e.Digital Corporation (fka EDIG)

[Cassandra]

Tenderloin: Although the I Kant financing was a loan - not a convertible preferred death spiral, it was just as toxic due to the terms and restrictions on what e.Digital could do with its shelf shares for a year. See #msg-1608148 for more details.

The share price indeed did spiral down following the loan, which hurt shareholders and prevented e.Digital from raising much money from shelf share sales. I and others believe it is quite likely that those behind I Kant shorted the stock and covered with a shelf share purchase by another shell, Apriori.

Remember too that the loan was renegotiated later with an effective interest rate of 65.5%.

Dealing with offshore shell entities for financing is seriously hazardous. It appears that David Sims has quite a track record of creativity in his financings.