A Different Perspective:
Risk factors of buying EDIG stock into this run at these prices...
(also applies to holding trading shares, particularly over the next 2 weeks). These are things you'll find being openly discussed on agoracom.
1. Results of the 1/20/09 hearing on summary judgment motions in the digEcor case are imminent. If the judge finds that EDIG did not violate the non-compete provisions of the 2002 NDA and digEcor is not awarded an injunction barring EDIG from selling the eVU to airlines, it could trigger a rush of new and reorders for the eVU. Such an event could trigger a best-case scenario because EDIG does have the cash to perform.
2. Although it appears that settlements have been reached with 6 of the 8 IP defendants, the $ value is known only for the LG settlement. Settlement revenue from Casio and possibly Nokia will be included in the FY09 Q3 10Q filing due 2/15/09. The value of the actual settlement(s) could be quite a bit larger than the $1.6 million from LG, which was unofficially explained as a one-time discount to the first settling party.
3. The 3,500,000 “commitment shares” issued to Fusion Capital in Jan. 07 will become freely tradable on 3/9/09, which is 25 months from the effective date of the accompanying share registration (see 8K). This date also marks the expiration of the purchase agreement so it is likely that EDIG will attempt to cash out all remaining shares reserved for Fusion by then. With the price of the stock appreciating Fusion just might hold on to their shares as the possibility of making millions is at hand.
4. Despite the fact that Putnam supposedly stated at the Sept. 08 ASM that there are now over 200 proposed defendants, no further IP suits have been filed. DM was engaged in 3/07, so they have had nearly two years to file suits. They filed against Vivitar in 9/07 and the other 7 on 3/2/08. In 3 weeks it will be one year since the last suit was filed. It seems likely that DM is going to file lawsuits against another 10 or 20 defendants in the very near future. It's possible DM won't have to file many more suits, as infringing companies license the Flash-R portfolio through negotiations.
5. The current price run is based upon 3 PACER filings last week indicating settlements in progress. There seems to be an assumption that these settlements are going to be big wins for EDIG.
I expect to see this run keep going and the share price increase. If risk factor #1 occurs, the SP could rise dramatically. If the 10Q is not disappointing, the SP will rise, but not as dramatically.
People who buy at the start of these runs always end up holding a big bag of money.
Chuck329
