Did anyone else notice this....
"15% UNSECURED PROMISSORY NOTE
On December 11, 2002, the Company issued a 15% Unsecured Promissory Note ("15% Unsecured Note") for cash proceeds of $750,000 from an unrelated corporation. On January 31, 2005, the 15% Unsecured Note was amended to extend the maturity date to June 30, 2006 when principal and interest will be payable. Accrued interest on the note at December 31, 2004 was $158,500. On January 31, 2005, the Company paid cash interest of $8,500 and issued to the noteholder a secondary 15% Unsecured Promissory Note ("15% Note") for accrued interest of $150,000. The 15% Note will also mature on June 30, 2006. Principal and interest on the 15% Note is payable in monthly installments of $3,500 with the balance due at maturity "
So EDIG could not pay the interest and had to issue a $150K note for the interest at 15%? They are paying interest on the interest because they can not make the payments.
Now this happened in January, after having signed all those airlines and receiving all those massive orders for the IFE devices, and after making all that money reworking the portable devices for Wencor, and designing the installed device, EDIG still can't pay it own bills? They are forced to delay payments and pay 15% interest on the 15% interest they owe?
Why didn't they just take one of those huge installed IFE contracts and use that to get conventional financing? EDIG was supposedly in such a strong position that they were demanding and getting massive upfront payments for the devices and making huge margins; so why can't they pay the interest in a timely manner?
There are two possibilities here. First, the amount of revenue and margin EDIG is getting on these huge orders is less than what is being hyped and they just don't have the money to pay the measly $150K in interest.
Or second, everything being hyped is true, EDIG has huge contracts and they are demanding huge up front payments and getting huge margins, but they are taking all that revenue and deliberately not paying the bills to maximize the interest and penalties they have to pay to the "friendlies".
If 1/10th of what is being claimed was true, why in January 2005 does EDIG still not have the money to pay the bills and why are they continuing to cut sweetheart deals with the "friendlies" at outrageous interest rates?
