinion did he feel this was more of the same? A definite NO to my question, I then asked him if he knew or felt the signing on the dotted line to do business with these OEM's was, (1) so-so (we are just talking or in the beginning stage of talks to see if we can do business), or (2) serious but not near an accord, or (3) ''very close'' and most likely will happen. His answer was a very positive #3. In fact he said it was in the hands of the lawers right now and he acted a little frustrated when he said that. ''You know those guys, every letter, word and paragraph has to be examined, written and re-written. Sent back and forth...etc...'' I got the impression what he was talking about was fairly close to being ''a done deal''

I was wrong in my thoughts about the need for the latest financing. It wasn't to ''pay the bills, keep the doors open or the lights on'' It wasn't to defray operating costs and it wasn't for what I thought it was for, ''to front manufacturing costs to get products to market.'' EDig has far bigger irons in the fire than we know of. Both FF and Rp stated the major reason for the financing was to have enough on the books to satisfy potential, (perhaps 1 ??) customers that the company (verbatum) ''will be around a while.''

There was no definitive news on the 3rd quarter earnings until F10 is shipped and that will happen this month. However perhaps the entire order (4,000 units) will be not be finished shipping until the 1st. couple of weeks in Jan 04. Disappointing, so I don't think this will be a ''wizz bang'' quarter.

However, FF STRESSED, that ALL, ALL, the business they are involved in now are ''LONG TERM'' relationships, meaning the products will have demand and strong sales throughout the entire year, not just at holiday times. FF says if it doesn't meet that criteria they will not do it.

I am getting pooped, its late, I have much more to say, will try to gather thoughts and do more tomorrow. Just to finish it up however, our nit picking, doubtling thomas, jdtii was swayed over to the positive side after spending at least a half an hour with RP and asking him everything in the book he could think of... As we walked out of the metting, (we were the last two beside EDig personell in there) he indicated that he was much happier and very much convinced he had a winner..

My personal opinion was one of great optimism. Of course you all know I have never been negative about EDig but just couldn't quite put my finger on what manner of success, and when, EDig would have. While FF and RP gave the usual platitudes during the formal part of the meeting afterwards they both spoke more candidly and with much enthusiasm. The meeting was not full of ''maybes'' or ''we have contacted this or that OEM and we could possibly do business with them''. It was of a quiet confidence, expressed strongly, as if they knew what they couldn't tell us was in fact ''signed, sealed and just about delivered''

This was 180 degrees off of last years meeting and while FF was not forthcoming factually you could see in his demeanor that he ''proud as punch'' in what he had to say to us.

Frank

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